Invepar Toll Roads 52 Results Management 64 EBITDA and EBITDA Margin

Contents Invepar Achievements Management Performance About GRI

2017 ANNUAL REPORT Contents

03 Message from the CEO

05 Message from the Board

Economic and Financial 07 Invepar 20 Achievements in 2017 43 Invepar Management 59 Performance

08 About Invepar 21 Highlights 44 Strategic Controller 60 About Consolidation

11 Corporate Identity 22 Invepar Airports 48 Risk and Compliance Management 61 Operating Revenue

12 Corporate Governance 28 Invepar Urban Mobility 50 People Management 62 Costs and Expenditure

17 Strategy 37 Invepar Toll Roads 52 Results Management 64 EBITDA and EBITDA Margin

18 Awards and Recognition 53 Engineering Management 65 Results

Cash and Cash Equivalents 54 Supplies Management 67 and Indebtedness

55 Sustainability Management 68 Main Investments

58 Community Relations 69 About this report

70 GRI Index

Contents Invepar Achievements Management Performance About GRI

02 Message from the CEO

ergy opportunities afforded by the group as a whole. As a result, we have achieved economies Innovation was part of the strategy for of scale in our service contracts and materials recovering revenue. MetrôRio consoli- procurement, optimized our resources and sig- dated modal integration partnerships nificantly cut R$92 million in costs. and Rio’s Light Rail Transit (VLT) sys- We closed 2017 with an adjusted EBTIDA of R$ 2 billion, in line with the projected budget, tem began Line 2 operations and earned with growth of 9.7% year-on-year. Invepar is still a positive assessment from 92% of users. the biggest private airport operator and urban mobility company in Brazil, and ranks second in Toll Roads. The main positive impacts of this ports segment, our most significant achieve- result were and upturn in the number of pas- ment was the early payment of the 2018 fixed sengers, especially on international flights, and concession for GRU Airport. growth in cargo transit, both at Guarulhos air- This meant that, in economic and financial port (GRU), as well as increased revenues for terms, São Paulo International Airport became group companies. fully operational with no further investment Innovation was part of our strategy to recov- from shareholders, and can now focus its en- er revenue, above all in the urban mobility seg- ergies on generating revenue and delivering ment. MetrôRio consolidated modal integration on our commitments laid down in the conces- Erik Breyer – Invepar CEO partnerships to promote facilities and improve sion contract. convenience for the traveler, with ticket integra- We have also moved forward with our initia- In 2017, after a resilient stand against the un- tion for vans, buses, BRT and taxis. Rio’s Light tives based on the Company’s ethical values precedented economic and financial crisis in Rail Transit (VLT) system began Line 2 opera- and principles, completing a number of proj- Brazil over the last three years, with severe con- tions and earned a positive assessment from ects relating to ABC due diligence and forensic sequences for the infrastructure sector, Inve- 92% of users (Datafolha survey). reviews, with no indication of illicit conduct or par opted to adopt an introspective approach In terms of Toll Roads, process review and illegality. We launched our Integrity Policy doc- and embark on a reorganization initiative. Our structural reorganization resulted in the de- ument affirming our commitment to addition- solution was to combine our strengths and re- velopment of new tools to monitor indicators, al guidelines to our Code of Ethics and Conduct, design our processes, review the Company’s and we standardized activities to cut costs and and these efforts have seen us through with organizational structure and capture the syn- boost quality of service and planning. In the Air- firmness, solidity and transparency.

Contents Invepar Achievements Management Performance About GRI Message from the CEO 03 The set of initiatives implemented in 2017 and sectors of the economy, and a significant drop in Peru. In Mobility, there was also a significant their economic knock-on effects boosted our in demand, these results show that we are on year-on-year drop of 15.7% in the number of 2017 result by 180.3% year-on-year. The group the right track. passengers carried (based on comparables). recorded a loss of R$ 334 million compared to In the Toll Roads segment, the number of The advances made by the Invepar group were R$ 960.8 million the previous year. Despite the Equivalent Paying Vehicles (EPVs) year-on-year wholly attributable to the determination and lack of investment during 2017, impacting all fell by 18.7%, mainly due to the sale of LAMSAC, team integration of the parent company and other companies in the group, focused on im- Stretch of CART toll road in the interior of São Paulo proving processes and seeking improved results. These factors were decisive in maintaining the Company’s competitive edge and market at- tractiveness as a good solution to infrastructure development in Brazil. Our conviction was further strengthened by a firm investment proposal from Mubadala to our shareholders Previ, Petros and Funcef for the acquisition of up to 50.1% of the Company’s shares. Details of this deal were given in press releases published in the second half of 2017. We know that we will also face daunting challenges in 2018 and the consolidation of our new results management model is one of the prior- ities that will prepare us to take advantage of future opportunities as the Brazilian economy picks up. We therefore believe that we will maintain the sustainability of our current business and any new business that may come our way. We will continue as one of Brazil’s leading infrastructure platforms. We hope that you will find this 2017 Annual Report informative.

Erik Breyer

Contents Invepar Achievements Management Performance About GRI Message from the CEO 04 Message from the Board

In the face of yet another challenging year in the infrastructure sector – impacting economic, financial, regulatory and public relations aspects – in 2017 Invepar responded with extreme diligence, cost discipline, teamwork and transparency, meeting our targets in a year that saw a steep drop in demand. Invepar also reaped the benefits of a new management model, initiated two years ago, that culminated in 2017 with process centralization and procedure unification, reducing exposure to risks and generating significant quality out- comes, such as the MetrôRio customer satisfaction survey with 92% user approval, as well as the Secretariat of Civil Aviation (SAC) survey at GRU Airport revealing it to be one of the best in the country during the fourth quarter of 2017 for airports handling over 15 million passengers a year. The group also succeeded in cut- ting costs through initiatives, including a 32% cut in management posts. In addition to reviewing all its processes, the company undertook to expand, both in-house and externally, its transparency mechanisms and responded rapidly and skillfully to the Board’s re- quests, taking further steps to improve integrity.

View from the Terminal 3 boarding pier

Contents Invepar Achievements Management Performance About GRI Message from the Board 05 The Company reinforced its compliance processes, launched the new Integrity Program and completed a robust auditing plan, including ABC due diligence at all associate companies, forensic audits and a more stringent internal auditing plan. All this work carried out mainly in-house in recent years, continued throughout 2017 and en- abled us to capture Invepar corporate synergies, sharing best practices, adding value to our business and helping make the Company an attrac- tive option in the marketplace. The results of auditing work and process review significantly improved procedures and cleared up any doubts and queries. It is important to high- light that shareholders, board members and managers are united in stressing the breadth and depth of this work. The company’s transparent approach, as well as unrestricted and open di- alog with stakeholders, has earned Invepar respect and trust, strengthening our conviction that integrity programs should be structured and treated as a priority in public utility companies. As part of a sector that is extremely dependent on the national macroeconomic context, Invepar concluded 2017 with positive results, and we are now in a more stable, tranquil and robust position to take on the challenges of managing Bra- zil’s transport infrastructure. And when the time comes, the Company will be ready to return to growth and help reduce bottlenecks in the country’s transit infrastructure. Henrique Freire Operation of MetrôRio in the state capital

Contents Invepar Achievements Management Performance About GRI Message from the Board 06 Invepar

08 About Invepar

11 Corporate Identity

12 Corporate Governance

17 Strategy

18 Awards and Recognition

Contents Invepar Achievements Management Performance About GRI

07 About Invepar

As one of the biggest private urban mobility and transit infrastructure management companies in Latin America, Invepar now holds 11 concessions through its subsidiary companies and joint ventures in the Toll Roads, Airports and Urban Mobility segments. In the Airports segment, Invepar controls the concession-holder of São Paulo International Airport (GRU), the biggest in South America in terms of passengers and freight. In the Urban Mobility segment, Invepar holds the MetrôRio and Light Rail (VLT Carioca) concessions in the city of Rio de Janeiro, and also controls MetrôBarra S.A., responsible for the procurement and provision of rolling stock and systems used on metro Line 4 in the state of Rio de Janeiro, which came into service in 2016. At present, Invepar holds eight concessions in the Toll Roads segment, with a total of 2,337 km including main and nearby corridors and access roads. In Rio de Janeiro, Invepar controls LAMSA – Linha Amarela S.A., ViaRio and CRT – Conces- sionária Rio-Teresópolis, in São Paulo, CART – Concessionária Auto Raposo Tavares, and in Minas Gerais, the Federal District and Goiás, Via040. In Bahia, CLN – Concessionária Litoral Norte and CBN – Concessionária Bahia Norte; and in Per- nambuco, CRA – Concessionária Rota do Atlântico.

Invepar and its subsidiaries provide mobility and safety in their modes of transport

Contents Invepar Achievements Management Performance About GRI About Invepar 08 With a payroll of 7,677, Invepar, the Invepar Institute and all subsidiaries in the group have been signatories to the UN Global Compact since 2010. In December 2016, Invepar and its subsidiaries signed the Corporate Pact for Integrity and against Corruption as part of the effort to per- fect corporate compliance. In 2017, the group completed its new Integrity Policy, setting forth guidelines to complement its Code of Ethics and Conduct. In addition, the Consequences Policy was approved, laying down guidelines applicable to the consequences of violating the ethical values and principles of the Invepar group.

Invepar Highlights As one of Latin America’s biggest urban mobility management companies, Invepar is responsible for: 2,337 Toll Roads

7,677 Direct Employees

11 Concessions

Contents Invepar Achievements Management Performance About GRI About Invepar 09 Where We Operate

Invepar operates in 6 Brazilian states (São Paulo, Rio de Janeiro, Minas Gerais, Bahia, Goiás and Pernambuco) and the Federal District, representing around

65% of Brazil’s GDP

Source: IBGE 2015

Airports Urban Mobility Toll Roads

Contents Invepar Achievements Management Performance About GRI About Invepar 10 Corporate Identity Vision To be a leader and international benchmark in transportation infrastructure.

Values To base our operations on best practices in corporate governance, Mission always prioritizing: People and Teams To provide and operate transportation Honesty infrastructure in the pursuit of excellence in Social and Environmental Responsibility service provision, and produce results that Entrepreneurship surpass the expectations of the public, our Commitment customers and shareholders. Respect

Contents Invepar Achievements Management Performance About GRI Corporate Identity 11 Corporate Governance

Governance Profile

Invepar has been registered as a company since 2000, with category A classification, authorized to negotiate any issuer securities in compliance with 25.6% 25.0% 25.0% 24.4% Instruction CVM480/09 of the Brazilian Securi- ties and Exchange Commission (CVM). All Invepar shares are currently held by its four shareholders, as shown in the chart below:

100.0% 91.5% 33.3% 100.0% 80.0%

100.0% 24.9% 100.0%

100.0% 50.0% 24.9% 50.0% 40.8%

1. Shareholder in the development phase. As stated in our previous Annual Reports, OAS petitioned for court-supervised reorganization and placed its Invepar shares up for sale. 2. Invepar holds an 80% stake in Aeroporto de Guarulhos Participações S.A., which holds a 51% stake in Guarulhos Airport. 3. MetrôBarra is responsible solely for hiring trains and services used on Line 4.

Contents Invepar Achievements Management Performance About GRI Corporate Governance 12 Governance Structure

Board of Directors

The Board of Directors acts strategical- Human Resources and Governance Committee representing a shareholder, as well as indepen- ly, defining policy and steering the Company’s and Audit Committee. Invepar also has a per- dent auditors to verify the consistency and in- business, in accordance with the Articles of In- manent Oversight Board of four members, each tegrity of corporate operations. corporation. The Board has eight members and respective substitutes, all Brazilian and resi- dent in Brazil, elected and removable from office by the General Assembly. Each shareholder nominates two representatives. The mandate is two years and members can be reelected. The Board has four Advisory Committees: Financial and Investment Committee; Works Committee;

Invepar Board Members (as of Apr/2018)

Renato Proença Lopes Board Chairman Roberto da Cunha Castello Branco Vice-Chairman Arnaldo José Vollet Paulo Cesar Cândido Werneck Renato Augusto Zagallo Ronaldo Del Buono Ramos Josedir Barreto dos Santos Fabio Hori Yonamine

Find out more (+)

GRU Airport crisis room

Contents Invepar Achievements Management Performance About GRI Corporate Governance 13 Internal Auditing Executive Board

Invepar has a separate Internal Auditing de- The Executive Board manages the Company and partment reporting directly to the Board of submits to the Board of Directors basic guide- Find out more on our management model (+) Directors. Internal Auditing results are reg- lines related to the company’s objectives and ularly submitted to the Audit Committee and goals, as well as ensuring that business flows Board of Directors. smoothly. Other Executive Board duties are as Reviews of the main corporate processes by stated in the Company’s Articles of Incorporation. Internal Auditing have helped maintain consis- In 2017, the Invepar Executive Board led a tency as the Invepar group’s internal control en- transformative project with the aim of making vironment has changed. By identifying fragilities the company a strategic controller based on in our audit controls, the Audit team helps man- key process centralization, and implemented agers define and implement action plans aimed a series of initiatives to add value and achieve at mitigating inherent risks. economies of scale. MetrôRio Operational Control Center

Contents Invepar Achievements Management Performance About GRI Corporate Governance 14 Executive Board Members

Erik da Costa Breyer Júlio César Fonseca Chief Executive Officer Human Resources Director and Vice-Chairman

Enio Stein Júnior Eduardo Marques de Almeida Dantas Administration, Finance and Investor New Business and Strategy Director Relations Director and Vice-Chairman and Vice-Chairman (as of 04/19/2018)

Luis Eduardo Baroni Eduardo de Abreu e Lima1 Engineering Director and Vice-Chairman Legal Director

Tulio Toledo Abi Saber James Oliver Guerreiro Carneiro1 Toll Roads Director and Vice-Chairman Compliance and Risks Director*

Find out more about the Executive Board (+) Vacant Urban Mobility and Airports Director and Vice-Chairman

1 Non-statutory director

Stretch of Raposo Tavares Toll Road run by CART

Contents Invepar Achievements Management Performance About GRI Corporate Governance 15 Invepar’s New Organizational Structure

Chief Executive Officer

Board of Directors

Legal Director

Internal Audit Manager

Compliance and Risks Director

Corporate Governance Manager Communications, Sustainability and Customer Services Executive Manager

New Business and Administration, Human Resources Toll Roads Urban Mobility and Engineering Director Finance and Investor Strategy Director and Director and Director and Airports Director and and Vice-Chairman Relations Director and Vice-Chairman Vice-Chairman Vice-Chairman Vice-Chairman Vice-Chairman

Contents Invepar Achievements Management Performance About GRI Corporate Governance 16 Strategy

In 2017, Invepar focused its efforts on develop- macroeconomic and political scenario and the de- Strengthening this new strategy confirmed In- ing a long-term internal restructuring strategy, parture of one of the shareholders, led to a change vepar’s commitment to operating in the trans- defining objectives and goals as milestones for in the group’s positioning as Invepar became a stra- portation infrastructure segment. With the a future cycle of planned growth. tegic controller of group companies. The parent standardization and integration of the parent The decision to take an introspective approach company began to focus on organizational struc- company with subsidiaries, the group further was taken after a phase of rapid, exponential ture, process design, synergy exploitation and a consolidated its position as an important play- growth which, combined with the change in the review and extraction of portfolio share values. er in this segment.

Invepar Objectives

To consolidate its position in the toll roads, urban To continually improve its policy of knowledge and training mobility and airports segments, structurally management, and leader succession planning preparing the company for a future expansion cycle To strengthen internal controls, risk management To maximize shareholder returns by means and processes by means of a robust management of sustainable growth, efficient portfolio system that would take advantage of operational management and an optimized capital structure improvements and synergies, guaranteeing the company’s durability

To consolidate a strong Invepar culture focused To improve practical institutional on operational efficiency, technical skills, value relations based on a policy of creation, safety and quality service provisions transparency, ethics and integrity

Contents Invepar Achievements Management Performance About GRI Strategy 17 Awards and Recognition

Invepar Toll Roads

Sixth Latin American fleet management model CART in The 100 Best Fleets Latin America, a ranking backed by the Instituto Parar and also recognized ··“Society Relations” Trophy during the Prêmio by the North American Fleet Association (NAFA). Concessionária do Ano 2016 (2016 Conces- In terms of Social Responsibility, the Invepar sion-Holder of the Year Award), promoted and Institute, MetrôRio and LAMSA received praise produced by ARTESP in April 2017. for their contribution to Sustainable Develop- ment Objectives. CRA

One of the best companies to work for in Per- Media mentions ·· nambuco (Great Place to Work). The Invepar group was covered by the media, with news items in the most important publications. In all, ·· Best toll road in the North and Northeast there were over 28 thousand news items on Invepar of Brazil, according to data published in the and group companies. 2017 CNT Toll Roads survey.

Invepar in the Media CBN

Positive Further recognition as a “Child-Friendly Com- Mentions 25,328 ·· pany” from the Fundação Abrinq. Negative 3,282 Mentions Source: Info4

CART receives an award at the 2016 Concession-Holder’s Award event in April 2017

Contents Invepar Achievements Management Performance About GRI Awards and Recognition 18 Airports Urban Mobility

GRU Airport MetrôRio

·· Best Brazilian airport in the category “over ·· Viaja São Paulo Award – Best in Tourism: best ·· In 2017, MetrôRio received important awards 15 million passengers per year”, according to airport in Brazil, received from the Folha de São and recognition, and retained ISO 9001: 2008 the Relatório de Desempenho Operacional dos Paulo newspaper for the second year running; Certification, with the highest international Aeroportos (Airports Operational Performance standards in quality and management. Prêmio Empresas que Melhor se Comunicam Report), published by the Brazilian Secretar- ·· com Jornalistas – (Companies that Best Com- iat of Civil Aviation (SAC) – survey relating to municate with Journalists Award) from Cecom the fourth quarter of 2017; (Center for Communication Studies) in part-

GRU Airport received its second Companies that nership with Negócios da Comunicação mag- Best Communicate with the Press Award. azine for the second year running.

Contents Invepar Achievements Management Performance About GRI Awards and Recognition 19 Achievements in 2017

21 Highlights

22 Invepar Airports

28 Invepar Urban Mobility

37 Invepar Toll Roads

Contents Invepar Achievements Management Performance About GRI

20 Highlights

Airports Urban Mobility Toll Roads

• Total Passengers: 37.8 million • Passengers carried: 256.2 million • Equivalent Paying Vehicles (EPVs): • Aircraft movements: • Paying passengers: 227.6 million 236.3 million 266 thousand landings and take-offs • First full year of operation for the • Duplication of 37 km by CART (São Paulo) • Total cargo: 283 thousand metric tons Light Rail Transit (VLT Carioca) system in Rio • CLN delivers works on the bridge over • 42 airlines to 88 regular destinations de Janeiro and Line 4 of the Rio metro River Jacuípe (Bahia) (47 international and 41 domestic) • Inauguration of the direct link between • Duplication of the Telésphoro Cândido de • GRU Airport awarded best Brazilian airport metro Lines 1 and 4, eliminating the connection Rezende viaduct by Via040 (Minas Gerais) in the category “over 15 million passengers at General Osório station in Ipanema • CBN delivers duplication of the Lauro de per year” by the Brazilian Secretariat of Civil • VLT Carioca's Line 2 started operations Freitas bypass (Bahia) Aviation (SAC) Find out more (+) Find out more (+) Find out more (+)

Economic-financial Social and Environmental

• Adjusted EBITDA: • Total private social investment: R$ 2.0 billion (+9.6%) R$ 5.2 million • Adjusted net revenue: • Total water consumption: 1,272,565 m³ R$ 3.7 billion (+6.4%) • Waste Generated (hazardous and non- • Adjusted EBITDA margin: hazardous): 23,926 metric tons 54% (+1.7%) • Greenhouse gas emissions¹: 166,901 tCo e ² • Energy consumption within the organization¹: 459,428.50 MWh

Find out more (+) Find out more (+) (1) Results only for companies controlled by Invepar, since some associate companies do not record Greenhouse Gas Emissions (scopes 1, 2 and 3).

Contents Invepar Achievements Management Performance About GRI Highlights 21 Invepar Airports

São Paulo International Airport

São Paulo International Airport has been run by Concessionária do Aeroporto Internacional de Guarulhos S.A (GRU Airport) since 2012. A daily average 104 thousand passengers pass through the airport, with around 800 take- offs and landings every day (2017 data). It is the biggest hub in South America. In 2017, 37.8 million people boarded or deboarded almost 270 thousand flights. It is the main distribution hub for flights in Brazil, with 88 regular destinations, 46 international and 42 domestic. GRU Airport is also the biggest gateway for air cargo in Brazil, handling 43% of domestic volume.

Terminal 3 at São Paulo International Airport

Contents Invepar Achievements Management Performance About GRI Invepar Airports 22 GRU Airport Figures

37.8 million 3 passengers passenger in 2017 terminals

42 292 airlines with stores regular flights

26 thousand 10.2 thousand m³ cold storage car parking in 20 rooms spaces

99 thousand m² covered area (the 387 thousand biggest cargo terminal m² built area in South America)

301.5 thousand 1,115 m² landing and direct employees* take-off runways

New Terminal 2 boarding facility at GRU Airport

Contents Invepar Achievements Management Performance About GRI Invepar Airports 23 Highlights – GRU Airport

Early concession fee payment

As disclosed by the Company in the press re- outstanding for 2017. The additional clause of payment of the same amount for 2031 and 2032. lease of December 2017, GRU Airport paid in ad- the Concession Agreement signed by the con- This was an essential element in preserving the vance the R$ 460 million for the fixed concession cession-holder regarding early payment of fixed company’s long-term financial equilibrium. in 2018, after making full payment of amounts concession amounts for 2018 also postpones Terminal 3 boarding area

Contents Invepar Achievements Management Performance About GRI Invepar Airports 24 New Latam Hangar

A partnership has been sealed with Latam for the construction of a new hangar to house the Line Maintenance Center. The investment of R$ 130 million in the new hangar consolidates the number of Latam direct flight routes leaving from GRU Airport, which is already the company’s biggest hub.

Airbus A380

In March 2017, GRU received its first regular flight from the Emirates, an Airbus A380, the biggest commercial aircraft in the world. The Dubai-São Paulo route is also the first commercial flight for the A380 in South America, and in 2017, marked the completion of 10 years since Emirates began flights to Brazil.

Executive Hangar

At the end of the year, the first terminal for executive aviation was inaugurated at the airport. The project, known as the Open Skies Hangar, received investments of US$ 9 million and is part of a joint venture between CFLY Aviation and Jetex Flight Support, who will run the hangar facility for the next 15 years.

The Dubai-São Paulo route is the first Airbus A380 route in South America

Contents Invepar Achievements Management Performance About GRI Invepar Airports 25 GRU Airport Cargo

GRU Airport is the biggest airport gateway in flow from other Brazilian airports to and from in 2016. Air cargo carrier capacity on internation- Brazil. It handles 43% of Brazil’s air cargo im- all continents. al flights operating from GRU Airport increased ports/exports (data from Feb/18). Cargo ware- In 2017, GRU Airport Cargo saw an 18% increase 12% in 2017, and in February 2018, the figure had houses are located close to the main São Paulo in the volume of import and export cargo com- already increased by a further 5%. state highways, providing connections to the pared to 2016. coast and interior. In addition, it is the biggest In 2017, the terminal handled 283,100 metric The GRU Airport cargo terminal saw an increase domestic flight hub in Brazil, facilitating traffic tons of cargo, compared to 241,000 metric tons of 18% in volume compared to 2016

Contents Invepar Achievements Management Performance About GRI Invepar Airports 26 Results Total Passengers In 2017, 37.8 million passengers boarded and de- increase of 3% year-on-year, with a record num- per Segment (million) boarded flights at the airport, an increase of 3.2% ber of passengers. Growth of domestic flight pas- compared to 2016 (36.6 million). Domestic flights sengers stood at 3.6%. 201 13.6 25.4 accounted for 23.7 million passengers (63%) and Flights - The airport handled 266,016 flights international flights 14 million (37%). in 2017, slightly down (-0.7%) on the 2016 figure, 201 13.5 23.1 In the same period, international flights saw an which stood at 267,491 landings and take-offs. 2017 14.0 23.8

Performance Indicators – Airports 2016 2017  Internaonal Domesc Total Passengers (million) 33.6 37.8 3.2% International 13.5 14.0 3.6% Domestic 23.1 23.8 3.0% Total Aircra Total aircraft movements (thousand) 267.8 266.0 -0.7% Movements (thousand) International 74.3 74.1 -0.4% 201 Domestic 193.4 192.0 -0.8% Total Cargo (thousand metric tons) 247.0 285.5 15.6% 201 Airlines¹ 42 42 0.0% Parking Places² 9.232 10.223 10.7% 2017 Commercial premises³ 241 292 21.2%

1 Covers only airlines with regular flights. 2 Includes motorcycle spaces. 3 Excluding ATMs, loans for use, depositories, temporary rentals, vending machines and secure bags. Source: Invepar Total Cargo (thousand metric tons)

201

2017

Contents Invepar Achievements Management Performance About GRI Invepar Airports 27 Invepar Urban Mobility

As the biggest private metro operator in Brazil, million passengers traveled on these three Rio vice operates in the center of the city of Rio, Invepar has been in charge of operating MetrôRio de Janeiro metro lines. with two lines totaling 28 km. Over 15 million Lines 1 and 2 since 2009, and Line 4 since 2016, Also in the Urban Mobility segment, the Com- passengers used this mode of transport in 2017. with its subsidiary MetrôBarra handling train pany is a shareholder in VLT Carioca (Light Rail Light rail and metro services interconnect and systems hire for Line 4. In 2017, over 240 Transit), inaugurated in 2016. This light rail ser- both places and other transit modes.

Contents Invepar Achievements Management Performance About GRI Invepar Urban Mobility 28 MetrôRio

Lines 1 and 2

Under its concession, MetrôRio runs and maintains Lines 1 and 2, providing transport links between the South Zone, North Zone and Cen- ter of Rio de Janeiro, with 36 stations and 42 km track. Since Invepar acquired a 100% interest in MetrôRio in December 2009, it has invested in system modernization with the purchase of 19 new trains, in operation since March 2013, renovated and upgraded the Op- erations Center and opened new stations (Can- tagalo and General Osório in the South Zone, Cidade Nova in the city center and Uruguai in the North Zone).

Station on MetrôRio Line 1 in Rio’s North Zone

Contents Invepar Achievements Management Performance About GRI Invepar Urban Mobility 29 Pavuna Operation of Line 4 Eng. Rubens Paiva

Acari/Fazenda Botafogo Linking Barra da Tijuca in the West Zone to the South Zone, the new line cuts passenger Coelho Neto travel time between the two regions. The Jar- Colégio dim Oceânico station has become an import- Irajá ant hub linking other transit modes, such as

Vicente de Carvalho Bus Rapid Transit (BRT). On Line 4, MetrôRio

Thomaz Coelho operates the service and maintains the rolling stock, system and infrastructure. Built by Engenho da Rainha the Rio de Janeiro State Government, the new Inháuma line was inaugurated in 2016. N. América / Del Castilho

Maria da Graça São Cidade Central Presidente Vargas Triagem Cristóvão Nova Uruguaiana Maracanã Carioca Stations on Line 4 Praça Onze • Jardim Oceânico (Barra da Tijuca) Estácio Cinelndia Afonso Pena • São Conrado Glória Uruguai São Francisco avier • Antero de Quental (Leblon) Saens Pea Catete • Jardim de Alah (Leblon) Largo do Machado • Nossa Senhora da Paz (Ipanema)

Flamengo

Botafogo

Cardeal Arcoverde

Siqueira Campos

Cantagalo Line 1 General Osório Line 2

Jardim São Antero de Jardim N. Sra. MetrôRio bus (Metrô na Superfície) Ocenico Conrado Quental de Alah da Paz Line 4

Contents Invepar Achievements Management Performance About GRI Invepar Urban Mobility 30 MetrôRio Figures

41 stations (Lines 1, 2 and 4)

244.7 million passengers

64 trains

384 cars

880 thousand passengers/day

MetrôRio employee at the maintenance center

Contents Invepar Achievements Management Performance About GRI Invepar Urban Mobility 31 Highlights – MetrôRio

Innovation and Partnerships

2017 was marked by management in pursuit of innovation to cope with the challenges posed by the macroeconomic scenario, which was especially unfavorable in Rio de Janeiro. Against this backdrop, initiatives were implemented to exam- ine the important role of modal transportation in Rio de Janeiro and the potential for expansion. The company also invested to improve efficiency and operational performance, which did not pass unnoticed by service users. MetrôRio trialed urban mobility expansion initiatives, focusing on customer convenience to provide alternatives from the start to the end of the journey, as a way of encouraging more people to use the system. This, in part, involved forming partnerships. Agreements were concluded with 99Táxis (discounts for people buying a card for five metro journeys), Movida (offering car rental concessions for people with pre-pay cards and credit of R$ 100), and vans (discounts on metro/van integration).

Access to MetrôRio’s Uruguai station

Contents Invepar Achievements Management Performance About GRI Invepar Urban Mobility 32 Promotional campaigns like“Eu amo férias” (I love vacation) offered 42 journeys in a week with a 70% saving for the customer, and “Vale Night” (Night Voucher) gave a discount on single-ticket journeys after 10 pm. To boost passenger numbers on the new Line 4, MetrôRio ran a campaign, “Quem prova aprova” (Try it. You’ll like it) in April 2017, with charge-free trips on the new stretch of line. The outcome was a total of 194,000 passengers traveling on Line 4 in a single day. For greater passenger convenience, Line 4 was interconnected with Line 1 without the need to change at General Os- ório station in Ipanema. This change cut journey times by some 10 minutes. Both these initiatives boosted demand on Line 4 by 37.8%, taking average passenger numbers on working days to 150,000 for the rest of the quarter. As a result of the pursuit of excellence in operation and customer experience, MetrôRio achieved a general Quality of Service score of 8.2 out of 10 on Lines 1, 2 and 4, the best rating since 2009. The satisfaction survey commis- sioned by MetrôRio was conducted by IBOPE in September.

More on the GRI Index survey (+)

Light Rail train in the port zone

Contents Invepar Achievements Management Performance About GRI Invepar Urban Mobility 35 Results

In terms of Urban Mobility, 256.2 million pas- ·· Brazil’s economic crisis, with a greater impact Total Passengers sengers were carried in 2017, an increase of on Rio de Janeiro after the Rio 2016 Olympic Carried (million) 0.4% on the previous year. This increase is and Paralympic Games; mainly due to: 201 ·· Finalization of the road works in the city for the ··VLT Carioca Light Rail charging which began Olympic Games, which improved traffic flow, cut- in July 2016; ting journey times for buses and cars in particular; 201 Charging on Line 4, operated by MetrôRio, ·· In addition to the economic crisis, another factor which began in September 2016. ·· that impacted MetrôRio demand was the wid- 2017 ening gap in fares between modes of transit. To obtain a better comparison of the variation From April, MetrôRio charged R$ 4.30 per jour- Source: Invepar in passengers carried, the figures for the Light ney, and the buses that started the year with Rail Service (VLT Carioca) and Line 4 were ex- a fare of R$ 3.80, had to drop the price in Au- cluded. In comparative terms, the drop in pas- gust to R$ 3.60 by court order, and in Novem- Equivalent Paying Vehicles sengers carried was 15.7% year-on-year. The ber, also by court order, to R$ 3.40, making the EPVs (thousand) drop was mainly due to: fare 19.4%, and then 26.5% cheaper. 201 Performance Indicators – Urban Mobility (million) 2016 2017  201 Total Passengers Passengers Carried 255.1 256.2 0.4% 2017 Paying Passengers 229.2 227.6 -0.7% Source: Invepar Ratio of Paying Passenger to Passengers Carried 0.9 0.9 -1.1% Comparable Passengers Comparable Passengers Carried¹ 240.9 203.2 -15.7% Comparable Paying Passengers¹ 216.8 180.3 -16.8% 1 Comparable basis: the figures from VLT and metro Line 4 were excluded. Source: Invepar

Contents Invepar Achievements Management Performance About GRI Invepar Urban Mobility 36 Invepar Toll Roads

With eight toll roads covering a distance of Total Concession Time Company Location Granting Authority concession period remaining 2,337 km, Invepar has a diversified portfolio distance (km) (years) (years) of concessions in five Brazilian states and the CART São Paulo State of São Paulo 833.5¹ 8.8 21.2 Federal District. Located in urban and rural regions, the roads have different operational CBN Bahia State of Bahia 132.6 7.4 22.6 characteristics. Due to the higher concentra- CLN Bahia State of Bahia 217 17.8 32.2² tion of people, toll roads in urban centers carry CRA Pernambuco State of Pernambuco 44 6.5 28.8 a higher volume traffic. In contrast, concessions in rural regions are more seasonal and CRT Rio de Janeiro Federal Government 142.5 21.8 3.2 used for longer journeys. Municipality of LAMSA Rio de Janeiro 17.4 20.1 19.9 Rio de Janeiro Municipality of ViaRio Rio de Janeiro 13 5.7 29.3 Rio de Janeiro Via040 Minas Gerais, Goiás and DF Federal Government 936.8 3.9 26.3

1 443.7 km major route between Bauru and Presidente Epitácio. Since 2013, the company has also been responsible for the maintenance and conservation of Aerial view of the LAMSA toll station 389.8 km of minor roads. 2 Based on termination of the concession on 12/31/2017. Source: Invepar

Contents Invepar Achievements Management Performance About GRI Invepar Toll Roads 37 Toll Road Figures 38 16 toll stations animal capture vehicles

47 1,051 user service points emergency telephones

60 2,064 ambulances monitoring cameras

77 80 light and heavy tow trucks variable message signs (VMSs)

57 895 km inspection and optical fiber service vehicles

12 12 fire fighting vehicles weighing stations (fixed and mobile)

Stretch of CART toll road

Contents Invepar Achievements Management Performance About GRI Invepar Toll Roads 38 Highlights – Toll Roads

Toll Road Structure Centralization

The current Invepar organizational structure, inaugurating the position of Toll Roads Vice-Chairman, initiated a plan to standardize its operations in 2016 with the aim of capturing synergies and opportunities from its portfolio of toll road concessions. In 2017, all toll road management and services departments were centralized and the entire segment repositioned within wholly-owned subsidiary concession-holders. The Company also achieved economies of scale and mitigat- ed financial and operational risks on various fronts, such as operation and maintenance, regulatory management, toll collection and fleet management, as well as centralizing the Sup- plies, Financial, Human Resources, Legal and Engineering departments. With this redesigning of the segment and as a result of the initiatives taken, toll road quality and performance rose, a trend that should be maintained and generate further conquests in the years to come.

Stretch of the toll road run by CLN

Contents Invepar Achievements Management Performance About GRI Invepar Toll Roads 39 Operating Results

Traffic Traffic – Toll Roads (million) 2016 2017  Equivalent Paying Vehicles 290.5 236.3 -18.7% For comparing the Toll Roads segment, exclud- Comparable Equivalent Paying Vehicles¹ 227.1 221.2 -2.6% ing the impact of LAMSAC which was sold and LAMSA 48.0 43.8 -8.6% ViaRio which began charging in August 2016, the CLN 7.7 7.5 -2.2% total number of Equivalent Paying Vehicles (on a comparable basis)¹ fell 2.6% year-on-year, di- CART 49.8 49.5 -0.4% rectly due to Brazil’s economic contraction. CRT 16.3 14.5 -10.7% Consolidated traffic in 2017 reached 236.3 mil- CBN 32.4 32.2 -0.5% lion Equivalent Paying Vehicles (EPVs), a drop of CRA 6.9 7.1 2.4% 18.7% on the previous year, mainly due to the sale LAMSAC 59.1 - n.m.² of the LAMSAC urban expressway in Lima (Pe- Via 040 66.1 66.4 0.5% ru), which in 2016 carried 59.1 million EPVs, rep- ViaRio 4.3 15.1 248.9 resent an average 164,000 EPVs/day. 1 Comparable basis: the following companies were excluded (i) LAMSAC after the sale completed in Nov/16; (ii) ViaRio, which began charging in Aug/16; 2 n.m.: not measurable. Source: Invepar Stretch in the interior of São Paulo under CART management

Contents Invepar Achievements Management Performance About GRI Invepar Toll Roads 40 Infrastructure Highlights

CART – São Paulo

In the third quarter of 2017, Invepar duplicated 37 so included camera monitoring and emergency try in the region of Agudos and Lençóis Paulista. km of road and installed eight new cloverleaf in- telephones every km, as well as free internet ac- The duplication also improved the transit route terchanges on the SP-225 (João Baptista Cabral cess at User Service Bases (SAU). for inputs and agricultural raw materials in São Rennó toll road), directly benefiting 75,000 in- Highway modernization also drives regional de- Paulo state, such as the orange groves in the habitants of western-central São Paulo state, velopment and provides a corridor for transport- region of Espírito Santo do Turvo, which supply providing safer travel on inter-municipal roads ing agricultural and industrial products from the industry in the Matão region, and cereals pro- between Piratininga and Santa Cruz do Rio Pardo. north of Paraná to the western central region of cessed in Santa Cruz do Rio Pardo and carried to Two new traffic lanes, hard shoulder, drain- São Paulo state. It is a freight transit route, carry- various regions in the state. age systems, horizontal and vertical signage, ing in particular eucalyptus timber produced in the additional facilities and a median strip were municipalities of Piratininga, Cabrália Paulista and constructed. Modernization of the stretch al- Paulistânia, and supplying manufacturing indus- Stretch of toll road run by CART

Contents Invepar Achievements Management Performance About GRI Invepar Toll Roads 41 Fresh bidding process for Via 040

In September 2017, Invepar requested that are yet to be defined by the government. ness plan, leading the company to seek partic- Via040 be allowed to participate in the fresh Via040 did not receive an environmental li- ipation in the fresh bidding process proposed bidding process proposed by the Federal Govern- cense, for which the concession authority is re- by the government. ment under the provisions of Law 13,448/2017, sponsible, for duplication of the entire toll road, Via040 continues to maintain and operate the enacted in June of the same year. The conces- which was limited to the 73 km with an approved toll road to ensure safety and 24-hour service sion-holder took the necessary steps to com- environmental license, equivalent to 13.1%. In ad- to users by means of 21 service bases, provid- ply with the legal requirements for fresh bidding dition, the severe economic recession in Brazil ing first aid and mechanical assistance, as well processes and is awaiting a decision from the over the past four years drove up the prices of as carrying out conservation, signage and in- competent authorities. items controlled by the government, such as as- spection work. The process allows for amicable renegotiation phalt, and estimated traffic decreased with ad- of the agreement, enabling the government to verse impacts on the project used as a basis for launch a fresh bidding process for the stretch the concession proposal submitted in 2013. This of road. The format, parameters and deadline disrupted the concession-holders entire busi- Stretch of toll road managed by Via040

Contents Invepar Achievements Management Performance About GRI Invepar Toll Roads 42 Invepar Management

44 Strategic Controller

48 Risk and Compliance Management

50 People Management

52 Results Management

53 Engineering Management

54 Supplies Management

55 Sustainability Management

58 Community Relations

Contents Invepar Achievements Management Performance About GRI

43 Strategic Controller

With the aim of strengthening Invepar’s Stra- terms of management capabilities. The drive ed their changes and began working with nine tegic Controller skills, capturing asset syn- towards standardization and unification of pro- designed processes. Changes in the organiza- ergies and consolidating internal controls, cesses used by all companies gave the group tional structure were also introduced, central- the Company developed a new working mod- strength to promote a new, secure and sus- izing activities in the parent company, boosting el within Invepar itself and within its whol- tainable growth cycle. All Invepar group teams staff numbers from 125 in December 2016 to ly-owned subsidiaries. took part in the project. 266 in December 2017, and eliminating the du- Beginning in 2016 and implementing most Sixteen working groups were set up to split plication of group activities. This task unifi- of the initiatives throughout 2017, the Struc- activities into 68 macro-processes for defin- cation cut 27% of management positions and ture Project continued the process of transfor- ing and documenting new methods and pro- reduced the group’s headcount by 12%, with mation started in 2015, applied the initiatives cedures. The outcome was 554 normative payroll savings of over R$ 2 million per month. to all organizational levels, defined new ap- documents covering policies, procedures, reg- Throughout the year, group initiatives to cap- proaches to intensify the alignment of group ulations, work instructions and forms. Still in ture synergies and value created a saving on companies and took them to a higher level in 2017, nine of these working groups complet- expenditure of the order of R$ 95 million.

Objectives Results Costs cut by around 8%, mainly in Human Re- Main Objectives To cut budgetary costs by 6% sources and Supplies • To strengthen the Invepar group’s sense of unity 68 macro-processes, producing 523 normative • To develop and standardize processes and systems To design and document all corporate processes documents covering policies, procedures, reg- • To encourage synergies and economies of scale ulations, work instructions and forms. • To drive the pursuit of continual improvement and To turn around 9 of the 16 mapped areas Objective achieved operational excellence To consolidate compliance and risk reduction pro- To develop, redesign and implement the orga- • cesses nizational structure (managers and teams) of Objective achieved • To provide greater agility and security in deci- Invepar and subsidiaries. sion-making Development and upgrading of offices in Nova To upgrade physical facilities Lima (Minas Gerais), on the metro (Rio de Ja- neiro) and at Guarulhos (São Paulo)

Contents Invepar Achievements Management Performance About GRI Strategic Controller 44 Timeline – Invepar Group Management Strategy

Kickoff – Alignment Training begun Change Management Methodology on new internal processes

Design and documentation Adequation of Physical Structures Zero Policy work commenced on around MetrôRio (Rio de Janeiro), Bauru (São Normative Document Management 70 key processes Paulo) and Nova Lima (Minas Gerais)

FEB APR MAY 2017 2017 2017

Contents Invepar Achievements Management Performance About GRI Strategic Controller 45 Timeline – Invepar Group Management Strategy

Deployment of New Centralized Organizational Structure

Completion of process design Work started on creating Completion of training and documentation process indicators on new internal processes

JUN JUL SEP 2017 2017 2017

Contents Invepar Achievements Management Performance About GRI Strategic Controller 46 Timeline – Invepar Group Management Strategy

Publication of Scope and Deployment of new cargo Limits Regulations structure (Mercer)

Completion of work to Round of Process Improvement Launch of Normative create Process Indicators – Voice of the Internal Customer Documents Portal

OCT NOV DEC 2017 2017 2017

Contents Invepar Achievements Management Performance About GRI Strategic Controller 47 Risk and Compliance Management

Compliance Management

Within the Invepar group, compliance-related In 2017, Invepar tightened its Integrity Program This involved implementing a robust plan involving: matters are dealt with by a specific, dedicated with initiatives based on Law 12.846/2013 and I drafting new normative documents, team, with a budget allocated for its activities, regulatory decree 8420/15, aimed at streamlin- updating the Code of Ethics and Conduct support from leading consultancies and senior ing anticorruption practices. and launching the Integrity Policy; management backup. Compliance Course training material II providing anticorruption training;

III raising awareness of the Invepar Ethics Channel;¹

IV strengthening the position of the Ethics Committee;

V implementing reputation assessment for suppliers and service providers;

VI more stringent internal auditing;

VII implementing anticorruption due diligence and forensic reviews: no illicit acts, bribery or corruption was detected in group companies; and

VIII ongoing reporting to senior management regarding the Integrity Program.

As a result of these initiatives, Invepar and its subsidiaries enhanced their maturity in compliance matters during 2017 and further progress will be made in 2018. 1 Access the Ethics Channel at www.canaldedenunciainvepar.com.br or in- [email protected], or call 0800 721 0748;

Contents Invepar Achievements Management Performance About GRI Risk and Compliance Management 48 Risk Management

At Invepar, Risk Management involves taking ac- restructuring commenced in 2016 within the In terms of Risk Management within the Invepar tion today to survive a situation that, although Invepar group, in addition to continuing to miti- group, 2018 will see further consolidation of new unlikely, is possible. gate group risks, it was necessary to completely methods and ongoing pursuit of risk mitigation. The group has a structured Risk Management overhaul Risk Management methods to upgrade process based on the principles of COSO (Com- to the new scenario, which involved: mittee of Sponsoring Organizations of the Tread- I reviewing impact and likelihood metrics; way Commission) and ISO 31000, with the aim of mitigating the negative effects of economic and II reviewing normative documents and inter- financial, operational, social and environmental, nal processes; regulatory, compliance-related and image im- III setting up an internal controls section; pacts on the parent company and subsidiaries, with ongoing monitoring by senior management. IV redefining the activities and members of the In 2017, in view of the change in the business Risks Committees by upgrading risk moni- environment in Brazil and the organizational toring and assessing action plans. Front cover of the Invepar group Code of Ethics

Contents Invepar Achievements Management Performance About GRI Risk and Compliance Management 49 People Management

The redesigning of key business processes, assessment of job structure and salaries was begun in 2016, was completed and produced conducted by the specialist consultants at Mer- Highlights a new organizational structure, deployed in cer and completed in 2017. The project set up 2017. The parent company and Invepar group a standard methodology applicable through- companies adopted a more synergistic mode out all group companies, in line with market 7,677 employees of operation, unifying various processes and best practices. structures. It was therefore possible further At the end of 2017, the Corporate Occupational integrate teamwork, strengthen internal con- Health and Safety department was set up with 5 trol and cut expenditure. the central mission of instilling safety as a prime Brazilian states In parallel with this transformation plan, a re- factor into the Invepar’s group corporate culture.

General Indicators (GRI G4-10, LA1, LA6, LA9)

Own Employees

Functional category profile 2017 Gender profile 2016 2017 Regional profile 2016 2017 Presidency 1 Men 6,043 5,249 Bahia 540 508 Senior Management 41 Women 2,922 2,428 Minas Gerais 1,014 910 Management 363 Total¹ 8,965 7,677 Pernambuco 133 142 Adiministrative² 1,051 Age profile 2016 2017 Rio de Janeiro 4,533 4,346 Operational (Operation and Maintenance) 5,953 Under 30 2,812 2,274 São Paulo 2,115 1,761 Interns 47 Between 30 and 50 5,531 4,860 Total¹ 8,965 7,677 1 The numbers include information from all Invepar group companies: Aprentices 221 Over 50 622 543 subsidiaries (LAMSA, CLN, CART, Via040, MetrôRio and GRU Airport) and associate companies (CRA, CBN, CRT, ViaRio and VLT). 2 The administra- Total¹ 7,677 Total¹ 8,965 7,677 tive category covers coordinators, specialists, supervisors, assistants and auxiliary workers. Source: Invepar

Contents Invepar Achievements Management Performance About GRI People Management 50 Outsourced Employees Health and Safety (GRI G4-DMA G4-LA5 G4-LA6)

Type of Allocation 2016 2017 Indicators 2017 Contracts and Projects 2,612 1,654 Total own employees 7,677 Routine services 6,319 6,079 Total person-hours/year 14,791,184 Total 8,931 7,733 Accidents Invepar Source: Number of accidents 184 Accident rate 12.44 Highlights Occupational illnesses Number of Occupational Illnesses 3 Sta turnover Occupational Illness Rate 0.20 Days lost 201 Number of days lost 11,959 2017 Rate of days lost 808.52 Absenteeism Absenteeism 187,516 7.5% Absenteeism rate 12,677 reduction in turnover from 2016 to 2017 Fatalities 1 Source: Invepar 49.22 average training hours

Source: Invepar

MetrôRio security staff

Contents Invepar Achievements Management Performance About GRI People Management 51 Results Management

Throughout 2017, the Invepar Results Management ly analyzed the indicators, and if results were flourishing results management culture and team Model provided monthly monitoring of parent com- not as planned, remedial action was proposed alignment with the group’s objectives and goals. pany and subsidiary achievement of objectives and implemented. The ICF system (Management Control Items) is and goals. Results were tracked at monthly meet- The results analysis process matured through a platform that monitors Invepar results. Some ings of staff at different hierarchical levels, rang- systematic use, giving rise to remedial action 2,420 indicators from various departments were ing from coordinators to the parent company CEO. that proved increasingly effective. Some 90 re- input to the system by 470 active users, respon- At these meetings, managers systematical- sults meetings were held at the parent compa- sible for analyzing facts and causes to account ny and wholly-owned subsidiaries, involving 285 for deviations, and justify action plans for bal- CART traffic management screen managers. Application of the model produced a ancing the results and achieving goals.

Contents Invepar Achievements Management Performance About GRI Results Management 52 Engineering Management

The Invepar Engineering department set, as its One of the major gains for the sector was in- between engineering and environmental staff, all main purpose, the implementation of a culture house design development, making the contract the group’s projects began development based of proprietary engineering within the company models for each department as relevant as pos- on environmental assumptions from the onset. in 2017. At the beginning of this new phase, the sible to the needs of the company. The high level Furthermore, with the aim of delivering proj- group started to execute and plan projects as if of design detailing for each project also provid- ects on time, compliant with quality standards they themselves were the owners. This change ed security for the Invepar group. and on budget, with all licenses issued and with- brought in engineering expertise and combined As from 2017, Invepar Engineering also initiat- out accidents, the engineering sector also be- knowledge, technology and innovation as new ed closer ties with the environmental department, gan working on standardization in its five areas professionals joined the company, working with whose tasks include planning environmental li- of engagement: environment, planning, engi- standardized processes and procedures. cense applications. With improved collaboration neering, deployment and contract management.

The four pillars of Invepar Proprietary Engineering

Environment

Safety

Engineering

Deadline, cost and quality

Duplication of cloverleaf interchange on km 637 of a CART Before After toll road, in Caiuá town, region of Presidente Prudente

Contents Invepar Achievements Management Performance About GRI Engineering Management 53 Supplies Management

In 2017, Supplies Management was central- operations and the capability of satisfying the in particular a Procurement Policy and General ized at the parent company, and working with local needs of each company. Supply Terms and Conditions that set forth the companies and department supplied by Inve- This involved coming up with an action plan new rules for relations with in-house customers par, one of the main transformative initiatives based on a three-year roadmap of initiatives and departments, in line with the guidelines and was developed to generate value and consoli- for restructuring Supplies and achieving re- improvements recommended by corporate con- date the group’s new position. The initial mile- sults, and defining improvement cycles for op- trol and compliance. In addition, systems were stone consisted of identifying the operational eration and performance. overhauled, a Procurement Portal set up, and a needs of each business segment and develop- The plan defined and approved a new set of new working structure implemented for Supplies. ing a shared model, with a centralized view of policies, rules and standardized procedures, and Two new processes were introduced as the year progressed: economic and financial capacity assessment reporting for all strategic sourcing processes, and integrity and negative image reporting with an analysis of the history of each company related to labor, social, environmental, integrity and PEP (politically exposed persons) issues. The fact that the companies began operating on the market as a group, with volume consolidation, provided initial savings for Invepar of the order of R$ 19.2 million in 2017 alone. In 2018, Supplies will face the challenge of sta- bilizing and perfecting its processes and generating savings at differentiated quality levels, involving new contract models with a long-term vision, selection criteria and systematic supplier assessment, as well as supplier development plans.

Cargo admissions system operator at GRU Airport.

Contents Invepar Achievements Management Performance About GRI Supplies Management 54 Sustainability Management

Invepar, the Invepar Institute and wholly-owned standards related to the following processes: subsidiaries are signatories of the United Na- Monitoring and Control of Legal Environmen- tions Global Compact, committed to conduct- ·· tal Requirements ing business based on 10 principles related to human rights, labor relations, the environment ·· Surveys on Environmental Aspects and Impacts and combating corruption. Management of Environmental Licenses and Using Ethos Indicators for Sustainable and Re- ·· Requirements sponsible Business, the work is done systematically to diagnose and measure the development ··Solid Waste Management of management practices for sustainability in Water Resource and Effluent Management group companies. A biannual self-assessment ·· process is conducted and used as a basis for ·· Handling Chemicals drafting of various Ongoing Improvement Plans, Environmental Communications implemented by group companies and over- ·· seen by Invepar. The company also uses sustainability indica- Invepar’s guidelines for social and environmen- tors monitored monthly by the ICG System at re- tal action are based on the Sustainability Policy, sults meetings with Invepar group companies. the Code of Ethics and Conduct, Invepar Institute The aim of this process is to identify deviations, guidelines and other normative documents relat- plan actions, share best practices and drive pro- ed to social and environmental issues. cess improvement. In 2017, within the scope of the Invepar re- positioning process, the Sustainability sector began implementing and standardizing Envi- ronment Management Systems (EMS) within all wholly-owned companies, with the aim of strengthening the operational Risk and Com- pliance Management strategy throughout the group. As a result of this process, the new HSE (Health, Safety and the Environment) policy was approved. Invepar also published management Stretch of toll road run by VIA 040.

Contents Invepar Achievements Management Performance About GRI Sustainability Management 55 Environmental Results

Water Consumption (m3) (G4-EN3)1 Waste Generation (G4-EN23)

Water consumption 2016 2017  Types of Waste 2017 Total 1,053,246 1,272,565 21% Hazardous 1,632 1 Comparables: the following companies were excluded (i) LAMSAC, sold off in Nov/16; (ii) ViaRio, charging started in Aug/16. Source: Invepar Non-hazardous 22,294

In 2017, water consumption rose by 21%, due to which handled 1.2 million more passengers com- Total 23,926 increased consumption by MetrôRio, which be- pared to 2016, and CRT road surface maintenance gan metering consumption at five new stations work (asphalt micro coating) carried out over a on metro Line 4 in Rio de Janeiro; increased con- period of six months during the year. sumption at GRU Airport passenger terminals Toucan receiving treatment from a CRT employee

Contents Invepar Achievements Management Performance About GRI Sustainability Management 56 Energy and Greenhouse Gas Emissions (tCO2e) (G4-EN3, EN15, EN16, EN17)

Scope 1 direct emissions fell 30.6% between Types of Emission¹ (tCO e) 2016 2017  2016 and 2017, mainly as a result of Via040 ² weed suppression, lower consumption of Total Emissions 165.504,02 166.901,46 0,84% fossil fuels (diesel and gasoline) by the toll Direct Emissions (Scope 1) 48.501,11 33.624,08 -30,6% road vehicle fleet, and a drop in greenhouse Indirect Emissions (Scope 2) 30.463,39 40.300,72 32,3% gas emissions through the use of SF6 gas by Other Indirect Emissions (Scope 3) 86.539,5 92.976,60 7,5% MetrôRio as an insulating gas at power sub- 1 The above figures relate to emissions results for Invepar wholly-owned subsidiaries: LAMSA,CLN, CART, Via040, MetrôRio and GRU Airport, using the op- stations. The increase in indirect emissions erational control approach. Source: Invepar caused by electrical energy procurement was due to growth of 13.46% in mean emissions the group’s total energy consumption. puts bought, including steel and concrete, for from the Brazilian National Grid System com- The increase in other indirect emissions maintenance work on LAMSA overpasses. pared to 2016, and an increase of 4.23% in (scope 3) was due to the higher quantity of in-

Energy Consumption within the Organization (G4-EN3 e G4-EN6)

Energy consumption¹ (MWh) 2016 2017 Total 444,912.91 459,125.21 Renewable fuels (ethanol) 8,257.90 8,209.08 Electrical energy 409,875.27 427,223.56 Non-renewable fuels (fossil fuels) 26,779.74 23,692.58

1 The above figures relate to emissions for Invepar wholly-owned subsidiaries: LAMSA,CLN, CART, Via040, MetrôRio and GRU Airport, using the operational control approach. Source: Invepar

Fuel consumption (liters) 2016 2017  Diesel 2,315,588.97 1,980,621.84 -14.47% Ethanol 1,393,160.30 1,384,923.80 -0.6% Gasoline 106,686.11 117,700,25 10.3%

Stretch of toll road run by CART

Contents Invepar Achievements Management Performance About GRI Sustainability Management 57 Community Relations

The Invepar Institute works in the fields of Edu- panies encourage strategic actors to become cation, Environment, Sport and Culture to pro- involved in their activities. In 2017, all commu- Social and Environmental Project Highlights mote regional development. Besides running nity stakeholders were mapped by LAMSA, CLN, social and environmental projects, Invepar com- CART, MetrôRio and GRU Airport. During 2017, the Invepar Institute and group 108 social projects companies sponsored social and environment MetrôRio social project backed by the Invepar Institute projects through a public selection process. 95 communities

23 municipalities

103 mil beneficiaries

R$ 5,162,128.04 invested (R$ 689,690.13 direct funding and R$ 4,474,437.91 incentive-based funding)¹

1 Amounts for all Invepar group companies (wholly-owned and associate).

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Contents Invepar Achievements Management Performance About GRI Community Relations 58 Economic and Financial Performance

60 About Consolidation

61 Operating Revenue

62 Costs and Expenditure

64 EBITDA and EBITDA Margin

65 Results

67 Cash and Cash Equivalents and Indebtedness

68 Main Investments

Contents Invepar Achievements Management Performance About GRI

59 About Consolidation

The 2017 Consolidated Financial Statements are Type of Consolidation per Share Interest compliant with international financial reporting standards (IFRS) and with the accounting practices used in Brazil, including those of Brazilian company law and the pronouncements, guidelines and interpretations issued by the Brazil- ian Accounting Standards Committee (CPC) and approved by the Brazilian Securities and Ex- change Commission (CVM) applicable to the Company’s transactions. Invepar consolidates all subsidiaries over which it has control: CART, CLN, GRUPar, GRU Consolidation by the Airport, LAMSA, MetrôBarra, MetrôRio, and Via Full Consolidation Method Equivalence Method 040. The other companies are under joint control, with one or more shareholders, and consolidated using the equivalence method: CRT, CBN, CRA, VLT Carioca and ViaRio. 100.0% 91.5% 100.0%

50.0% 50.0% 24.9%

100.0% 100.0% 100.0%

33.3% 24.9%

80.0% 40.8%

Contents Invepar Achievements Management Performance About GRI About Consolidation 60 Operating Revenue

Adjusted Net Revenue stood at R$ 3.7 billion in Adjusted Net Revenue Airports 2016 2017  (R$ million) 2017, representing year-on-year growth of 6.4%. The main impacts were as follows: Growth of R$ 116.6 million (+7.1%) year-on-year, Total¹ 3,470.6 3,691.2 6.4% impacted mainly by: Toll Roads 889.1 965.4 8.6% Toll Roads ·· readjusted boarding charges for national and Urban Mobility 932.6 960.2 3.0% international passengers; Airports 1,649.0 1765.6 7.1% Growth of R$ 76.3 million (+8,6%) compared ·· increase of 13.5% in passenger revenue due 1 Impacts of IFRS on Construction Revenue disregarded. Source: Invepar to 2016, mainly due to toll adjustments on toll to growth in international passenger num- road concessions granted in 2017. In addition to bers (+4.1%) with a higher average ticket price; toll adjustments, CART also obtained tariff re- growth of 12.9% in cargo revenue, due to an Breakdown of Adjusted classification at two toll stations as a result of ·· increase of 15.6% in cargo movements, to- Net Revenue lane duplication. gether with a change in the charging method, startup of cargo operations by two airlines Urban Mobility (Turkish and Qatar) and the implementation 26.0% of warehouse charging on Saturdays; 48.0% Revenue reached R$ 960.2 million in 2017 (+3.0%), ·· despite a drop of 0.7% in total aircraft move- when the positive impacts of the toll increase, ments, there was an 11.3% increase in aircraft from R$ 4.10 to R$ 4.30 (+4.9%) in April 2017, and revenue due to a change of profile for bigger the startup of Line 4 were partially offset by a aircraft, with higher average weight, and an drop in demand for MetrôRio. amendment in the legislation on stopover times.

26.0%

Airports

Toll Roads

Urban Mobility

Contents Invepar Achievements Management Performance About GRI Operating Revenue 61 Costs and Expenditure

Breakdown of Adjusted Operating Costs and Expenditure (R$ million) 2016 2017  Costs and Expenditure Staff (626.8) (640.8) 2.2% Conservation and Maintenance (283.7) (253.9) ‑10.5% 2.0% Operating (410.7) (361.7) ‑11.9% Administrative Expenditure (245.6) (231.3) ‑5.8% 21.0% 50.0% Total Administrable (3,397.6) (3,209.7) ‑5.5% Variable Concession (189.6) (206.1) 8.7% Depreciation & Amortization (1,069.8) (1,123.9) 5.1%

Total Adjusted¹ (2,826.2) (2,817.7) ‑0.3% Construction Costs (IFRS) (561.7) (372.9) ‑33.6% Provision for Maintenance (IFRS) (9.7) (19.0) 95.7% Total (3,397.6) (3,209.7) ‑5.5% 27.0%

1 Impacts of IFRS on Revenue and Construction Costs, and the Provision for Maintenance disregarded. Source: Invepar

Administrable Costs and Expenditure fell 5.5% crease in expenditure on severance pay and Toll Roads Airports due to the centralization and standardization of transfers. The drop in conservation and main- key processes within the framework of a trans- tenance was mainly due to the unification of Urban Mobility Holding formative project commenced in 2016. The aim of cleaning contracts and revision of maintenance Source: Invepar this project was to rationalize and concentrate contracts. In terms of operating costs, expendi- some activities and departments within group ture on electrical energy fell due to energy pur- companies, providing economies of scale lead- chases on the spot market. There was a fall in ing to higher efficiency in Costs and Expenditure. administrative expenditure on advisory, legal In terms of staffing, there was a slight in- and consultancy services.

Contents Invepar Achievements Management Performance About GRI Costs and Expenditure 62 If the expenditure within the scope of the diture, including advice, consultancy, rents and metro, which impacted 2017 Costs and Expendi- transformative project is taken in isolation, other items, the drop is even greater, reaching ture by around R$ 43 million compared to 2016. such as the payroll and benefits, materials and 8.3%. This outcome was achieved despite infla- Adjusted Operating Costs and Expenditure operating services, costs on maintenance and tion of around 3.3% for the period, as well as fell by 0.3% year-on-year, reaching R$ 2.8 bil- conservation and general administrative expen- the operation of new Line 4 stations on the Rio lion, due to an increase of 5.1% in depreciation and amortization, accounted for by the activa- Operating Costs and Expenditure: Transformative Project (R$ million) 2016 2017  tion of new items and the higher number of op- Total Administrable (3,397.6) (3,209.7) ‑5.5% erational assets. Within the Scope of the Transformative Project (1,151.3) (1055.8) -8.3% Outside the Scope (415.6) (431.9) 5.1% Stretch of Via040 Toll Road 1 Impacts of IFRS on Revenue and Construction Costs, and the Provision for Maintenance disregarded. Source: Invepar

Contents Invepar Achievements Management Performance About GRI Costs and Expenditure 63 EBITDA and EBITDA Margin

The adjusted EBITDA totaled R$ 2 billion in 2017, Indicators (R$ million) 2016 2017  representing year-on-year growth of 9.6%, and Equivalence Method 54.2 (5.4) -109.9% disregarding the effects of selling off LAMSAC and EBIT 3,093.1 852.5 -72.4% PEX Peru. The adjusted EBITDA margin reached 54%, an increase of 1.7% on the previous year. (+) Depreciation & Amortization 1,069.8 1,123.9 5.1% EBITDA growth was mainly due to the toll in- EBITDA1 4,162.9 1,976.5 -52.5% creases impacting revenues, and a fall in Costs Adjustments 2.5 15.7 523.5% and Expenditure resulting from stricter control. (-) Construction Revenue (IFRS) (568.9) (376.3) -33.9% EBITDA Ajustado (R$ Milhões) (+) Construction Costs (IFRS) 561.7 372.9 -33.6% (+) Provision for Maintenance (IFRS) 9.7 19.0 95.7% EBITDA Adjusted EBITDA2 4,165.5 1,992.1 -52.2% EBITDA Margin Adjusted Net Revenue2 3,470.6 3,691.2 6.4%

2 EBITDA Margin Adjusted EBITDA Margin (%) 120.0% 54.0% -66.0 p.p. disregarding the sale of LAMSAC and PEX Peru 120.0% Disregarding the sale of LAMSAC and PEX Peru Adjusted EBITDA2 1,816.8 1,992.1 9.6% Adjusted Net Revenue2 3,470.6 3,691.2 6.4% Adjusted EBITDA Margin (%)2 52.3% 54.0% 1.7 p.p. 54.0% 1 CVM Instruction Nº527/12; 2 Disregarding the IFRS impacts on Revenue and Construction Costs, and the Provision for Maintenance and non-recur- 52.3% rent items. Source: Invepar

201 2017

Source: Invepar

Contents Invepar Achievements Management Performance About GRI EBITDA and EBITDA Margin 64 Results

Financial Result

Net financial expenditure for 2017 totaled R$1.5 financial expenditure as in 2016 (R$ 1.0 billion, billion, a drop of R$ 719.6 million year-on-year. 45.2%). The year-on-year drop in the net result Despite a drop of R$ 286 million in the restated was due to the partial settlement of the 3rd is- amount for the fixed concession on GRU Airport, sue of holding bonds, in December 2016, and a the 2017 amount of R$ 739.5 million represents drop in the indices affecting interest and cor- 47.7% of the total financial result, i.e. maintain- rection for inflation of loans taken out to fund ing more or less the same proportion of total the investment plan.

Financial Result (R$ million) 2016 2017  Total 2,269.7 1,550.1 -31.7% GRU concession 1,025.5 1,739.5 69.6% Financial Res. Excl. GRU concession 1,244.2 810.6 -34.8%

Source: Invepar

Financial Result (R$ million)

201 1,2442 1,0255

Net Financial Result

2017 8106 7395 GRU Airport concession

Source: Invepar

Suspension bridge on metro Line 4

Contents Invepar Achievements Management Performance About GRI Results 65 Annual Result Annual Result Simulated Result without sale of (R$ million) LAMSAC and PEX Peru (R$ million)

Annual Result (R$ million) 4Q16   4Q17 2016 2017 2017 2017 Net Profit/Loss 1,277.3 (191.3) -115.0% 409.1 (482.6) -218.0% 201 Source: Invepar 201 0 Source: Invepar 0 Simulated Result without sale of LAMSAC and PEX Peru 4Q16 4Q17  2016 2017  (R$ million) Annual Result Simulated Result without sale of Net Profit/Loss 1,277.3 (27.0) -102.1% (906.8)(R$ million)(482.6) -49.8% LAMSAC and PEX Peru (R$ million) Source: Invepar

2017 2017 The 2017 annual result was 49.8% up on 2016, financial expenditure due to a fall in the IPCA disregarding the effects of the sale of LAM- index which 201impacts the GRU fixed concession 201 SAC and PEX Peru. The negative R$ 482.6 mil- and partial settlement of the Invepar bond in 0 lion was impacted mainly by the reduction in December 2016. Source: Invepar 0

Operang and Non-Operang Results (R$ million)

1,992.1 (628.6)

(810.6)

(495.3) 375.9 (15.7) 256.9 (739.5) Operang Non-Operang (160.9) (482.6) Result Result

Adjusted 2017 Amor za on Net. Fin. Result Deprecia on/ IR & CS Minority IFRS Result before Restatement Loss for 2017 EBITDA of GRU (excluding Amor za on (Income tax Interest adjustments GRU concession of GRU xed concession restatement (excluding & Social amor za on concession of GRU xed restatement contribu ons) (Simulaon) and PVA Source: Invepar concession) of GRU xed concession) Contents Invepar Achievements Management Performance About GRI Results 66 Cash and Cash Equivalents and Indebtedness

The Invepar group ended 2017 with a cash balance due to the 4th bond issue. Net Debt (R$ million) and financial investments totaling R$ 1.1 billion. The amount of long-term debt was 71%. The The variation in the balance was due to the input increase in indebtedness in 2017 was due to of funds from the sale of LAMBRA and 3rd and 4th the need for funding to honor the group’s com- 4.2 4.2 issue Invepar bonds. mitments. Note, in particular, that the con- The Company’s consolidated gross debt cession amounts are accounted as liabilities reached R$ 9.5 billion in 2017, an increase of under a specific item, and not treated as a R$ 935.6 million (+10.9%) year-on-year, mainly debt balance.

Consolidated (R$ million) 2016 2017 

Gross Debt 8,554.3 9,490.0 10.9% Short term 1,569.5 2,794.3 78.0% Long term 6,984.9 6,695.7 -4.1% 201 2017 Cash and Cash Equivalents 889.3 1,123.4 26.3% Net Debt Cash and cash equivalents 655.3 835.1 27.4% Financial Investments 234.0 288.3 23.2% Net Debt/Adjusted EBITDA Source: Invepar Net Debt 7,665.1 8,366.6 9.2% Adjusted EBITDA LTM¹ 1,608.2 1,599.1 6.2% Net Debt/Adjusted EBITDA LTM¹ 6.0 6.5 1.0 p.p. Net Debt/Adjusted EBITDA 4.2 4.2 - Adjusted EBITDA LTM¹ 1,816.83 1,992.11 -

1 Last Twelve Months. Source: Invepar

Contents Invepar Achievements Management Performance About GRI Cash and Cash Equivalents 67 and Indebtedness Main Investments Investments per Segment (%)

In 2017, investments totaled R$ 527.7 million, in- The concession-holders who invested most 0.6% cluding R$ 358.1 million for Toll Roads, R$119.2 were CART, Via040, MetrôRio, MetrôBarra and 9.0% million for Urban Mobility, R$ 47.5 million for Air- GRU Airport. CART invested mainly in duplication ports and R$ 2.9 million for the holding. work, improvements in the highways system, and the deployment and improvement of trunk facil- 22.6% Indicators (R$ million) 2017 ities. Via040 invested in road surface milling and Toll Roads 358.1 dressing and bank stabilization. MetrôRio con- centrated investments in upgrading and devel- LAMSA 17.5 oping software and automatic train protection CLN 2.2 (ATP). MetrôBarra investments were targeted 67.9% CART 191.2 mainly toward signaling on Line 4 and the automatic driver system. GRU Airport made some Via 040 147.2 important investments, especially in runway re- Toll Roads Airports Urban Mobility 119.2 vitalization and signage on the main landing and Urban Mobility Holding MetrôRio 68.6 take-off runway, increasing surface durability. Source: Invepar MetrôBarra 50.5

Airports 47.5 Full financial statements are available on the Invepar website (+) GRU Airport 47.5 Holdings 2.9 Total Invested1 527.7 Capitalization of Financial Result 70.2 Other Non-Cash Effects2 52.3 Construction Margin 3.3 1 Investment in terms of cash, excluding GRU Airport fixed concession, as well as other non-cash effects to approximate maximum financial investment. Source: Invepar

Boarding bridge at GRU Airport

Contents Invepar Achievements Management Performance About GRI Main Investments 68 About this report

The Invepar 2017 Annual Report was drafted in accordance with the methods in GRI (Glob- al Reporting Initiative), version G4 – Essential. Credits This year, we have produced a more concise report that focuses more on Invepar’s business, Erik da Costa Breyer achievements and challenges. CEO This work on continual improvement has been in progress since 2014, when we submit- Communications Team Investor Relations Team ted the outcome of the inclusion of the materiality principle process in a more robust manner, Claudia Jeunon Nilton Pimentel Executive Manager in charge of Investor Relations Manager made adjustments, and improved our ability Customer Service, Communications, to focus on the most important topics, such as Marketing and Sustainability Aline Campos transparency and accountability. At that time, Investor Relations Coordinator we consulted various stakeholders, including Mariana Köhler Pereira Sustainability Coordinator Rafael Rondinelli community leaders, users, opinion formers, fi- Investor Relations Analyst nancial institutions and the media. Christine Lages Corporate Communications Coordinator Livia Bragança Investor Relations Analyst Marcelo Matos External Communications Analyst Contact Samira Martins [email protected] External Communications Analyst

Graphic Design and Body Copy Layout Estúdio Pictograma estudiopictograma.com.br

Contents Invepar Achievements Management Performance About GRI

69 GRI Index

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70 GRI Index

General Standard Content Answer

Declaration by the organization’s G4‑1 chief decision-maker on the Message from the CEO + relevance of sustainability

G4‑3 Name of Organization About Invepar +

About Invepar +

Main trademarks, Invepar Toll Roads + G4‑4 products and services Invepar Airports + Invepar Urban Mobility + Location of organization’s G4‑5 Av. Almirante Barroso, 52, 30º andar – Centro – Rio de Janeiro. Brazil headquarters Number and names of countries in G4‑6 About Invepar + which the organization operates Kind of ownership and G4‑7 Corporate Governance + organization’s legal form Invepar Toll Roads + Markets on which the G4‑8 Invepar Airports + organization operates Invepar Urban Mobility +

About Invepar + G4‑9 Size of organization People Management + Economic and Financial Performance +

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71 General Standard Content Answer

People Management +

Total number of employees for each Profile for each contract type 2017 2017 G4‑10 employment contract type, functional Full-time 8,766 7,409 category, gender and age group Part-time 199 268 Adjusted total 8,965 7,677

Percentage of total employees G4‑11 covered by collective 100% of the Invepar workforce is covered by collective bargaining agreements. bargaining agreements

The infrastructure and mobility management sector has fairly complex supply chains, involving a large number of suppliers from various segments, such as engineering companies, Description of the organization’s management consultancies, market research firms, cash-in-transit companies, information G4‑12 chain of suppliers and automation systems, telecommunications, maintenance firms, fire-fighting and prevention, cleaning and waste management firms, suppliers of individual protective equipment (IPE), security and surveillance, training companies, office materials suppliers, etc.

Significant changes that have occurred during the period In 2017, the Company kept its subsidiaries and associates and there was no alteration in G4‑13 covered by the report in regard shareholder equity. Details of the main events can be found on the Investor Relations website. to company size, structure, shareholder equity or supply chain

Invepar has a structured risk management process. The method used follows the parameters How does the organization approach in ISO 31000 (Corporate Risk Management) and aims to identify and administer events that G4‑14 the precautionary principle? could affect business and society. This approach is based on origins of risk related to the following categories: strategic, financial, image, social/environments and operational.

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72 General Standard Content Answer

All the initiatives that Invepar endorses are of a voluntary nature, i.e.: Name of letter, principle Date of Countries/Operational Units Letters, principles and other or other initiative adoption G4‑15 initiatives that the organization United Nations Global Compact 07/15/2010 Invepar (holding) subscribes to or endorses Corporate Pact for Integrity Invepar (holding), all wholly-owned companies 12/09/2016 and against Corruption and Concessionária Bahia Norte (CBN)

Invepar group representatives are members of associations acting in the defense of transportation infrastructure activities in Brazil. The Company also has a seat on the Board of Directors and is actively involved in the Communications Committee of the Brazilian Toll Road Concession-Holder’s Association (ABCR) and the National Association of Airport Management Companies (ANEAA). We are also members of the Firjan Infrastructure Board (Rio de Janeiro G4‑16 Participation in associations State Federation of Industries). We are also involved with other entities not dedicated to defending infrastructure activities, but important players in terms of related topics. These include the Ethos Institute for Corporate Social Responsibility, Gife (Business Institutes and Foundations Group), the Brazilian Global Compact Network, Aberje (Brazilian Association of Business Communications), Abrasca (Brazilian Association of Publicly Traded Companies) and Anefac (National Association of Finance, Administration and Accounting Executives).

Invepar fully consolidates its wholly-owned companies: CART, CLN, GRUPar, GRU Airport, Entities included in the LAMSA, MetrôBarra, MetrôRio, Via 040, PEX S.A. (operation discontinued) and LAMBRA G4‑17 consolidated financial statements Holding. Other companies are jointly controlled with one or more shareholders, and are or equivalent documents consolidated using the equivalence method: CRT, CBN, CRA, VLT Carioca and ViaRio.

Process adopted to define the G4‑18 content of the report and the About the Report + limits of different aspects

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73 General Standard Content Answer

Category Material Aspects

Economic Economic Performance Environmental Water, Waste, Climate/Energy Management and Biodiversity Employment, Training, Occupational Health G4‑19 Identified material aspects Labor Practices and Decent and Safety, Mechanisms for Complaints and Working Conditions Grievances Related to Working Practices Society Integrity and Anticorruption Program and Local Communities Responsibility for the Operational and Road Safety, Customer Service and Satisfaction product/service

Material Aspects Impact within/outside the organization

All group companies / Market, Economic Performance Suppliers, Public Authorities Water, Waste, Climate/Energy Management and All group companies/Society in the vicinity Biodiversity (for the toll roads and airports segment) of company operations, users, Suppliers G4‑20 Limits of aspects within and Employment, Training, Occupational Health G4‑21 outside the organization All group companies, Own employees, and Safety, Mechanisms for Complaints and Third-party employees, Suppliers, Market Grievances Related to Working Practices Integrity and Anticorruption Program All group companies, Employees / and Local Communities Suppliers, Market, Public Authorities Operational and Road Safety, Customer All group companies, Employees / Service and Satisfaction Users and Customers

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74 General Standard Content Answer

This year (2018), the results and all environmental performance information relate only to Effects of redrafting information G4‑22 Invepar wholly-owned subsidiaries, including GRU Airport. The total consumption indicators provided in previous reports for water, energy, emissions, etc., reported in 2016 no longer cover associate companies.

Significant changes regarding the G4‑23 periods covered by previous reports LAMSAC was sold to Vinci Highways S.A.S. and therefore its results are no longer included. under Scope and Aspect Limits

Stakeholder groups engaged G4‑24 See table in G4-26. by the organization

Since the 2014 Report, containing the results of including the materiality principle in a more robust way, we have made adjustments and improved our perception in regard Criteria for identifying and G4‑25 to the most relevant topics that should be included in our Annual Report. At that selecting stakeholders time, we consulted various stakeholders, such as community leaders, users, opinion formers, financial institutions, the media, employees and Invepar shareholders.

Audience Objectives Relations Strategies All group companies have various user relations channels, including the social networks (Twitter and Facebook), toll- Approach adopted to To improve knowledge and provide more free phone number (0800), ombudsman, G4‑26 engage stakeholders Customers information on the services offered, variable message signs (VMS), and assess it and build a relationship of trust. Customer Service Centers. In addition, satisfaction surveys are conducted by the companies themselves or by independent organizations.

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75 General Standard Content Answer

Audience Objectives Relations Strategies To strengthen relations by means of Shareholder relations are based on Shareholders transparency and accuracy of information corporate governance best practices and on which decisions will be taken. Invepar formal processes for governance.

Invepar has its own department To increase value perception for the Financial dedicated to relations with analysts and Invepar group, generating interest Market and investors (Investor Relations) which by creating a transparent, timely and Investors publishes regular information relevant legitimate information system. to the Company on its exclusive website.

To raise awareness of corporate values inside the company, and inspire and Climate research, performance In-house motivate employees to achieve long- assessment, internal talks, Approach adopted to Audience term strategic objectives, generating presentation of results to staff, G4‑26 engage stakeholders a sense of belonging so that they act coffee with the CEO, and so on. as ambassadors for the group.

Media days and road show with To build a relationship of credibility, opinion-forming journalists, transparency, respect and trust, Media and continually satisfying the reinforcing a positive perception of the requirements of the media. The Invepar group’s reputation and image. Company has its own press agency.

To publicize the group and establish a relationship of trust and a positive To find out more about our perception of the Invepar group relationships with neighboring Community and the Invepar Institute, keeping communities, see the section on communication channels open and Social Responsibility Management. facilitating access to information.

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76 General Standard Content Answer

Audience Objectives Relations Strategies This is a transverse topic and we seek to protect the environment To systematically manage all through a range of actions ranging environmental matters and impacts from environmental management resulting from our processes and in our operations, environmental Environment operations, seeking to minimize and project developed in conjunction with mitigate their effects through an ongoing communities, contractual clauses for process of continual improvement. suppliers requiring stricter compliance with environmental legislation, in-house awareness raising campaigns, etc.

To align Suppliers with Invepar policies, Approach adopted to and especially the Code of Ethics G4‑26 engage stakeholders and Conduct and policy regarding Clear rules and guidelines for hiring Suppliers Purchasing and Hiring, Health, Safety throughout the group, set forth in and the Environment and Sustainability, various normative documents. so as to build a mutually beneficial relationship in all aspects.

To build knowledge within the group Invepar has its own Regulatory Concession and create a positive perception of Management department granting its capabilities for governance and responsible for relations with authority commitment to concession agreements, concession granting authorities. management models and accountability.

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77 General Standard Content Answer

Audience Objectives Relations Strategies To improve knowledge and create a positive Approach adopted to Regulators perception of the Invepar group by creating Invepar has its own Regulatory G4‑26 engage stakeholders and a continuous information system on the Management department responsible Inspectorates provision of our services, user satisfaction for relations with regulatory agencies. indices and operational processes.

Main topics and concerns raised Invepar Toll Roads + by stakeholders and measures G4‑27 Invepar Airports + implemented to permit an organized approach to them Invepar Urban Mobility + G4‑28 Period covered by the report January 1st to December 31st 2018 G4‑29 Date of previous report The most recent report was published in April 2017, and relates to 2016 G4‑30 Report issuing cycle Annual Contact for queries About the Investor Relations Manager – [email protected] G4‑31 Report and its contents Communications and Sustainability Manager– [email protected] G4‑32 Summary of GRI contents GRI Index External verification No Independent Auditor’s Limited Assurance Report was published in 2016 and 2017. This process G4‑33 policy and practices was implemented in 2014 and 2015 by PwC and KPMG respectively. Governance structure G4‑34 Corporate Governance + and composition Organization’s values, principles, Corporate Identity + standards and norms of G4‑56 Invepar Integrity Program + behavior, such as the code of conduct and ethics Code of Ethics and Conduct +

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78 Specific Standard Content Answer ECONOMIC G4‑DMA Form of management Economic and Financial Performance +

AVS – Added Value Statement (for Financial Years ended December 31 2017 and 2016) Parent Company Consolidated Indicator Note 12/31/2017 12/31/2016* 12/31/2017 12/31/2016* Revenues 17 – – 4,865,498 7,393,322 Provision of services – – 4,454,776 3,820,081 Construction Revenue – – 480,434 666,619 Estimated losses for doubtful debts – – (78,367) (41,865) Other revenues – – 8,656 2,948,487 Inputs purchased from third parties 35,088 (535,965) (1,336,899) (2,375,617) Direct economic value Costs of Merchandise and services sold – – (17,917) (625,480) G4‑EC1 generated and distributed Construction Cost 17 – – (372,942) (561,679) Materials, energy, services of 35,088 (535,965) (935,629) (1,185,050) third parties and others Asset loss/recovery – – (5,652) (2,332) Other costs – – (4,758) (1,076) Gross added value 35,088 (535,965) 3,528,599 5,017,705 Retentions (5,791) (28,940) (1,123,918) (1,069,800) Depreciation and amortization 17 (5,791) (28,940) (1,123,918) (1,069,800) Net added value produced 29,297 (564,905) 2,404,681 3,947,905 by the entity

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79 Specific Standard Content Answer ECONOMIC

AVS – Added Value Statement (for Financial Years ended December 31 2017 and 2016) Parent Company Consolidated Indicator Note 12/31/2017 12/31/2016* 12/31/2017 12/31/2016* Added value received on transfer (322,440) 1,446,378 133,797 335,080 Result of equivalence method 8 (426,963) 1,340,416 (4,348) (2,768) Financial revenues 18 104,522 105,962 138,145 337,848 Total added value from continued (293,145) 881,473 2,538,479 4,282,985 operations to be distributed Added value from discontinued (1,015) 56,921 (1,015) 56,921 operations to be distributed Total added value to be distributed (294,159) 938,394 2,537,464 4,339,906 Direct economic value Distribution of added value (294,159) 938,394 2,537,464 4,339,906 G4‑EC1 generated and distributed Staff and positions 76,119 47,885 577,911 561,918 Direct remuneration 63,209 42,102 410,874 406,426 Benefits 9,631 3,558 131,731 115,389 FGTS (Severance Fund) 3,158 2,225 33,229 28,511 Other 121 – 2,078 11,592 Taxes, charges and contributions 11,603 19,593 1,013,035 1,261,547 Federal 11,515 19,593 848,084 1,190,598 State – – 25,223 5,316 Municipal 88 – 139,727 65,633 Net added value produced 29,297 (564,905) 2,404,681 3,947,905 by the entity

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80 Specific Standard Content Answer ECONOMIC

AVS – Added Value Statement (for Financial Years ended December 31 2017 and 2016) Parent Company Consolidated Indicator Note 12/31/2017 12/31/2016* 12/31/2017 12/31/2016* Remuneration on third party capital 100,749 461,783 1,805,015 2,738,986 Interest 63,565 402,447 1,594,135 2,353,356 Direct economic value Rents 2,346 2,905 9,902 36,140 G4‑EC1 generated and distributed Other 34,838 56,431 200,977 349,490 Remuneration on own capital (482,630) 409,133 (858,497) (222,545) Loss attributable to non-parent – – (375,868) (631,678) company shareholders Profit (Loss) attributable to (482,630) 409,133 (482,630) 409,133 parent company shareholders The notes are an integral part of the financial statements. 1 Engineering Director, Vice-Chairman since 06/ 19/2017

Rouanet PIS/COFINS SUDENE PIS/COFINS Law (Arts Company Zero rate Law Profit Exemption Total REIDI and Culture 12.860/13 Exploration Incentives) METRÔRIO ‑ 27,680 ‑ ‑ 9,645 37,325 LAMSA ‑ ‑ ‑ 581 ‑ 581 Financial assistance received G4‑EC4 CLN ‑ ‑ 2,767 ‑ ‑ 2,767 from the government CART 2,727 ‑ ‑ ‑ ‑ 2,727 VIA 040 2,356 ‑ ‑ ‑ ‑ 2,356 VLT 24,252 ‑ ‑ ‑ ‑ 24,252 CBN 2,426 ‑ 311 ‑ ‑ 2,737 CRA 14 ‑ ‑ ‑ ‑ 14 Total 31,774,51 27,680 3,079 581 9,645 72,760

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81 Specific Standard Content Answer ENVIRONMENT

Form of management (material G4‑DMA aspects: energy, emissions, water, biodiversity, waste)

Energy consumption within G4‑EN3 the organization

G4‑EN6 Reduction of energy consumption

G4‑EN8 Total water drawn per source

G4‑EN15, Direct greenhouse gas emissions, Sustainability Management + EN 16, indirect emissions and other indirect EN17, Invepar Toll Roads + emissions (Scopes 1,2 and 3) EN20 Invepar Airports + Invepar Urban Mobility + Total weight of waste, itemized G4‑EN23 per type of method of disposal

• Number of animal incidents at airport site • Number of passageways deployed and adapted for animals to Biodiversity cross toll roads run by Invepar • Number of animal rescue and recovery operations • Number of animals run over

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82 Specific Standard Content Answer LABOR PRACTICES

Total Total Total Gender Turnover (%) Employees¹ Admissions Terminations Male 5,067 1,006 1,353 23.28 Female 2,342 665 841 32.15 Total number and rates of new Total 7,409 1,671 2,194 26.08 employee admissions, and Total Total Total G4‑LA1 Age group Turnover (%) employee turnover per age Employees¹ Admissions Terminations group, gender and region Under 30 2,006 756 668 35.49 Between 30 and 50 4,860 869 1,335 22.67 Over 50 543 46 46 8.47 Total 7,409 1,671 2,049 25.10 1 For calculating turnover, the Total Employees figure excludes interns and apprentices under fixed term contracts.

Indicators 2017 Total own employees 7,677 Total person hours worked/year 14,791,184 Accidents Total number and rates of Number of accidents 184 new employee admissions Accident rate 12.44 G4‑LA6 and staff turnover per age Occupational illnesses group, gender and region Number de occupational illnesses 3 Rate of occupational illnesses 0.20 Days lost Number of days lost 11,959 Rate of days lost 808.52

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83 Specific Standard Content Answer LABOR PRACTICES

Indicators 2017 Total number and rate of Absenteeism new employee admissions G4‑LA6 Absenteeism 187,516 and staff turnover per age group, gender and region Rate of absenteeism 12,677 Fatalities 1

Number of Average training Functional Category Number of hours employees hours CEO 1 34 34 Senior Management 41 558.50 13.62 Average number of hours’ training Management 363 3,417.75 9.42 G4‑LA9 per year per employee, itemized by Administration 1051 17,588.07 16.73 gender and functional category Operational 5,953 284,086.99 47.72 Interns 47 1,512.00 32.17 Apprentices 221 70,149.76 317.42 Total 7,677 377,347.10 49.15

Labor complaints and grievances¹ 2016 2017 From own employees 191 480 From third party employees 1,216 1,044 Total 1,407 1,524 Number of labor-related complaints Number complaints from own employees dealt with during 2017 426 G4‑LA16 and grievances recorded, processed Number complaints from own employees resolved during 2017 76 and resolved by formal mechanisms Number de complaints and grievances related to labor practices 428 recorded prior to 2017, but resolved during the year

1 Labor-related complaints and grievances are those raised through formal channels, i.e. agencies linked to the Ministry of Labor and Work and responsible for enforcing standards of occupational protection, in addition to the Public Prosecutor’s Office, and the Labor Courts.

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84 Specific Standard Content Answer LOCAL COMMUNITIES

The Invepar Institute steers and supports private social investment initiatives targeting communities near to the operations of wholly-owned subsidiaries. The group constantly seeks to maintain good relations with local communities. With support from the Invepar Institute, group companies implement working methods that involve, but are not limited to, the following:

• Preliminary socioenvironmental and socioeconomic diagnostics; • Communications plan for the entire project implementation phase and in areas impacted by operations;

• Implementation of compensatory and impact-mitigation operations, especially G4‑DMA Form of management in projects involving compulsory purchase and resettlement;

• Identification and mapping of local actors and formal/informal organizations; • Definition of a local community relations plan for communities near concessions; • Implementation of social investment projects as a priority in the most vulnerable areas and communities (for details of the main projects supported, click the links below);

• Ongoing awareness-raising campaigns for sensitive Invepar operations, such as sexual exploitation of children and adolescents on Toll Roads, traffic and road safety education, child labor at the airport site, etc.

Percentage of operations with All companies have local community engagement programs. To check out 2018 results, see: local community engagement G4‑SO1 Sustainability Management + programs, impact assessment and local development programs Community Relations +

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85 Specific Standard Content Answer ANTICORRUPTION

G4‑DMA Form of management Invepar Integrity Program +

Total number and percentage All Invepar group companies are subject to corruption-related risk assessment, including of operations with corruption- G4‑SO3 failure to comply with laws and regulations; non-performance of Concession Contract related risk assessment, and obligations; unethical conduct by employees and/or third parties, and fraud. significant identified risks

Communication and training G4‑SO4 in anticorruption policies The company has never experienced any cases of corruption. and procedures

Confirmed cases of corruption G4‑SO5 The company has never experienced any cases of corruption. and measures taken

Invepar Number of cases notified on the In 2017, 265 notifications were received, (including GRU Airport). Of these, Indicator Invepar anticorruption hotline none were related to corruption and 32 were deemed justified.

Specific Standard Content Answer OPERATIONAL AND ROAD SAFETY

Invepar Toll Roads + G4‑DMA Form of management Invepar Airports + Invepar Urban Mobility +

Invepar Number of accidents with injuries, Invepar Toll Roads + Indicator with no injuries and with fatalities

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86 Specific Standard Content Answer CUSTOMER SERVICE AND USER SATISFACTION

GRU AIRPORT Brazilian Secretariat of Civil Aviation Survey – São Paulo International Airport was found to be the best airport in Brazil in the category “over 15 million passengers a year”, according to the Airports Operational Performance Report published by the Brazilian Secretariat of Civil Aviation (SAC) – 4th quarter of 2017. On a scale from 1 to 5, GRU Airport scored 4.43 based on 37 indicators measuring the real level of passenger satisfaction. These indicators ranged from sign information quality to the commercial facilities available to passengers, including check-in queuing times and friendliness of airport staff. Over the past five years, a series of improvements have been made to enhance user comfort and boost boarding and deboarding efficiency. Of particular interest are the construction of Passenger Terminal 3 and the Terminal 2 modernization project, adding 23,000 m² of operational area (check in, X-ray facilities, passport control, baggage reclaim) and the expansion of shopping facilities from 100 stores to over 270. METRÔRIO G4‑PR5 Satisfaction Survey Results Service Quality Indicator Survey – Conducted every year in the months of March and September to monitor user satisfaction levels. The survey interviews a representative sample of metro users in Rio de Janeiro, using a random approach near the turnstiles at all stations. Data gathering and number of interviews: 1001 personal interviews using a questionnaire designed to assess the quality of services provided from the user’s viewpoint, considering various factors: staff service (including ticket office teams and security staff), audible train signals, comfort, station and train conservation, user information, ticket purchase convenience and queuing times, system safety, platform waiting time, etc. Users give their opinions within the context of a multimodal transit system, subject to contingency risks. See the results below:

Month 2015 2016 2017 March 7.6 7.7 8.3 September 7.8 8.1 8.2

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87 Specific Standard Content Answer CUSTOMER SERVICE AND USER SATISFACTION VLT CARIOCA A survey conducted by the Instituto Datafolha between November 27 and December 3, 2017, showed that 92% of Rio’s Light Rail users have a positive assessment of the system (good or very good). This was an improvement on 2016 with a figure of 88%. The random approach based a quantitative survey was conducted inside stations on Rio Light Rail Lines 1 and 2, and also inside the trains. A total of 989 people were interviewed using a structured questionnaire and tablet. To guarantee a representative sample, quotas were used for each period, station and working day/weekend, based on flow data from November 2017, supplied by the concession-holder. The margin of error was 3% and the confidence interval 95%. Seven out of 10 passengers interviewed recommended the Light Rail System as an efficient means of transit. Speed was highlighted as the most important aspect (62%) for Light Rail users, and was one of the aspects that changed significantly compared to the previous year. The system was considered good or very good by 81% of interviewees, compared to 56% in 2016. Comfort (93%) and operational safety (87%) were other aspects scoring above average. Reliability, relating to requirements such as waiting times and number of unscheduled stops, rose from 46% to 85%. G4‑PR5 Satisfaction Survey Results LAMSA On toll roads run by LAMSA and CLN, the aim of the survey was to obtain information on user profiles and habits, assess knowledge and use of the services provided, administration, image and level of satisfaction of drivers using the Linha Amarela and Estrada do Coco, comparing the results with those of the previous year. Users aged 18 or over were interviewed on working days and weekends using quantitative methods (total: 400 subjects. Margin of error: plus or minus 4.9 %, with a confidence interval of 95%. LAMSA 2015 2016 2017 Physical aspects 8.30 8.84 8.56 Services 8.40 8.80 8.72 Team and Toll Station Service 8.40 8.88 8.76 Image 8.40 8.80 8.35 Management 8.00 8.19 8.02 Final Score 8.30 8.70 8.50

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88 Specific Standard Content Answer CUSTOMER SERVICE AND USER SATISFACTION

CLN 2015 2016 2017 Physical aspects 80,4 80,4 77,6 Services 86,0 84,1 80,4 G4‑PR5 Satisfaction Survey Results Team and Toll Station Service 86,4 85,9 81,2 Image 87,9 86,8 79,3 Management 77,1 77,2 70,3 Final Score 83,6 82,9 77,8

In 2017, fines amounting to R$734,719.80 were paid; in 2017, MetrôRio paid R$704,466.24 Sum of heavy fines levied for in fines levied by AGETRANSP (Public Services Regulator for Water, Rail and Metro failure to comply with the laws and G4‑PR5 Transit and Toll Roads in the State of Rio de Janeiro). CART paid R$23,153.16 in fines regulations relating to the provision levied by ARTESP (Public Services Regulator for Transportation in the State of São and use of products and services. Paulo) and GRU AIRPORT paid R$7,100.40 to ANAC (National Civil Aviation Agency).

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