CENTRAIS ELETRICAS BRASILEIRAS S.A. CNPJ: 00.001.180/0001-26 PUBLIC TRADED COMPANY
Centrais Elétricas Brasileiras S/A ("Company" or "Eletrobras") hereby informs its shareholders and the market in general that received on August 26, 2016, the Official Letter No. 2973/2016-SAE BM&FBovespa, requesting clarification about atypical movement of the Company's shares, which took place from August 15, 2016, as transcribed below:Free Translation of Official Letter 2973/2016-SAE of BM&FBovespa:
Ref .: Atypical Trading Shares Dear CFO
In view of the latest fluctuations registered with shares issued by Eletrobras, the number of trades and trading volume, as shown below, we request to be informed until August 29, 2016, if there is any fact, knowledge by the company that can justify this performance. The answer of the company, without prejudice to the provisions of the sole paragraph of art. 6 of CVM Instruction No. 358/02, must be sent through the IPE module, selecting the Category: Notice to the Market, Type: Clarifications on consultations of CVM/BM&FBOVESPA and the Subject: Atypical Trading Securities, which will result the simultaneous transmission to the BM&FBOVESPA and CVM.
We emphasize the obligation under the sole paragraph of art. 4 of CVM Instruction No. 358/02, to inquire the management and controlling shareholders of the company, in order to ascertain whether they have knowledge of information that should be disclosed to the market.
Common Shares | |||||||||
Price (R$ per share) | |||||||||
Date | Opening | Minimum | Maximum | Average | Last | % | No. of Trades | Trading Volume | Amount Traded R$ |
08/15/2016 | 19.77 | 19.49 | 19.85 | 19.71 | 19.75 | 0.50 | 1,603 | 648,700 | 12,786,730.00 |
08/16/2016 | 19.98 | 19.29 | 20.85 | 19.83 | 19.70 | -0.25 | 5,655 | 1,762,700 | 34,954,206.00 |
08/17/2016 | 19.70 | 18.60 | 19.82 | 19.09 | 19.51 | -0.96 | 6,335 | 2,505,700 | 47,822,721.00 |
08/18/2016 | 19.35 | 19.13 | 19.78 | 19.54 | 19.68 | 0.87 | 5,096 | 969,600 | 18,944,048.00 |
08/19/2016 | 19.64 | 18.98 | 19.67 | 19.17 | 19.02 | -3.35 | 4,315 | 1,471,900 | 28,218,250.00 |
08/22/2016 | 19.03 | 18.13 | 19.07 | 18.47 | 18.50 | -2.73 | 5,984 | 1,272,600 | 23,503,190.00 |
08/23/2016 | 18.56 | 18.17 | 18.85 | 18.46 | 18.36 | -0.75 | 3,907 | 1,677,000 | 30,957,500.00 |
08/24/2016 | 18.28 | 17.83 | 18.59 | 18.12 | 18.30 | -0.32 | 4,011 | 1,237,400 | 22,421,067.00 |
08/25/2016 | 18.48 | 18.21 | 18.85 | 18.53 | 18.58 | 1.53 | 5,018 | 1,661,700 | 30,786,417.00 |
08/26/2016* | 18.71 | 18.64 | 20.89 | 19.79 | 20.33 | 9.42 | 12,808 | 7,331,400 | 145,094,924.00 |
Preferred Shares - Class "B" | |||||||||
Price (R$ per share) | |||||||||
Date | Opening | Minimum | Maximum | Average | Last | % | No. neg. | Amount Shares | Amount R$ |
08/15/2016 | 24.87 | 24.81 | 25.38 | 25.12 | 25.10 | 0.60 | 2,161 | 552,900 | 13,887,576.00 |
08/16/2016 | 25.26 | 25.18 | 26.58 | 25.54 | 25.46 | 1.43 | 3,897 | 1,236,500 | 31,583,420.00 |
08/17/2016 | 25.52 | 24.26 | 25.78 | 24.80 | 24.65 | -3.18 | 5,552 | 2,199,500 | 54,544,992.00 |
08/18/2016 | 24.45 | 24.30 | 25.19 | 24.98 | 25.00 | 1.41 | 2,389 | 651,100 | 16,263,002.00 |
08/19/2016 | 25.12 | 24.64 | 25.12 | 24.79 | 24.76 | -0.96 | 2,693 | 889,000 | 22,039,542.00 |
08/22/2016 | 24.67 | 24.04 | 24.92 | 24.33 | 24.11 | -2.62 | 3,844 | 898,000 | 21,843,965.00 |
08/23/2016 | 24.27 | 23.87 | 24.53 | 24.18 | 23.97 | -0.58 | 4,401 | 1,255,100 | 30,345,678.00 |
08/24/2016 | 23.88 | 23.62 | 24.37 | 24.03 | 24.27 | 1.25 | 5,213 | 1,047,300 | 25,170,079.00 |
08/25/2016 | 24.32 | 24.20 | 24.95 | 24.68 | 24.77 | 2.06 | 4,426 | 882,700 | 21,781,315.00 |
08/26/2016* | 24.80 | 24.80 | 28.31 | 27.06 | 27.47 | 10.90 | 9,942 | 3,636,800 | 98,431,773.00 |
Updated until 17h30.
The file to be sent must be transcribed the above inquiry of the content before the reply of that company. (…)
In response to the Official Letter in question, the Company clarifies the following:
The consolidated Company's financial statements for the second quarter of 2016 ("2Q16") disclosed to the market on August 15, 2016, registered in results for the first half 2016 ("1H16"), a net profit attributable to controlling shareholders of R$ 8,824 million, compared to a net loss of R$ 103 million in the first half of 2015 ("1H15"). In 2Q16, the Company reported net income attributable to the controlling shareholders of R$ 12,722 million, compared to a net loss attributed to the controlling shareholders of R$ 3,898 million in the first quarter of 2016 ("1Q16").
According to the Relevant Fact of August 15, 2016, the result of 1H16 and 2Q16 was decisively influenced by the accounting recognition of financial income relating to electricity transmission assets existing on May 31, 2000, called Existing Basic Network System - RBSE, with impact on transmission revenue, in the account Transmission - Return on Investment, in the amount of R$ 25,810 million.
The expectation of such accounting was already being monitored by the market since April 20, 2016, when the Ministry of Mines and Energy - MME published Ordinance No. 120 which regulated the receiving conditions of the above claims.
On August 12, 2016, Eletrobras had issued a market announcement mentionig the need to postpone the release of its Financial Statements of 2Q16 to August 15, 2016, precisely because of the discussions that there were still around accounting of the credit.
It is believed that the accounting and the expected payment of dividends, due to the recognition of this credit, contributed to the appreciation of the Company's shares.
However, the Company, through the Market Announcement released on August 26, 2016 and in conference call of the 2Q16 results, held on August 16, 2016, reminded its shareholders and investors that the legislation corporate in releiton to payments of dividend over profit not yet realized and also confirmed that it does not make projections of future results and therefore any decision about dividends for the fiscal year 2016, depends on the outcome to be presented to the end of their period.
Another highlight that can have contributed to the unusual movement of the Company's shares in recent days, refers to the decision of the 165th Eletrobras Shareholders' Meeting, in which was deliberated not renew the concessions of the Eletrobras distribution companies, located in the north and northeast of the country, and transfer their shareholding controls by the end of 2017. Although this decision was taken at the 165th EGM of July 22, 2016, this matter was widely discussed during result presentations to the market of 2Q16, from August 16, 2016.
Finally, it is thought that there is a positive market reaction regarding the new management of the Company.
Rio de Janeiro, August 29, 2016.
Armando Casado de Araujo
CFO and Investor Relations OfficerEletrobrás - Centrais Elétricas Brasileiras SA published this content on 29 August 2016 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 30 August 2016 01:18:10 UTC.
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