INTEGRATED REPORT SHORT VERSION BUILDING OUR TOMORROW ANNUAL CEMENT CAPACITY We are a Company made to last, KEY FACTS AND INITIATIVES BUSINESS AND MARKETS WHERE WE OPERATE OF CONSOLIDATED and our actions in 2016 promoted OPERATIONS6 important advances towards the ● CEMENT ● CO-PROCESSING CAPTION sustainability of our business. We 33.8 MILLION TONS SOLD IN 2016 AGRICULTURAL LIME invested in competitiveness, optimized ● CONCRETE LIME 9.2 MILLION M3 SOLD IN 2016 INSTALLED CONSTRUCTION SHOTCRETE CAPACITY OF OF 83 MARACANÃ costs and improved the efficiency of all 1 MILLION STADIUMS (RIO DE 57.5 ● MORTAR CONCRETE BLOCKS = our operations. Applied in a planned 1.6 MILLION TONS SOLD IN 2016 METRIC TONS JANEIRO, BRAZIL) MILLION way in different contexts, these ● AGGREGATES TONS/YEAR 24.4 MILLION TONS SOLD IN 2016 actions made VCNA (North America) 34.3 and VCEEA (Europe, Asia and Africa) 5.2 operations participation reach a new LAUNCH OF THE NEW SUCCESSFUL STARTUP GLOBAL level inside our business, which ratifies PORTFOLIO OF BAGGED OF PRIMAVERA CO-PROCESSING: CEMENT IN BRAZIL. (BRAZIL) AND WE WENT FROM 5.9 the hit in the geographic diversification ● ● ● ● 3.2 HIGHLIGHT: THE NEW YACUSES (BOLIVIA) 9.7% TO 11.8% OF Great Lakes 3.0 strategy built over the years. STRUCTURAL CEMENT, PLANTS REPLACEMENT OF United States/ In Brazil, our main market, we antic- WHICH ALREADY ACCOUNTS FOSSIL FUELS Canada ● ● ● ● ● FOR 10% OF SALES ● ● ● ● ● ipated the decrease in the Brazilian GDP Spain Turkey China with initiatives such as the adoption of 1.2 1.8 zero-based budgeting, adjustments to ● ● ● ● the organizational structure and the Morroco ● ● ● Tunisia launch of a new product line, always ● ● 1.2 framed by financial discipline. More Florida5 than punctual actions, these initiatives ● ● are tied to a long term strategy that India already leaves as legacy a much more ● solid and well prepared company to Peru ● ● ● ● ● 1.2 face the next years challenges. APPROVAL OF 3,500 EMPLOYEES THE BOLT PROJECT BRAZIL The same strategy was behind an R$ 1 BILLION IN NEW PARTICIPATED TRANSFORMED LOGISTICS ● extensive systematic of processes INVESTMENTS FOR IN THE INTO A LEVER OF Bolivia3 review, done in 2016 in all contries EXPANSIONS IN TURKEY, SUSTAINABLE COMPETITIVENESS, WITH ● ● ● 0.5 UNITED STATES AND PRACTICE A GOAL TO SAVE 2 in which we operate. Our Focus on Chile ARGENTINA WEEK R$ 45 MILLION A YEAR Excellence, with reduction expenses ● ● ● ● ● ● ● ● Argentina1 Uruguay4 actions and productivity increase, yielded, beyond better financial results, two notable milestones in Votorantim VOTORANTIM VOTORANTIM CIMENTOS Cimentos image: our award record CIMENTOS SOUTH AMERICA (43 in total) and increase in quality NORTH AMERICA indicators and customer loyalty. VOTORANTIM YACUSES – BOLIVIA ARGENTINA This long term perspective CHARLEVOIX – UNITED CIMENTOS EUROPE, Our first greenfield project In 2016, we advanced guided actions such as investments STATES VOTORANTIM ASIA AND AFRICA outside Brazil, the plant our project to expand maintenance in co-processing (which ISSUANCE OF THE IMPLEMENTATION RECORD NUMBER OF We will continue to CIMENTOS BRAZIL was inaugurated 15 days the capacity of the San will ensure raw-material saving $ 500 MILLION IN OF THE LEAN AWARDS. HIGHLIGHT: expand the unit with an SIVAS - TURKEY ahead of schedule and has Luis plant. Startup is BONDS BY VCNA MODEL THE MASTER already become a planned for 2019. aquisition and advances in sustaint- estimated investment PRIMAVERA – BRAZIL Our estimated AND EXTENSION IMPROVED THE IMOBILIÁRIO, of US$ 184 million. The The unit, inaugurated in investment of successful example of We also approved the ability indicators), the issue of US$ OF COMPANY’S MORTAR BUSINESS THE MOST IMPORTANT expansion, with startup May 2016, has strategic € 140 million in the planning and applying expansion of the Olavarría 500 million in bons in North America DEBT PROFILE PERFORMANCE IN AWARD IN THE scheduled for 2018, importance to serve the expansion of the unit the Company’s global plant. This will increase BRAZIL BY 26% BRAZILIAN REAL ESTATE (which better balanced the Company will put us in a good markets of the North will triple its production standards. This unit will its capacity by 175,000 MARKET debts among their plants) and the position to capitalize and Northeast capacity and increase enable us to produce up metric tons a year. continuity in our expansion cycle that, on opportunities in the of Brazil, regions with our network in eastern to five times more after the inauguration plants in Bolivia Great Lakes region. growth potential Turkey. cement in Bolivia. and Brazil in 2016, walks towards the expansion of the plants in USA, Turkey 4 2 18 9 14 8 1 2 8 1 1 and Argentina. 89 26 50 16 9 102 21 2 Our geographic diversification and long term planning promoted in the past resulted in a dynamic, sustainable CAPTION: NUMBER OF UNITS and competitive company. We are sure THE INDEX (NPS) THAT CREATION OF MAINTAINING OUR Cement plants Mills Concrete plants Aggregate units Mortar units that maintaing our DNA, our Beliefs, MEASURES CUSTOMER ENVIRONMENTAL LONG-TERM FOCUS, RECOMMENDATION PRODUCT WE APPROVED OUR our Values and our Purpose, we will OF OUR PRODUCTS DECLARATIONS 10-YEAR keep paving our path towards a even 1. Argentina: 49% stake in Cementos Avellaneda | 2. Chile: 16.7% stake in Cementos Bío Bío | 3. Bolivia: 51% stake in Yacuses, which holds 66.7% in Itacamba Cementos S.A. | 4. Uruguay: 51% stake GREW 14 PERCENTAGE (EPD) IN BRAZIL AND STRATEGIC in Cementos Artigas | 5. Includes 100% of Suwannee’s annual installed capacity, which is not consolidated in the VCSA Financial Statements | 6. Does not include annual installed capacity of Bio Bio, more solid future. POINTS IN BRAZIL IN THE UNITED STATES PLAN Avellaneda and Suwannee, which are not consolidated in the VCSA Financial Statements. ZERO LOSS KEY-ACTIVITIES AND PRODUCTION PROGRAM MANAGEMENT OF PROJECTS AND INDICATORS HARDENED CONCRETE Advocacy ADDITIVES GRINDINGRAW SOFT CONCRETE MILL CRUSHING MAIN ADDITIVES RESOURCES Investiment capacity CLINKER BURNING GRINDING MILL ADDITIVES SAND POZZOLANSLAG Human resources ASH CONCRETE KILN IRON ORE CLAY BAUXITE Natural resources LIMESTONE Mines COOLING PLASTER Electricity Water GRINDING MILL GRINDING MILL CRUSHING Firewood Gas HYDRATION HYDRATED LIMESTONE FILLER KILN STORAGE Fuel MIXER LIMESTONEADDITIVES FILLER Inputs PACKING DECORATTA FINISHING GRINDING CEMENT PACKING ADDITIVES Machinery/equipment MILL CEMENT AGRICULTURAL LIME Fleet and concrete-mixer trucks 1 2 3 4 MIXER LIME HYDRATED LIME Infrastructure Plants PACKING STORAGE RESEARCH* CONSTRUCTION MINING PRODUCTION LIMEPAINT Concrete plants Distribution center OF PLANTS STANDARD MORTAR Technology center ADHESIVE MORTAR STORAGE Media and marketing IT KEY-ACTIVITIES 1 2 3 4 5 6 7 8 MATERIALITY VALUE PROPOSITION Financial capital Credibility of the brand Efficient process management and reduction of red-tape Human capital Investments in sustaintability Social and Customer relationship 5 6 7 8 relationship capital Quality and variety in portfolio Technical expertise safety in the workplace LOGISTICS COMMUNICATION SALES AFTER-SALES Natural capital Inbound/outbound Services Mine closure Intellectual and IMPACTS BY ACTIVITY manufactured-goods capital Positive impacts Negative impacts STRATEGIC DRIVERS ENVIRONMENTAL A Occupational health and safety Emission of GHG CUSTOMER FOCUS BEST IN CLASS OPERATION EMPOWERED PEOPLE SUSTAINABLE PRACTICES Emissions of NOx and SOx B Ethics and integrity in business Emission of particulate material C Climate change and GHG Waste generation STRATEGIC PARTNERSHIPS KEY-ACTIVITIES 1 2 3 4 5 6 7 8 emissions Co-processing of waste AND ALLIANCES D Customer relationship and Consumption of water and generation of effluents recommendation Impact on soil, biodiversity and suppression of vegetation ● Community/social license PERFORMANCE INDICATORS Management of biodiversity and restoration ● Universities E Economic performance ● Engagement with the community F L of degraded areas Vocational training schools ● Environmental institutes Reduction in emissions of NOx and SOx F Relationship with the community Archeological and Paleontological rescue K ● Governmental bodies 30% use of fossil fuels C H G Training, qualification and Impact on the communities ● Unions Safety (fatality rate) A development of employees Noise ● Government ● Water and biodiversity J M Trade associations H Energy management ● ECONOMIC Banks Ethical commercial practices (Code of conduct) B ● Suppliers I Innovation, research and Tax on contracting products and services AFR - Substitution target C H ● Equipment suppliers Ebitda E development Tax on sales of products and services ● Suppliers of coke (fuel and additives) Tax on mining ● Suppliers of equipment, alternative fuels Sustainability in the supply chain D N J Biodiversity preservation ● Provision of service in co-processing Reduction in CO emissions C Generation of Company’s value and maintenance 2 K Atmospheric emissions ● Carriers and self-employed drivers of the brand’s credibility Global Environmental Policy and Green Rules C H K M ● Army (explosives) (particulates, NOx and SO ) Cash Cost Process 2 Management of liabilities ● Cementitious L Sustainable and inclusive Cash generation ● Opinion makers/influencers Clinker/Cement factor C ● Customers/promoters IQP Processes D construction ● Newspapers, magazines, TV and websites SOCIAL NPS (Net Promoter Score) D M Water and effluent management ● Customers Generation of jobs and income OEE - Productivity