Mills 2Q15 results

Investor Relations

BM&FBOVESPA: MILS3 and OTC-US: MILTY

Mills: EBITDA 10% higher quarter over quarter

Rio de Janeiro, August 5th, 2015 - Mills Estruturas e Servios de Engenharia S.A. (Mills) presented EBITDA of R$ 52.1 million in
the second quarter of 2015 (2Q15), with 9.9% growth in relation to the first quarter of 2015 (1Q15), and EBITDA margin of
35.3%.
In this quarter, we signed new contracts related to important construction jobs in the Heavy Construction business unit, started
having reversals of allowance for doubtful debt, and a new variable compensation program was launched, aiming at greater
engagement of our employees. However, uncertainties remain in the markets in which we operate. Therefore, we will continue
our efforts to reduce costs, improve operational productivity and synergies among the business units, as well as focus on cash
preservation and assets resizing, through sale of equipment.
The highlights of Mills performance in 2Q15 were:

Net revenues of R$ 147.9 million, 30.6% below the amount registered in the second quarter of 2014 (2Q14).

Sales of semi-new equipment of R$ 6.8 million, with planned sales of R$ 40 million.

Cost of goods and services sold (COGS) and general, administrative and operating expenses (G&A) 8.2% lower yearover-year (yoy).

New adjustment of organizational structure, with annual cost reduction of approximately R$ 6.3 million.

Allowance for doubtful debt (ADD) represented 1.2% of net revenues, including reversal of R$ 6.8 million.

EBITDA(a) of R$ 52.1 million, with a drop of 50.8% yoy, impacted by operating leverage.

Net loss of R$ 8.2 million and Return on Invested Capital (ROIC)(b) of 2.0%.

Capex(c) of R$ 9.7 million, of which R$ 5.1 million for replacement of the mix of rental equipment.

Positive net cash flow(d) of R$ 36.6 million versus R$ 10.9 million in 2Q14.

Completion of principal payments expected for 2015, of R$ 131.2 million, without rolling over the debt.

in R$ million

2Q14

1Q15

2Q15

(C)/(A)

(C)/(B)

(A)

(B)

(C)

Net revenue

213.0

163.9

147.9

-30.6%

-9.8%

EBITDA

105.9

47.4

52.1

-50.8%

9.9%

EBITDA margin (%)

49.7%

28.9%

35.3%

Net earnings (Loss)

33.4

-14.5

-8.2

n.a.

n.a.

12.3%

4.0%

2.0%

54.7

6.4

9.7

-82.3%

51.1%

ROIC (%)
Capex
Table 1 Key financial indicators
1

Excluding depreciation and allowance for doubtful debt (ADD)

The financial and operational information presented in this release, except when otherwise indicated, is in accordance with accounting policies adopted in Brazil,
which are in accordance with international accounting standards (International Financial Reporting Standards - IFRS).

Business Perspective
According to a research conducted by the National Confederation of Industry (CNI Confederao Nacional da Indstria),
expectations for the infrastructure sector continue to deteriorate in the last months, as indicated by the expected level of activity,
which reached 40.92 points in July 2015, below the value recorded in April 2015, of 43.5 points.
In its Infrastructure letter of June 2015, consulting company Inter.B points out that the adjustments to public accounts and the
low visibility may cause a drop of 20% in investments in Infrastructure in 2015 in relation to 2014.
However, the federal government announced, in June, a new package of logistics, with estimated investments of R$ 198.4
billion, of which R$ 86.4 billion in railways, R$ 66.1 billion in highways, R$ 37.5 billion in ports and R$ 8.5 billion in airports. For
2015 four highway auctions are expected, with investments of R$ 18.3 billion.
In the real estate market, the activity level, as measured by the CNI research, finished 2Q15 with 38 points, lower than 1Q15,
with 41 points. The real estate credit market has been negatively impacted by the lower balance in savings accounts and the
recent restraint of Caixa Econmica Federal, the main source of housing credit in Brazil, in financing used properties.
Furthermore, higher interest rates and unemployment risk increased the number of dissolutions, the return of properties still
under construction, to 30-35% of gross sales, against 10% in 2012, increasing the level of property inventory and, thus,
hindering new launches. New launches announced by the listed real estate companies presented a reduction of 49.5% in the
first half of 2015, in relation to the same period of last year, while sales reduced 27.7% in the same period.
The market for motorized access equipment shares the same negative scenario as the construction sector. In the Oil and Gas
market, although Petrobras new plan foresees a reduction in investments of 37% in comparison to last year, the company is
prioritizing the exploration activities and should conclude Abreu e Lima refinery, in Pernambuco, which can gradually improve
demand for motorized access equipment, mainly in shipyard activities.
On the supply side, less than 300 machines entered the market between January and June of 2015, against about 3,300 in the
same period of last year. We believe the supply adjustment will occur gradually as a result of equipment exportation and
obsolescence due to players exiting the market and executing lower investments in maintenance.

Revenue
Net revenue reached R$ 147.9 million in 2Q15, with a 9.8% drop quarter-over-quarter (qoq), negatively impacted by a reduction
of R$ 9.5 million, or 30.3%, of revenues from sales, technical assistance and others. Heavy Construction business unit was
mainly responsible for this reduction, since its revenues from sales, technical assistance and others returned to historical levels,
not repeating results of 1Q15, when the amount was almost the double of the 2014 quarterly average.
Rental revenues dropped R$ 6.5 million, or 4.9%, with the lower rental volume in the three business units responsible for R$ 3.0
million of this reduction, while the variation of price and mix, in the Rental business unit, was responsible for R$ 3.5 million.

Costs and Expenses

COGS, excluding depreciation, totaled R$ 48.5 million in 2Q15, similar to 1Q15.
Quarter-over-quarter, lower sales and asset write-offs costs were offset by higher freight and material costs, linked mainly to
construction jobs outside of Brazil and to the constructions which use fair-faced concrete, which require new wood sheets in
rented formwork, respectively.
In this quarter, we suspended the deferred maintenance of Real Estate and Heavy Construction equipment, and started to do
the maintenance according to the volume of equipment that leaves the deposit, since there is no sign of demand recovery in the
short term.

2Q15 Mills Results

G&A, excluding depreciation and ADD, amounted to R$ 45.5 41million in 2Q15, 6.0% lower qoq, as a result of initiatives to
reduce the Companys costs.
We maintain our focus on reducing expenses, scaling our resources to reflect the new situation of the markets in which we
operate. In 2Q15, we made a new adjustment in our organizational structure, reducing personnel, with a non recurring impact of
R$ 1.8 million in layoff costs, totaling R$ 8.7 million in the last twelve months, and generating annual savings of R$ 6.3 million.
We are analyzing to close the Barra da Tijuca office until the end of 2015, transferring the employees and the companys
headquarters to our operational address in Rio de Janeiro, located in Jacarepagu neighborhood, and continue to centralize
administrative activities, such as procurement, billing, collection, among others, which will bring productive gains and more
control to our business.
ADD amounted to R$ 1.8 million, representing 1.2% of net revenues in 2Q15, versus 12.8% in 1Q15.
The new phase of ongoing investigations did not affect the ADD level in this quarter, since the newly investigated companies
had already been included in the group that, being conservative, we downgraded the credit rating in the fourth quarter of 2014
(4Q14). Our net receivables exposure to these companies totaled R$ 21 million at the end of June 2015, versus R$ 27 million at
the end of March 2015.
Although we continue to adopt a conservative approach for the provisioning of receivables, average payment terms remained
stable on a consolidated basis, which enabled reversals in this quarter. Excluding reversals of R$ 6.8 million from previous
quarters, ADD would reach 5.8% of net revenues in 2Q15.
According to our accounting practices, ADD is reversed with the payment of the due amount or with the payment of the second
parcel of a signed Acknowledgement of Debt. In the latter case, if the client becomes a debtor again, the entire remaining debt
will be recorded as ADD.

EBITDA
Cash generation, as measured by EBITDA, reached R$ 52.1 million in 2Q15, with a 9.9% qoq increase due to lower levels of
ADD in the three business units. The EBITDA margin was 35.3% in 2Q15, versus 28.9% in 1Q15. Excluding ADD related to the
ongoing investigations, EBITDA would total R$ 55.1 million, with EBITDA margin of 37.3%, in 2Q15.
Accumulated EBITDA for the twelve months ended June 30, 2015, LTM EBITDA, totaled R$ 221.9 million. Excluding nonrecurring items, such as Easy Set and slow turnover inventory provisions (R$ 14.5 million), restructuring indemnities (R$ 8.7
million) and ADD related to the effects of ongoing investigations (R$ 21.7 million), LTM EBITDA would be R$ 266.8 million.

Net Earnings
Mills presented a net loss of R$ 8.2 million in 2Q15, versus a R$ 14.5 million loss in 1Q15. The qoq decrease of R$ 16.0 million
in revenues was more than offset by a decrease in ADD (R$ 19.2 million), a better financial result (R$ 2.3 million) and lower
expenses (R$ 1.5 million).
The financial result was a negative R$ 16.1 million in 2Q15, against a negative R$ 18.4 million in 1Q15, due to lower gross debt
qoq.

ROIC
ROIC reached 2.0% in 2Q15, against 4.0% in 1Q15, since the reduction in the operating profit yoy, of R$ 47.8 million, was
higher than its growth qoq, of R$ 5.0 million.

Values above 50 indicate a prospecto f growth of aactivity in the sector for the next six months.
Cyrela, Direcional, Even, Eztech Gafisa, Helbor, MRV, Rodobens, PDG e Tecnisa.
G&A corresponds to the sum of Rental, Heavy Construction and Real Estate business units.

3
4

2Q15 Mills Results

Debt indicators
Mills total debt was R$ 618.2 million as of June 30, 2015. At the end of the quarter our net debt(e) position was R$ 480.2 million,
versus R$ 498.0 million at the end of 1T15.
Our debt is 18% short-term and 82% long-term, with an average maturity of 3.3 years, at an average cost of CDI+0.78%. In
terms of currency, 100% of Mills debt is in Brazilian Reais.
Besides the amortization payments of R$ 90 million, we performed, in 2Q15, a disbursement of R$ 21.8 million as interest on
capital, net of income taxes, related to the 2014 fiscal year. In July, we received the second of four installments of R$ 15.0
million, which amounted to R$ 18.6 million, adjusted by 100% CDI, from the sale of the Industrial Services business unit.
Our leverage, as measured by net debt/LTM EBITDA, was at 2.2x as of June 30, 2015. The total debt/enterprise value(f) was
46.5%, while interest coverage, as measured by LTM EBITDA/LTM interest payments, was 2.8x. Excluding non-recurring items
of the last twelve months, our leverage would drop to 1.8x, this being probably the leverage peak of the year, in accordance with
our forecasts.
The strategy to preserve cash, which includes the suspension of the Companys share buyback program, will continue as long
as the uncertainties in our operating markets remain. Even in a negative scenario, the Company is capable of honoring its
financial obligations. We already paid the relevant amortizations of 2015, without rolling over the debt, with the next installment,
of R$ 90.0 million, due only in April 2016.

Free Cash Flow

Mills presented a free cash flow, measured by operating cash flow minus investments, of R$ 36.6 million in 2Q15, totaling R$
225.6 million in the last twelve months.
Operating cash flow was positively affected by non-cash items (R$ 47.6 million) and by positive change in recoverable taxes
(R$ 6.2 million) and receivables (R$ 5.3 million), partially offset by the payment of interest which totaled R$ 24.5 million.
Mills invested R$ 9.7 million in 2Q15, of which R$ 5.1 million in rental equipment, mainly for the replacement of Real Estate and
Heavy Construction equipment, which suffered losses or damage during the rental period and is reimbursed by clients. We
invested R$ 2.0 million in our branch facilities, related to changes of address and to the Rental business unit geographic
expansion plan, R$ 1.2 million in operating equipment to improve our maintenance activity, and R$ 1.2 million in software
licenses and improvements in our SAP system.
Because of the characteristics of our equipment, the Company is able to maintain low investment levels for a few years, if
necessary, without reducing its operational capacity. In addition, our contracts allow us to charge compensation for loss or
damage of equipment. Therefore, our replacement capex is in line with revenues from indemnities. In the last two years, the
average annual indemnity revenue was R$ 34 million for Real Estate and Heavy Construction business units, in line with our
total 2015 capex, of R$ 33.6 million.
Additionally, we continue with our efforts to sell semi-new equipment, especially in the Rental and Real Estate business units.
Payments related to the sale of semi-new equipment and indemnities related to loss of our equipment during the rental period
positively impacted 2Q15 cash generation by R$ 5.8 million.

Share buyback program

On November 10th, 2014, Mills Board of Directors approved a program to repurchase common shares of Mills issuance, with
the objective of acquiring up to 4,000,000 shares, with a deadline of 365 days as of the date of approval, to be held in treasury
and subsequent cancellation or disposal, including in the context of any exercise of options under its stock option program, in
the case of exercise of options. Up to June 30, 2015, the Company acquired and kept in treasury 2,285,300 shares, shares, with
a total value of R$ 19.8 million, the last acquisition being made in 1Q15. During 2Q15, no shares were acquired, aiming at
preserving cash generation for the Company.
The Board of Directors approved in 2Q15 the sale of 6,878 shares, which were held in treasury, to attend the exercise of stock
options. Currently, Mills holds 2,278,422 shares in treasury.

2Q15 Mills Results

Performance of the business units

Rental
Net revenue from the Rental business unit amounted to R$ 74.5 million in 2Q15, with a reduction of 6.4% qoq and of 24.5% yoy.
Rental revenue reached R$ 65.3 million, with a reduction of R$ 4.0 million, or 5.8%, qoq, with price and mix change responsible
for R$ 3.5 million of the reduction and lower rental volumes for R$ 0.5 million. The utilization rate average for the twelve months
ending June 30, 2015 was 60.6%.
Returns from the Oil and Gas sector, which started in December 2014, continue to contribute to a negative effect in the mix of
equipment rented, as this industry requires the use of larger equipment, generally more expensive, and difficult to relocate to
other industrial sectors.
We continue on the strategy of selling semi-new equipment, mainly exports, which totaled R$ 4.5 million in 2Q15, 16.4% higher
qoq. Our planned sales for semi-new equipment for the second half of the year is R$ 40 million. The sales of semi-new
equipment will occur as we carry out the maintenance needed prior to delivery. We have a semi-new sales goal that will enable
the reduction of our assets, with current value of R$ 808 million in acquisition cost, by 10% in three years.
EBITDA totaled R$ 39.4 million in 2Q15, with an EBITDA margin of 53.0%, positively impacted by an ADD reversal of R$ 4.7
million, which generated a positive net effect of R$ 1.8 million in the quarter, and negatively affected by cost of layoffs of R$ 0.4
million and lower revenues. Excluding the R$ 1.9 million positive effect from the reversal of ADD from clients involved in ongoing
investigations, the EBITDA would reach R$ 37.5 million, with an EBITDA margin of 50.3%.
This quarter we opened two new branches: one at Macei, in the state of Alagoas, and another at Pouso Alegre, in the state of
Minas Gerais, totaling 32 branches in the end of 2Q15.
COGS and G&A, excluding depreciation and ADD, remained stable qoq, since lower sales costs offset higher material and
freight costs, whilst there was a reduction of 7.8% yoy. Operating profit totaled R$ 18.7 million in 2Q15, 37.4% higher qoq,
though 46.2% lower yoy, contributing to a lower ROIC, from 8.8% in 1Q15 to 7.4% in 2Q15.

Heavy Construction
Net revenues from Heavy Construction business unit amounted to R$ 41.8 million in 2Q15, with a reduction of 18.1% qoq, since
revenues from sales, technical assistance and others decreased. Rental revenues totaled R$ 35.6 million in 2Q15, presenting a
slight qoq decrease of R$ 0.8 million, or 2.3%. Lower rented volumes accounted for R$ 0.9 million of the reduction in rental
revenue, partially offset by a positive effect from price and mix of R$ 0.1 million. The utilization rate average for the twelve
months ended June 30, 2015 was 62.4%.
Many construction projects in which we are involved continue to progress at a slow pace, and with no significant impact from the
ongoing investigations of Petrobras. Despite the high level of uncertainty in Brazils infrastructure sector, we have signed new
contracts for relevant construction works starting in 2Q15, such as the So Loureno system and Subway line 6, both in So
Paulo; a modest improvement over a very weak first quarter.
The main projects of 2Q15, in terms of revenue were:

South and Southeastern regions: Olympic Park, subway line 4, Jo Elevated road duplication, and Galeo airport, in
Rio de Janeiro; subway line 5, Gold monorail line, and the North Beltway, in So Paulo; CSN and Gerdau projects, and
the BR-381 highway in Minas Gerais; and the Klabin pulp plant in Paran.

Midwest, North and Northeastern region: Jirau and Colder hydroelectric power plants; Oeste-Leste

and

Transnordestina railroads; transposition of the So Francisco river, BR-163, in Mato Grosso; Salvador subway, in
Bahia; the Companhia Siderrgica do Pecm steel mill, in Cear; Serto channel, in Alagoas; and Vales S11D project,
in Par and Maranho.
EBITDA was R$ 12.5 million in 2Q15, stable qoq. The EBITDA margin was 29.8%, versus 25.3% in 1Q15, as a result of a
decrease in ADD (R$ 2.9 million), which represented 7% of net revenues in 2Q15 versus 17.3% of net revenues in 1Q15.

2Q15 Mills Results

The new phase of ongoing investigations did not bring significant changes for the construction works in progress or in ADD
levels, as explained in the Costs and Expenses section. Excluding the credit downgrade of clients involved in the ongoing
investigations, EBITDA would reach R$ 17.2 million in 2Q15, with an EBITDA margin of 41.1%.
There was a COGS decrease of 11.3% qoq because lower sales and asset write-off costs more than offset higher freight and
material costs, mainly due to construction works abroad and to constructions that use fair-faced concrete, which requires the
use of new wooden sheets in rented formwork. Furthermore, there were costs of layoffs of R$ 0.5 million in 2Q15. G&A
excluding ADD reduced 8.5% qoq.
ROIC totaled 4.3%, against 7.0% in 1Q15, mainly due to the yoy reduction of 87.6% in the operating profit.

Real Estate
Net revenues from Real Estate amounted to R$ 31.6 million in 2Q15, 5% lower qoq and 46.3% lower yoy. Rental revenues
totaled R$ 25 million, 6.2% below qoq, affected by a lower utilization rate, an average of 50.2% in the twelve months ended
June 30, 2015. The lower rented volume was responsible for a qoq decrease of R$ 1.6 million and price and mix for a negative
effect of R$ 0.1 million.
We have recently signed important contracts, such as Naturas building, in So Paulo, as well as the Hospital das Clnicas, a
hospital in Porto Alegre.
Sales totaled R$ 4.6 million in 2Q15, of which R$ 1.7 million were semi-new equipment. We will continue with our efforts to sell
semi-new equipment to minimize the negative effects of the weaker economic cycle in our results. Our target is to reduce by
20% total net assets, currently at R$ 300 million, until 2017.
COGS increased 27.1% qoq, due to higher costs of sales and materials, because of the need of new wooden sheets in
formwork recently rented for construction works that use fair-faced concrete, besides an impact of R$ 1 million from costs with
layoffs. G&A, excluding ADD, decreased 9.8% qoq. ADD amounted R$ 0.8 million in 2Q15, after the reversal of R$ 1 million in
provisions from previous periods.
EBITDA reached R$ 0.2 million in 2Q15, with an EBITDA margin of 0.7%, stable qoq. ROIC was -7.6% versus -3.3% in 1Q15,
mainly due to the yoy reduction of R$ 25.0 million in operating profit.

Teleconference and Webcast

Date: Thursday, August 6, 2015
Time: 10 am (NY time) / 11:00 am (Rio de Janeiro time)/ 3:00 pm (London time)
Teleconference: +1 786 924-6977 (Dial-in) or +1 888 700-0802 (Toll-free); Code: Mills
Replay: +55 11 3193-1012 or +55 11 2820-4012, Code: 9744215# or www.mills.com.br/ri
Webcast: www.mills.com.br/ri

2Q15 Mills Results

Tables
Table 2 Net revenue per type
in R$ million

2Q14

1Q15

2Q15

(C)/(A)

(A)

(B)

(C)

175,7

132,4

125,9

-28,3%

-4,9%

Technical support services

3,0

1,7

1,8

-41,2%

6,1%

Sales

25,8

17,9

12,3

-52,2%

-31,3%

Others

8,4

11,9

7,8

-6,8%

-34,0%

213,0

163,9

147,9

-30,6%

-9,8%

2Q14

1Q15

2Q15

Heavy construction

55.5

26.1%

51.1

31.2%

41.8

28.3%

Real estate

58.8

27.6%

33.2

20.3%

31.6

21.3%

Rental

98.6

46.3%

79.6

48.6%

74.5

50.4%

213.0

100.0%

163.9

100.0%

147.9

100.0%

Rental

Total net revenue

(C)/(B)

Table 3 Net revenue per business unit

in R$ million

Total net revenue

Table 4 Cost of goods and services sold (COGS) and general, administrative and operating expenses (G&A), ex-depreciation
in R$ million

2Q14

1Q15

2Q15

24,1

21,1%

18,1

15,6%

23,0

23,9%

Costs of sale of equipment

14,7

12,9%

10,9

9,3%

8,2

8,6%

Costs of asset write-offs

1,7

1,5%

4,7

4,1%

3,2

3,3%

Equipment storage (h)

10,9

9,6%

13,3

11,4%

14,2

14,8%

COGS

51,5

45,1%

47,1

40,4%

48,5

50,6%

G&A

57,8

50,6%

48,5

41,6%

45,5

47,5%

ADD

4,9

4,3%

21,0

18,0%

1,8

1,9%

114,1

100,0%

116,5

100,0%

95,9

100,0%

Costs of job execution

(g)

Total COGS + G&A

Table 5 EBITDA per business unit and EBITDA margin

in R$ million
Heavy Construction
Real Estate
Rental
Total EBITDA
EBITDA margin (%)

2Q14

1Q15

2Q15

25.6

24.2%

12.9

27.2%

12.5

23.9%

25.2

23.8%

0.1

0.1%

0.2

0.4%

55.1

52.0%

34.4

72.6%

39.4

75.6%

105.9

100.0%

47.4

100.0%

52.1

100.0%

49.7%

28.9%

35.3%

Table 6 Reconciliation of EBITDA

2Q14

1Q15

2Q15

(C)/(A)

(C)/(B)

(A)

(B)

(C)

33.4

-14.5

-8.2

-124.5%

-43.5%

-18.4

-18.4

-16.1

-12.8%

-12.7%

in R$ million

Results of continuing operations

Financial result
Income tax and social contribution expenses
Operational Results before Financial Result
Depreciation
Expenses (revenues) related to the Industrial services former
business unit
EBITDA

2Q15 Mills Results

-5.0

-0.1

-1.1

-77.3%

1096.8%

56.8

4.0

9.0

-84.1%

125.5%

42.1

43.4

43.0

2.3%

-0.8%

7.1

0.1

0.1

-98.2%

36.6%

105.9

47.4

52.1

-50.8%

9.9%

Table 7 Investment per business unit

Actual
in R$ million

2Q14

1Q15

Budget
2Q15

1H15

2015

(A)/(B)

(A)

(B)

Rental equipment
Heavy Construction

11,3

0,5

4,6

5,1

7,0

72,9%

Real Estate

8,9

0,6

0,5

1,1

3,0

38,3%

Rental

28,5

0,0

0,0

0,0

0,0

n.a.

Rental equipment

48,7

1,2

5,1

6,3

10,0

62,9%

Corporate and use goods

6,0

5,2

4,5

9,8

24,0

40,7%

Capex Total

54,7

6,4

9,7

16,1

34,0

47,2%

Table 8 Rental financial indicators

2Q14

1Q15

2Q15

(C)/(A)

(C)/(B)

(A)

(B)

(C)

Rental

84.4

69.3

65.3

-22.7%

-5.8%

Technical support services. sales and others

14.2

10.3

9.2

-35.2%

-10.6%

Total net revenue

98.6

79.6

74.5

-24.5%

-6.4%

COGS. ex-depreciation

23.4

20.6

20.5

-12.1%

0.0%

G&A. ex-depreciation and ADD

16.5

16.2

16.3

-1.4%

0.4%

in R$ million
Net revenue

ADD

3.6

8.3

-1.8

n.a.

n.a.

EBITDA

55.1

34.4

39.4

-28.4%

14.5%

EBITDA margin (%)

55.8%

43.3%

53.0%

ROIC (%)

16.2%

8.8%

7.4%

Capex

29.5

0.7

0.4

-98.8%

-50.3%

Invested Capital

644.0

712.9

698.7

8.5%

-2.0%

Rental net PP&E

561.4

588.2

570.2

1.6%

-3.1%

Others

82.6

124.7

128.5

55.5%

3.0%

20.3

20.9

20.8

2.1%

-0.4%

2Q14

1Q15

2Q15

(C)/(A)

(C)/(B)

(A)

(B)

(C)

45.9

36.5

35.6

-22.3%

-2.3%

Technical support services. sales and others

9.7

14.6

6.2

-36.1%

-57.7%

Total net revenue

55.5

51.1

41.8

-24.7%

-18.1%

COGS. ex-depreciation

13.6

15.0

13.3

-2.0%

-11.3%

G&A. ex-depreciation and ADD

15.5

14.3

13.1

-15.1%

-8.5%

ADD

0.9

8.8

2.9

234.7%

-66.7%

-51.4%

-3.6%

-60.0%

797.9%

Depreciation
Table 9 Heavy Construction financial indicators

in R$ million
Net revenue
Rental

EBITDA

25.6

12.9

12.5

EBITDA margin (%)

46.2%

25.3%

29.8%

ROIC (%)

16.3%

7.0%

4.3%

Capex

11.5

0.5

4.6

Invested Capital

319.4

352.4

349.0

9.3%

-1.0%

Rental net PP&E

245.1

248.8

243.4

-0.7%

-2.2%

Others

74.3

103.6

105.6

42.2%

1.9%

10.0

10.6

10.5

5.0%

-0.2%

Depreciation

2Q15 Mills Results

Table 10 Real Estate financial indicators

2Q14

1Q15

2Q15

(C)/(A)

(C)/(B)

(A)

(B)

(C)

Rental

45.5

26.7

25.0

-45.0%

-6.2%

Technical support services. sales and others

13.4

6.6

6.6

-50.8%

-0.2%

Total net revenue

58.8

33.2

31.6

-46.3%

-5.0%

COGS. ex-depreciation

14.6

11.5

14.7

0.5%

27.1%

G&A. ex-depreciation and ADD

18.7

17.6

15.9

-15.1%

-9.8%

ADD

0.3

4.0

0.8

131.4%

-81.1%

EBITDA

25.2

0.1

0.2

-99.1%

244.4%

EBITDA margin (%)

42.8%

0.2%

0.7%

ROIC (%)

6.5%

-3.3%

-7.6%

9.4

0.7

0.5

-94.6%

-30.8%

490.3

448.6

425.5

-13.2%

-5.1%

Rental net PP&E

336.3

307.0

296.2

-11.9%

-3.5%

Others

154.0

141.6

129.3

-16.0%

-8.7%

11.7

11.9

11.7

0.2%

-1.9%

in R$ million
Net revenue

Capex
Invested Capital

Depreciation
Table 11 ROIC Analysis

Heavy
Construction

Real Estate

Rental

Mills

-272 pbs

-390 pbs

-157 pbs

-201 pbs

11 pbs

-8 pbs

23 pbs

8 pbs

ROIC variation (qoq)

Operational income after taxes
Rental net PP&E
Others
Total

-4 pbs

-9 pbs

-5 pbs

2 pbs

-267 pbs

-429 pbs

-143 pbs

-196 pbs

-1158 pbs

-1309 pbs

-822 pbs

-1015 pbs

9 pbs

58 pbs

-22 pbs

26 pbs

ROIC variation (yoy)

Operational income after taxes
Rental net PP&E
Others

-146 pbs

34 pbs

-108 pbs

-57 pbs

Total

-1199 pbs

-1409 pbs

-885 pbs

-1021 pbs

2Q15 Mills Results

Glossary
(a) EBITDA EBITDA is a non-accounting measurement which we prepare and which is reconciled with our financial statement
in accordance with CVM Instruction 01/2007, when applicable. We have calculated our EBITDA (usually defined as earnings
before interest, tax, depreciation and amortization) as net earnings before financial results, the effect of depreciation of
assets and equipment used for rental, and the amortization of intangible assets. EBITDA is not a measure recognized under
BR GAAP, IFRS or US GAAP. It is not significantly standardized and cannot be compared to measurements with similar
names provided by other companies. We have reported EBITDA because we use it to measure our performance. EBITDA
should not be considered in isolation or as a substitute for "net income" or "operating income" as indicators of operational
performance or cash flow, or for the measurement of liquidity or debt repayment capacity.
(b) ROIC - (Return on Invested Capital) - Calculated as Operating Income before financial results and after the payment of
income tax and social contribution (theoretical 30% income tax rate) on this income, divided by average Invested Capital, as
defined below. ROIC is not a measure recognized under BR GAAP, and it is not significantly standardized and cannot be
compared to measurements with similar names provided by other companies.
ROIC LTM: ((Net earnings in the last twelve months (30% IR) + (firms remuneration in which possess minority
shareholding)/ (Average Invested Capital in the last thirteen months))
Annual ROIC: (Annual Operational Income (30% Income Tax Rate) + remuneration from affiliates) / Average Invested
Capital of the last thirteen months
(c) Capex (Capital Expenditure) Acquisition of goods and intangibles for permanent assets.
(d) Net cash flow - Net cash generated by operating activities minus net cash used in investing activities.
(e) Net Debt Gross debt less cash holdings.
(f) Enterprise value (EV) Company value at the end of the period. It is calculated by multiplying the number of outstanding
shares by the closing price per share, and adding the net debt.
(g) Job execution costs Job execution costs include: (a) labor costs from construction jobs supervision and technical
assistance; (b) labor costs for erection and dismantling of the equipment rented to our clients, when such tasks are carried
out by the Mills workforce; (b) equipment freight costs, when under Mills responsibility; (d) cost of materials used in the
maintenance of the equipment, when it is returned to our warehouse; and (e) cost of equipment rented from third-parties.
(h) Warehouse costs Warehouse costs includes expenses directly related to the warehouse management, storage, repair
and maintenance of equipment to be rented and to be sold, including labor costs, PPEs used in the warehouse activities
(handling, storage and maintenance), materials needed (forklift fuel, gases for welding, plywood, paints, timber battens,
among others) and machines and equipment maintenance (forklifts, welding machines, water-blasting hoists and tools in
general).
(i) Invested Capital For the Company, invested capital is defined as the sum of its own capital (net equity or shareholders
equity) and capital from third parties (total loans and other liabilities that carry interest, from banks or not), both being
average capital from the beginning to the end of the period considered. By business segment, it is the average of the capital
invested by the company weighted by the average assets of each business segment (net liquid assets plus PPE Property,
Plant and Equipment). The quarter asset base is calculated as the average of the asset base of the last four months and the
annual asset base is calculated as the average of the last thirteen months.

2Q15 Mills Results

10

INCOME STATEMENT
in R$ million

2Q14

1Q15

2Q15

Net revenue from sales and services

213.0

163.9

147.9

Cost of products sold and services rendered

(89.9)

(86.1)

(87.1)

Gross profit

123.0

77.8

60.8

(66.3)

(73.8)

(51.8)

Operating profit

56.8

4.0

9.0

Financial expense

(25.9)

(26.1)

(23.0)

Financial income

7.5

7.7

6.9

Financial result

(18.4)

(18.4)

(16.1)

Profit before taxation

38.4

(14.4)

(7.1)

Income tax and social contribution expenses

(5.0)

(0.1)

(1.1)

Net income (Loss)

33.4

(14.5)

(8.2)

128.026

128.058

128.058

0.26

(0.11)

(0.06)

Other operational revenues

General and administrative expenses

Number of shares at the end of the period (in thousands)

Net income (R$ per shares)

2Q15 Mills Results

11

Balance Sheet
in R$ million
Assets

2Q14

1Q15

2Q15

Current Assets
Cash and cash equivalents
Trade receivables
Inventories
Recoverable taxes
Advances to suppliers
Other receivables- Sale of investee
Other current assets

93.7
199.1
37.8
32.6
0.3
16.5
8.0

214.0
126.4
19.9
28.6
0.1
18.0
6.6

138.0
121.1
21.4
29.8
0.2
18.5
7.5

Total Current Assets

388.2

413.7

336.6

Non-Current Assets
Trade receivables
Recoverable taxes
Deferred taxes
Deposits in court
Other trade receivables
Other Assets

1.3
41.6
10.4
10.3
49.6
-

1.2
26.8
27.1
10.9
35.9
-

22.1
23.7
11.4
37.0
1,1

113.1

101.9

95.2

87.4
1.265.5
75.0

87.4
1.154.4
76.5

87.4
1.113.3
76.3

1.427.9

1.318.4

1.277.0

Total Non-Current Assets

1.541.1

1.420.3

1.372.3

Total Assets

1.929.2

1.833.9

1.708.9

Investment
Property. plant and equipment
Intangible assets

2Q15 Mills Results

12

in R$ million

2Q14

1Q15

2Q15

Current Liabilities
Suppliers
Borrowings and financings
Debentures
Salaries and payroll charges
Income tax and social contribution
Tax refinancing program (REFIS)
Taxes payable
Profit sharing payable
Dividends and interest on equity payable
Derivative financial instruments
Other current liabilities

29.1
45.4
107.1
24.3
2.7
1.0
8.6
1.7
21.8
5.2
5.1

14.9
3.2
114.3
20.0
1.0
2.9
21.8
1.2

11.1
3.2
107.8
21.7
1.1
2.9
0.0
0.0
0.2

Total Current Liabilities

252.0

179.4

148.1

Non-Current Liabilities
Borrowings and financings
Debentures
Provision for tax. civil and labor risks
Tax refinancing program (REFIS)

16.5
572.1
11.6
9.3

14.3
580.3
12.4
9.0

13.5
493.7
12.0
8.9

Total Non-Current Liabilities

609.5

616.0

528.1

Total Liabilities

861.5

795.3

676.2

563.1
447.9
14.9
(0.2)
42.2

563.3
487.0
2.5
0.2
(14.5)

563.3
487.0
4.8
0.2
(22.7)

Total Stockholders' Equity

1.067.7

1.038.6

1.032.7

Total Liabilities and Stockholders' Equity

1.929.2

1.833.9

1.708.9

Liabilities

Stockholders' Equity
Capital
Earnings reserves
Capital reserves
Valuation adjustments to equity
Retained earnings

2Q15 Mills Results

13

Cash Flow
in R$ million

2Q14

1Q15

2Q15

38,4

(14,4)

(7,1)

Cash flow from operating activities

Net income before taxation

Adjustments
Depreciation and amortization

42,1

43,4

43,0

Provision for tax, civil and labor risks

0,6

(0,5)

(0,0)

Accrued expenses on stock options

2,5

2,5

2,2

Profit sharing payable

1,2

(11,4)

(14,4)

(0,2)

Interest, monetary and exchange rate variation on loans, contingencies and deposits in court

18,9

22,9

19,7

Allowance for doubtful debts

4,9

21,0

1,8

1,9

0,8

58,8

76,8

67,3

Trade receivables

(11,5)

4,3

2,1

Inventories

(1,2)

0,0

(2,3)

Gain on sale of property, plant and equipment and intangible assets

Others

Changes in assets and liabilities

Recoverable taxes

8,4

7,2

6,2

Deposits in court

0,2

(0,4)

(0,6)

Other assets

1,7

(1,0)

(0,0)

Suppliers

1,5

(1,7)

(3,7)

Salaries and payroll charges

0,7

0,6

1,7

Taxes payable

4,0

(1,1)

0,0

Other liabilities

1,4

0,2

(1,1)

5,1

8,2

2,2

Cash from operations

102,3

70,6

62,4

Lawsuits settled

(0,4)

(0,0)

(0,8)

Interest paid

(20,2)

(15,0)

(24,5)

Income tax and social contribution paid

(13,4)

(6,3)

68,3

49,3

37,2

Net cash generated by operating activities

Cash flow from investment activities
Purchases of property, plant and equipment and intangible assets

(82,5)

(6,4)

(6,4)

Proceeds from sale of property, plant and equipment and intangible assets

13,8

27,5

5,8

Proceeds from sale of SI business unit

11,3

(57,4)

21,1

(0,6)

Net cash proceeded from (applied on) investment activities

Cash flow from financing activities
Capital contributions
Shares in treasury

8,2

(8,8)

0,0

Dividends and interest on capital invested paid

(41,0)

(21,8)

Repayment of borrowings

(292,8)

(41,2)

(90,8)

Borrowings/Debentures raised

400,0

Net cash generated by (used in) financing activities

74,4

(50,0)

(112,5)

Increase (decrease) in cash and cash equivalents

85,3

20,4

(76,0)

Cash and cash equivalents at the beginning of the period

8,5

193,7

214,0

Cash and cash equivalents at the end of the period

93,7

214,0

138,0

2Q15 Mills Results

14

This press release may include declarations about Mills expectations regarding future events or results. All declarations based upon future expectations. rather than
historical facts. are subject to various risks and uncertainties. Mills cannot guarantee that such declarations will prove to be correct. These risks and uncertainties
include factors related to the following: the Brazilian economy. capital markets. infrastructure. real estate and oil & gas sectors. among others. and government rules
that are subject to change without previous notice. To obtain further information on factors that may give rise to results different from those forecasted by Mills.
please consult the reports filed with the Brazilian Comisso de Valores Mobilirios (CVM. equivalent to U.S. SEC).

2Q15 Mills Results

15