ANNUAL REPORT 2015 SUMMARY PRESENTATION ACCOMPLISHMENTS AND GOALS The Expansion of Subway System o Line 2-Green o Line 4-Yellow o Line 5-Violet o Line 15-Silver o Line 17-Gold PERFORMANCE o Operation o Maintenance o Customer service ENVIRONMENT AND SUSTAINABILITY o Expansion: Environmental Licenses o Power and greenhouse gas emissions o Environmental management system ADMINISTRATIVE PROCESSES o Information Systems o Personnel Management o Training, qualification and corporate university o Labor Safety, occupational health and life quality o Human Resources Management o Building infrastructure and administrative services COMMUNICATION AND MARKETING o Cultural activities o Campaigns o Social Projects o Press and Social Networks ECONOMIC-FINANCIAL PERFORMANCE o Businesses o Income statement o Financial resources THANKS SOCIAL BALANCE o Social Benefits 2015 ACCOUNTING STATEMENTS 1 PRESENTATION We are hereby presenting the Administration Report and the accounting statements of Companhia do Metropolitano de São Paulo – Metrô, regarding the fiscal year of 2015, in accordance with legal and statutory provisions related to public transportation service rendering for subway passengers and expansion of subway system. ACCOMPLISHMENTS AND GOALS THE EXPANSION OF SUBWAY SYSTEM The daily concern of Companhia do Metropolitano de São Paulo – Metrô with the lines in operation is added to the continuous focus on the future. Therefore, Metrô continues with their study, research and survey activities to plan and build new lines to compose the metropolitan transportation network. LINE 2-GREEN Line 2‐Green project consists on the expansion of the current branch up to the Municipality of Guarulhos, crossing the east side of São Paulo and connecting these regions with the south and west sides, in addition to the remaining subway‐railway network. With 14.4 kilometers of extension, connecting Vila Prudente Station to the Municipality of Guarulhos, this line expansion will count with additional thirteen stations and maintenance yard. It will meet the demand of the residents from neighborhoods Jardim Anália Franco, Vila Formosa, Vila Manchester, Aricanduva, Penha and Tiquatira in São Paulo, and Ponte Grande and Vila Augusta in Guarulhos. Its distribution role of concentrated passengers flow is highlighted that currently occurs in lines 3‐Red of Metrô, 11‐Coral, 12‐Safire and future 13‐Jade of CPTM, which constitutes radial connections of subway‐railway service. After the project conclusion, it will be the longest subway line – with 29.1 kilometers of extension, and is also the axis with the greatest number of stations: 27. It will connect with other four subway lines, tree metropolitan trains and one monorail. For the expansion implementation of Line 2 – Green of Metrô – section Vila Prudente – Dutra, the construction works contracts were signed on September 2014, relative to eight lots foreseen for this implementation. On October 2014, partial Service Orders were issued for lots 1, 3, 4 and 5 releasing the execution of preliminary services for construction works implementation, such as: detailed project and demolition of expropriated properties. Lots 2, 6, 7 and 8 didn’t have the service orders issued at that time 2 Expropriations and demolitions: In 2015, the necessary expropriations were continued for the project implementation and initiated demolition of properties for the beginning of the works. Detailed projects and construction work: In 2015, began the elaboration of detailed projects and geological surveys were performed necessary for the project implementation. In 2015, due to priorities redefinition in the expansion plan, Companhia do Metrô entirely suspended, until December 31, 2016, all construction work contracts of this Project. LINE 4-YELLOW Because of its integration characteristics with the entire rail transportation network in the Metropolitan Region of São Paulo – RMSP (lines 1-Blue, 2-Green, 3-Red and 5-Violet of Metrô and lines 7-Rubi, 8-Diamant, 9-Esmerald, 10-Turquoise, 11-Coral, and 12-Safire of CPTM) and with the bus system, Line 4-Yellow is considered a priority project for the Urban Transportation Integrated Plan (Plano Integrado do Transporte Urbano – PITU) and for the Metropolitan Network of São Paulo. Line 4-Yellow is operated by a concessionaire – ViaQuatro – and its implementation is being performed in three phases. It has as differential the trains operated under driverless mode, without operator. In the year 2015 was performed the management of remaining works of Phase 1, for the compliance with the services and repairs under warranty and to hire the company for the construction of public restrooms at stations Luz, República, Paulista, Faria Lima, Pinheiros and Butantã. Due to the interruption of the works from Phase 2 by the contractor Corsàn Corvian (stations Higienópolis – Mackenzie, Oscar Freire, Fradique Coutinho, São Paulo – Morumbi, Pátio and Vila Sônia Bus Terminal), Metrô unilaterally terminated the contract on Sept/10/2015. The activities for contracting a new company, to continue the works and for its conclusion, resulted in the elaboration of material aiming a new bidding process, published on November 2015. LINE 5-VIOLET The operating section of Line 5-Violet, between stations Capão Redondo and Adolfo Pinheiro, in the south region of the capital, has 9.3 kilometers of extension, seven stations and a parking and maintenance yard for trains. This section is integrated to the intercity buses at stations Capão Redondo and Campo Limpo, to municipal buses in all stations and to CPTM at Santo Amaro Station. The expansion in progress contemplates the implementation of 11.0 kilometers of ways and 10 new stations. The new section will connect Adolfo Pinheiro Station to Chácara Klabin Station, in Vila Mariana district, integrating with Line 1-Blue at Santa Cruz Station, with Line 2-Green at Chácara Klabin Station and with Line 17-Gold at Campo Belo Station. 3 In 2015, the execution of construction works continued in the expansion section as from Adolfo Pinheiro Station up to Chácara Klabin Station, as well as Guido Caloi Yard. The construction of coverage slabs progressed at stations Alto da Boa Vista, Borba Gato and Brooklin, of internal structures of stations Eucaliptos, Moema and AACD-Servidor, and excavation of tunnels for the station of stations bodies at São Paulo Hospital, Santa Cruz and Chácara Klabin. Also continued the excavations with three tunnel boring machines, one for the double tunnel between Bandeirantes Shaft and Dionísio da Costa Shaft, and another two for single parallel tunnels between Conde de Itu Shaft and Bandeirantes Shaft. During the year, the excavation of the double tunnel reached Santa Cruz Station, crossing stations AACD-Servidor and São Paulo Hospital and the excavation of single tunnels crossed stations Brooklin and Campo Belo, wherein one of the tunnel boring machines concluded the trajectory, reaching Bandeirantes Shaft. LINE 15-SILVER Line 15-Silver in monorail will have 24.5 kilometers of extension, starting at Vila Prudente Station up to Cidade Tiradentes Hospital Station, with 17 stations and two yards for trains parking, Oratório and Ragheb Chohfi, both with capacity to park 28 trains each. The system will meet the demand of around 550 thousand passengers/day, operating with 54 trains with seven cars each, for the section between stations Vila Prudente and Hospital Cidade Tiradentes, as foreseen in the functional project. In 2015, another 11 new complete trains were delivered, totaling 20 trains already delivered to Oratório Yard, all of them manufactured in Brazil, at Hortolândia, in countryside of São Paulo. LINE 17-GOLD Line 17-Gold will have a commercial extension of 17.7 kilometers and 18 stations. This line will connect, through a branch, Congonhas Airport to Jabaquara Station from Line 1-Blue, in one direction, and to São Paulo – Morumbi Station from Line 4-Yellow in the other direction. It will also be integrated to Line 5-Violet at Campo Belo Station and to Line 9- Esmerald from CPTM at Morumbi Station – CPTM and will meet the estimated demand for section 1 of 214 thousand passengers/day. Upon the conclusion of sections 2 and 3, it will meet an estimated demand of 511 thousand passengers/day. Água Espraiada Yard is also part of this phase, which is destined for the maintenance and parking of a freight with 27 trains, from which 14 trains were already contracted. In this section, the implementation of construction works for Água Espraiada Yard and for stations Chucri Zaidan, Vila Cordeiro and Campo Belo, during the year of 2015, developed regularly until the middle of October, when the construction consortiums interrupted the September 2010: Sacomã – Vila Prudente from Line 2-Green. Since August 2013, was 4 initiated, on weekends, the commercial operation using CBTC in all Line 2-Green, in order to test it operationally and prepare the Operation and Maintenance technical staff. Along 2015, the pending matters detected during the tests were settled by the supplier and it is foreseen that in 2016, Line 2-Green will starts full operation, during the 19 hours of commercial operation, with signaling made by CBTC. Permanent way: The highlight of the year 2015 in the permanent way system was the change of 540 meters of rail on ballast way performed over the night on the day Mar/01/2015, at Line 3-Red. Due to the local difficulties – the new rail is almost on the same level of the rail to be substituted – it was the first time that such extension was substituted over a single night. The usage of special equipment (multiuse tractor) was crucial, once it minimized manpower in the elevation and positioning of the rails, improving the ergonomics and productivity. ASSISTANCE TO USERS Ombudsman: In 2015, were registered 12,728 manifestations from citizens in the Custom Corporate System. From this total 6,266 were claims, 4,803 information requests, 889 suggestions, 391 compliments, 323 complaints and 56 thanks. There was a 26% drop of the total Ombudsman demand when compared to the year 2014.