Altri SGPS — Annual Report 2013

Apr 29, 2014

DIRECTORS' REPORT

December, 31 2013

INTRODUCTION 3
MACROECONOMIC BACKGROUND 5
STOCK EXCHANGE EVOLUTION 6
GROUP'S ACTIVITY 8
CORPORATE RESPONSIBILITY AND SUSTAINABILITY 12
FINANCIAL ANALYSIS 14
ACTIVITY DEVELOPED BY NON-EXECUTIVE MEMBERS OF THE BOARD OF DIRECTORS 17
PROPOSAL OF THE BOARD OF DIRECTORS FOR APPROPRIATION OF THE NON – CONSOLIDATION NET PROFIT FOR THE YEAR AND DISTRIBUTION OF RESERVES 18
2014 OUTLOOK 19
CORPORATE GOVERNANCE 20
LEGAL MATTERS 50
STATEMENT UNDER THE TERMS OF ARTICLE 245, PARAGRAPH 1, C) OF THE SECURITIES CODE……… 52
DECLARATION OF RESPONSABILITY 52
CLOSING REMARKS 52
APPENDIX 1……………………………………………………………………………………………………………………. 53

To the Shareholders

Pursuant to the legal and statutory requirements, the Board of Directors of Altri, S.G.P.S., S.A. hereby presents its Director's Report for the year 2013. According to number 6 of article 508 - C of the Portuguese Companies Act, the Board of Directors decided to submit a single Board of Directors' Report, fulfilling all legal requirements.

INTRODUCTION

Altri was incorporated as of March 2005, as a result of the demerger of Cofina. Altri is a reference European producer of bleached eucalyptus pulp and is a listed company included in NYSE Euronext Lisbon, integrating the PSI 20 (Portuguese Stock Index), the benchmark stock market index. In addition to pulp production, the company is also present in the sector of renewable energy based on forest resources, namely industrial cogeneration from black liquor and biomass. The forestry strategy is based on full use of all the components provided by the forest: pulp, black liquor and forest wastes.

Over the past years, Altri invested in Portugal about 470 million euro, mainly on Celbi and Celtejo unities. Currently, Altri owns three pulp mills in Portugal with a total capacity above 970,000 tonnes/year of bleached eucalyptus pulp in 2013. There is an ongoing process of small investments, to increase production capacity of Celbi and Caima, whose completion is expected to occur in between the end of 2014 and beginning of 2015. Caima, after the completion of the conversion project to dissolving pulp will produce 105 thousand tons. On the other hand, Celbi will have an installed capacity exceeding 700 thousand tons of bleached pulp type BEKP.

Currently, Altri manages over 84 thousand hectares of forest in Portugal. The company obtained certification from the Forest Stewardship Council® (FSC®)1 and Programme for the Endorsement of Forest Certification (PEFC), two of the most worldwide acknowledged certification entities.

Altri's industrial strategy implementation is based on integrated forest management in Portugal. This model is based on forest optimization, ensuring a full recovery of all its components. Thus, the eucalyptus is processed in Altri mills, producing pulp and power (cogeneration). The bark, the branches and forest waste are used to produce electric energy from biomass.

Until June 2008, Altri had another industrial activity through F.Ramada, which was devoted to retail steel and development of industrial solutions for storage systems. In June 2008 took place the demerger of F. Ramada. The strategic rational of this operation lies in focusing Altri exclusively on its core business: forest management and production of pulp.

Since the beginning of its activity Altri carried out various acquisitions (Celtejo in 2005 and in 2006 Celbi) that allowed Altri to reinforce its position in its operating markets through the development of a set capacity increase projects.

For a better valuation of forest resources, Altri acquired in 2005, 50% of EDP Produção - Bioeléctrica, S.A., in a jointventure with EDP to produce electricity from forest biomass. This company is leader in its market segment with a share of 50% of licenses to produce electricity through forest biomass.

¹ FSC-C004615

Altri's organic structure is as follows:

MACROECONOMIC BACKGROUND

During 2013, the global economy continued to face high levels of uncertainty and the economic recovery occurred only in certain regions. In particular, the Eurozone continued to suffer the impact of lack of dynamism in economic activity, especially felt in the countries of southern Europe, since the additional policies and tax measures had strong consequences on the level of private consumption, especially in the category of durable products. In the northern countries of Europe there was a different environment, having begun to show some signs of the much desired recovery.

According to the latest estimates from leading institutions for 2013, real growth of GDP should have been situated at -0.4 % in 2013 (-0.7% in 2012) for Eurozone, reflecting a slowdown of recession that characterized the last years. Projections for 2014 already reflect a scenario of reversal, with projected growth of +1% assuming more modest contributions of the economies of southern Europe, which will have a longer path to recovery. The weight of the debt crisis, both public and private, continues to constrain the political and financial options (in the way of austerity), necessarily impacting the levels of domestic demand. In this scenario, exports are expected to take a leading role in the effort to recover the economies of the Eurozone. Uncertainties related to the performance of the Eurozone, in particular with regard to the sustainability of reforms and the governance model in place, remain dormant and extremely critical in any projection model. In the Eurozone, inflation is expected to remain at low levels throughout 2014 (about 1.5% according to the IMF's Autumn World Economic Outlook) and the average unemployment should be around 12% (according to the same source) reflecting very different realities by country and rates ranging from 5% to 27%.

The deleveraging process of the banking sector is set to continue in the up coming years involving the maintenance of restrictions on access to credit. Levels of interbank interest rates are at historically low levels, not foreseeing that there is a reversal of this trend in the short term. Achieving a gradual recovery may cause slight shortening of the gap of the lending interest rates of banks compared to the reference rate (currently at 0.25%).

The performance of the Portuguese economy in 2013 necessarily reflects the impact of implementation of the measures in the economic and financial adjustment program (EFAP). As more recent estimates included in the Winter Bulletin of the Bank of Portugal, GDP showed a decline of 1.4% in 2013, compared to a decrease of 3.2% in 2012, which envisaged a recovery to positive territory in 2014 (+0.8%).

Like the Eurozone, the projected performance of the Portuguese economy is based on a fall in domestic demand (- 2.7% in 2013 versus -6.9% in 2012) partially offset by an increase in net exports (1.1% in 2013 and 3.7% in 2012). In the last quarter of 2013 it will have already occurred over the same period of last year, a homologous increase of around 1.6% with a positive contribution of domestic demand, a situation that didn't occur since the 4th quarter of 2010. In cumulative terms, the decline in domestic demand in the 2009-2013 period will have been around 17 percent. Inflation should be of 0.5% in 2013 (2.8% in 2012), and the unemployment rate should have remained high, closing the year at 15.3% (16.5% in 2012).

Projections for 2014 point to a recovery in economic growth, though tenuous, of about 0.8% of GDP - continuing the trend of the last quarters of 2013 (+0.3% variation in chain in the 3rd quarter and +0.5% in the 4th quarter).

STOCK EXCHANGE EVOLUTION

(Note: in order to enable a better comparison of the stock fluctuations, the PSI 20 index has been considered as being equal in value to the opening price of the shares in question.)

The year 2013 was marked by a strong performance of stock exchange markets but without a linear trend. The Portuguese market grew by about 16%, but this positive evolution was obtained in the second half of the year once the index until July had a negative performance.

Altri's shares exceeded the index, recording an increase of 41% but with greater focus from September onwards.

Altri's share price closed 2013 at 2.24 Euro per share. The market capitalization at the end of 2013 was about 459 million Euro.

During 2013, Altri's shares were traded at a maximum price of 2.617 Euro per share and the minimum of 1.588 Euro per share. In total, 103 million Altri shares were traded in 2013, equivalent to 50% of the issued capital.

The main events that marked the evolution of the Company's shares during 2013 may be described chronologically as follows:

Stock exchange evolution

• On 7 March, the Group announced its financial performance for the year 2012, standing consolidated net profit of 52 million Euro. The consolidated total revenues amounted to 543 million Euro, representing an increase of 11.6% over 2011. Consolidated EBITDA amounted to 143.1 million Euro, recording a growth of 26.5% over the previous year. At that date, shares closed quoting at 1.862 Euro per share;
• In a statement made on 18 April 2013, Altri informed the market about the resolutions of the General Meeting held on that date whereas it was approved, among others, the proposed distribution of dividends corresponding to 0.025 Euro per share;
• On April 23, 2013, the Company informed the market that the dividends for the year 2012 would be paid from May 17 onwards;
• Through an announcement made on May 8, the Group announced results for the first quarter of 2013. The consolidated total revenues during this period reached a record 145 million Euro, which represents an increase of about 18% over the same period of 2012. EBITDA amounted to 36.3 million Euro, which means an increase of about 27% over the first quarter of 2012;
• On August 1, Altri announced to the market the result of the 1st half of 2013 presenting EBITDA of 75 million Euro, which represents an increase of 13% over the same period of 2012. EBITDA margin reached 25.5% and the operating profit (EBIT) was about 48 million Euro, the margin was 16.2%. The net profit of Altri reached about 30.3 million Euro;
• On 29 October the 3rd quarter results were released. The Group achieved a record volume of sales in that period. EBITDA achieved in the first nine months of 2013 totalled 112 million Euro, which represents an increase of 4.5% over the same period of 2012 and net profit reached 43.1 million Euro.

GROUP'S ACTIVITY

With its genesis in the reorganization process of Cofina with the purpose of setting into a separate holding the industrial operations, Altri held until 1 June 2008 the investments in the paper, pulp, steel and storage systems. On that date the business of steel and storage systems was demerged to a separate holding. This reorganization was part of a focusing and business transparency strategy, aiming at giving greater visibility to each area and increasing market's perception of value.

The main participations where Altri holds the majority of capital are indirectly hold, and are as follows:

• Caima Indústria de Celulose (Constância), producer and distributor of paper pulp;
• Celbi Celulose da Beira Industrial, S.A. (Figueira da Foz), producer and distributor of paper pulp;
• Celtejo Empresa de Celulose do Tejo, S.A. (Vila Velha de Ródão), producer and distributor of paper pulp;
• Altri Florestal (Constância), manager of the Group's forestry resources.

Moreover, in order to fulfil its energetic needs and expand its activity in a strategic sector, the Group holds a participation of 50% of the share capital of EDP Bioeléctrica.

Location of the industrial units of the Group Location of the centrals of energy production

Altri's complete structure of participation as of 31 December 2013 is as follows:

Pulp Market

According to Pulp and Paper Products Council (PPPC), in 2013, total demand for hardwood pulp increased by 5.4% (reached 28.8 million tons), highlighting the type produced by eucalyptus, which registered an increase of 15.3%, compared to 2012. At the end of 2013 the share of eucalyptus market in comparison with all bleached pulps (softwood and hardwood) increased 140 basis points reaching 35.4% in 2013 (34% in 2012).

The consumption of hardwood pulp, in 2013, increase by 1.5 million tons over the previous year. In geographical terms, China consumed more 1.3 million tons in 2013 than in 2012, which represents an increase of 19%, higher than the weighted average annual growth since 2000.

In the 4th quarter of 2013, the BEKP price, in USD, was categorized by a decrease of 3% compared to previous quarter. However, when converted to euro, the decrease was much more pronounced, reaching 6%. Thereby, the average market price was 770 USD/ton, in the 4th quarter of 2013 (vs 795 USD/ton in the 3rd quarter of 2013), while in EUR it reached 566 EUR/ton (vs 602 EUR/ton in the 3rd quarter of 2013).

Market price evolution in BEKP pulp in Europe since 1990 until the end of 2013 (EUR)

Source: Hawkins Wright

In 2013 Altri reached, again, a new record of production and sales of pulp. Thus, during this year Altri's three mills produced 973 thousand tons of pulp.

Evolution of pulp production between 2012 and 2013 by mill (thousands tons)

The main Altri mill, Celbi, produced 667 thousand tons of pulp (+7%); Celtejo produced 218 thousand tons (+13%) and Caima produced 89 thousand tons (-2%). The decrease recorded in Caima's production is related to the conversion to dissolving pulp. It is expected that the project ends in 2014/2015, increasing the level of capacity of the industrial unit to 105 thousand tons.

In terms of pulp sales, 964 thousand tons were sold, more 4.5% of pulp sales compared to 2012 (922 thousand tons).

Evolution of sales between 2012 and 2013 by mill (thousands tons)

Pulp sales by region and detail by use

Pulp revenues reached 473.4 million euro (+4.5%), approximately 83% of Altri's total revenues.

In 2013, Altri exported 907 thousand tons of pulp, which represents an increase of 7% compared to 2012, being the Western Europe the main destination, representing 80% of sales, approximately 735 thousand tons.

In terms of pulp use, tissue paper producers are Altri's main clients, with a share of 46% (40% in last year).

CORPORATE RESPONSIBILITY AND SUSTAINABILITY

Altri believes that the welfare of its stakeholders, including society in general, their customers, their suppliers, their employees and their shareholders, depends on the continued success of the company and on its commitment to sustainable development.

Altri is responsible to continuously improve its environmental and social performance looking for a continued increase in return of capital from its shareholders.

Environment: renewable raw materials from sustainably managed forests are the base for the production of Altri's pulp in Portugal, which manages a large area of certified forest, and all the wood produced in these areas is to supply its mills.

Altri is self-sufficient in electricity, using cogeneration systems where it is made a combined production of thermal energy and electrical power for industrial use. The excess of electricity is placed in the national network. Investment in new technologies and investing in best practices in energy efficiency have enabled to produce almost all its energy by the burning of biofuels.

It has taken a lot of efforts in optimizing the balance of electric power in Altri's mills, reflecting the importance of energy for the Group. Also, the water consumption has declined over the years.

The emission of some liquid pollutants also reduced significantly, showing the Group's commitment to continuous improvement of its environmental performance.

The other indicators of eco-efficiency and environmental performance in the areas of water, air, waste and natural resources, have remained stable and in line with the best available techniques defined for the sector of pulp and paper reflected in the environmental certifications of the three mills of Altri.

Altri is also a member of BCSD (Business Council for Sustainable Development) and of WBCSD (World Business Council for Sustainable Development).

Certification of Management Systems: All industrial units of Altri have its management systems certified in accordance with the requirements of ISO 9001, ISO 14001 and OHSAS 18001 and have their laboratories certified by ISO / IEC 17025. Celbi and Celtejo have implemented energy management systems, certified according to ISO 50001. Celbi and Caima are also registered under EMAS, a Community Eco-management and Audit System of the European Union. Celtejo has its system of Research, Development and Innovation certified by the Norm NP 4457.

The responsibility's chains of wood supply are also certified by international standards of forest management (FSC® – Forest Stewardship Council®2 and PEFC - Programme for the Endorsement of Forest Certification Schemes), which demonstrates the commitment established in the supply policy of Altri to check the origin of the wood along the supply chain.

Human Resources: Investing in developing the skills of senior staff, the Group began in 2013 a training program which will run until 2015, with the goal of consolidating knowledge in areas of communication, management and leadership techniques. This challenge is partnered with Porto Business School.

Social Responsibility: In its relationship with society, Altri streamlines the economy of the areas in which it operates, particularly in the creation of direct and indirect employment. It also has a policy of granting internships, whether professional or as a complement to the school curriculum, which allow young people the opportunity to have contact with a business reality.

In partnership with several local institutions, Altri tries to develop and support initiatives and activities essential to the creation of relevant relationships with the surrounding community. Through donations and logistical support, the Group seeks to identify and support projects with merit and impact on the population's quality of living.

² FSC-C004615

FINANCIAL REVIEW

The consolidated financial information of Altri was prepared in accordance with the International Financial Reporting Standards (IFRS) as adopted by the European Union.

The key data and indicators of consolidated activity of Altri Group can be summarized as follows:

Thousand euros	2012	2013	2013/2012 Var%
Sales	522.314	550.432	5%
Services rendered	7.793	8.638	11%
Other income	12.720	13.500	6%
Total Revenues	542.827	572.571	5,5%
Cost of sales	208.834	240.344	15%
External supplies and service	144.558	151.341	5%
Payroll expenses	31.488	27.376	-13%
Provisions and impairment losses	4.544	-25	-
Other expenses	10.353	12.134	17%
Total expenses (a)	399.777	431.170	7,9%
EBITDA (b)	143.050	141.400	-1,2%
Margin	26,4%	24,7%	-1,7 pp
Amortisation and Depreciation	48.862	49.236	0,8%
Other indirect taxes	0	3.423	-
EBIT (c)	94.188	88.742	-5,8%
Margin	17,4%	15,5%	-1,7 pp
Gains and losses in associated companies	2.302	2.305	0,1%
Financial expenses	-39.905	-30.986	-22,4%
Financial income	4.281	5.223	22,0%
Financial profit	-33.322	-23.458	-29,6%
Earnings before taxes	60.866	65.283	7,3%
Income tax	-8.661	-9.917	14,5%
Minority interest	23	18	-20,2%
Net income attributable to parent company's shareholders	52.182	55.348	6,1%

(a) operating costs excluding amortisation, financial expenses and income tax

(b) EBITDA = Earnings before interests, taxes, depreciation and amortisation

(c) EBIT = Earnings before interests and taxes

Altri's total revenues reached 572.6 million euro in 2013, which represents an increase about 5.5% compared to 2012. This increase in sales, associated to a dynamic management of debt and short-term lines, led to a net profit of approximately 55 million Euro, an increase of 6% compared to 2012.

Excluding depreciation, financial costs and taxes, total costs in 2013 reached approximately 431 million euro, a 8% increase compared to 2012. This increase is related to a production growth and to the increase of prices of some production factors, in particular, the wood price which recorded an increase higher than inflation.

Payroll costs recorded a decrease of 13%, reflecting operating efficiency measures that have been taken during the year. At the end of the year Altri had 643 employees.

EBITDA reached approximately 141 million Euro, a 1.2% decrease compared to 2012 and EBITDA margin of 2013 reached 24.7% (-1.7 p.p.). EBIT recorded a decrease of 5%, compared to 2012, reaching 89.4 million euro.

Altri's net profit reached 55.3 million Euro, having recorded a growth of 6.1% over the previous year.

The origin of the net profit growth was the decrease in net financial loss of 30%, which moved from a net financial loss of about 33 million Euro in 2012 to a net financial loss of 23 million Euro in 2013.

Key balance sheet indicators

thousand euro	2012	2013	Var%
Biological assets	108.034,8	107.123,0	-1%
Tangible assets	424.105,2	390.512,5	-8%
Goodw ill	265.531,4	265.531,4	0%
Investments avaiable for sale	14.981,9	14.656,9	-2%
Others	41.153,4	43.534,6	6%
Total non current assets	853.806,6	821.358,4	-4%
Inventories	47.440,3	54.829,3	16%
Customers	94.859,4	80.294,6	-15%
Cash and cash equivalents	112.392,5	232.450,5	107%
Others	19.861,2	32.445,0	63%
Total current assets	274.553,4	400.019,4	46%
Total assets	1.128.360,0	1.221.377,8	8%
Shareholder's equity and minority interests	183.926,9	241.809,8	31%
Bank loans	103.556,9	74.212,5	-28%
Other loans	454.999,1	439.370,3	-3%
Reimbursable subsidies	22.770,2	11.228,4	-51%
Others	41.092,2	55.809,3	36%
Total non current liabilities	622.418,4	580.620,5	-7%
Bank loans	45.467,2	81.943,4	80%
Other current loans	139.404,0	210.469,6	51%
Reimbursable subsidies	11.694,6	71,0	-99%
Suppliers	56.343,4	60.034,6	7%
Others	69.105,5	46.429,0	-33%
Total current liabilities	322.014,7	398.947,5	24%

In 2013, total net investment (CAPEX) was 16.1 million Euro.

Altri's nominal remunerated debt net of cash and investments available for sale as of 31 December 2013 reached 563.2 million Euro corresponding to a decrease of 56.5 million Euro compared to 2012 (619.7 million Euro). It should be highlighted that, in 2013, the company paid 5.1 million Euro of dividends related to 2012.

Financial needs are fully assured, the Group holds 232 million euro in cash and cash equivalents, in 31 December 2013.

In 2014, Altri completed the refinancing of is bonds "Celbi 2015" amounting to 300 million Euros, through 4 medium and long term loans. These loans were granted by domestic banks and have weighted average maturity in 2018.

The weighted average cost of net debt amounted, during 2013, to 4.5%. It should, however, be noted that the marginal costs of current financing programs record spreads below 4%.

ACTIVITY DEVELOPED BY THE NON-EXECUTIVE MEMBERS OF THE BOARD OF DIRECTORS

During 2013, the non-executive directors of the Company have developed regularly and effectively their functions which consist in monitoring and evaluating the activities of the executive directors.

During 2013, the non-executive directors regularly and actively attended the Board of Directors meetings, discussing the matters under consideration and expressing their respective opinions on the Group's strategic guidelines. Whenever necessary, they maintained a close contact with the financial and operational key staff of the group companies. In the year 2013, and during the Board of Directors' meetings, the executive members provided all the information required by the remaining members of the Board of Directors.

PROPOSAL OF THE BOARD OF DIRECTORS FOR APPROPRIATION OF THE NON CONSOLIDATED NET PROFIT FOR THE YEAR AND DISTRIBUTION OF RESERVES

Altri, S.G.P.S., S.A., as holding company of the Group, recorded in its individual financial statements prepared in accordance with International Financial Reporting Standards as adopted by the European Union, free reserves of 24,642,370.20 Euro and negative retained earnings of 11,976,754.92 Euro, for which, in accordance with the applicable legislation and the Company's articles of association, the Board of Directors proposes to General Shareholders Meeting, its offset against those free reserves.

Additionally Altri, S.G.P.S., S.A. recorded in its individual financial statements prepared in accordance with International Financial Reporting Standards as adopted by the European Union, a net profit of 10,843,235.78 Euro, for which, in accordance with the applicable legislation and the Company's articles of association, the Board of Directors proposes to General Shareholders Meeting the following application:

Legal reserve
Free reserves
Dividends distribution

2014 OUTLOOK

At the economic level, the year 2014 should be characterized by a slight recovery in Europe and a stronger improvement in the United States. However, recent economic indicators raise some doubts about the performance of the Chinese economy. Moreover, the evolution of the exchange rate of the EUR/USD has followed a pattern opposite to that expected by most market analysts, i.e.,what actually occurred in the last months of 2013 and early 2014 was a deepening the devaluation of the U.S. dollar against the Euro. Thus it is very difficult to anticipate a trend for the evolution of the U.S. dollar.

Concerning the global pulp market, 2014 will be a year of new capacities coming from Latin America. In the recent past, net capacity additions were easily absorbed by increased demand, in particular by growth of chinese demand.

Regarding Altri, the company is developing a number of projects aimed at enhancing operational efficiency, which include variable cost reductions, particularly in terms of specific consumption of wood, chemicals, water and electricity. The company also has an ongoing project to convert Caima mill, which aims to transform this mill into a specialties producer. The completion of both projects is scheduled for the year 2015.

The Board of Directors is convinced that Altri is developing a correct strategy based on strengthening the operational efficiency and simultaneously diversifying sources of revenue for segments with higher added value and which enable a change in the value chain. Thus, to compete comfortably in the commodities market, and in an adverse exchange rate context, the company must place a great emphasis on reducing operating costs, and on the other hand, the development of a strategy based on the production of higher value added products aims to provide Altri with additional sources of growth.

CORPORATE GOVERNANCE

PART I – INFORMATION ON SHAREHOLDER AND ORGANIZATION STRUCTURE AND CORPORATE GOVERNANCE

A. SHAREHOLDER STRUCTURE

I. CAPITAL STRUCTURE

1. The capital structure

On 31 December 2013, the Company's share capital was fully subscribed and paid up and was made up of 205,131,672 shares with a nominal value of 12.5 Euro cents each, all entitled to dividends.

2. Restrictions on the transfer and ownership of shares

Altri's shares have no restrictions on their transfer or on their ownership.

3. Own shares

Pursuant to the purposes of the article 66 of the Portuguese Companies Act, the Directors inform that as of 31 December 2013 Altri had no treasury own shares and did not acquire or sold own shares during 2013.

1. Important agreements to which the company is a party and that come into effect, amend or terminated in cases such as a change in the control of the company after a takeover bid, and the respective effects

There are no significant agreements concluded by Altri or its subsidiaries that include any clauses of control change (including after a takeover bid), that is, which come into effect, be amended or terminated, well as their effects. There are also no specific conditions that limit the exercise of voting rights by shareholders of the Company or other matters that may interfere with the success of takeover bids.

5. System that is subject to the renewal or withdrawal of countermeasures, particularly those that provide for a restriction on the number of votes capable of being held or exercised by only one shareholder individually or together with other shareholders

Altri didn't adopt any countermeasures.

6. Shareholders' agreements that the company is aware of and that may result in restrictions on the transfer of securities or voting rights

As far as Altri is aware there are no agreements regarding the exercise of voting rights or the transfer of shares and does not exist, to the best of its' knowledge, any agreement to ensure or frustrate the success of takeover bids.

II. Shareholdings and Bonds held

7. Qualifying holdings

As of 31 December 2013 pursuant to the requirements of articles 16 and 20 of the Securities Code ("Código de Valores Mobiliários") and article 448 of the Portuguese Companies Act, the Company informs that, in accordance with the notifications received, the companies and/or individuals that hold qualifying holdings exceeding 2%, 5%, 10%, 20%, 33% and 50% of the voting rights, are as follows:

Exceeding 2% of the voting rights	Shares held	Direct % of the voting rights
LIVREFLUXO – SGPS, S.A. (a)	8,664,064	4.22%
Lazard Frères Gestion SAS (b)	4,157,000	2.03%
Norges Bank	4,149,572	2.02%

(a) The 8,664,064 shares of Altri SGPS, S.A held by LIVREFLUXO – SGPS, S.A., are attributable to Domingos José Vieira Matos, its director and dominant shareholder.

(b) The 4,157,000 shares are held by SICAV OBJECTIF EURO SMALL CAPS. Having SICAV delegated the exercise of voting rights in Lazard Frères Gestion SAS, this participation is considered attributable to Lazard Frères Gestion SAS.

Exceeding 5% of the voting rights	Shares held	Direct % of the voting rights
Domingos José Vieira de Matos (a)	13,939,432	6.80%
Pedro Miguel Matos Borges de Oliveira	10,930,000	5.33%
Bestinver Gestión S.A., SGIIC	10,269,347	5.01%

(a) It is also attributable to Domingos José Vieira de Matos, 8,664,064 shares of Altri SGPS, S.A held by LIVREFLUXO – SGPS, S.A., of which he is director and dominant shareholder. Thus, in legal terms, are considered attributable to Domingos José Vieira de Matos a total of 22,603,496 shares, representing 11.02% of the capital and voting rights of Altri SGPS, S.A.

		Direct % of the
Exceeding 10% of the voting rights	Shares held	voting rights
Caderno Azul, SGPS, S.A. (a)	29,000,000	14.14%
Paulo Jorge dos Santos Fernandes (b)	21,643,168	10.55%

• (a) 29.000.000 shares represent Altri SGPS, S.A total shares held by the company Caderno Azul SGPS, S.A., of which João Manuel Matos Borges de Oliveira is director and shareholder.
• (b) It is also attributable to Paulo Jorge dos Santos Fernandes, 2,400,000 shares of Altri SGPS, S.A held by ACTIUM CAPITAL – SGPS, S.A., of which he is director and dominant shareholder. Thus, in legal terms, are considered attributable to Paulo Jorge dos Santos Fernandes a total of 24,043,168 shares, representing 11.72% of the capital and voting rights of Altri SGPS, S.A.

		Direct % of the
Exceeding 15% of the voting rights	Shares held	voting rights
PROMENDO – SGPS, S.A.	30,837,782	15.03%

Altri was not informed of any participation exceeding 20% of the voting rights.

8. Number of shares and bonds held by members of the management and supervisory boards, under the terms of 447/5 of the Portuguese Companies Act

Pursuant to and for the requirements of article 447 of the Portuguese Companies Act the Company hereby states that on December 31, 2013, the directors of the Company held the following shares:

Paulo Jorge dos Santos Fernandes (a)	24,043,168
Pedro Macedo Pinto de Mendonça	1,705,000
Domingos José Vieira de Matos (b)	22,603,496
João Manuel Matos Borges de Oliveira (c)	29,000,000
Laurentina da Silva Martins	0

• (a) Are also considered attributable to Paulo Jorge dos Santos Fernandes, apart from the 21,643,168 shares of Altri, SGPS, SA, held on an individual basis, 2,400,000 shares of Altri, SGPS, SA held by "ACTIUM CAPITAL – SGPS, SA" of which he is the dominant shareholder and director. Therefore, in legal terms, are considered attributable to Paulo Jorge dos Santos Fernando a total of 24,043,168 shares, representing 11.72% of capital and voting rights of Altri, SGPS, SA
• (b) Are also considered attributable to Domingos José Vieira de Matos in addition to the 13,939,432 shares of Altri, SGPS, SA held on an individual basis, 8,664,064 shares of Altri SGPS, S.A held by LIVREFLUXO – SGPS, S.A., of which he is director and dominant shareholder. Thus, in legal terms, are considered attributable to Domingos José Vieira de Matos a total of 22,603,496 shares, representing 11.02% of the capital and voting rights of Altri SGPS, S.A.
• (c) The 29.000.000 shares represent Altri SGPS, S.A. total shares held by the company Caderno Azul SGPS, S.A., of which João Manuel Matos Borges de Oliveira is director and shareholder.

As of December 31, 2013, the Statutory Auditor, the members of the Supervisory Board and the members of the Board of the General Shareholders' Meeting held no shares of Altri.

9. Special powers of the Board of Directors, especially as regards resolutions on the capital increase

Altri's articles of association assign to the Board of Directors powers to manage and represent the Company and carry out all operations related to its corporate purpose including, among others, the possibility to decide, with the prior opinion of the supervisory board of the company, capital increases, by one or more occasions, up to 35 million Euro in cash.

10. Significant business relationships between the holders of qualifying holdings and the company

There were no businesses or significant transactions between the Company and holders of qualifying holdings except those that, as part of normal operations, were performed in normal market conditions for similar transactions. The amounts involved are immaterial.

B. CORPORATE BOARDS AND COMMITTEES

I. GENERAL MEETING

a) Composition of the Presiding Board of the General Meeting

11. Details and position of the members of the Presiding Board of the General Meeting and respective term of office

The Shareholders' General Meeting Chairman is Pedro Nuno Fernandes de Sá Pessanha da Costa and the Secretary is Fernando Eugénio Cerqueira Magro Ferreira. The current Altri's Shareholders' General Meeting members were elected on May 26, 2011 for the period 2011/2013.

b) Exercising the right to vote

12. Restrictions on voting rights

The General Meeting is composed by all shareholders with voting right, corresponding one vote to each share.

There aren't articles of association which restrict voting rights or which enable voting rights over a certain number not to be counted, when issued by a shareholder individually or together with other related shareholders.

Individual shareholders with voting rights and companies who are shareholders of the Company may be represented by the person designated for that purpose. The representation should be communicated to the Chairman of the General Meeting, in writing, until the end of the third working day prior to the day scheduled for the meeting. The Company makes available at its headquarters and at its site, before the date of each General Meeting, a draft of the appropriate power of attorney form.

A shareholder may appoint different representatives for the shares owned in different securities accounts, without prejudice to the principle of unity of vote and of vote in different directions allowed to shareholders acting as professionals.

Shareholders can exercise voting rights via postal voting on all matters subject to the General Meeting. According to the articles of association, the declaration of intention to cast postal votes and the supporting document proving the quality of shareholder must be delivered in the Company's headquarters, until the end of the third working day prior to the day scheduled for the meeting, with identification of the sender, addressed to the Chairman of the General Shareholders' Meeting. It isn't provided the possibility to exercise voting rights by electronic means.

1. maximum percentage of voting rights that may be exercised by a single shareholder or by shareholders that are in any relationship as set out in Article 20/1

The General Meeting is composed by all shareholders with voting right, corresponding one vote to each share.

There aren't articles of association which envisage the existence of shares that do not confer voting rights or which enable voting rights over a certain number not to be counted, when issued by a single shareholder or together with other related shareholders.

14. Shareholders' resolutions that, imposed by the articles of association, may only be taken with a qualified majority

Altri's articles of association do not include quorum for convening or deciding greater than the ones established by law.

II. MANAGEMENT AND SUPERVISION

a) Composition

15. Identification of corporate governance model adopted

The structure of the Company's Corporate Governance is based on the reinforced Latin model and is composed by the Board of Directors, Supervisory Board and Statutory Auditor, all appointed by the Shareholders' General Meeting.

16. Articles of association rules on the procedural requirements governing the appointment and replacement of members of the Board of Directors, the Executive Board and the General and Supervisory Board, where applicable

The Members of the Board of Directors of the Company are appointed by the Shareholders' General Meeting for a three years mandate and may be re-elected once or more.

The Board is made up by three to nine members, shareholders or not, appointed by the Shareholders' General Meeting. At the General Shareholders' Meeting elections, 1 (one), 2 (two) or 3 (three) Directors shall be elected individually among the candidates proposed on the lists endorsed by groups of shareholders, depending on whether the total number of Directors is 3 (three) or 4 (four), 5 (five) or 6 (six), 7 or more than 7 (seven), provided that none of the said groups own shares representing over 20 % (twenty per cent) or less than 10 % (ten per cent) of the share capital . Each of the referred lists shall propose at least 2 (two) candidates eligible for each one of the available posts, one of them being nominated as substitute. No shareholder may endorse more than 1 (one) of the mentioned lists.

The General Shareholders' Meeting may not proceed to the election of any further Directors until 1 (one), 2 (two) or 3 (three) have been elected, as per the dispositions above, unless the above mentioned lists have not been presented. In the case of there being no elected Director, his/her respective substitute shall be called. In the case of there being no substitute, a new election shall be called, in which the dispositions above shall be applied with the necessary adaptations.

17. Composition of the Board of Directors

The Board of Directors is composed by three to nine members, shareholders or not, elected by the Shareholder's General Meeting. Company's Board of Directors' Members are elected by Shareholder's General Meeting for three years mandates' and can be re-elected once or more.

The Board of Directors is currently made up of 5 members who are responsible for carrying out all the management functions to implement the operations inherent to its corporate goals, acting in the best interests of the Company, its shareholders and other stakeholders. On December 31, 2013 this corporate board was composed of the following members:

• Paulo Jorge dos Santos Fernandes President
• João Manuel Matos Borges de Oliveira Member
• Domingos José Vieira de Matos Member
• Laurentina da Silva Martins Member
• Pedro Macedo Pinto de Mendonça Member

All Board of Directors members were appointed by the Shareholder's General Meeting held in May 26, 2011 for the period 2011/13.

Name	First appointment	End of mandate
Paulo Jorge dos Santos Fernandes	March 2005	31 December 2013
João Manuel Matos Borges de Oliveira	March 2005	31 December 2013
Domingos José Vieira de Matos	March 2005	31 December 2013
Pedro Macedo Pinto de Mendonça	March 2005	31 December 2013
Laurentina da Silva Martins	March 2009	31 December 2013

18. Distinction to be drawn between executive and non-executive directors and, as regards non-executive members, details of members that may be considered independent

As of December 31, 2013, the Board of Directors included two non-executive members: Pedro Macedo Mendonça Pinto da Silva Martins and Laurentina da Silva Martins.

The Board Directors does not include any member that satisfies the standard of independence referred in recommendation II.1.7 of Corporate Governance Code issued by the Portuguese Securities Regulator (CMVM) since the non-executive director Pedro Mendonça is relative of holders of qualifying holdings and the non-executive director Laurentina Martins was employee of the subsidiary Caima – Indústria de Celulose, S.A.

To allow to the non-executive directors an independent and informed decision, the Company has the following mechanisms:

• Notices of meetings of the Board of Directors sent to all directors include the agenda, even tentatively, of the meeting, and are accompanied by all the relevant information and documentation; and
• The non executive directors have wide powers to obtain information on any aspect of the Company, to examine its books, records, documents and other antecedents of the Company's operations. They can request relevant information directly to the directors and to the financial and operating senior staff of all group companies, without requiring any intervention of the executive directors in this process.

Additionally, it is Company's practice the presence of non-executive directors in the meetings of the Board.

The Director's report includes in its chapter "Activity developed by the non-executive members of the Board," a description of the activity of the non-executive director during 2013.

Given the Corporate model adopted, the composition of the governing boards and the way they operate, namely the independence of the Supervisory Board and of the Statutory Auditor, without the existence of any delegation of powers, the Group believes that the appointment of independent directors would not bring significant gains for the proper functioning of the adopted corporate governance model which has been deemed appropriate and efficient.

1. Professional qualifications and other relevant curricular information of each member of the Board of Directors

The qualifications, experience and positions held in other Companies by the members of the Board of Directors are presented in Appendix I.

20. Customary and meaningful family, professional or business relationships of members of the Board of Directors with shareholders that are assigned qualifying holdings that are greater than 2% of the voting rights

The director José Domingos Vieira de Matos is director and dominant shareholder of LIVREFLUXO - SGPS, SA which owns 4.22 % of the share capital of Altri, SGPS, SA.

The director João Manuel Matos Borges de Oliveira is director and shareholder of CADERNO AZUL - SGPS, SA, which owns 14.14% of the share capital of Altri, SGPS, SA. In addition, that director is brother of Pedro Miguel Matos Borges de Oliveira, holder of a qualifying holding of 5.33 % of the share capital of Altri, SGPS, SA.

The company Promendo SGPS, SA, holder of 15.03 % of the share capital of Altri, SGPS, SA has as its director and dominant shareholder Ana Rebelo de Carvalho Menéres Mendonça, daughter of the director Pedro Macedo Pinto Mendonça.

21. Organisational charts or flowcharts concerning the allocation of powers between the various corporate boards, committees and/or departments within the company, including information on delegating powers, particularly as regards the delegation of the company's daily management

The Board of Directors, appointed in the Shareholders' General Meeting, develops its functions of management and coordination of the Group companies on a collective basis and is currently made up of a president and four members, two of them being non-executive.

The Board has been exercising its activity in constant dialogue with the Supervisory Board and the Statutory Auditor, providing the assistance requested with transparency and rigor, complying their regulations and best practices of corporate governance.

There is no limit to the maximum number of positions that the Board members can accumulate as directors of other companies. The members of Altri's Board of Directors are part of the management of the most significant group companies, so as to enable their activities to be more closely monitored.

In what refers to of internal control, operating companies of Altri Group have management control boards that are active at all levels, preparing monthly reports to each Board of Directors.

The distribution of functions among the several members of the Board of Directors may be presented as follows:

Generically, Altri SGPS directors focus their activities in managing the Group's holdings and defining its strategic development guidelines. The strategic decisions are adopted by the Board including all its members, executives and non-executives, in the normal accomplishment of their duties.

The daily management of each operating company is a responsibility of its Board of Directors, which includes some of Altri's directors but also some other members with defined functions.

Thus, taking into consideration the activities developed by the Board Members, both in Altri SGPS and in the several group companies, the functional organisational chart can be presented as follows:

b) Functioning

22. Availability and place where rules on the functioning of the Board of Directors may be viewed

The Board of Directors and the Supervisory Board approved their regulations, which are available on the website of Altri.

23. The number of meetings held and the attendance report for each member of the Board of Directors

The Company's Board of Directors meets regularly and the Boards of Directors of subsidiaries of which Altri's directors are also part meet as often as necessary to the proper monitoring of its operations. Additionally, the Board of Directors meets periodically with the Supervisory Board providing them the necessary support, including for the preparation of their annual report on the supervision of the Company and its opinion on the directors' report and on the Board of Directors' proposals.

The meetings of the Board are scheduled and prepared in advance, and timely documentation relating to the matters contained in its agenda is provided, to ensure all members of the Board the conditions for the informed exercise of their functions. Similarly, minutes of meetings, once approved, and the respective notices of meeting are forwarded to the President of the Supervisory Board.

The Board of Directors meets regularly, and their decisions are only valid if the majority of members is present. During 2013 the Board of Directors met 14 times being the corresponding minutes recorded in the minute book of the Board of Directors.

24. Details of competent corporate boards undertaking the performance appraisal of executive directors

The performance assessment of executive directors belongs to the Remuneration Committee and is based on the functions performed by them in Altri and in group companies as well as their responsibility and added value and the experience and knowledge accumulated on the job.

25. Predefined criteria for assessing executive directors' performance

The remuneration of executive members of the Board of Directors includes a variable component of medium term (2011 to 2013) computed based on total shareholders' return, on the sum of net profit for that period and on the evolution in the Company's business.

26. Availability of each member of the Board of Directors and details of the positions held at the same time in other companies within and outside the group, and other relevant activities undertaken by members of these boards throughout the financial year

The professional activity of the current members of Altri's Board of Directors, with reference to other companies where they have directors' functions and other relevant activities undertaken are presented in Appendix I. The members of Board of Directors showed availability in the exercise of their functions being present and participating in all meetings of the Board. All members of the Board attended all the meetings.

c) Committees within the Board of Directors

27. Details of the committees created within the Board of Directors and the place where the rules on the functioning thereof is available

The Board of Directors believes that the only committee required to meet the essential needs of the Company, considering its size, is the Remuneration Committee.

Altri, SGPS, SA has set a Remuneration Committee for the period 2011/2013, which composition is as follows:

• Pedro Nuno Fernandes de Sá Pessanha da Costa President
• João da Silva Natária Member
• Fernando Eugénio Cerqueira Magro Ferreira Member

The Company is currently in the revision of the rules of the Board of Directors which will also include the regulation establishing the functioning of the Remuneration Committee.

28. Composition, if applicable, of the executive board and/or identification of board delegates

Altri did not appoint any executive committee of the Board of Directors; the decisions regarding strategic matters are adopted by the Board of Directors as a collegial board made up of all its members, executives and non-executives in the normal prosecution of their duties.

29. Description of the powers of each of the committees established and a summary of activities undertaken in exercising said powers

The Board of Directors believes that the only specialized committee indispensable to satisfy the needs of the Company, considering its dimension, is the Remuneration Committee.

According with the articles of association the governing boards' members will have the remuneration fixed by the Remuneration Committee and approved in the Shareholders' General Meeting.

The performance assessment of executive directors belongs to the Remuneration Committee and is based on the functions performed by them in Altri and in the Group as well as the responsibility and the added value by each one of the directors and the accumulated experience and knowledge on their functions.

The members of the Board of Directors are not remunerated by Altri, SGPS, SA, but directly by the subsidiaries where they have functions, so that the actual powers of the Remuneration Committee also focus on setting the remunerations of the company's Board of Directors members paid by other group companies.

III. SUPERVISIONS

a) Composition

30. Details of the Supervisory Board representing the model adopted

The structure of the Company's Corporate Governance is based on the reinforced Latin model and is composed by the Board of Directors, Supervisory Board and Statutory Auditor, appointed by the Shareholders' General Meeting.

31. Composition of the Supervisory Board with details of the articles of association's minimum and maximum number of members, duration of term of office, number of effective members, date of first appointment, date of end of the term of office for each member

The Supervisory Board is appointed by the Shareholders' General Meeting, composed of three members and one or two substitutes, responsible for the supervision of the company and the appointment of the Statutory Auditor. In the period 2011/2013 this corporate board was composed by the following members:

• João da Silva Natária President
• Cristina Isabel Linhares Fernandes Member
• Manuel Tiago Alves Baldaque Marinho Fernandes Member
• Jacinto da Costa Vilarinho Substitute

The Supervisory Board members were apointed for the first time in March 2007 for the remainder period of triennium 2005/2007. Currently, Supervisory Board members are completing their third mandate corresponding to the period 2011/2013, for which they were elected in May 2011.

32. Details of the members of the Supervisory Board which are considered to be independent pursuant to Article 414/5 of Portuguese Companies Act

As a collective board, the assessment of independence of the Supervisory Board is made to all those who compose it, given the application of the number 6 of Article 414 of the Portuguese Companies Act, considering independence in accordance with the definition that is given by number 5 of article 414 and incompatibility according to definition of the number 1 of article 414-A, both of the Portuguese Companies Act. All members that compose the Supervisory Board comply the rules of incompatibility and independence identified above.

33. Professional qualifications of each member of the Supervisory Board and other important curricular information

As regards the skills to exercise these functions, all members have appropriate skills to fulfil their duties and the chairman is adequately supported by the other members of the Supervisory Board. Appendix I presents the qualifications and professional activities of the members of the Supervisory Board.

b) Functioning

34. Availability and place where the rules on the functioning of the Supervisory Board may be viewed

The Supervisory Board rules of functioning are available for consultation on the website of Altri (www.altri.pt).

35. Number of meetings held and the attendance report for each member of the Supervisory Board

During 2013 the Supervisory Board of the Company met 4 times, and the corresponding minutes are recorded in the minutes' book of the Supervisory Board.

36. The availability of each member of the Supervisory Board indicating the positions held simultaneously in other companies inside and outside the group, and other relevant activities undertaken by members of this Board throughout the financial year

The members of Supervisory Board showed availability in the exercise of their duties attending and participating in all meetings of the Board. The information regarding other undertaken positions, qualifications and professional experience of the Supervisory Board members are detailed on Appendix I.

c) Powers and duties

37. Description of the procedures and criteria applicable to the supervisory body for the purposes of hiring additional services from the external auditor.

The Supervisory Board analyses and approves the nature of other additional services evaluating if the independence of the External Auditor is ensured.

The Supervisory Board, exercising its functions, carries out an annual evaluation of independence of the External Auditor, particularly regarding non-audit services. Additionally, the Supervisory Board receives, annually, the declaration of independence of the auditor where are described the services rendered by it and by other entities of the same network, their fees, possible threats to their independence and safeguard measures. All threats to the independence of the Auditor are evaluated and discussed with him as well as the respective safeguard measures.

The Board of Directors, at the request of the projects assigned to the group companies' auditors, ensures, before its adjudication, that no services are contracted to them or to their network that, in accordance with the recommendation of the European Commission no. C (2002) 1873 of 16 May, would threaten their independence.

38. Other duties of the supervisory board

The supervision of the Company is assigned to the Supervisory Board and to the Statutory Auditor.

The Supervisory Board also represents the company next to the External Auditor and Statutory Auditor and is responsible for proposing the provider for these services, their remuneration and to ensure that they are guaranteed, within the group, suitable conditions for them to provide their services. The Supervisory Board, together with the Board of Directors, is the first recipient of the reports issued by the External Auditor as well as the group's representative in the relationship with that entity.

The Supervisory Board is responsible for preparing an annual report on its activity and for giving an opinion on the annual report and proposals presented by the Board of Directors as well as monitor the effectiveness of risk management and internal control.

The Board of Directors, together with the Supervisory Board, regularly reviews and oversees the preparation and disclosure of financial information in order to prevent access, improper and untimely of third parties to relevant information.

Additionally, the Supervisory Board issues an opinion on transactions between the directors of Altri and the company or between Altri and companies in a group or domain relationship with the one in which the interested part is director, regardless of the amount, under article 397 of Portuguese Companies Act.

The External Auditor, within the annual audit, analyses the functioning of the internal control mechanisms and reports deficiencies identified; verifies that the key elements of internal control systems and risk management implemented in the company in relation to the process of financial reporting are presented and disclosed in the annual Corporate Governance Report and issues a legal certification of accounts and audit report, which certifies whether that report disclosed about the structure and practices of corporate governance includes the elements referred to in Article 245 - A of Securities Code.

During 2013, the Statutory Auditor monitored the development of company's activity and carried out the tests and inspections deemed necessary to the review and legal certification of the accounts, in interaction with the Supervisory Board and with full cooperation of the Board of Directors.

In addition, the Statutory Auditor pronounced itself on the work it developed in 2013 in its annual audit report subject to the assessment of the Shareholders' Annual General Meeting.

IV. STATUTORY AUDITOR

39. Details of the statutory auditor and the partner that represents same

The Statutory Auditor of the Company for the period 2011/2013 is Deloitte & Associados, SROC, S.A., represented by António Manuel Martins Amaral.

40. Number of years that the statutory auditor consecutively carries out duties with the company and/or group.

Deloitte & Associados, SROC, S.A., represented by Antonio Manuel Martins Amaral since 2007, is responsible for the functions of the Statutory Auditor since 2005.

41. Description of other services that the statutory auditor provides to the company

The Statutory Auditor is simultaneous the External Auditor of Company as detailed in sections below.

V. EXTERNAL AUDITOR

42. Details of the external auditor appointed in accordance with Article 8 and the partner that represents same in carrying out these duties, and the respective registration number at the CMVM

The External Auditor of Company is Deloitte & Associados, SROC, S.A. appointed for the effect of article 8 of CVM registered under the number 231 in the Portuguese Securities Regulator (CMVM), represented by António Manuel Martins Amaral.

43. State the number of years that the external auditor and respective partner that represents same in carrying out these duties consecutively carries out duties with the company and/or group

The External Auditor was appointed for the first time in 2005 and it is in its third mandate, being represented by its partner António Manuel Martins Amaral since 2007.

44. Rotation policy and schedule of the external auditor and the respective partner that represents said auditor in carrying out such duties

As regards the period of rotation of the External Auditor, Altri has not set a fixed policy of rotation of the External Auditor. The Company adopted in 2007 the current model of governance of companies in which the Statutory Auditor is not part of the Supervisory Board. According to this model, the election for each mandate of Statutory Auditor / External Auditor is made in the Shareholders General Meeting upon the proposal of the Supervisory Board. Additionally, the Supervisory Board undertakes an annual assessment of the work of the External Auditor verifying if the provisions of Article 54 of Decree-Law No. 487/99 of 16 November (amended by Decree-Law No. 224/2008, of 20 November), concerning the rotation of the partner responsible to execute the work are fulfilled.

45. Details of the Board responsible for assessing the external auditor and the regular intervals when said assessment is carried out

The Supervisory Board, in the fulfillment of its functions, annually assesses the External Auditor independence-Additionally, the Supervisory Board promotes whenever necessary or appropriate in light of developments in the Company's business or the evolution of the market, a reflection on the adequacy of the External Auditor to carry out its duties.

46. Details of services, other than auditing, carried out by the external auditor for the company and/or companies in a control relationship and an indication of the internal procedures for approving the recruitment of such services and a statement on the reasons for said recruitment

Other services rendered by External Auditor in 2013 include, essentially, services connected with validation of applications to governmental subsidies and with the revision of fiscal documentation processes.

The other services and other audit reliability services are provided by different teams of those involved in the audit process, so it enhances auditor's independence.

The Supervisory Board has reviewed and approved the scope of those services and concluded that they did not threaten the independence of the External Auditor. In this particular aspect, the hiring of Deloitte proved to be the most appropriate due to its solid experience and expertise in the field of taxation and fiscal incentives. Moreover, the actions of Deloitte are often articulated with technicians and experts independent from its network, namely consultants.

In 2013, the fees charged by Deloitte to Altri's Group represented less than 1% of the total annual turnover of Deloitte in Portugal. The quality system of the External Auditor controls and monitors the potential risk of loss of independence or conflicts of interest with Altri.

1. Details of the annual remuneration paid by the company and/or legal entities in a control or group relationship to the auditor and other natural or legal persons pertaining to the same network and the percentage breakdown relating to the following services:

Company		2013	%	2012	%
	Audit and statutory audit (€)	1,000	0.2%	1,000	0.2%
	Other assurance services (€)	‐	0.0%	‐	0.0%
	Tax consulting services (€)	‐	0.0%	‐	0.0%
	Other services (€)	‐	0.0%	‐	0.0%
Group companie
	Audit and statutory audit (€)	266,147	43.4%	279,925	55.8%
	Other assurance services (€)	163,493	26.7%	102,891	20.5%
	Tax consulting services (€)	27,075	4.4%	‐	0.0%
	Other services (€)	155,467	25.4%	118,117	23.5%
Total
	Audit and statutory audit (€)	267,147	43.6%	280,925	56.0%
	Other assurance services (€)	163,493	26.7%	102,891	20.5%
	Subtotal assurance services	430,640	70.2%	383,816	76.5%
	Tax consulting services (€)	27,075	4.4%	‐	0.0%
	Other services (€)	155,467	25.4%	118,117	23.5%
		613,182	100.00%	501,933	100.00%

C. INTERNAL ORGANISATION

I. ARTICLES OF ASSOCIATION

48. Rules governing amendment to the articles of association

There are no statutory rules relating to amendment of the articles of association. It is applied, in this matter, the framework established under the Portuguese Companies Act.

II. REPORTING OF IRREGULARITIES

49. Reporting means and policy on the reporting of irregularities in the company

Altri has a conduct code that governs the ethical principles common to the whole Group. This code is applied to all Group employees, including its management boards, and it was widely distributed. The guiding principles of that document are integrity, responsibility and confidence.

In first place, workers must report to their hierarchy any suspicion or evidence of violation of the conduct code. The Chairman of the Board of Directors is responsible for enforcing the code in all Group units.

The defined mechanisms for reporting irregularities ensure confidentiality of the communications made and, as well as, the anonymity of the persons, who report irregularities.

III. INTERNAL CONTROL AND RISK MANAGEMENT

50. Individuals, boards or committees responsible for the internal audit and/or implementation of the internal control systems

Altri has no autonomous internal audit services and compliance. Risk management is ensured by the several Altri's operating units based on a preliminary identification and prioritization of critical risks, by developing risk management strategies in order to implement control procedures considered appropriate to reduce the risk to an acceptable level.

51. Detail of hierarchical and/or functional dependency in relation to other boards or committees of the company

This is not applicable because the Group has not autonomous services of internal audit and/or autonomous services responsible for the implementation of systems for internal control.

52. Other functional areas responsible for risk control

Risk management is ensured by various Altri's operating units. The methodology of risk management includes several steps:

• First, internal and external risks that may materially affect the Groups' strategic objectives are identified and prioritized;
• The operational management of the various business units identify risk factors and events that may affect the operations and activities of Altri, as well as any procedures and control mechanisms;
• Additionally, the impact and the probability of occurrence of each risk factor are weighted and according to the exposure level, the need to respond to the risk is evaluated; and
• The risk mitigation actions are monitored and the level of exposure to critical factors is constantly monitored.

The Board of Directors is responsible for the definition of the Group's general strategic policies, being fully supported by the management teams of subsidiaries to ensure an effective risk control.

The Board of Directors decides the level of exposure assumed by the group in its various activities and, without prejudice the delegation of tasks and responsibilities, sets overall limits of risk and ensures that policies and procedures for risk management are followed.

In the monitoring of the risk management process the Board of Directors as a board responsible for Altri's strategy, has the following objectives and responsibilities:

• Be aware of the most significant risks affecting the group;
• Ensure the existence within the Group, of appropriate levels of knowledge of the risks affecting the operations and how to manage them;
• Ensure the disclosure of the risk management strategy at all levels of hierarchy;
• Ensure that the Group is able to minimize the likelihood and impact of risks in the business; and
• Ensure that the risk management process is adequate and that it maintains a close monitoring of those risks with higher probability of occurrence and higher impact in the group´s operations.

The subsidiaries manage their own risks, within the established criteria and delegations set by the board of Directors.

53. Details and description of the major economic, financial and legal risks to which the company is exposed in pursuing its business activity

The Board of Directors considers that the Group is exposed to the normal risks associated with its operations, namely in its operating units. Therefore, the main risks considered by the Group are:

Credit risk

Like any activity involving a commercial component, the Group's exposure to credit risk is attributable mainly to the accounts receivable resulting from the Group's operating activity.

This risk is monitored and controlled through a system for collecting financial and qualitative information, provided by entities that provide credible risk information, which allows customers to evaluate the feasibility of the fulfilment of their obligations, in order to minimize the risk associated with granting credit.

Credit risk evaluation is done in a regular basis, by analysing the current economic conjuncture conditions, in particular the credit situation of each company and, when necessary, adopting the corrective measures.

Credit risk is mitigated by the management of risk concentration of customer and by careful selection of counterparties and the credit insurance contracts with specialized institutions and covering a significant portion of credit granted.

Market risk

Interest rate risk

Considering the Group's debt, possible variations on the interest rate may have an unwanted impact on the results. Therefore, the Group adopts a balanced position between the cost of the debt and its exposure to the interest rate variability. When the reasonable risk is exceeded, the Group engages interest rate swaps in order to reduce its exposure to risk and to restrict the potential volatility of results.

The Group's exposure to interest rates arises primarily from long-term loans which consist mostly of debt indexed to Euribor.

Exchange rate risk

Due to the great volume of transactions with non-resident entities and with different currencies, exchange rate instability might have a relevant impact on the Group's performance. Therefore, whenever the Group considers necessary to reduce the volatility of its results, the position is covered by contracting derivative instruments to reduce the volatility of its results.

Commodities price variability risk

By developing its activity in a sector of commodities (paper pulp), the Group is particularly exposed to its price fluctuations, with the correspondent impacts in their results. However, being in these sectors allows the access to paper pulp price fluctuations hedging contracts in amounts considered adequate for the foreseen operations, reducing the volatility of group's results.

Liquidity risk

Liquidity risk can occur if the sources of financing, such as operating cash flows, cash flows of disinvestment, credit lines and cash flows from financing do not meet the financing needs, such as outputs cash for operating and financing activities, investment, shareholders returns and debt repayment.

The main objective of the liquidity risk management policy is to ensure that the Group is available at all times, the financial resources needed to meet its responsibilities and pursue the strategies outlined by honouring all commitments made to third parties when they become due, through proper management of the maturity of funding.

The Group adopts an active strategy of refinancing focused on maintaining a high level of immediately available funds to meet short term needs and the extension or maintenance of debt maturity in accordance with the forecasted cash flows and the capacity of leveraging of the balance sheet.

Regulation risk

The Company is subject to national and activity laws and rules of the market where it works, which aim to ensure: the security and protection of clients and of environment, employees´ rights and the maintenance of an open and competitive market. Thus, Altri is naturally exposed to the risk of regulatory changes, which may affect the way the business is managed and, consequently, harm or prevent the achievement of strategic goals.

The Company's attitude is of permanent cooperation with the authorities regarding the respect and observance of the law.

Forest risk

Altri, through its subsidiary Altri Forestal, has the management of a forest asset amounting to 84,000 hectares, of which 79% is eucalyptus. The forest is certified by FSC®3 (Forest Stewardship Council®) and PEFC (Programme for the Endorsement of Forest Certification), entities that establish the principles and criteria for which is evaluated the sustainability of the forest's management in economic, environmental and social terms.

In this context, all forestry activity is directed towards the optimization of available resources while preserving the environmental stability and ecological values present in its assets and ensuring its development.

The risks associated with any forestry activity are also present in Altri Forestal management. Forest fires, pests and diseases that can occur in forests spread through the country are the biggest risks threatening this sector. These threats, if they occur, depending on their intensity, affect the normal function of the forest's exploration and the production's efficiency.

In order to prevent and reduce the impact of forest fires, Altri Florestal participates, together with Portucel Soporcel group, in a company called AFOCELCA that has the goal of providing, coordinating and managing the resources available for fire-fighting. At the same time, large investments are made to clean forest areas in order to reduce the risk of spread of the fires as well as reduce losses.

Regarding pests and diseases, its arising can reduce significantly the growth of the forest productivity causing irreversible damages. For combating these problems integrated fight procedures were established by releasing specific parasitoids from Australia and through the use of phytopharmaceuticals products to control populations of harmful insects and reduce the negative effects of its presence. On the other hand, in the most affected areas, Altri Forestal is using genetic material more suitable for new plantations which, by its characteristics, allows more resistance to these pests and diseases.

54. Description of the procedure for identification, assessment, monitoring, control and risk management

The Board of Directors identifies as essential the implementation of a system that allows to:

• Identify the risks that the Group faces;

• Measure the impact on financial performance and the value of the Group;
• Compare the value in risk with the costs of hedging instruments, if available;
• Monitor developments in the identified risks and the hedging instruments.

³ FSC-C004615

The risk management strategies adopted are intended to ensure that:

• Systems and control procedures and policies in place allow an appropriate response to the expectations of the management boards, shareholders and other stakeholders;
• Systems and control procedures and policies are established in accordance with all applicable laws and regulations;
• The financial and operational information is complete, reliable, safe and reported on a regular and timely manner;
• Altri resources are used efficiently and rationally; and
• The shareholder value is maximized and operational management takes the necessary measures to correct problems reported.

The methodology of risk management includes several steps:

• First, internal and external risks that may materially affect the Groups' strategic objectives are identified and prioritized;
• The operational management of the various business units identify risk factors and events that may affect the operations and activities of Altri, as well as any procedures and control mechanisms;
• Additionally, the impact and the probability of occurrence of each risk factor are weighted and according to the exposure level, the need to respond to the risk is evaluated; and
• The risk mitigation actions are monitored and the level of exposure to critical factors is constantly monitored.
• 55. Core details on the internal control and risk management systems implemented in the company regarding the procedure for reporting financial information

In what refers to risk control in the process of disclosure of financial information, a form of control is the involvement of a very limited number of Group employees in the process.

All involved in financial analysis are considered as having access to privileged information and is especially knowledgeable about the content of their obligations as well as the sanctions resulting from the misuse of such information.

The system of internal control in areas of accounting and preparation and disclosure of financial information is based on the following key elements:

• The use of accounting principles, detailed throughout the notes to financial statements, is one of the bases of the control system;
• Plans, procedures and records of the Company and its subsidiaries provide reasonable assurance that transactions are recorded only properly authorized and that such transactions are recorded in accordance with generally accepted accounting principles;
• Financial information is analysed in a systematic and regular basis for the management of operational units, ensuring a permanent monitoring and control its budget;
• During the process of preparing and reviewing financial information, is previously established a timetable for closure of accounts and shared with the different areas involved, and all documents are reviewed in depth;
• At the level of individual financial statements of the various group companies, the accounting records and preparing financial statements are provided by administrative and accounting services. The financial statements are prepared by official chartered of accounts and reviewed by the financial management of each subsidiary;

• The consolidated financial statements are prepared quarterly by the consolidation team. This process is an additional element of monitoring the reliability of financial reporting, particularly by ensuring the uniform application of accounting principles and procedures for cut-off of operations as well as check balances and transactions between group companies;

• The consolidated financial statements are prepared under the supervision of the CFO. The annual report is sent for review and approval by the Board of Directors. After the approval, the documents are sent to the External Auditor, which issues the Statutory Audit and Auditor's Report; and

• The process of preparing the financial information and consolidated directors' report is monitored by the Supervisory Board and by the Board of Directors. Each quarter, these corporate boards meet and analyse the individual and consolidated financial statements of the Company.

As regards to risk factors that could materially affect the accounting and financial reporting, we should highlight the use of accounting estimates that are based on the best available information during the preparation of financial statements as well as the knowledge and experience of past or present events. We also stress the balances and transactions with related parties: Altri's Group balances and transactions with related parties relate essentially to the operational running of the group companies as well as to granting and obtaining loans at market rates.

The Board of Directors, together with the Supervisory Board, regularly review and monitor the preparation and disclosure of financial information in order to prevent access, improper and untimely, of other persons to relevant information.

IV. Investor Assistance

56. Department responsible for investor assistance, composition, functions, the information made available by said department and contact details

The Company has an investor assistance department which includes the group's market liaison officer and the investor relations.

The contact for investors to obtain information is as follows:

Rua do General Norton de Matos, 68 – r/c 4050-424 Porto Tel: + 351 22 834 65 02 Fax: + 351 22 834 65 03 Email: sede@altri.pt

Altri provides financial information relating to its individual and consolidated operations, as well as that of its subsidiary companies, through its official internet website (www.altri.pt). This website is also used by the Altri to provide information on press releases, as well as any relevant facts occurring in the life of the Company. This page also includes Altri Group's reports and accounts of the latest years. The majority of the information is available in the site both in Portuguese and in English.

57. Market Liaison Officer

The functions of Group's market liaison officer are performed by Alfredo Luís Portocarrero Teixeira and the investor relations functions are performed by Ricardo Mendes Ferreira.

58. Data on the extent and deadline for replying to the requests for information received throughout the year or pending from preceding years

Whenever necessary, the market liaison officer ensures that all relevant information regarding events, facts considered as relevant, disclosure of quarterly results and answers to any requests for clarification by the investors or the general public on public financial information is provided. All information requested by investors are analysed and provided within a maximum of five days.

V. WEBSITE

1. Address(es)

Altr's has available a web page with information about the Company and the Group. The address is: www.altri.pt.

60. Place where information on the firm, public company status, headquarters and other details referred to in Article 171 of the Commercial Companies Code is available

www.altri.pt \ investors \ company profile

61. Place where the articles of association and regulations on the functioning of the boards and/or committees are available

www.altri.pt \ about altri \ articles of association www.altri.pt \ acerca da altri \ governance

62. Place where information is available on the names of the corporate boards' members, the Market Liaison Officer, the Investor Assistance Office or comparable structure, respective functions and contact details

www.altri.pt \ about altri \ management team www.altri.pt \ investors \ investors assistance

63. Place where the documents are available and relate to financial accounts reporting, which should be accessible for at least five years and the half-yearly calendar on company events that is published at the beginning of every six months, including, inter alia, general meetings, disclosure of annual, half-yearly and where applicable, quarterly financial statements

www.altri.pt \ investors \ reports www.altri.pt \ investors \ financial calendar

64. Place where the notice convening the general meeting and all the preparatory and subsequent information related thereto is disclosed

www.altri.pt \ investors \ general meetings

65. Place where the historical archive on the resolutions passed at the company's General Meetings, share capital and voting results relating to the preceding three years are available

www.altri.pt \ investors \ general meetings

D. REMUNERATION

I. POWER TO ESTABLISH

66. Details of the powers for establishing the remuneration of corporate boards, members of the executive committee or chief executive and directors of the company

According to the articles of association, the board members will have remunerations that will be established by the Remuneration Committee, composed by three members, one of whom will be the president and will have casting vote, all appointed by shareholders' resolution according to Article 21 of the articles of association. The Remuneration Committee submits its proposal for approval at the Shareholders' Annual General Meeting.

The remuneration policy is reviewed annually and is submitted for approval at the company's Shareholders Annual General Meeting where it is present, at least, one representative of the remuneration committee.

II. REMUNERATION COMMITTEE

67. Composition of the remuneration committee, including details of individuals or legal persons recruited to provide services to said committee and a statement on the independence of each member and advisor

Altri, SGPS, SA appointed a Remuneration Committee for the period 2011/2013, whose composition is as follows:

• Pedro Nuno Fernandes de Sá Pessanha da Costa President
• João da Silva Natária Member
• Fernando Eugénio Cerqueira Magro Ferreira Member

All members of the Remuneration Committee are independent from the members of the Board of Directors. Additionally, in 2013 no persons or entities were hired to assist the members of the Remuneration Committee.

68. Knowledge and experience in remuneration policy issues by members of the Remuneration Committee

Altri believes that the experience and professional careers of the members of the Remuneration Committee allow them to perform their duties accurately and effectively. In particular, João da Silva Natária has extensive experience and specific knowledge in matters of remuneration policy. Additionally, and whenever necessary, this committee uses specialized resources, internal or external, to support its decisions.

III. Remuneration structure

69. Description of the remuneration policy of the Board of Directors and Supervisory Boards as set out in Article 2 of Law No. 28/2009 of 19 June

As provided in Law 28/2009, of 19 June, a statement on the remuneration policy of the Management and Supervisory boards is submitted annually for appreciation by the General Shareholders Meeting.

The policy on remuneration and compensation of the corporate boards of Altri, approved at the General Meeting held on 18 April 2013, respects, the following principles:

BOARD OF DIRECTORS:

In order to establish the value of individual remuneration of each director it will be taken into account:

• The functions performed in the group's subsidiaries;
• The responsibility and the added value by individual performance;
• Knowledge and experience accumulated on the job;
• The economic situation of the Company; and
• The remuneration in the same sector companies and other companies listed on NYSE Euronext Lisbon.

The total fixed remuneration of the Board of Directors, included the remuneration that subsidiaries pays to member of Board of Directors cannot exceed 2 million Euro per year.

1. Executive directors

• Fixed component, monthly amount paid 14 times a year
• Medium term variable component: Intended to align more strongly the interests of executive directors with those of shareholders and will be calculated covering the years 2011, 2012 and 2013, based on:
• Total shareholder return (shares valorisation plus dividend distributed dividend)
• Sum of the net results of three years (2011, 2012 and 2013)
• Company's business development

The total value of the medium term component cannot exceed 50% of fixed remuneration earned during the period of 3 years.

2. Non-executive directors

The individual remuneration of any non-executive director cannot exceed 120,000 Euro per year, being exclusively fixed.

SUPERVISORY BOARD

The remuneration of Members of the Supervisory Board will be based on yearly fixed values at levels considered adequate for similar functions.

GENERAL SHAREHOLDERS MEETING

The remuneration of the Board of the General Shareholders Meeting will be exclusively fixed and will follow market practices.

STATUTORY AUDITOR

The Statutory Auditor will have a fixed remuneration based on performance of his duties and in accordance with the market price, under the supervision of the Supervisory Board.

COMPENSATION FOR TERMINATION OF FUNCTIONS BEFORE OR ON TERM OF MANDATE

The remuneration policy maintains the principle of not covering the grating of any compensation to directors or other governing boards, concerning their termination of functions, either early or at the scheduled end of their terms of office, subject to compliance with the legal provisions in force.

SCOPE OF PRINCIPLES

The remuneration policy described above is applicable to Altri and to all companies directly or indirectly controlled by it and the amounts and limits of remuneration, set by it to the remunerations of the Board of Directors, cover the totality of remunerations paid by Altri and by the companies directly or indirectly controlled by it to its members of the Board of directors.

70. Information on how remuneration is structured so as to enable the aligning of the interests of the members of the board of directors with the company's long-term interests and how it is based on the performance assessment and how it discourages excessive risk taking.

The remuneration policy for executive directors aims to ensure a proper and thorough compensation for the performance and contribution of each director for the success of the organization, aligning the interests of the executive directors with those of the shareholders and of the company. Additionally, the remuneration policy provides for a variable component with deferred payment aiming to more strongly align the interests of the executive directors with those of the shareholders and the long-term interests of the company.

The proposal for remuneration of executive directors are drawn up taking into account the functions performed in Altri, SGPS, S.A. and in its subsidiaries, the responsibility and added value by individual performance, the knowledge and the experience accumulated on the job, the economic situation of the company, the remuneration paid by other companies from the same sector and other companies listed on NYSE Euronext Lisbon. Regarding the latter point, the Remuneration Committee takes into account all national companies of equivalent size, particularly listed on NYSE Euronext Lisbon, and also companies in international markets with characteristics similar to Altri.

71. Reference, where applicable, to there being a variable remuneration component and information on any impact of the performance appraisal on this component

According to the Company's article's association, the corporate boards' members receive remunerations set by the Remuneration Committee composed by three elements, one of whom will be president and will have casting vote. In the General Shareholders Meeting held in 18 April 2013, it was approved the remuneration policy as detailed in paragraph 69 above, which includes a variable component depending on performance during the period between 2011 and 2013.

No mechanisms to prevent executive directors from having employment contracts that question the grounds of the variable remuneration are implemented. However, the Remuneration Committee takes into account these factors in the criteria for determining the variable remuneration. The Company did not celebrate any agreements with members of the Board of Directors that have the effect of mitigating the risk associated to variability of the remuneration or has become aware of any identical contracts with third parties.

72. The deferred payment of the remuneration's variable component and specify the relevant deferral period

There is currently no variable compensation due which payment was deferred in time.

73. The criteria whereon the allocation of variable remuneration on shares is based

Altri has not in place nor intends to have any form of compensation that may include shares or any other equity based compensation system.

74. The criteria whereon the allocation of variable remuneration on options is based

Altri does not have in place any form of compensation that includes stock options.

75. The key factors and grounds for any annual bonus scheme and any additional non-financial benefits

Altri hasn't any annual bonus scheme nor any other non-financial benefits.

1. Key characteristics of the supplementary pensions or early retirement schemes for directors and state date when said schemes were approved at the general meeting, on an individual basis

Altri has no supplementary pension or early retirement schemes for corporate boards or key staff. The director Laurentina Martins benefits of a plan assigned before her appointment to the Board of Directors because, at the grant date, she was a worker of the subsidiary Caima - Indústria de Celulose, SA. The main features and information about this plan are detailed in note 30 a) of the notes to the consolidated financial statements at 31 December 2013.

On that date, the liabilities for past services related with this director amounted to Euro 430,090 and no additional contribution to the fund was made in 2013. Additionally during 2013 this director received Euro 33,705 from the fund, as retirement pension for age limit.

IV. REMUNERATION DISCLOSURE

77. Details on the amount relating to the annual remuneration paid as a whole and individually to members of the company's board of directors, including fixed and variable remuneration and as regards the latter, reference to the different components that gave rise to same.

The remunerations received by the members of the Board of Directors were fully paid by the Group's subsidiaries were they are also directors and there are no directors paid directly by Altri SGPS.

78. Any amounts paid, for any reason whatsoever, by other companies in a control or group relationship, or are subject to a common control

The remuneration received by the Board of Directors of Altri during 2013, in the exercise of their functions, include only fixed remuneration and amounted to Euro 1,079,120 allocated as follows: Paulo Fernandes – Euro 391,860; João Borges de Oliveira – Euro 391,860; Domingos Matos – Euro 224,700; Pedro Mendonça – Euro 70,700.

79. Remuneration paid in the form of profit sharing and/or bonus payments and the reasons for said bonuses or profit sharing being awarded

During the year there weren't any remuneration in the form of profit sharing or bonuses.

80. Compensation paid or owed to former executive directors concerning contract termination during the financial year

During the year, no amounts relating to compensation to directors whose functions have ceased have been paid or became due.

81. Details of the annual remuneration paid, as a whole and individually, to the members of the company's supervisory board

The remuneration of the Supervisory Board is composed of a fixed annual amount based on Altri's situation and on the current market practices. In the year ended 31 December 2013, the remuneration of Supervisory Board members amounted to Euro 32,970 distributed as follows: João Natária – Euro 16,350; Cristina Linhares – Euro 8,310; Manuel Tiago Fernandes – Euro 8,310.

The remuneration of the Statutory Auditor is described in paragraph 47 above.

82. Details of the remuneration in said year of the Chairman of the Presiding Board to the General Meeting

The remuneration of the Chairman of the Board of the General Meeting in the year ended in 31 December 2013 was Euro 5.000.

V. AGREEMENTS WITH REMUNERATION IMPLICATIONS

83. The envisaged contractual restraints for compensation payable for the unfair dismissal of directors and the relevance thereof to the remunerations' variable component

The remuneration policy maintains the principle of not including the grating of any compensation to directors or other governing boards, concerning the termination of their functions, either early or at the scheduled end of their terms of office, subject to the compliance with the legal provisions in force.

1. Reference to the existence and description, with details of the sums involved, of agreements between the company and members of the board of directors and managers, pursuant to Article 248-B/3 of the Securities Code that envisages compensation in the event of resignation or unfair dismissal or termination of employment following a takeover bid.

There are no agreements, between the Company and members of the board of directors or other key staff, pursuant to paragraph 3 of Article 248-B of CVM, which provide compensations in case of resignation, unfair dismissal or termination of employment contract following a takeover bid. There aren't also planned agreements with directors to ensure any compensation in case of non-renewal of their terms of office.

VI. Share-Allocation and/or Stock Option Plans

1. Details of the plan and the number of persons included therein.

Altri, SGPS, SA has no plan to grant shares or stock options to the Board of Directors nor to its employees.

86. Characteristics of the plan

Altri, SGPS, S.A. does not have any plan to grant shares or stock options.

87. Stock option plans for the company employees and staff

There are no stock options granted for the acquisition of shares which benefit company employees and staff.

88. Control mechanisms for a possible employee-shareholder system inasmuch as the voting rights are not directly exercised by said employees

Not applicable as explained above.

E. RELATED PARTY TRANSACTIONS

I. CONTROL MECHANISMS AND PROCEDURES

89. Mechanisms implemented by the Company for the purpose of controlling transactions with related parties

Currently, there are no established procedures or criteria for defining the relevant significance level of business between the Company and holders of qualifying holdings, or entities in any relationship or group with those shareholders, from which the intervention of the supervisory board is required.

90. Details of transactions that were subject to control in the referred year

There weren't performed businesses or significant transactions between the Company and members of its governing boards (both management and supervision), the holders of qualified shareholdings or companies in a control or group, except those that are part of the current activity of the group and which were carried out under normal market conditions for similar transactions.

There weren't performed any business or transactions with members of the Supervisory Board.

The non-audit services provided by the Statutory Auditor were approved by the Supervisory Board and are detailed in paragraph 47 above.

Transactions with group companies are not material and were made under normal market conditions and are part of the current activity of the Company and therefore are not subject to separate disclosure.

91. A description of the procedures and criteria applicable to the supervisory body when same provides preliminary assessment of the business deals to be carried out between the company and the holders of qualifying holdings or entity-relationships with the former

Transactions with Altri directors or companies that are in a group or control relationship with the one in which the intervener is a director, regardless of the amount, are subject to the prior authorization of the Board of Directors with a favorable opinion the Supervisory Board pursuant to Article 397 of the Portuguese Companies Act. In 2013 it was not necessary to the Supervisory Board to issue an opinion because no transactions that require the approval of that board occurred.

II. DATA ON BUSINESS DEALS

92. Details of the place where the financial statements including information on business dealings with related parties are available

Information on related parties is disclosed in note 32 of the notes to consolidated financial statements and note 17 of the notes to the individual financial statements of the Company.

PARTE II - CORPORATE GOVERNANCE ASSESSMENT

1. Details of the Corporate Governance Code implemented

This report was prepared in accordance with the CMVM Regulation nr. 4/2013 of 1 August and with the Code of Corporate Governance ("Código de Governo das Sociedades"), both available at www.cmvm.pt, and aims to be the summary of the fundamental aspects of the management of the Company as regards the Board of Directors, considering the need for transparency on this issue and the need for communication with investors and other stakeholders. The reporting model adopted by the Company is defined in Article 1, nr. 4 of that Regulation and detailed in its Appendix I.

The report complies with the standards of Article 245-A of the Portuguese Securities Code and discloses in accordance with thecomply or explain principle, the degree of compliance with the CMVM recommendations incorporated in 2013 CMVM Corporate Governance Code.

There are also fulfilled the duties of disclosure required by Law 28/2009 of 19 June, Articles 447 and 448 of the Portuguese Companies Act and CMVM Regulation Nr. 5 / 2008, of 2 October 2008.

2. Analysis of compliance with the Corporate Governance Code implemented

Altri, S.G.P.S., S.A. complies with the majority of recommendations on corporate governance issued by the Securities Market Commission (CMVM) as follows:

CMVM RECOMENDATIONS	COMPLIES	REPORT
I. VOTING AND CONTROL OF THE COMPANY
I.1. Companies shall encourage shareholders to attend and vote at general meetings and shall not set an
excessively large number of shares required for the entitlement of one vote, and implement the means necessary to
exercise the right to vote by mail and electronically.	Adopted	Part I / B / I. / b) / 12, 13 and 14
I.2. Companies shall not adopt mechanisms that hinder the passing of resolutions by shareholders, including fixing a
quorum for resolutions greater than that provided for by law.	Adopted	Part I / B / I. / b) / 12 and 13
I.3. Companies shall not establish mechanisms intended to cause mismatching between the right to receive
dividends or the subscription of new securities and the voting right of each common share, unless duly justified in
terms of long-term interests of shareholders.	Adopted	Part I / B / I. / b) / 13 and 14
I.4. The company's articles of association that provide for the restriction of the number of votes that may be held or
exercised by a sole shareholder, either individually or in concert with other shareholders, shall also foresee for a
resolution by the general assembly (five year intervals), on whether that statutory provision is to be amended or
prevails - without superquorum requirements as to the one legally in force - and that in said resolution, all
votesissued be counted, without applying said restriction.	Adopted	Part I / B / I. / b) / 13 and 14
I.5. Measures that require payment or assumption of fees by the company in the event of change of control or change in the composition of the Board and that whichappear likely to impair the free transfer of shares and free
assessment by shareholders of the performance of Board members, shall not be adopted.	Adopted	Part I / A / I. / 2, 4, 5 and 6
II. SUPERVISION, MANAGEMENT AND OVERSIGHT
II.1 SUPERVISION AND MANAGEMENT
II.1.1. Within the limits established by law, and except for the small size of the company, the board of directors shall
delegate the daily management of the company and said delegated powers shall be identified in the Annual Report
on Corporate Governance.	Not Adopted	Part II / 2 and Part I / B / II. / a) / 21
II.1.2. The Board of Directors shall ensure that the company acts in accordance with its objectives and shall not delegate its responsibilities as regards the following:
i) define the strategy and general policies of the company;
ii) define business structure of the group;
iii) decisions considered strategic due to the amount, risk and particular characteristics
involved.	Adopted	Part I / B / II. / a) / 21
II.1.3. The General and Audit Committee, in addition to its supervisory duties supervision, shall take full responsibility
at corporate governance level, whereby through the statutory provision or by equivalent means, shall enshrine the
requirement for this body to decide on the strategy and major policies of the company, the definition of the corporate structure of the group and the decisions that shall be considered strategic due to the amount or risk involved. This
body shall also assess compliance with the strategic plan and the implementation of key policies of the company.
	Not applicable
II.1.4. Except for small-sized companies, the Board of Directors and the General and Audit Committee, depending
on the model adopted, shall create the necessary committees in order to:
a) Ensure a competent and independent assessment of the performance of executive directors and its own overall
performance, as well as of other committees;
b) Reflect on the system structure and governance practices adopted, verify its efficiency and propose to the
competent bodies, measures to be implemented with a view to their improvement.	Not Adopted	Part II / 2 and Part I / B / II. / c) / 29
II.1.5. The Board of Directors or the General and Audit Committeed, depending on the applicable model, should set
goals in terms of risk-taking and create systems for their control to ensure that the risks effectively incurred are
consistent with those goals.	Not Adopted	Part II / 2 and Part I / C / III. / 52, 54 and 55
II.1.6. The Board of Directors shall include a number of non-executive members ensuring effective monitoring,
supervision and assessment of the activity of the remaining members of the board.	Adopted	Part I / B / II. / a) / 18

CMVM RECOMENDATIONS	COMPLIES	REPORT
II.1.7. Non-executive members shall include an appropriate number of independent members, taking into account the adopted governance model, the size of the company, its shareholder structure and the relevant free float. The independence of the members of the General and Supervisory Board and members of the Audit Committee shall be assessed as per the law in force. The other members of the Board of Directors are considered independent if the member is not associated with any specific group of interests in the company nor is under any circumstance likely to affect an exempt analysis or decision, particularly due to: a. Having been an employee at the company or at a company holding a controlling or group relationship within the last three years; b. Having, in the past three years, provided services or established commercial relationship with the company or company with which it is in a control or group relationship, either directly or as a partner, board member, manager
or director of a legal person; c. Being paid by the company or by a company with which it is in a control or group relationship besides the remuneration arising from the exercise of the functions of a board member; d. Living with a partner or a spouse, relative or any first degree next of kin and up to and including the third degree of collateral affinity of board members or natural persons that are direct and indirectly holders of qualifying holdings;
e. Being a qualifying shareholder or representative of a qualifying shareholder.	Not Adopted	Part II / 2 and Part I / B / II. / a) / 18
II.1.8. When board members that carry out executive duties are requested by other board members, said shall provide the information requested, in a timely and appropriate manner to the request.	Adopted	Part I / B / II. / a) / 18
II.1.9. The Chair of the Executive Board or of the Executive Committee shall submit, as applicable, to the Chair of the Board of Directors, the Chair of the Supervisory Board, the Chair of the Audit Committee, the Chair of the General and Supervisory Board and the Chairman of the Financial Matters Board, the convening notices and minutes of the relevant meetings.	Adopted	Part I / B / II. / a) / 18 and Part I / B / II. / b) / 23
II.1.10. If the chair of the board of directors carries out executive duties, said body shall appoint, from among its members, an independent member to ensure the coordination of the work of other non-executive members and the conditions so that these members can make independent and informed decisions or to ensure the existence of an equivalent mechanism for such coordination.	Not Adopted	Part II / 2 and Part I / B / II. / a) / 18
II.2. SUPERVISION II.2.1. Depending on the applicable model, the Chair of the Supervisory Board, the Audit Committee or the Financial Matters Committee shall be independent in accordance with the applicable legal standard, and have the necessary skills to carry out their relevant duties.	Adopted	Part I / B / III. / a) / 32
II.2.2. The supervisory body shall be the main representative of the external auditor and the first recipient of the relevant reports, and is responsible, inter alia, for proposing the relevant remuneration and ensuring that the proper conditions for the provision of services are provided within the company.	Adopted	Part I / B / III. / c) / 38
II.2.3. The Audit Committee shall evaluate the external auditor on an annual basis and propose to the competent body its dismissal or termination of the contract as to the provision of their services when there is a valid basis for said dismissal.	Adopted	Part I / B / V. / 45
II.2.4. The Audit Committee shall evaluate the functioning of the internal control systems and risk management and propose adjustments as may be deemed necessary.	Adopted	Part I / B / III. / c) / 38
II.2.5. The Audit Committee, the General and Supervisory Board and the Audit Committee decide on the work plans and resources concerning the internal audit services and services that ensure compliance with the rules applicable to the company (compliance services), and should be recipients of reports made by these services at least when it concerns matters related to accountability, identification or resolution of conflicts of interest and detection of potential improprieties.	Not applicable	Part I / C / III. / 50
II.3. REMUNERATION SETTING
II.3.1. All members of the Remuneration Committee or equivalent should be independent from the executive board members and include at least one member with knowledge and experience in matters of remuneration policy.	Adopted	Part I / D / II. / 67 and 68
II.3.2. Any natural or legal person that provides or has provided services in the past three years, to any structure under the board of directors, the board of directors of the company itself or who has a current relationship with the company or consultant of the company, shall not be hired to assist the Remuneration Committee in the performance of their duties. This recommendation also applies to any natural or legal person that is related by
employment contract or provision of services with the above. II.3.3. A statement on the remuneration policy of the management and supervisory bodies referred to in Article 2 of	Adopted	Part I / D / II. / 67
Law No. 28/2009 of 19 June, shall also contain the following: a) Identification and details of the criteria for determining the remuneration paid to the members of the governing bodies; b) Information regarding the maximum potential, in individual terms, and the maximum potential, in aggregate form, to be paid to members of corporate bodies, and identify the circumstances whereby these maximum amounts may be payable;
c) Information regarding the enforceability or unenforceability of payments for the dismissal or termination of appointment of board members.	Adopted	Part I / D / III. / 69
II.3.4. Approval of plans for the allotment of shares and/or options to acquire shares or based on share price variation to board members shall be submitted to the General Meeting. The proposal shall contain all the necessary information in order to correctly evaluate said plan.	Not applicable	Part I / D / III. / 73 and 74
II.3.5. Approval of any retirement benefit scheme established for members of corporate members shall be submitted to the General Meeting. The proposal shall contain all the necessary information in order to correctly evaluate said system.	Not applicable	Part I / D / III. / 76

CMVM RECOMENDATIONS	COMPLIES	REPORT
III. REMUNERATION
III.1. The remuneration of the executive members of the board shall be based on actual performance and shall
discourage taking on excessive risk-taking.	Adopted	Part I / D / III. / 70
III.2. The remuneration of non-executive board
members and the remuneration of the members of the Audit Committee shall not include any component whose
value depends on the performance of the company or of its value.	Adopted	Part I / D / III. / 69 and Part I / D / IV. / 78, 81 and 82
III.3. The variable component of remuneration shall be reasonable overall in relation to the fixed component of the
remuneration and maximum limits should be set for all components.	Adopted	Part I / D / III. / 69
III.4. A significant part of the variable remuneration should be deferred for a period not less than three years,
and the right of way payment shall depend on the continued positive performance of the company during that
period.	Adopted	Part I / D / III. / 69
III.5. Members of the Board of Directors shall not enter into contracts with the company or with third parties which
intend to mitigate the risk inherent to remuneration variability set by the company.	Adopted	Part I / D / III. / 71
III.6. Executive board members shall maintain the company's shares that were allotted by virtue of variable
remuneration schemes, up to twice the value of the total annual remuneration, except for those that need to be
sold for paying taxes on the gains of said shares, until the end of their mandate.	Not applicable	Part I / D / III. / 73 and 74
III.7. When the variable remuneration includes the allocation of options, the beginning of the exercise period shall be
deferred for a period not less than three years.	Not applicable	Part I / D / III. / 74
III.8. When the removal of board member is not due to serious breach of their duties nor to their unfitness for the
normal exercise of their functions but is yet due on inadequate performance, the company shall be endowed
with the adequate and necessary legal instruments so that any damages or compensation, beyond that which
is legally due, is unenforceable.	Adopted	Part I / D / III. / 69 and Part I / D / V. / 83
IV. AUDITING
IV.1. The external auditor shall, within the scope of its duties, verify the implementation of remuneration policies and
systems of the corporate bodies as well as the efficiency and effectiveness of the internal controlmechanisms and
report any shortcomings to the supervisory body of the company.	Adopted	Part I / B / III. / c) / 38
IV.2. The company or any entity with which it maintains a control relationship shall not engage the external
auditor or any entity with which it finds itself in a group relationship or that incorporates the same network, for
services other than audit services. If there are reasons for hiring such services - which must be
approved by the Audit Committee and explained in its Annual Report on Corporate Governance - said should
not exceed more than 30% of the total value of servicesrendered to the company.	Adopted	Part I / D / IV. / 41 and Part I / D / V. / 47
IV.3. Companies shall support auditor rotation after two or three terms whether four or three years, respectively. Its
continuance beyond this period must be based on a specific opinion of the Audit Committee that explicitly considers
the conditions of auditor's independence and the benefits and costs of its replacement.	Adopted	Part I / D / V. / 44
V. CONFLICTS OF INTEREST AND RELATED PARTY TRANSACTIONS
V.1. The company's business with holders of qualifying holdings or entities with which they are in any type of
relationship pursuant to article 20 of the Portuguese Securities Code, shall be conducted during normal market
conditions.	Adopted	Part I / and / I. / 90
V.2. The supervisory or oversight board shall lay down procedures and criteria that are required to define the
relevant level of significance of business with holders of qualifying holdings - or entities with which they are in
any of the relationships described in article 20.1 of the Portuguese Securities Code -thus significant relevant
business is dependent upon prior opinion of that body.	Not Adopted	Part II / 2 and Part I / and / I. / 91
VI. INFORMATION
VI.1. Companies shall provide, via their websites in both the Portuguese and English languages access to
information on their progress as regards the economic, financial and governance state of play.	Adopted	Part I / C / V. / 59 a 65
VI.2. Companies shall ensure the existence of an investor support and market liaison office, which responds to
requests from investors in a timely fashion and a record of the submitted requests and their processing, shall be
kept.	Adopted	Part I / C / IV. / 56 a 58

The recommendations II.1.1., II.1.4., II.1.5., II.1.7., II.1.10. and V.2. are not fully adopted by Altri, as explained below.

• Recommendation II.1.1.: Altri's directors focus their activity in the management of the Group's holdings and in the definition of lines for strategic development. The decisions regarding the strategic matters are adopted by the Board of Directors as a collective board composed by all its members, executive and non-executive in the normal performance of their duties. Additionally, some of the directors of Altri SGPS, SA integrate the Board of Directors of the various operating units of the Group and therefore the recommendation is not fully adopted.

• Recommendation II.1.4.: Altri considers that, taking into account its size, the only committee essential to meet the needs of the Company is the Remuneration Committee. The Company does not have any committee specifically designed to identify candidates to directors and to reflect about the corporate governance model adopted, so this recommendation cannot be considered adopted.

• Recommendation II.1.5.: In the present report there are described the most important aspects of risk management implemented by the Group. However, Altri does not have an internal control and risk management system formalized that encompasses all of the components provided for that type of system so the recommendation is not fully adopted.

• Recommendations II.1.7. and II.1.10.: The Board of Directors does not include any member who meets the criteria for independence mentioned in that recommendation as the non-executive director Pedro Mendonça is relative from qualifying shareholders and the non-executive Laurentina Martins worked at the subsidiary Caima - Indústria de Celulose, S.A. Therefore, also the recommendation II.1.10.. is not fulfilled. Given the corporate model adopted and the composition and mode of operation of its governing boards, including the independence of the supervisory boards, without, delegation of powers among them, the Group considers that the designation of independent directors to the Board would not yield significant improvements for the proper functioning of the corporate governance model, which has revealed itself proper and efficient.
• Recommendation V.2.: Currently, there aren't established procedures or criteria for defining the relevant level of significance of businesses between the company and holders of qualified holdings or entities that are in a group or dominance relationship, from which the intervention from the Statutory Board is required. However, transactions with Altri's directors or with companies that are in a group or dominance relationship with them, regardless of the amount, are subject to prior approval of the Board of Directors, with a favorable opinion of the Statutory Board, under the terms of article 397 of the Portuguese Companies Act.

3. Other information

Altri considers that, notwithstanding the partial fulfillment of CMVM recommendations, as explained above, the degree of adoption of the recommendations is quite broad and complete.

LEGAL MATTERS

Own Shares

Pursuant to the requirements of article 66 of the Portuguese Companies Act, the Directors inform that as of 31 December 2013 Altri had no own shares and did not acquire or sell any own shares during the year.

Shares held by the governing boards of Altri

Pursuant to the requirements of article 447 of the Portuguese Companies Act, the Directors inform that, as of 31 December 2013, they held the following shares:

Paulo Jorge dos Santos Fernandes (a)	24,043,168
Pedro Macedo Pinto de Mendonça	1,705,000
Domingos José Vieira de Matos (b)	22,603,496
João Manuel Matos Borges de Oliveira (c)	29,000,000
Laurentina da Silva Martins	0

• (a) Are also considered attributable to Paulo Jorge dos Santos Fernandes, apart from the 21,643,168 shares of Altri, SGPS, SA, held on an individual basis, 2,400,000 shares of Altri, SGPS, SA held by "ACTIUM CAPITAL – SGPS, SA" of which he is the dominant shareholder and director. Therefore, in legal terms, are considered attributable to Paulo Jorge dos Santos Fernando a total of 24,043,168 shares, representing 11.72% of capital and voting rights of Altri, SGPS, SA
• (b) Are also considered attributable to Domingos José Vieira de Matos in addition to the 13,939,432 shares of Altri, SGPS, SA held on an individual basis, 8,664,064 shares of Altri SGPS, S.A held by LIVREFLUXO – SGPS, S.A., of which he is director and dominant shareholder. Thus, in legal terms, are considered attributable to Domingos José Vieira de Matos a total of 22,603,496 shares, representing 11.02% of the capital and voting rights of Altri SGPS, S.A.
• (c) The 29,000,000 shares represent Altri SGPS, S.A. total shares held by the company Caderno Azul SGPS, S.A., of which João Manuel Matos Borges de Oliveira is director and shareholder.

As of December 31, 2013, the Statutory Auditor, the members of the Supervisory Board and the members of the Board of the General Shareholders' Meeting held no shares of Altri.

Participation in the Company's share capital

Pursuant to the requirements of articles 16 and 20 of the Securities Code and article 448 of the Portuguese Companies Act, the Directors inform that, in accordance with the notifications received, the companies and/or individuals that hold qualified participations exceeding 2%, 5%, 10%, 20%, 33% and 50% of the voting rights, are as follows:

Exceeding 2% of the voting rights	Shares held	Direct % of the voting rights
LIVREFLUXO – SGPS, S.A. (a)	8,664,064	4.22%
Lazard Frères Gestion SAS (b)	4,157,000	2.03%
Norges Bank	4,149,572	2.02%

• (c) The 8,664,064 shares of Altri SGPS, S.A held by LIVREFLUXO SGPS, S.A., are attributable to Domingos José Vieira Matos, its director and dominant shareholder.
• (d) The 4,157,000 shares are held by SICAV OBJECTIF EURO SMALL CAPS. Having SICAV delegated the exercise of voting rights in Lazard Frères Gestion SAS, this participation is considered attributable to Lazard Frères Gestion SAS.

Exceeding 5% of the voting rights	Shares held	Direct % of the voting rights
Domingos José Vieira de Matos (a)	13,939,432	6.80%
Pedro Miguel Matos Borges de Oliveira	10,930,000	5.33%
Bestinver Gestión S.A., SGIIC	10,269,347	5.01%

(b) It is also attributable to Domingos José Vieira de Matos, 8,664,064 shares of Altri SGPS, S.A held by LIVREFLUXO – SGPS, S.A., of which he is director and dominant shareholder. Thus, in legal terms, are considered attributable to Domingos José Vieira de Matos a total of 22,603,496 shares, representing 11.02% of the capital and voting rights of Altri SGPS, S.A.

		Direct % of the
Exceeding 10% of the voting rights	Shares held	voting rights
Caderno Azul, SGPS, S.A. (a)	29,000,000	14.14%
Paulo Jorge dos Santos Fernandes (b)	21,643,168	10.55%

• (c) 29.000.000 shares represent Altri SGPS, S.A total shares held by the company Caderno Azul SGPS, S.A., of which João Manuel Matos Borges de Oliveira is director and shareholder.
• (d) It is also attributable to Paulo Jorge dos Santos Fernandes, 2,400,000 shares of Altri SGPS, S.A held by ACTIUM CAPITAL – SGPS, S.A., of which he is director and dominant shareholder. Thus, in legal terms, are considered attributable to Paulo Jorge dos Santos Fernandes a total of 24,043,168 shares, representing 11.72% of the capital and voting rights of Altri SGPS, S.A.

		Direct % of the
Exceeding 15% of the voting rights	Shares held	voting rights
PROMENDO – SGPS, S.A.	30,837,782	15.03%

Altri was not informed of any participation exceeding 20% of the voting rights.

STATEMENT UNDER THE TERMS OF ARTICLE 245, PARAGRAPH 1, C) OF THE SECURITIES CODE

The signatories individually declare that, to the best of their knowledge, the Board of Director's Report, the Individual and Consolidated Financial Statements were prepared in accordance with the International Financial Reporting Standards ("IFRS") as adopted by the European Union, and other accounting documents required by law or regulation, giving a truthful and appropriate image of assets and liabilities, financial position and the consolidated and individual results of Altri, SGPS, S.A. and of the companies included in the consolidation perimeter and contains a description of the major risks and uncertainties faced.

DECLARATION OF RESPONSIBILITY

The members of the Board of Directors of Altri, S.G.P.S., S.A. declare that they assume responsibility for this information and affirm that the items included herein are true and that, to the best of their knowledge, there are no omissions.

As required by article 21 of Decree-Law 411/91 of 17 October, the Board of Directors informs that there are no overdue debts to the State, namely with respect to Social Security.

CLOSING REMARKS

We don't want to conclude without thanking the various partners of the group for their trust in our organization. Finally, we wish to express our gratitude to all our employees for their dedication and commitment.

Oporto, 27 March 2014

The Board of Directors

Paulo Jorge dos Santos Fernandes

__________________________________

__________________________________

__________________________________

__________________________________

__________________________________

João Manuel Matos Borges de Oliveira

Pedro Macedo Pinto de Mendonça

Domingos José Vieira de Matos

Laurentina da Silva Martins

APPENDIX I

1. Board of Directors

Qualifications, experience and positions held in other companies by the members of the Board of Directors:

Paulo Jorge dos Santos Fernandes

Was one of the founders of Cofina (company that led to the creation of Altri, by spin-off), and has been involved in the Group's management since its incorporation. Graduated from Oporto University with a degree in Electronic Engineering, also has an MBA from the Nova University of Lisbon.

He is shareholder of the Company since 2005 having been also appointed Director at the same date.

In addition to the Companies where he currently performs management functions, his professional experience includes:

1982/1984	Assistant Director of Production of CORTAL
1986/1989	General Director of CORTAL
1989/1994	President of the Board of CORTAL
1995	Director of CRISAL – CRISTAIS DE ALCOBAÇA, SA
1997	Director of Grupo Vista Alegre, SA
1997	Chairman of the Board of ATLANTIS - Cristais de Alcobaça, SA
2000/2001	Director of SIC
2001	Director of V.A.A.

Throughout his career, also played roles in several associations:

1989/1994	President of FEMB (Fédération Européene de Mobilier de Bureau) for Portugal;
1989/1990	President of the General Meeting Assoc. Industr. Águeda
1991/1993	Member of the Advisory Board Assoc. Ind. Portuense
Since 2005	Member of Superior Board at the MBA Former Student's Association
2013/2016	President of the Supervisory Board of BCSD
Since 2006	Member of the Advisory Board for engineering and management of IST

The other companies where he carries out management functions as of 31 December 2013 are as follows:

• Actium Capital, SGPS, S.A. (a)
• Alteria, S.G.P.S., S.A. (a)
• Altri Energias Renováveis, SGPS, S.A.
• Altri Participaciones Y Trading, S.L.
• Caima Indústria de Celulose, S.A.
• Celbi Celulose da Beira Industrial, S.A.
• Celtejo Empresa de Celulose do Tejo, S.A.
• Celulose do Caima, S.G.P.S., S.A.
• Cofina, S.G.P.S, S.A. (a)
• Cofina Media, S.G.P.S., S.A. (a)
• Edirevistas Sociedade Editorial, S.A. (a)
• Edisport Soc. de Publicações, S.A. (a)
• Efe Erre Participações, S.G.P.S., S.A. (a)
• Elege Valor, S.G.P.S., S.A. (a)
• F. Ramada Investimentos, S.G.P.S., S.A. (a)
• F. Ramada Produção e Comercialização de Estruturas Metálicas de Armazenagem, S.A. (a)
• F. Ramada II Imobiliária, S.A. (a)
• F. Ramada, Aços e Indústrias, S.A. (a)

• Invescaima, S.G.P.S., S.A.

• Jardins de França Empreendimentos Imobiliários, S.A. (a)

• Malva Gestão Imobiliária, S.A. (a)
• Mediafin S.G.P.S., S.A. (a)
• Presselivre Imprensa Livre, S.A. (a)
• Prestimo Prestígio Imobiliário, S.A. (a)
• Sociedade Imobiliária Porto Seguro Investimentos Imobiliários, S.A. (a)
• Torres da Luz Investimentos imobiliários, S.A. (a)

(a) – Companies that, as of December 31, 2013 cannot be considered to be part of Altri, S.G.P.S., S.A. group

João Manuel Matos Borges de Oliveira

He was also one of the founders of Cofina and has been involved in the Group's management since its incorporation. Graduated from Oporto University with a degree in Chemical Engineering, holds an MBA from INSEAD. He develops his activity in the media and industrial operations, as well as in the strategic definition of the Group. He is a shareholder of the company since 2005 and has also been appointed director on the same date.

In addition to the Companies where he currently performs management functions, his professional experience includes:

1982/1983	Assistant Production Director of Cortal
1984/1985	Production Director of Cortal
1987/1989	Marketing Director of Cortal
1989/1994	General Director of Cortal
1989/1995	Vice President of the Board of Cortal
1989/1994	Director of Seldex
1992/1994	Vice President of General Meeting of Assoc. Industr. Águeda
1995/2004	President of Supervisory Board of Assoc. Industr. Aveiro
1996/2000	Non-executive Director of Atlantis, SA
1997/2000	Non-executive Director of Vista Alegre, SA
1998/1999	Director of Efacec Capital, SGPS, SA
Since 2008	President of Supervisory Board of Porto Business School
2008/2011	Non-executive Director of Zon Multimédia, SGPS, S.A.
2011/2013	Member of ISCTE-IUL CFO Advisory Forum

The other companies where he carries out management functions as of 31 December 2013 are as follows:

• Alteria, S.G.P.S., S.A. (a)
• Altri Energias Renováveis, SGPS, S.A.
• Altri Participaciones Y Trading, S.L.
• Base Holding, SGPS, S.A. (a)
• Caderno Azul, S.G.P.S., S.A. (a)
• Caima Indústria de Celulose, S.A.
• Celbi Celulose da Beira Industrial, S.A.
• Celtejo Empresa de Celulose do Tejo, S.A.
• Celulose do Caima, S.G.P.S., S.A.
• Cofina, SGPS, S.A. (a)
• Cofina Media, S.G.P.S., S.A. (a)
• Edirevistas Sociedade Editorial, S.A. (a)
• Edisport Soc. de Publicações, S.A. (a)
• Efe Erre Participações, S.G.P.S., S.A. (a)
• Elege Valor, S.G.P.S., S.A. (a)
• F. Ramada Investimentos, S.G.P.S., S.A. (a)
• F. Ramada Produção e Comercialização de Estruturas Metálicas de Armazenagem, S.A. (a)
• F. Ramada II Imobiliária, S.A. (a)

• F. Ramada Serviços de Gestão, Lda. (a)

• F. Ramada, Aços e Indústrias, S.A. (a)

• Grafedisport Impressão e Artes Gráficas, S.A. (a)
• Invescaima, S.G.P.S., S.A.
• Jardins de França Empreendimentos Imobiliários, S.A. (a)
• Malva Gestão Imobiliária, S.A. (a)
• Mediafin, SGPS, S.A. (a)
• Presselivre Imprensa Livre, S.A. (a)
• Prestimo Prestígio Imobiliário, S.A. (a)
• Storax Racking Systems, Ltd. (a)
• Sociedade Imobiliária Porto Seguro Investimentos Imobiliários, S.A. (a)
• Torres da Luz Investimentos imobiliários, S.A. (a)
• Universal Afir Aços Especiais e Ferramentas, S.A. (a)

a) – Companies that, as of December 31, 2013 cannot be considered to be part of Altri, S.G.P.S., S.A. group

Pedro Macedo Pinto de Mendonça

He was one of the founders of Cofina (company that originated Altri by spin-off) and has been directly involved in the management of the Group since its beginning. Attended the Faculty of Medicine of Oporto for two years and holds a degree in Mechanics from the École Superiore de L'Etat in Brussels. He is shareholder of the Company since 2005 and has been director since that date.

In addition to the Companies where he currently performs management functions, his professional experience includes:

1959	Director of Supply of Empresa de Metalurgia Artística Lisboa
1965	Production Director of Empresa de Metalurgia Artística Lisboa
1970	Director and sales responsible of Seldex
1986	Founding Partner of Euroseel
1986/1990	Director of Euroseel
1986	Chairman of the Board of Seldex
1989	Director of Cortal

The other companies where he carries out management functions as of 31 December 2013 are as follows:

• Alteria, S.G.P.S., S.A. (a)
• Altri Energias Renováveis, SGPS, S.A.
• Altri Participaciones Y Trading, S.L.
• Caima Indústria de Celulose, S.A.
• Celbi Celulose da Beira Industrial, S.A.
• Celtejo Empresa de Celulose do Tejo, S.A.
• Celulose do Caima, S.G.P.S., S.A.
• Cofina, SGPS, S.A. (a)
• Cofina Media, S.G.P.S., S.A. (a)
• Cofihold, S.G.P.S., S.A. (a)
• Efe Erre Participações, S.G.P.S., S.A. (a)
• Elege Valor, S.G.P.S., S.A. (a)
• F. Ramada Investimentos, S.G.P.S., S.A. (a)
• F. Ramada Produção e Comercialização de Estruturas Metálicas de Armazenagem, S.A. (a)
• F. Ramada II Imobiliária, S.A. (a)
• F. Ramada, Aços e Indústrias, S.A. (a)
• Invescaima, S.G.P.S., S.A.
• Jardins de França Empreendimentos Imobiliários, S.A. (a)

• Malva Gestão Imobiliária, S.A. (a)

• Prestimo Prestígio Imobiliário, S.A. (a)

• Sociedade Imobiliária Porto Seguro Investimentos Imobiliários, S.A. (a)
• Torres da Luz Investimentos imobiliários, S.A. (a)
• Universal Afir Aços, Máquinas e Ferramentas, S.A. (a)

a) – Companies that, as of December 31, 2013 cannot be considered to be part of Altri, S.G.P.S., S.A. group

Domingos José Vieira de Matos

He was one of the founders of Cofina (company that originated Altri by spin-off) and has been directly involved in the management of the Group since its beginning. He holds a degree in Economics from the Faculty of Economy of Oporto and began his carrier in management in 1978. He is shareholder of the Company since 2005 and has been director since that date.

In addition to the Companies where he currently performs management functions, his professional experience includes:

1978/1994	Administrator of CORTAL, SA
1983	Founding Partner of PROMEDE – Produtos Médicos, SA
1998/2000	Administrator of ELECTRO CERÂMICA, SA

The other companies where he carries out management functions as of 31 December 2013 are as follows:

• Alteria, S.G.P.S., S.A. (a)
• Altri Participaciones Y Trading, S.L.
• Altri Florestal, S.A.
• Base Holding, SGPS, S.A. (a)
• Caima Indústria de Celulose, S.A.
• Celbi Celulose da Beira Industrial, S.A.
• Celulose do Caima, S.G.P.S., S.A.
• Cofina, SGPS, S.A. (a)
• Efe Erre Participações, S.G.P.S., S.A. (a)
• Elege Valor, S.G.P.S., S.A. (a)
• F. Ramada Investimentos, S.G.P.S., S.A. (a)
• F. Ramada Produção e Comercialização de Estruturas Metálicas de Armazenagem, S.A. (a)
• F. Ramada II Imobiliária, S.A. (a)
• F. Ramada Serviços de Gestão, Lda. (a)
• F. Ramada, Aços e Indústrias, S.A. (a)
• Jardins de França Empreendimentos Imobiliários, S.A. (a)
• Livrefluxo, S.G.P.S., S.A. (a)
• Malva Gestão Imobiliária, S.A. (a)
• Prestimo Prestígio Imobiliário, S.A. (a)
• Sociedade Imobiliária Porto Seguro Investimentos Imobiliários, S.A. (a)
• Torres da Luz Investimentos imobiliários, S.A. (a)
• Universal Afir Aços, Máquinas e Ferramentas, S.A. (a)

(a) – companies that, as of 31 December 2013, cannot be considered as part of the Altri, SGPS, SA group

Laurentina da Silva Martins

With education in Finance and Administration from Instituto Superior do Porto she is related with Altri Group since its incorporation and was appointed director of the company in March 2009.

Her Professional experience includes:

• 1965 Financial direction assessor of Companhia de Celulose do Caima, S.A.
• 1990 Financial director of Companhia de Celulose do Caima, S.A.
• 2001 Director of Cofina Media, SGPS, S.A.
• 2001 Director of Caima Energia Empresa de Gestão e Exploração de Energia, S.A.
• 2004 Director of Grafedisport Impressão e Artes Gráficas, S.A.
• 2005 Director of Silvicaima Sociedade Silvícola do Caima, S.A. (now Altri Florestal, S.A.)
• 2006 Director of EDP Produção Bioeléctrica, S.A.

The other companies where she carries out management functions as of 31 December 2013 are as follows:

• Altri Participaciones Y Trading, S.L.

• EDP – Produção Bioeléctrica, S.A.

2. Supervisory Board

Qualifications, experience and positions held in other companies by members of the Supervisory Board:

João da Silva Natária

Academic curriculum:

Degree in Law from University of Lisbon

Professional Experience:

1979	General Director of Luanda / Viana branch of F. Ramada, appointed jointly by the Board of
	Directors and the Ministry of Industry of Angola
1983	Director of the Department of Polyester and Buttons of F. Ramada, Aços e Indústrias, SA
1984/2000	Director of Human Resources of F. Ramada, Aços e Indústrias, SA
1993/1995	Director of Universal – Aços, Máquinas e Ferramentas, SA
Since 2000	Lawyer specialized in Labour Law and Family Law

Other positions:

President of the Supervisory Board of Cofina SGPS SA (a) President of the Supervisory Board of F. Ramada Investimentos, SGPS, SA (a) Member of the Remuneration Committee of Cofina SGPS SA (a) Member of the Remuneration Committee of the F. Ramada Investimentos, SGPS, SA (a)

(a) - companies that, on 31 December 2013, cannot be considered as part of the Altri, SGPS, SA group

Cristina Isabel Linhares Fernandes

Academic curriculum:

1996	Degree in Economics - Faculty of Economics, University of Coimbra
2000	Postgraduate in Taxation – Instituto Superior de Administração e Gestão do Porto
2006	Statutory Auditor nr. 1262 certified by the Portuguese Institute of Statutory Auditors
2007	Executive MBA at EGP - Escola de Gestão do Porto

Professional experience:

1996/1998	Assistant in the audit division of Arthur Andersen in Porto
1999/2001	Senior of the audit division of Arthur Andersen in Porto
2002/2005	Manager of the audit division of Deloitte office in Porto
2006	Senior Manager of Deloitte's audit division in Luanda
Since 2007	Statutory Auditor and consultant

Other positions held:

Member of the Supervisory Board of Cofina SGPS, S.A. (a) Member of the Supervisory Board of F. Ramada Investimentos, SGPS, S.A. (a) Statutory Auditor of Sociedade Comercial de Plásticos Chemieuro Unipessoal Lda. (a) Statutory Auditor of Stemmatters – Biotecnologia e Medicina Regenerativa, S.A. (a) Statutory Auditor of IM3DICAL, S.A. (a) Statutory Auditor of Tecvinhais SGPS, S.A. (a) Statutory Auditor of Teclignium, S.A. (a) Statutory Auditor of Creativesystems – Sistemas e Serviços de Consultoria, S.A. (a)

(a) - companies that, as of 31 December 2013, cannot be considered as part of the Altri, SGPS, S.A. group

Other past positions:

Member of the Supervisory Board of Tertir – Terminais de Portugal, S.A.

Manuel Tiago Alves Baldaque de Marinho Fernandes

Academic curriculum:

1992	Degree in Business Administration and Management provided by the Faculty of Economics and
	Management of the Regional Centre of Oporto of Portuguese Catholic University
2000	Postgraduate in Human Resource Management by Catholic University
2002	Masters in Finance by Catholic University
2007	International MBA by School of Business Management / ESADE
2010	Postgraduate in Management Services by Portuguese Catholic University

Professional experience:

1992	Auditor at Arthur Andersen, S.A.
1995	Management Controller at group SIPMA, S.A. (Saludães, S.A.; Lorisa, S.A. and SOTPA, S.A.)
Since 1998	Financial and Human Resources director at Regional Centre of Porto, Portuguese Catholic
	University

Other positions held:

Member of the Supervisory Board of Cofina SGPS, S.A. (a) Member of the Supervisory Board of F. Ramada Investimentos, SGPS, S.A. (a)

(a) - companies that, as of 31 December 2013, cannot be considered as part of the Altri, SGPS, S.A. group

Other past positions:

Board Member of financial management committee of the Portuguese Catholic University President of the Supervisory Board of Tertir - Terminal de Portugal, S.A. Non-executive Director of Investvar Comercial, SGPS, S.A.

Article 447 of the Portuguese Companies Act and Article 14, paragraph 7 of Portuguese Securities Regulator (CMVM) Regulation nr. 5/2008

Disclosure of shares and other securities held by members of the Board of Directors and by those discharging managerial responsibilities, as well as by people closely connected with them (article 248 B of the Portuguese Securities Code), and disclosure of the respective transactions during the year involving such shares and other securities.

	Shares held at 31-			Shares held at 31-
Members of other Board of Directors	Dec-2012	Aquisitions Disposals		Dec-2013
Paulo Jorge dos Santos Fernandes	16,640,929	6,002,239	(1,000,000)	21,643,168
Paulo Jorge dos Santos Fernandes (assigned to ACTIUM CAPITAL - SGPS, S.A.)	1,400,000	1,000,000	-	2,400,000
Pedro Macedo Pinto de Mendonça	1,705,000	-	-	1,705,000
João Manuel Matos Borges de Oliveira (assigned to CADERNO AZUL - SGPS, S.A.)	28,000,000	1,000,000	-	29,000,000
Domingos José Vieira de Matos	13,939,432	-	-	13,939,432
Domingos José Vieira de Matos (assigned to LIVREFLUXO - SGPS, S.A.)	-	8,664,064	-	8,664,064

Paulo Jorge dos Santos Fernandes

Date	Nature	Volume	Price (€)	Place	Nr of Shares
31-Dec-12	-	-	-	-	16,640,929
22-Jan-13	Buy	1,200,000	1.800000	NYSE Euronext Lisbon	17,840,929
28-Jan-13	Buy	1,200,000	1.922000	NYSE Euronext Lisbon	19,040,929
8-Feb-13	Buy	72,239	1.850000	NYSE Euronext Lisbon	19,113,168
4-Nov-13	Donation	3,530,000	2.443000	-	22,643,168
18-Dec-13	Sell	(1,000,000)	2.283000	NYSE Euronext Lisbon	21,643,168
31-Dec-13	-	-	-	-	21,643,168

Paulo Jorge dos Santos Fernandes (assigned to ACTIUM CAPITAL - SGPS, S.A.)

Date	Type	Volume	Price (€)	Local	Nr of Shares
31-Dec-12	-	-	-	-	1,400,000
18-Dec-13	Buy	1,000,000	2.283000	NYSE Euronext Lisbon	2,400,000
31-Dec-13	-	-	-	-	2,400,000

Pedro Macedo Pinto de Mendonça

Date	Type	Volume	Price (€)	Local	Nr of Shares
31-Dec-12	-	-	-	-	1,705,000
31-Dec-13	-	-	-	-	1,705,000

João Manuel Matos Borges de Oliveira (assigned to CADERNO AZUL - SGPS, S.A.)

Date	Type	Volume	Price (€)	Local	Nr of Shares
31-Dec-12	-	-	-	-	28,000,000
3-Jan-13	Buy	715,000	1.691400	NYSE Euronext Lisbon	28,715,000
4-Jan-13	Buy	285,000	1.705000	NYSE Euronext Lisbon	29,000,000
31-Dec-13	-	-	-	-	29,000,000

Domingos José Vieira de Matos

Date	Type	Volume	Price (€)	Local	Nr of Shares
31-Dec-12	-	-	-	-	13,939,432
31-Dec-13	-	-	-	-	13,939,432

Date	Type	Volume	Price (€)	Local	Nr of Shares
31-Dec-12	-	-	-	-	-
25-Jun-13	Buy	200,000	1.704590	NYSE Euronext Lisbon	200,000
26-Jun-13	Buy	278,538	1.731275	NYSE Euronext Lisbon	478,538
3-Jul-13	Buy	589,113	1.731322	NYSE Euronext Lisbon	1,067,651
12-Jul-13	Buy	801	1.732000	NYSE Euronext Lisbon	1,068,452
12-Jul-13	Buy	1,985	1.733000	NYSE Euronext Lisbon	1,070,437
12-Jul-13	Buy	1,230	1.735000	NYSE Euronext Lisbon	1,071,667
12-Jul-13	Buy	5,000	1.735000	NYSE Euronext Lisbon	1,076,667
12-Jul-13	Buy	20,480	1.735000	NYSE Euronext Lisbon	1,097,147
12-Jul-13	Buy	1,842	1.736000	NYSE Euronext Lisbon	1,098,989
12-Jul-13	Buy	2,514	1.738000	NYSE Euronext Lisbon	1,101,503
12-Jul-13	Buy	2,278	1.740000	NYSE Euronext Lisbon	1,103,781
12-Jul-13	Buy	1,150	1.745000	NYSE Euronext Lisbon	1,104,931
12-Jul-13	Buy	1,850	1.746000	NYSE Euronext Lisbon	1,106,781
12-Jul-13	Buy	8,150	1.746000	NYSE Euronext Lisbon	1,114,931
12-Jul-13	Buy	4,844	1.747000	NYSE Euronext Lisbon	1,119,775
12-Jul-13	Buy	7,286	1.748000	NYSE Euronext Lisbon	1,127,061
12-Jul-13	Buy	2,736	1.748000	NYSE Euronext Lisbon	1,129,797
12-Jul-13	Buy	7,000	1.750000	NYSE Euronext Lisbon	1,136,797
12-Jul-13	Buy	3,500	1.750000	NYSE Euronext Lisbon	1,140,297
12-Jul-13	Buy	138,351	1.750000	NYSE Euronext Lisbon	1,278,648
12-Jul-13	Buy	16,500	1.750000	NYSE Euronext Lisbon	1,295,148
12-Jul-13	Buy	2,188	1.750000	NYSE Euronext Lisbon	1,297,336
12-Jul-13	Buy	2,569	1.750000	NYSE Euronext Lisbon	1,299,905
12-Jul-13	Buy	1,194	1.750000	NYSE Euronext Lisbon	1,301,099
12-Jul-13	Buy	969	1.750000	NYSE Euronext Lisbon	1,302,068
12-Jul-13	Buy	1,196	1.750000	NYSE Euronext Lisbon	1,303,264
12-Jul-13	Buy	9,653	1.750000	NYSE Euronext Lisbon	1,312,917
12-Jul-13	Buy	1,049	1.750000	NYSE Euronext Lisbon	1,313,966
12-Jul-13	Buy	2,776	1.750000	NYSE Euronext Lisbon	1,316,742
12-Jul-13	Buy	909	1.750000	NYSE Euronext Lisbon	1,317,651
15-Jul-13	Buy	1,900	1.695000	NYSE Euronext Lisbon	1,319,551
15-Jul-13	Buy	186,151	1.695000	NYSE Euronext Lisbon	1,505,702
15-Jul-13	Buy	550	1.695000	NYSE Euronext Lisbon	1,506,252
15-Jul-13	Buy	1,350	1.695000	NYSE Euronext Lisbon	1,507,602
15-Jul-13	Buy	49	1.695	NYSE Euronext Lisbon	1,507,651

Domingos José Vieira de Matos (assigned to LIVREFLUXO - SGPS, S.A.)

Domingos José Vieira de Matos (assigned to LIVREFLUXO - SGPS, S.A.)

Date	Type	Volume	Price (€)	Local	Nr of Shares
23-Jul-13	Buy	112	1.825000	NYSE Euronext Lisbon	1,507,763
23-Jul-13	Buy	1,500	1.825000	NYSE Euronext Lisbon	1,509,263
23-Jul-13	Buy	4,289	1.824000	NYSE Euronext Lisbon	1,513,552
23-Jul-13	Buy	2,500	1.825000	NYSE Euronext Lisbon	1,516,052
23-Jul-13	Buy	111,900	1.825000	NYSE Euronext Lisbon	1,627,952
23-Jul-13	Buy	2,000	1.825000	NYSE Euronext Lisbon	1,629,952
23-Jul-13	Buy	47,891	1.825000	NYSE Euronext Lisbon	1,677,843
23-Jul-13	Buy	1,970	1.825000	NYSE Euronext Lisbon	1,679,813
23-Jul-13	Buy	30	1.825000	NYSE Euronext Lisbon	1,679,843
23-Jul-13	Buy	22,711	1.825000	NYSE Euronext Lisbon	1,702,554
23-Jul-13	Buy	2,000	1.825000	NYSE Euronext Lisbon	1,704,554
23-Jul-13	Buy	11,133	1.825000	NYSE Euronext Lisbon	1,715,687
23-Jul-13	Buy	1,839	1.818000	NYSE Euronext Lisbon	1,717,526
24-Jul-13	Buy	1,413	1.818000	NYSE Euronext Lisbon	1,718,939
24-Jul-13	Buy	69,764	1.820000	NYSE Euronext Lisbon	1,788,703
24-Jul-13	Buy	11,425	1.820000	NYSE Euronext Lisbon	1,800,128
24-Jul-13	Buy	15,559	1.820000	NYSE Euronext Lisbon	1,815,687
24-Jul-13	Buy	9,850	1.820000	NYSE Euronext Lisbon	1,825,537
21-Aug-13	Buy	882	1.918000	NYSE Euronext Lisbon	1,826,419
21-Aug-13	Buy	60,000	1.920000	NYSE Euronext Lisbon	1,886,419
21-Aug-13	Buy	299,118	1.920000	NYSE Euronext Lisbon	2,185,537
21-Aug-13	Buy	882	1.920000	NYSE Euronext Lisbon	2,186,419
21-Aug-13	Buy	506	1.920000	NYSE Euronext Lisbon	2,186,925
28-Aug-13	Buy	1,284	1.878000	NYSE Euronext Lisbon	2,188,209
28-Aug-13	Buy	88,038	1.879000	NYSE Euronext Lisbon	2,276,247
28-Aug-13	Buy	1,348	1.879000	NYSE Euronext Lisbon	2,277,595
28-Aug-13	Buy	775	1.876000	NYSE Euronext Lisbon	2,278,370
28-Aug-13	Buy	1,166	1.878000	NYSE Euronext Lisbon	2,279,536
28-Aug-13	Buy	52,509	1.879000	NYSE Euronext Lisbon	2,332,045
28-Aug-13	Buy	2,083	1.879000	NYSE Euronext Lisbon	2,334,128
28-Aug-13	Buy	1,459	1.879000	NYSE Euronext Lisbon	2,335,587
28-Aug-13	Buy	44,041	1.879000	NYSE Euronext Lisbon	2,379,628
28-Aug-13	Buy	17,516	1.879000	NYSE Euronext Lisbon	2,397,144
9-Sep-13	Buy	257,000	1.783000	NYSE Euronext Lisbon	2,654,144
10-Sep-13	Buy	320,000	1.810000	NYSE Euronext Lisbon	2,974,144
11-Sep-13	Buy	220,000	1.800000	NYSE Euronext Lisbon	3,194,144
12-Sep-13	Buy	315,500	1.813000	NYSE Euronext Lisbon	3,509,644
13-Sep-13	Buy	275,300	1.816000	NYSE Euronext Lisbon	3,784,944
16-Sep-13	Buy	285,000	1.826000	NYSE Euronext Lisbon	4,069,944
17-Sep-13	Buy	235,000	1.889000	NYSE Euronext Lisbon	4,304,944
23-Sep-13	Buy	500,000	1.955000	NYSE Euronext Lisbon	4,804,944
24-Sep-13	Buy	320,000	1.940000	NYSE Euronext Lisbon	5,124,944
10-Oct-13	Buy	1,724,120	2.043000	NYSE Euronext Lisbon	6,849,064
14-Oct-13	Buy	750,000	2.093000	NYSE Euronext Lisbon	7,599,064
17-Dec-13	Buy	1,065,000	2.296000	NYSE Euronext Lisbon	8,664,064
31-Dec-13	-	-	-	-	8,664,064

ALTRI, SGPS, S.A.

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION AS AT 31 DECEMBER 2013 AND 2012

(Translation of financial statements originally issued in Portuguese – Note 45) (Amounts expressed in Euro)

ASSETS	Notes	31.12.2013	31.12.2012
NON CURRENT ASSETS:
Biological assets	11	107,122,952	108,034,768
Tangible fixed assets	7	390,512,538	424,105,163
Investment properties	8	460,627	468,006
Goodwill	9	265,531,404	265,531,404
Intangible assets	10	194,285	605,388
Investments in associated companies and joint ventures	4.2	8,642,309	6,337,694
Investments available for sale	4.3 and 6	14,656,909	14,981,903
Other non current assets	18	3,071,539	384,915
Deferred tax assets	12	31,165,814	33,357,371
Total non current assets		821,358,377	853,806,612
ACTIVOS CORRENTES:
Inventories	11	54,829,315	47,440,279
Customers	6, 13 and 32	80,294,638	94,859,425
Other debtors	6, 13 and 32	7,562,193	7,241,482
State and other public entities	15	20,223,728	9,810,537
Other current assets	16	3,454,873	2,547,443
Derivatives	6 and 28	1,204,184	261,783
Cash and cash equivalents	6 and 17	232,450,518	112,392,485
Total current assets		400,019,449	274,553,434
Total assets		1,221,377,826	1,128,360,046
SHAREHOLDERS' FUNDS AND LIABILITIES		31.12.2013	31.12.2012
SHAREHOLDERS' FUNDS:
Share capital	19	25,641,459	25,641,459
Legal reserve	19	2,862,981	2,862,981
Other reserves	19	157,811,081	103,112,415
Consolidated net profit / (loss)		55,347,961	52,181,891
Total shareholders' funds attributable to the parent company's shareholders		241,663,482	183,798,746
Non controlling interests	20	146,308	128,166
Total Shareholders' funds		241,809,790	183,926,912
LIABILITIES:
NON CURRENT LIABILITIES:
Bank loans	6 and 21	74,212,500	103,556,923
Other loans	6 and 21	439,370,297	454,999,132
Reimbursable subsidies	6 and 21	11,228,419	22,770,236
Other non current creditors	6, 23 and 31	404,350	528,802
Other non current liabilities	24	32,384,801	22,096,030
Deferred tax liabilities	12	17,896,214	16,931,978
Provisions	22	5,123,914	1,535,342
Total non current liabilities		580,620,495	622,418,443
CURRENT LIABILITIES:
Bank loans	6 and 21	78,693,353	45,467,181
Other loans	6 and 21	213,719,587	139,404,040
Reimbursable subsidies	6 and 21	71,008	11,694,604
Suppliers	6, 25 and 32	60,034,597	56,343,385
Other current creditors	6, 26 and 32	6,395,461	6,679,435
State and other public entities	15	1,914,156	5,091,056
Other current liabilities	27	31,630,830	35,221,194
Derivatives	6 and 28	6,488,549	22,113,796
Total current liabilities		398,947,541	322,014,691
Total shareholders' funds and liabilities		1,221,377,826	1,128,360,046

The accompanying notes form an integral part of the consolidated financial statements.

ALTRI, SGPS, S.A.

CONSOLIDATED STATEMENTS OF PROFIT AND LOSS FOR THE YEARS ENDED 31 DECEMBER 2013 AND 2012

(Translation of financial statements originally issued in Portuguese – Note 45) (Amounts expressed in Euro)

	Notes	31.12.2013	31.12.2012
Sales	39	550,432,455	522,314,410
Services rendered	39	8,637,596	7,792,875
Other income	34	13,500,490	12,719,758
Cost of sales	11 and 32	(240,343,561)	(208,834,212)
External supplies and services	31 and 32	(151,340,687)	(144,557,997)
Payroll expenses	30 and 40	(27,376,287)	(31,487,816)
Amortisation and depreciation	37	(49,236,171)	(48,861,653)
Provisions and impairment losses	22	24,845	(4,544,227)
Other costs	35	(12,134,372)	(10,352,968)
Other indirect taxes	22	(3,422,651)	-
Gains and losses in associated companies and joint ventures	36	2,304,614	2,302,064
Financial expenses	36	(30,985,740)	(39,904,873)
Financial income	36	5,222,871	4,280,566
Profit before income tax		65,283,402	60,865,927
Income tax	12	(9,917,299)	(8,661,291)
Net profit		55,366,103	52,204,636
Consolidated net profit		55,366,103	52,204,636
Attributable to:
Parent company's shareholders	38	55,347,961	52,181,891
Non controlling interests	20	18,142	22,745
		55,366,103	52,204,636
Earnings per share:
Basic	38	0.27	0.25
Diluted	38	0.27	0.25

The accompanying notes form an integral part of the consolidated financial statements.

CONSOLIDATED STATEMENTS OF PROFIT AND LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEARS ENDED 31 DECEMBER 2013 AND 2012

(Translation of financial statements originally issued in Portuguese – Note 45) (Amounts expressed in Euro)

	Notes	31.12.2013	31.12.2012
Net consolidated profit for the period		55,366,103	52,204,636
Other comprehensive income:
Items that will not be reclassified to profit or loss		-	-
		-	-
Items that may be reclassified to profit or loss
Change in fair value of cash flow hedging derivatives	28	7,981,650	(5,270,870)
Change in fair value of available for sale investments	4.3	(344,490)	310,202
		7,637,160	(4,960,668)
Other comprehensive income		7,637,160	(4,960,668)
Total comprehensive income for the period		63,003,263	47,243,968
Attributable to:
Shareholders' of the parent company		62,985,121	47,221,223
Non controlling interests	20	18,142	22,745

The accompanying notes form an integral part of the consolidated financial statements.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITYFOR THE YEARS ENDED 31 DECEMBER 2013 AND 2012

(Translation of financial statements originally issued in Portuguese – Note 45) (Amounts expressed in Euro)

Attributable to the parent company's shareholders

	No tes	Sh ital are ca p	Le l re ga ser ve	Ot he rs r ese rve s	Ne rof it t p	To tal	No n llin tro con g inte ts res	To tal sha reh old er's fun ds
of Ba lan 1 J 20 12 ce as an ua ry	19	25 64 1, 45 9	2, 862 98 1	89 585 006	22 56 7, 762	140 657 20 8	105 42 1	140 762 62 9
Ap iati of t he sol ida ted rof it o f 2 01 1 t p pro pr on con ne		, -	, -	, , 22 56 7, 762	, ( 22 56 7, 762 )	, , -	, -	, , -
Div ide nds dis trib utio n	42	-	-	, ( 4, 102 633 ) ,	, -	( 4, 102 633 ) ,	-	( 4, 102 633 ) ,
Oth ers		-	-	22 948 ,	-	22 948 ,	-	22 948 ,
e fo To tal hen siv e in r th com pre com e y ea r		-	-	( ) 4, 960 668 ,	52 181 89 1 , ,	47 22 1, 22 3 ,	22 745 ,	47 24 3, 968 ,
Ba lan of 3 1 D mb 20 12 ce as ece er	19	25 64 1, 45 9 ,	2, 862 98 1 ,	103 112 41 5 , ,	52 181 89 1 , ,	183 798 746 , ,	128 166 ,	183 926 912 , ,
Ba lan of 1 J 20 13 ce as an ua ry	19	25 64 1, 45 9 ,	2, 862 98 1 ,	103 112 41 5 , ,	52 181 89 1 , ,	183 798 746 , ,	128 166 ,	183 926 912 , ,
of t rof f 2 Ap iati he sol ida ted t p it o 012 pro pr on con ne		-	-	52 181 89 1 , ,	( 1) 52 181 89 , ,	-	-	-
Div ide nds dis trib utio n	42	-	-	( 5, 128 29 3) ,	-	( 5, 128 29 3) ,	-	( 5, 128 29 3) ,
Oth ers		-	-	908 7,	-	908 7,	-	908 7,
To tal hen siv e in e fo r th com pre com e y ea r		-	-	7, 637 160 ,	55 34 7, 96 1 ,	62 985 121 , ,	18, 142	63 003 26 3 , ,
Ba lan of 3 1 D mb 20 13 ce as ece er	19	25 64 1, 45 9 ,	2, 862 98 1 ,	157 81 1, 08 1 ,	34 96 1 55 7, ,	24 1, 663 482 ,	146 30 8 ,	24 1, 80 9, 790

The accompanying notes form an integral part of the consolidated financial statements.

The official chartered accountant

The Board of Directors

ALTRI , SGPS, S.A.

CONSOLIDATED CASH-FLOW STATEMENTS FOR THE YEARS ENDED 31 DECEMBER 2013 AND 2012

(Translation of financial statements originally issued in Portuguese – Note 45) (Amounts expressed in Euro)

Operating activities: Collections from customers 580,037,895 485,011,638 Payments to suppliers (401,730,330) (335,300,050) Payments to personnel (23,684,163) (28,188,261) Other collections/payments relating to operating activities (22,462,808) (12,994,086) Income tax (20,046,760) 112,113,834 (2,994,789) Cash flow from operating activities (1) 112,113,834 Investment activities: Collections relating to: Investments 17 48,000 3,500,000 Tangible fixed assets 501,077 964,330 Investment subsidies 2,215,222 530,718 Interest and similar income 4,048,871 6,813,170 3,866,400 Payments relating to: Investments 17 (2,993,239) (4,050,468) Investment subsidies (4,708,910) (277,862) Intangible assets - (3,223) Tangible fixed assets (14,516,983) (22,219,132) (14,851,222) Cash flow from investment activities (2) (15,405,962) Financing activities: Collections relating to: Loans obtained 153,991,439 153,991,439 42,095,109 Payments relating to: Interests and similar costs (34,662,789) (35,920,532) Distributed dividends (5,128,293) (4,102,633) Loans obtained (89,160,943) (128,952,025) (98,078,582) (138,101,747) Cash flow from financing activities (3) 25,039,414 Cash and cash equivalents at the beginning of the year 110,624,494 Variation of cash and cash equivalents: (1)+(2)+(3) 121,747,286 Cash and cash equivalents at the end of the year 17 232,371,780	Notes	2013	2012
				105,534,452
				105,534,452
				8,861,448
				(19,182,775)
				(10,321,327)
				42,095,109
				(96,006,638)
				111,418,007
				(793,513)
				110,624,494

The accompanying notes form an integral part of the consolidated cash flow statement.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

1. INTRODUCTORY NOTE

Altri, SGPS, S.A. ("Altri" or "Company") is an open capital company incorporated as of 1 March 2005, as a result of the reorganization process of Cofina, SGPS, S.A., has its head-office located at Rua General Norton de Matos, 68, r/c – Porto, Portugal and its shares are listed in the NYSE Lisbon Euronext Stock Exchange. Its main activity is the management of investments.

Altri is the parent company of a group of companies listed in Note 4 known as Altri Group. The current activity of Altri Group focuses on the production of bleached paper pulp of eucalyptus through three mills (Celbi in Figueira da Foz, Caima in Constância do Ribatejo and Celtejo in Vila Velha de Ródão).

Due to this reality of Altri Group, the Board of Directors believes that there is only one business segment (production and commercialization of bleached paper pulp from eucalyptus) and the management information is also analysed on this basis, for which the segmental information mentioned in Note 39 is limited by this.

The consolidated financial statements of Altri Group are presented in Euro rounded off to the unit, which is the currency used by the Group in its operations and considered as the functional currency. The operations of foreign companies whose functional currency isn't the Euro are included in the consolidated financial statements in accordance with the policy set out in Note 2.2.e).

2. MAIN ACCOUNTING POLICIES

The main accounting policies adopted in the preparation of the accompanying consolidated financial statements are as follows:

2.1 BASIS OF PRESENTATION

The accompanying consolidated financial statements have been prepared on a going concern basis from the books and accounting records of the companies included on the consolidation, which were prepared according to the International Financial Reporting Standards ("IFRS") as adopted by the European Union and under the historical cost convention, except for some financial instruments which are stated at fair value. These standards include International Financial Reporting Standards issued by the International Accounting Standards Board ("IASB"), International Accounting Standards ("IAS") issued by International Accounting Standards Committee ("IASC") and interpretations issued by the International Financial Reporting Interpretations Committee ("IFRIC") or by the previous Standing Interpretations Committee ("SIC"), as adopted by the European Union. Standards and interpretations above mentioned will be generally presented as "IFRS".

The interim financial statements were presented quarterly, according to IAS 34 – "Interim Financial Reporting".

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

(i) Adoption of new, revised or amended standards and interpretations

The following standards, interpretations, amendments and revisions endorsed by European Union and with mandatory application in the financial years starting on or after January 1, 2013, were for the first time adopted in the year ended December 31, 2013:

Standard	Effective date (annual periods beginning on or after)	Observations
IFRS 1 (Amendment) - First time adoption of IFRS (Government Loans)	01-jan-13	This amendment exempts entities adopting IFRS for the first time the retrospective application of the provisions of IAS 39 and paragraph 10A of IAS 20 relating to government loans.
IFRS 7 - (Admendment) - Disclosures od Financial Instruments	01-jan-13	The amendments require additional disclosures regarding financial instruments, particularly, information about those subject to offset betw een financial assets and liabilities.
IAS 1 (Amendment) -Presentation of financial statements (Other comprehensive income)	01-jul-12	This amendment comprises the follow ing modifications: (i) It is requires entities to present separately the items accounted for as Other comprehensive income, depending on w hether they can be reclassified subsequently to profit or loss from those that cannot be reclassified subsequently to profit or loss; and (ii)The Statements of Comprehensive Income shall also be named Statetments of Profit and Loss and Other Comprehensive Income.
IFRS 9 (Revision) - Employee Benefits	01-jan-13	The revision of this standard included the follow ing alterations: (i) Actuarial gains and losses arising from diferences betw een the assumptions used in determining liability and the expect return plan assets and the effective amounts, as w ell as those resulting from change of acturial and financial assumptions during the year are to be recognised only in "Other comprehensive income": (ii) Shall be applied to a single interest rate in determining the present value of liabilities and the expected return on plans assets; (iii) The costs recorded in results correspond only to the current services and costs w ith net interests; (iv) New disclosures are required.
IFRS 13 (New ) – Fair value: measurement and disclosure	01-jan-13	This standard establishes a single source of guidance for fair value measurements and disclosures about fair value measurement. IFRS 13 applies w hen another IFRS requires or permits measurements or disclosure of fair value.
IFRIC 20 (New ) – Discovery costs in the production phase of an open cast mine	01-jan-13	This interpretation clarifies the recording of certain costs during the production phase of a surface mine.
Improvements to International Financial Reporting Standards (cycle 2009-2011)	01-jan-13	These standards involve the review of several standards, including IFRS 1 (repeated application of the standard), IAS 1 (comparative information), IAS 16 (classification of servicing equipment), IAS 32 (tax effect of equity distributions) and IAS 34 (segment information).

The effect in the consolidated financial statements of the Group for the year ended as of 31 December 2013, due to the adoption of the standards, interpretations, amendments and revisions mentioned above has not been significant.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

(ii) New standards and interpretations, amended or revised not adopted

The following standards, interpretations, amendments and revisions, with mandatory application to financial years beginning on or after 1 January 2013, were, until the approval date of the accompanying financial statements, endorsed by the European Union:

Standard	Effective date (annual periods beginning on or after)	Observations
IFRS 10 – Consolidated financial statements	01-jan-14	This standard is to establish requirements for the presentation of consolidated financial statements by the parent company, replacing, in these respects, IAS 27 - Consolidated and Separate Financial Statements and SIC 12 - Consolidation - Special Purpose Entities. This standard also introduces new rules concerning the definition of control and the determination of the scope of consolidation.
IFRS 11 – Joint Arrangements	01-jan-14	This standard replaces IAS 31 - Joint Ventures and SIC 13 - Jointly Controlled Entities - Non-Monetary Contributions by Venturers and eliminates the possibility of using the proportional consolidation method in accounting for interests in joint ventures.
IFRS 12 – Disclosure of interests in other entities	01-jan-14	This standard establishes a new set of disclosures relating to investments in subsidiaries, joint arrangements, associates and unconsolidated entities.
IAS 27 – Separate financial statements (2011)	01-jan-14	This amendment restricts the scope of IAS 27 to the separate financial statements.
IAS 28 (Revision) – Investments in associates and joint ventures	01-jan-14	This amendment to ensure consistency betw een IAS 28 - Investments in Associates and new standards adopted, in particular IFRS 11 - Joint Arrangements.
Amendments:  IFRS 10 - Consolidated Financial Statements;  IFRS 12 - Disclosure of Interests in other entities (Investment activities)	01-jan-14	This amendment introduces an exemption from consolidation for certain entities that meet the definition of investment entity. It also determines rules for measurement of investments held by these investment entities.
IAS 32 (Amendment) – Offsetting financial assets and financial liabilities	01-jan-14	This amendment clarify the requirements relating to the offset of financial assets and financial liabilities.
IAS 36 (Amendment) – Impairment (Recoverable Amount Disclosures for Non Financial Assets)	01-jan-14	This amendment eliminates the disclosure requirements of the recoverable amount of a cash-generating unit like goodw ill or intangible assets w ith indefinite useful lives allocated to periods w here it w as not recorded any impairment loss or reversal of impairment. Introduces additional disclosure requirements for assets for w hich it w as recorded an impairment loss or reversal of impairment and the recoverable amount of these has been determined based on fair value less costs to sell.
IAS 39 (Amendment) – Financial Instruments: Recognition and Measurement (Novation of Derivatives and Continuation of Hedge Accounting)	01-jan-14	This amendment permits, the continuation of hedge accounting w hen a derivative designated as a hedging instrument is overhauled.

These standards, although endorsed by the European Union, were not adopted by the Group in the year ended as of 31 December 2013, because its application is not yet mandatory. No significant impacts are expected to arise in the financial statements as a result of the adoption of these standards.

ALTRI, S.G.P.S., S.A. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

The accounting policies and measurement criteria adopted by the Group as of 31 December 2013 are consistent with those used in the preparation of the consolidated financial statements as of 31 December 2012.

In the preparation of the consolidated financial statements, in accordance with the IFRS, the Board of Directors adopted certain assumptions and estimates that affect the reported assets and liabilities, as well as the income and expenses in relation to the reported periods. All the estimates and assumptions made by the Board of Directors were made on the basis of its better existing knowledge, with reference to the date of approval of the financial statements, of the events and transactions in progress.

The accompanying consolidated financial statements have been prepared for appreciation and approval by the General Shareholders Meeting. The Group's Board of Directors believes that they will be approved without changes.

2.2 CONSOLIDATION POLICIES

The consolidation policies adopted by the Group in the preparation of the consolidated financial statements are as follows:

a) Investments in group companies

Investments in companies in which the Group owns, directly or indirectly, more than 50% of the voting rights at the Shareholders' General Meeting and is able to control the financial and operating policies so as to benefit from its activities (definition of control normally used by the Group), are included in the consolidated financial statements by the full consolidation method. Equity and net profit attributable to minority shareholders are shown separately, under the caption "Non-controlling interests", in the consolidated balance sheet and in the consolidated statement of profit and loss. Companies included in the consolidated financial statements by the full consolidation method are listed in Note 4.1.

The total integral income is attributed to the owners of the mother-company and to the non-controlling members even if by doing that, the company acquire a deficit balance at the level of non-controlling interests.

Under concentration processes, occurred after the transition date to International Financial Reporting Standards as adopted by the European Union (1 January 2004) the assets and liabilities of each subsidiary are measured at their fair value at the date of acquisition according to IFRS 3 - "Business Combinations". Any excess on the cost of acquisition over the fair value of the identifiable net assets and liabilities acquired is recognised as goodwill. Any excess of the fair value of the identifiable net assets and liabilities acquired over its cost is recognised as income in the profit and loss statement of the period of acquisition, after reassessment of the estimated fair value. Non-controlling interests are presented according to their share in the fair value of the identifiable assets and liabilities.

The results of subsidiaries acquired or disposed during the period are included in the consolidated statement of profit and loss from the effective date of acquisition or up to the effective date of disposal, respectively.

Adjustments to the financial statements of Group companies are performed, whenever necessary, in order to adapt its accounting policies to those used by the Group. All intercompany transactions, balances and distributed dividends are eliminated during the consolidation process.

Whenever the Group has, in substance, control over other entities created for a specific purpose ("Special Purpose Entities" – SPE's), even if no share capital interest is directly held in those entities, these are consolidated by the full consolidation method. As at 31 December 2013 did not exist these types of entities in the consolidated financial statement.

b) Investments in joint ventures

Investments in joint companies (companies where the Group has a jointly control over the financial and operating decisions - usually corresponding to holdings of 50% in a company's share capital) are accounted for in accordance with the equity method.

ALTRI, S.G.P.S., S.A. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese.

In the event of discrepancies, the Portuguese language version prevails – Note 45)

According to the equity method, the investments in joint companies are initially recorded at acquisition cost, which is adjusted proportionally to the Group's corresponding share capital, as at the acquisition date or as at the date of the first adoption of the equity method. On a yearly basis, investments are adjusted in accordance with the Group's participation in the associated company's net income. Additionally, the dividends of this companies are recorded as a reduction in the investment's book value and the Group's proportion in the changes occurred in the associated company's equity are recorded as a change in the Group's equity.

Any excess of the cost of acquisition over the Group's share in the fair value of the identifiable net assets acquired is recognised as goodwill, which is included in the caption "Investments in joint companies". If that difference is negative it is recorded as a gain in the caption "Gains and losses in joint companies" after reassessment of the fair value of the identifiable assets and liabilities acquired.

An evaluation of investments held in joint companies is performed whenever there are signs of impairment in those investments. Impairment losses are recorded in the statement of profit and loss for the period. When those losses recorded in previous periods vanish, they are reverted in the statement of profit and losses for the period.

Unrealised gains arising from transactions with joint companies are eliminated to the extent of the group's interest in the joint against the investment held. Unrealised losses are eliminated but only to the extent that there is no evidence of impairment of the asset transferred.

Investments in joint companies are listed in Note 4.2.

c) Investments in associated companies

Investments in associated companies (companies where the Group has significant influence but has no control over the financial and operating decisions - usually corresponding to holdings between 20% and 50% in a company's share capital) are accounted for in accordance with the equity method.

According to the equity method, the investments in associated companies are initially recorded at acquisition cost, which is adjusted proportionally to the Group's corresponding share capital, as at the acquisition date or as at the date of the first adoption of the equity method. On a yearly basis, investments are adjusted in accordance with the Group's participation in the associated company's net income. Additionally, the dividends of the subsidiary are recorded as a reduction in the investment's book value and the Group's proportion in the changes occurred in the associated company's equity are recorded as a change in the Group's equity.

Any excess of the cost of acquisition over the Group's share in the fair value of the identifiable net assets acquired is recognised as goodwill, which is included in the caption "Investments in associated companies". If that difference is negative it is recorded as a gain in the caption "Gains and losses in associated companies" after reassessment of the fair value of the identifiable assets and liabilities acquired.

An evaluation of investments held in associated companies is performed whenever there are signs of impairment in those investments. Impairment losses are recorded in the statement of profit and loss for the period. When those losses recorded in previous periods vanish, they are reverted in the statement of profit and losses for the period.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

When the Group's share of losses of the associated company exceeds the investment's book value, the investment is recorded at nil value, except to the extent of the Group's commitments to the associate. In such case, the Group records a provision to cover those commitments.

Unrealised gains arising from transactions with associated companies are eliminated to the extent of the group's interest in the associate against the investment held. Unrealised losses are eliminated but only to the extent that there is no evidence of impairment of the asset transferred.

Investments in associated companies are listed in Note 4.2.

d) Goodwill

The differences between the price of investments in subsidiaries companies added the value of noncontrolling interests, and the amount attributed to the fair value of the identifiable assets and liabilities at the time of their acquisition, when positive, are recorded under the caption 'Goodwill', and, when negative, after a re-appreciation of its calculation, are recorded directly in the profit and loss statement. The differences between the price of investments in associated companies and in joint ventures and the amount attributed to the fair value of the identifiable assets and liabilities at the time of their acquisition, when positive, are recorded under the caption 'Investments in associated companies', and, when negative, after a reappreciation of its calculation, are recorded directly in the profit and loss statement.

The excess of the cost of acquisition of investments in foreign companies over the fair value of their identifiable assets and liabilities as at the date of acquisition is calculated using the local currency of each of those companies. Translation to the Group's currency (Euro) is made using the exchange rate as at the balance sheet date. Exchange rate differences arising from this translation are recorded under the equity caption "Conversion reserves", include in the caption "Others reserves".

The Group will chose, on an acquisition-by-acquisition basis, to measure non-controlling interests either at their proportionate interest on the fair value of the assets and liabilities acquired, or at the fair value of the non-controlling interests themselves. Until 1 January 2010, non-controlling interests were always measured at their proportionate interest on the fair value of the acquired assets and liabilities.

Contingent consideration is recognized as a liability, at the acquisition-date, according to its fair value, and any changes to its value are recorded as a change in the 'Goodwill', but only as long as they occur during the 'measurement period' (until 12 months after the acquisition-date) and as long as they relate to facts and circumstances that existed at the acquisition date, otherwise these changes must be recognized in profit or loss.

Transactions regarding the acquisition of additional interests in a subsidiary after control is obtained, or the partial disposal of an investment in a subsidiary while control is retained, are accounted for as equity transactions impacting the shareholders' funds captions, and without giving rise to any additional 'Goodwill' and without any gain or loss recognized.

The moment a sales transaction to generate a loss of control, should be derecognized assets and liabilities of the entity and any interest retained in the entity sold should be premeasured at fair value and any gain or loss calculated on the sale is recorded in results.

The Group tests on an annual basis the impairment of goodwill. The recoverable amount of the cashgenerating unities is computed based on the value of use. This computation implies the use of assumptions based on estimates of future events which may occur differently from expected.

e) Translation of financial statements of foreign companies

Assets and liabilities in the financial statements of foreign entities are translated to Euro using the exchange rates in force at the balance sheet date. Profit and loss and cash flows are converted to Euro using the average exchange rate for the period. The exchange rate differences originated are recorded in the equity caption "Conversion reserves".

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

Goodwill and adjustments to the fair value arising from the acquisition of foreign subsidiaries are recorded as assets and liabilities of those companies and translated to Euro at the balance sheet date exchange rate.

Whenever a foreign company is sold, the accumulated exchange rate differences are recorded in the statement of profit and losses as a gain or loss associated with the sale.

2.3 MAIN ACCOUNTING POLICIES

The main accounting policies used in the preparation of the consolidated financial statements are as follows:

a) Intangible assets

Intangible fixed assets are recorded at cost, net of depreciation and accumulated impairment losses. Intangible assets are only recognised if it is likely that future economic benefits will flow to the Group, are controlled by the Group and if its cost can be reliably measured.

Development costs are recognised as an intangible asset if the Group has proven technical feasibility and ability to finish the development and to sell/use such assets and it is likely that those assets will generate future economic benefits. Development costs which do not fulfil these conditions are recorded as an expense in the period in which they are incurred.

Internal costs related with maintenance and development of software are recorded as expenses in the statement of profit and loss for the period in which they are incurred, except when these costs are directly attributable to projects for which the existence of future economic benefits is likely. Being this the case, they are capitalized as intangible assets.

Amortisation is calculated on a straight line basis, as from the date the asset is first used, over its expected useful life (usually 3 to 5 years).

b) Tangible fixed assets

Tangible fixed assets acquired until 1 January 2004 (IFRS transition date) are recorded at deemed cost, which corresponds to its acquisition cost, or its acquisition cost re-valued in accordance with generally accepted accounting principles in Portugal until that date, net of accumulated amortisation and accumulated impairment losses.

Tangible assets acquired after that date, are recorded at acquisition cost, net of depreciation and accumulated impairment losses.

Depreciation is calculated on a straight line basis, as from the date the asset is first used, over the expected useful life for each group of assets.

The depreciation rates used correspond to the following estimated useful lives:

	Years
Land and natural resources	20 to 50
Buildings and other constructions	10 to 50
Plant and machinery	2 to 15
Vehicles	2 to 10
Office equipment	2 to 10
Other tangible assets	3 to 10

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

Maintenance and repair costs related to tangible assets which do not increase the useful life or result in significant benefits or improvements in tangible fixed assets are recorded as expenses in the period they are incurred.

Tangible fixed assets in progress correspond to fixed assets still in construction and are stated at acquisition cost, net of impairment losses. These assets are depreciated from the date they are concluded or ready to be used under the conditions and for the use established by the management.

Gains or losses arising from the sale or disposal of tangible assets are calculated as the difference between the selling price and the asset's net book value as at the date of its sale/disposal, and are recorded in the statement of profit and loss under the captions "Other income" or "Other expenses", respectively.

c) Investment Properties

Investment properties of the Group correspond to the properties (land or building or part of a building or both) that are not use in the Group's activities: in the production or supply of goods or services or for administrative purposes or held for sale in the ordinary course of business.

Initially, investment properties are recorded at acquisition cost (including transaction costs) and, subsequently, are recorded at acquisition or production cost, net of impairment losses.

d) Lease contracts

Classifying a lease as financial or as operational depends on the substance of the transaction rather than the form of the contract.

Lease contracts are classified as (i) a finance lease if the risks and rewards incidental to ownership lie with the lessee and (ii) as an operating lease if the risks and rewards incidental to ownership do not lie with the lessee.

Tangible fixed assets acquired under financial lease contracts and the corresponding liabilities are recorded in accordance with the financial method. Under this method, the cost of the fixed assets and the corresponding liability are reflected in the balance sheet. In addition, interests included in the lease instalments and depreciation of the fixed assets, calculated as explained in Note 2.3.b), are recorded in the statement of profit and loss of the period to which they apply.

The operational lease instalments on assets acquired under long-term rental contracts are recognized in full as expenses in the period to which they refer to.

e) Subsidies from Government or other public entities

Subsidies for personnel training programmes or production support are recorded in the statement of profit and loss caption "Other income" when attributed, independently of when they are received.

Non-repayable subsidies obtained to finance investment in tangible fixed assets are recorded as "Other non-current liabilities" and "Other current liabilities" corresponding to the instalments repayable in the long and short term, respectively. These subsidies are recognized in the statement of profit and loss in accordance with the depreciation of the related tangible fixed assets.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

f) Impairment of assets, except for goodwill

Assets are assessed for impairment at each balance sheet date and whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Whenever the carrying amount of an asset exceeds its recoverable amount, an impairment loss is recognized in the statement of profit and loss under the caption "Provisions and impairment losses".

The recoverable amount is the higher of an asset's net selling price and its value of use. The net selling price is the amount obtainable from the sale of an asset in an arm's length transaction less the costs of the disposal. The value of use is the present value of estimated future cash flows expected to arise from the continued use of an asset and from its disposal at the end of its useful life. Recoverable amounts are estimated for individual assets or, if not possible, for the cash-generating unit to which the asset belongs.

Reversal of impairment losses recognized in prior years is recorded when the Group concludes that the impairment losses previously recognized for the asset no longer exist or has decreased. The reversal is recorded in the statement of profit and loss as "Other income". However, the increased carrying amount of an asset due to a reversal of an impairment loss is recognized to the extent it does not exceed the carrying amount that would have been determined (net of depreciation and amortization) had no impairment loss been recognized for that asset in prior years.

g) Borrowing costs

Borrowing costs are recognised as expense in the statement of profit and loss for the period in which they are incurred, in an accrual basis.

When the Company contracts loans to specifically finance capital assets, the corresponding interests are capitalized, being part of the cost of the asset. The capitalization of these interests starts after the beginning of the preparation of the activities of construction, and ceases when the asset is ready for use or in case the project is suspended.

h) Inventories

Raw, subsidiary and consumable materials are stated at acquisition average cost, deducted from quantity discounts granted by suppliers, which is lower than its market value.

Finished and intermediate goods, sub-products and work in progress are stated at production cost, which includes the cost of raw materials, direct labour and production overheads, which is lower than market value. Therefore, harvested wood owned by the Group is valued at production cost, which includes the costs incurred with the cutting, gathering and transport of harvested wood, as well as the accumulated cost of plantations, maintenance and administrative expenses in proportion to the harvested area.

When necessary the Group companies record impairment losses to reduce inventories to its net realisable or market value.

ALTRI, S.G.P.S., S.A. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

i) Biological assets

Part of Altri's activity consists in in the cultivation of several species of forestry, especially eucalyptus, which are used as raw material for paper pulp's production. At the end of the year, the plantations owned by the Group are classified in the caption "Biological assets". The forest lands owned by the Group are valued in accordance with accounting policy described in Note 2.3 b) and are classified in the caption "Tangible assets" of the consolidated financial statements.

Because of the inexistence of an active market of this forestry species in Portugal and given the impossibility of obtaining a reliable estimation of the present value of future cash flows generated by these biological assets, the Board of Directors opted to record biological assets at its historical cost, net impairment losses. This includes all the expenses incurred with plantation and with its development.

The cost of wood is transferred to production cost when the wood is harvested. The cost of wood harvested is determined based on the specific cost of each plantation attributed to each harvesting, which also includes the costs incurred on each plantation since the last harvesting.

Although it is not possible to estimate a reliable fair value of biological assets because of the reasons described above. The Board of Directors believes their fair value is higher than their book value. The Board has this understanding considering the fact that the forest management activity is concentrated in Altri Florestal S.A., which has been generating a recurring current balanced exploitation's activity. The industrial units of the Group purchase their raw material at similar prices to Altri Florestal or to third parties.

j) Provisions

Provisions are recognised when, and only when, the Group has an obligation (legal or constructive) arising from a past event, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate can be made of that obligation. Provisions are reviewed and adjusted at each balance sheet date to reflect the best estimate as of that date.

Restructuring provisions are recorded by the Group whenever a formal and detailed restructuring plan exists and has been communicated to the involved parties.

k) Pension complements

Some Group companies have assumed commitments to provide pension complements to employees retiring due to age or disability. To cover these liabilities there have been created autonomous pension funds, which annual charges, computed in accordance with actuarial analysis, are recorded in the statement of profit and loss in accordance with IAS 19 – "Employee benefits".

Any insufficiency of coverage by the autonomous pension funds that happened in order of rendered services is recorded as a liability in the financial statements of the Group.

When the financial situation of autonomous pension funds is superior to past services' responsibilities, Altri records an asset in its financial statements because this difference corresponds to less appropriations' necessities for pension funds in the future.

These liabilities were calculated under the "Projected unit credit method" under the actuarial and financial assumptions deemed to be the most adequate (Note 30).

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

l) Financial instruments

i) Investments

Investments held by the Group are divided into the following categories:

Investments held to maturity, are classified as non-current assets unless they mature within 12 months of the balance sheet date. The investments classified as held to maturity are non-derivative assets with defined or determinable payment dates, have defined maturity and the Group has the intention and ability to maintain them until the maturity date.

Investments measured at fair value through profit and loss are classified as current assets. The purpose of these investments is to obtain short term profits.

Investments available for sale are all the other investments that are not classified as held to maturity or measured at fair value through profit and loss, being classified as non-current assets.

Investments are initially measured at cost, which is the fair value of the price paid, including transaction costs if related with held to maturity and available for sale investments.

Investments available for sale and investments measured at fair value through profit and loss are subsequently measured at fair value by reference to the market value at the balance sheet date without any deduction for transaction costs which may be incurred until its sale. Investments in equity instruments which are not listed on a stock exchange market and whose fair value cannot be reliably measured are stated at cost net of impairment losses. Investments held to maturity are recorded at amortised cost, using the effective interest method.

Gains or losses arising from a change in the fair value of available for sale investments are recognised under the equity caption "Fair value reserve" included in caption "Other reserves", until the investment is sold or disposed, or until it is determined to be impaired, at which time the cumulative loss previously recognised in equity is transferred to profit and loss account for the period.

All purchases and sales of investments are recorded on its trade date, independently of the liquidation date.

ii) Accounts receivable

Receivables from "customers" and "other debtors" are stated at nominal value less impairment losses so that those receivables reflect its net realisable value. The current accounts receivable not include interests because discount's impact is not considered immaterial.

Impairment is recognised if there is objective and measurable evidence that, as a result of one or more events that occurred, the balance will not be fully received. Therefore, each group company takes into consideration market information which shows the client default in their responsibilities', as well as historic information on outstanding debts not received.

Recognized Impairment losses equals to the difference between the nominal value of the receivable balance and the correspondent present value of future estimated discounted cash-flows at the initial effective interest rate; when the payment is expected to occur in a period less than a year, the rate is considered null.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

iii) Loans and non-current payable accounts

Loans and non-current payable accounts are recorded in liabilities by amortised cost, using the effective interest rate method. Financial expenses are calculated based on the effective interest rate and are recorded in the statement of profit and loss on an accrual basis. The portion of the effective interest charge relating to up-front fees and commissions, if not paid in the period, is added to the book value of the loan.

Assets and liabilities are compensated and presented for its net amount as long as there is the right for compulsory fulfilment of compensation and the Board of Directors intends to realise them on a net basis or realise the asset and simultaneously settle the liability.

iv) Accounts payable

Non-interest bearing accounts payable are stated at nominal value, once the discount effect is immaterial.

v) Derivatives

Altri Group uses hedge derivatives for the management and hedging of its financial risks not being used for the purpose of trading.

Derivatives classified as cash flow hedge instruments are used by the Group mainly to hedge interest rate fluctuation, exchange rate and to fix pulp price. The index, the computation conventions, the interest rate hedging instruments are similar to the ones established for the underlying loans and therefore are qualified as perfect hedging. The derivatives most used by the Group are the price indexations of pulp using future contracts.

The Group's criteria for classifying a derivative instrument as a cash flow hedge instrument are:

• the hedge transaction is expected to be highly effective in offsetting changes in cash flows attributable to the hedged risk;
• the effectiveness of the hedge can be reliably measured;
• there is adequate documentation of the hedging relationships at the inception of the hedge;
• the forecasted transaction that is being hedged is highly probable.

The cash flow hedge instruments are recorded at its fair value. Changes in the fair value of these instruments are recorded in assets or liabilities, against the corresponding entry under the equity caption "Hedging reserves", and transferred to the statement of profit and loss when the operation subjected to hedging affects the net profit.

The determination of the fair value of these financial instruments is made with informatics systems of derivative instruments valuation and had, on its basis the actualization, for the balance sheet date, of the future fix and variable leg cash flows of the derivative instrument.

Hedge accounting of derivative instruments is discontinued when the instrument matures or is sold. Whenever a derivative instrument can no longer be qualified as a hedging instrument, the fair value differences recorded and deferred in equity under the caption "Hedging reserves" are transferred to profit and loss of the period or to the carrying amount of the asset that resulted from the hedged forecast transaction. Subsequent changes in fair value are recorded in the income statement.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

When embedded derivatives exist, they are accounted for as separate derivatives when the risks and the characteristics are not closely related to economic risks and characteristics of the host contract and when these are not stated at fair value with gains and losses not realizable are recorded in the profit and loss statement.

When derivative instruments, although specifically contracted to hedge financial risks, do not fulfil the requirements listed above to be classified and accounted as hedge instruments, the changes in fair value are directly recorded in the profit and loss statement, as financial results.

vi) Financial liabilities and Equity instruments

Financial liabilities and equity instruments are classified and accounted for based upon its contractual substance. Equity instruments are those that represent a residual interest upon the Group's net assets and are recorded by the amount received, net of costs incurred with its issuance.

vii) Own shares

Own shares are recorded at acquisition cost as a deduction to equity captions. Gains or losses on its sale are recorded in the equity caption "Other reserves" not affecting the project and loss statement for the period.

viii) Discounted bills and accounts receivable transferred to factoring companies

Only when the assets´ cash flows contractual right has expired or when the risks and benefits inherent to those assets property are transferred to a third entity the Group derecognise the financial assets of its financial statements. If the Group retains substantially the risks and benefits inherent to the property of such assets, the Group continues to recognize them in its financial statements, by recording in the caption "Other loans" the monetary counterparty for the conceded assets.

In consequence, the costumers balances formed by non-outstanding discounted bills and accounts receivable transferred to factoring companies as of the balance sheet date, with exception of the nonappealing factoring operations are recognized in the Group's financial statements until the moment of its collection.

ix) Cash and cash equivalents

Cash and cash equivalents include cash on hand, cash at banks on demand and term deposits and other treasury applications which reach maturity within less than three months and may be mobilized without significant risk of change in value.

For purposes of the consolidated statement of cash flows, "Cash and cash equivalents" caption also includes bank overdrafts, which are included in the balance sheet caption "Bank loans".

x) Assets classified as held for sale or in discontinuation

The assets and liabilities are classified as held for sale or in discontinuation, when their realization is made not by its use but by its sale. The Group classifies assets and liabilities in this caption when exists a high probability of its sale becomes effective and the assets and liabilities are available for immediate sale. The Board of Directors is committed in the sale of the assets and liabilities recorded in this caption, and it is their understanding that this sale will be completed in the next twelve months.

The assets classified as held for sale or in discontinuation are valued at the lower of its accounting value at the date of the sale decision and its fair value deducted of their selling costs.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

m) Contingent assets and liabilities

Contingent assets are possible assets arising from past events and whose existence will be confirmed, or not, by uncertain future events not controlled by the Company.

Contingent assets are not recorded in the consolidated financial statements but only disclosed when the existence of future economic benefits is likely.

Contingent liabilities are defined by the Company as (i) possible obligations that arise from past events and which existence will be confirmed, or not, by one or more occurrences of uncertain future events not controlled by the Company, or (ii) present obligations that arise from past events but that are not recorded because it is unlikely that an outflow of resources occurs to settle the obligation or the obligation amount cannot be reliably measured.

Contingent liabilities are not recorded in the consolidated financial statements, being disclosed, unless the probability of a cash outflow is remote, in which case no disclosure is made.

n) Income tax

Income tax for the period is determined based on the taxable results of the companies included in the consolidation and takes into consideration deferred taxation.

Current income tax is determined based on the taxable results of the companies included in the consolidation, in accordance with tax regulations in force at the location of the head office of each Group company, considering the annual estimated income tax rate.

For some of the companies included in the consolidation of Altri Group by the full consolidation method, the income tax is determined in accordance with article 69 of the Corporate Income Tax Code (Código do Imposto sobre o Rendimento das Pessoas Colectivas), under the special regime of taxation of groups of companies.

Deferred taxes are computed using the balance sheet liability method and reflect the timing differences between the amount of assets and liabilities for accounting purposes and the correspondent amounts for tax purposes. Deferred taxes are computed using the tax rate that is expected to be in force at the time these temporary differences are reversed.

Deferred tax assets are only recorded when there is reasonable expectation that sufficient taxable profits will arise in the future to allow such deferred tax assets to be used. At the end of each period the company reviews its recorded and unrecorded deferred tax assets which are reduced whenever its realization ceases to be likely, or recorded if it is likely that taxable profits will be generated in the future to enable its recovery.

Deferred tax assets and liabilities are recorded in the statement of profit and loss, except if they relate to items directly recorded in equity. In these cases the corresponding deferred tax is recorded in the same equity captions.

o) Income recognition and accrual basis

Revenue arising from the sale of goods is recognized in the consolidated income statement when (i) the risks and benefits have been transferred to the buyer, (ii) the company retains neither continued management involvement in a degree usually associated with ownership nor effective control over the goods sold, (iii) the amount of the revenue can be measured reasonably, (iv) it is likely that the economic benefits associated with the transaction will flow to the Company, and (v) the costs incurred or to be incurred related with the transaction can be reliably measured. Sales are recorded net of taxes, discounts and other expenses arising from the sale, and are measured at the fair value of the amount received or receivable.

Dividends are recognized as income in the period its distribution is approved.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

All other income and expenses are recognized in the period to which they relate, independently of when the amounts are received or paid. Differences between the amounts received and paid and the corresponding income and expenses are recorded in the captions "Other current assets", "Other current liabilities", "Other non-current assets" and "Other non-current liabilities".

When the actual amount of income or expenses is yet unknown, these are recorded based on the best estimate of the Board of Directors of the Group companies.

p) Balances and transactions expressed in foreign currencies

All assets and liabilities expressed in foreign currencies were translated to Euro using the exchange rates in force on the balance sheet date.

Favourable and unfavourable exchange differences arising from changes in the exchange rates between those prevailing on the dates of the transactions and those in force on the dates of payment, collection or as of the balance sheet date are recorded in the consolidated statement of profit and loss, except the ones related to non-monetary values which fair value variation be directly recorded in equity.

q) Subsequent events

Post balance sheet date events that provide additional information about conditions that existed at the balance sheet data ("adjusting events"), are reflected in the consolidated financial statements. Post balance sheet date events that provide information about conditions that have only arise after the balance sheet date are considered "non-adjusting events" and are disclosed in the notes to the financial statements, if material.

r) Segment information

In each period, the Company identifies the most adequate segment division taking into consideration the business areas in which the Group is present.

At the moment, Altri Group has only one business segment (production and commercialization of bleached paper pulp from eucalyptus) for which the internal report of segmental information is analysed under this assumption.

s) Judgments and estimates

In preparing the consolidated financial statements in accordance with IAS / IFRS, the Group's Board of Directors has adopted certain assumptions and estimates that affect the reported assets and liabilities and income and expenses incurred for the periods reported. All estimates and assumptions made by the Board were made based on your best knowledge existing at the date of approval of the financial statements, events and transactions in progress.

The most significant accounting estimates reflected in the consolidated income statements include:

• a) Useful lives of the tangible and intangible fixed assets;
• b) Impairment analysis of goodwill and of other tangible and intangible fixed assets;
• c) Recognition of impairment on assets, namely inventory and account receivables, and provisions;
• d) Pension Fund responsibilities calculation; and
• e) Fair value of Derivative Financial Instruments.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

Estimates used are based on the best information available during the preparation of consolidated financial statements and are based on best knowledge of past and present events. Although future events are neither controlled by the Group nor foreseeable, some could occur and have impact on the estimates. Changes to the estimates used by the management that occur after the date of these consolidated financial statements, will be recognised in net income, in accordance with IAS 8, using a prospective methodology.

2.4 FINANCIAL RISK MANAGEMENT

Altri´s Group is exposed essentially to the: (i) market risk; (ii) liquidity risk and (iii) credit risk. The main objective of the Board of Directors, on what risk management concerns, is to reduce these risks to a level considered acceptable for the development of the Group activities. The guiding lines of the risk management policy are defined by Altri´s Board of Directors, which determines the acceptable risk limits. The operational concretization of the risk management policy is made by the Board of Directors and by the management of each participated company.

a) Market risk

At this level of market risk, a particular importance is given to interest rate risk, exchange rate risk, variability of the commodities' price risk and forest management and production of eucalyptus risk.

The Group uses derivative instruments on the management of their market risks which is exposed as a way of ensure its hedging and does not use derivative instruments with the objective of negotiation or speculation.

i) Interest rate risk

The exposure of the Group to interest rate results of the long term loans constituted, mainly, by debt indexed to Euribor.

The Group uses derivative instruments or similar transactions for hedging interest rate considered significant. Three principles are used in the selection and determination of the hedging instruments of interest rate:

• For each derivative or hedging instrument used to protect the risk associated with a particular funding, there is coincidence between the dates of the flow of interests paid on loans to be hedged and the dates of liquidation under the hedging instruments;
• Perfect equivalence between the base rates: the indexing used in derivative or hedging instrument should be the same as that applicable to the financing or transaction that is being hedged; and
• Since the beginning of the transaction, the maximum cost of debt resulting from the hedging transaction undertaken, is known and limited, even in scenarios of extreme changes in interest rates market.

Since the entire indebtedness of Altri is indexed to floating rates, interest rate swaps are used when it is considered necessary as a mean of protection against changes in future cash flows associated with interest payments. The interest rate swaps agreed have the economic effect of converting the loans linked to variable rates to fixed rates. Under these contracts the Group agrees with other parties (banks) to exchange, in pre-determined periods of time, the difference between the amount of interest calculated at the fixed rate and variable rate contracted at that time, with reference to the respective amounts previously agreed.

ALTRI, S.G.P.S., S.A. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

The counterparts of the hedging instruments are limited to high credit quality financial institutions, since the Group policy priority is the hiring of these instruments with banks that are part of its financing operations. For purposes of determining the counterpart of specific operations, Altri requests proposals and indicative prices from a representative number of banks to ensure adequate competitiveness of these operations.

In determining the fair value of hedging transactions, the Group uses certain methods, such as valuation models of options and discounted future cash flows, as well as certain assumptions that are based on the interest rate market conditions prevailing at the date of the consolidated financial statement position. Quotes of comparative financial institutions, for specific instruments, are used as reference for evaluation.

The Board of Directors approves the terms and conditions of the relevant funding of the Group, analysing the structure of such debt, the risks and the different options available in the market, particularly regarding the type of interest rate (fixed / variable).

The Group objective is to limit the cash-flows and results volatility according to its operational activity through the utilization of an adequate combination of fix and variable tax debt. The Group policy allows the use of interest rate derivatives in order to obtain a reduction of the exposure to Euribor variations and not to speculative purposes.

Most derivative instruments used by the Group in interest rate management are defined as cash-flow hedging instruments as these configure perfect hedging relations. The index, the computation conventions, the interest rate hedging instruments are similar to the ones established for the underlying loans. Nevertheless, there are some derivative instruments which, although have been contracted with the hedging interest risk objective, do not match with the requirements above defined for the hedging instruments classification.

The sensitivity analysis of the results of Altri to the changes in interest rate is in the Note 21.

ii) Exchange rates risk

The Group is exposed to exchange rates risk in transactions related with the finished goods sales in international markets with different currency from Euro.

Whenever the Board of Directors considers necessary to reduce the volatility of their results to the variability of exchange rates the exposition is managed trough forwards programs or other exchange rates derivatives.

As of 31 December 2013 and 2012 the balances denominated in USD are as follows:

	31.12.2013	31.12.2012
Accounts receivable	14,196,014	18,570,855
Accounts payable	32,159	55,452
Bank deposits (Note 17)	26,600,326	20,552,601
Factoring (Note 21)	6,544,697	7,815,839
	47,373,196	46,994,747

Additionally, as of 31 December 2013 and 2012 the balances in a currency different from Euro and USD are as follows:

	31.12.2013	31.12.2012
Accounts payable	58,208	51,347
	58,208	51,347

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

The Board of Directors considers that eventual changes in exchange rates do not have a significant effect in the consolidated financial statements.

iii) Variability risk on commodities price

By developing its activity in a commodity transactional industry (paper pulp), the Group is particularly exposed to its price fluctuations, with the correspondent impacts in their results. However, in order to manage this risk, paper pulp price fluctuations hedging contracts were celebrated by the adequate amounts by the foreseen operations, reducing the volatility of its results.

The increase/decrease of 5% in the pulp price commercialized by the Group during 2013 would have implied an increase/decrease on operational results, approximately of 23.75 million euro, without considering the effects of the pulp's derivatives (Note 28) and keeping everything else constant.

iv) Forest management and eucalyptus production risks

Altri, through its subsidiary Altri Forest, has the management of a forest asset of about 84,000 hectares where 79% are eucalyptus. The forest is certified by FSC ® (Forest Stewardship Council ®1) and PEFC (Programme for the Endorsement of Forest Certification) entities that establish the principles and criteria for which is evaluated the sustainability of the forest's management in economic, environmental and social terms.

In this context, all forestry activity is directed towards the optimization of available resources while preserving the environmental stability and ecological values present in its assets and ensuring its development.

The risks associated with any forestry activity are also present in Altri Forest's management. Forest fires, pests and diseases that can occur in forests spread through the country are the biggest risks facing this sector. These threats, if they occur, depending on its intensity, affect the normal function of the forest's exploration and the production's efficiency.

In order to prevent and reduce the impact of forest fires, the Forest Altri participates, together with the Portucel Soporcel, in a company called AFOCELCA that has the goal of providing, coordinating and managing the resources available for fire-fighting. At the same time, are made large investments to clean forest areas in order to reduce the risk of spread of the fires as well as mitigate its losses.

Regarding pests and diseases, its emergence can significantly reduce the growth of the forest productivity causing irreversible damage. For combating these problems were established integrated fight procedures by releasing specific parasitoids from Australia or through the use of phytopharmaceuticals products to control populations of insects and reduce the negative effects of its presence. On the other hand, in the areas more affected, Altri Forest is using genetic material more suitable for new plantations which, by its characteristics, allow more resistance to these pests and diseases.

The increase/decrease of 5% in the wood price during 2013 would have implied an increase/decrease on operational results, approximately of 10.5 million euro, keeping everything else constant.

b) Liquidity risk

The purpose of liquidity risk management is to ensure, at all times, that the Group has the financial capacity to fulfil its commitments as they become due and to carry on its business activities and strategy trough an adequate financing maturities management.

¹ FSC-C004615

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

The Group prosecutes an active refinancing policy distinguished by the maintenance of high free and immediate available resources to face short term necessities and the extension or sustenance of the debt maturity in accordance with the predicted cash flows and the Balance leverage capability.

The liquidity analysis' for financial instruments is disclosed next to the respective note to each financial liabilities class.

c) Credit risk

The Group is exposed to the credit risk in its current operational activity. This risk is controlled trough a collecting information system of financial and qualitative information provided by recognized entities that supply information of risks, which allow the assessment of the clients' viability in the fulfilment of their obligations in order to reduce the credit concession risk.

The evaluation of credit risk is made on a regular basis, taking into consideration the current conditions of economic conjuncture and the specific situation of credit rating of each debtor, adopting corrective measures whenever necessary.

The risk credit is limited by the risk concentration management and a strict selection of counterparts as well as the contracting of credit insurances' to specialized institutions which ensure a significant part of the conceded credit in result of the activity developed by the Group.

The adjustments to accounts receivable are calculated taking into consideration (i) the risk profile of the customer, (ii) the average collection period, and (iii) the customer's financial conditions.

The amounts included in the face of the consolidated statement of financial position are presented net of accumulated impairment losses, and therefore, at its fair value.

3. CHANGES IN ACCOUNTING POLICIES AND CORRECTION OF MISTAKES

During the year there were no changes in accounting policies and were identified no material mistakes related to previous years.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

4. INVESTMENTS

4.1 INVESTMENTS IN SUBSIDIARIES

The companies included in the consolidated financial statements by the full consolidation method, its headquarters, percentage participation held and main activity as of 31 December 2013 and 2012, are as follows:

Company	Head Office		Percentage Held	Activiy
		2013	2012
Parent-Company
Altri, SGPS, S.A.	Porto			Investment management
Subsidiaries
Altri - Energias Renováveis, SGPS, S.A.	Vila Velha de Ródão	99.83%	99.83%	Holding
Altri Florestal, S.A.	Figueira da Foz	100%	100%	Forest management
Altri Sales, S.A.	Nyon, Sw itzerland	100%	100%	Group management support services
Altri, Participaciones Y Trading, S.L.	Madrid, Spain	100%	100%	Comercialization of pulp
Caima Energia – Empresa de Gestão e Exploração de Energia, S.A.	Constância	100%	100%	Production of energy
Caima Indústria de Celulose, S.A.	Constância	100%	100%	Production and comercialisation of pulp
Captaraíz Unipessoal, Lda.	Figueira da Foz	100%	100%	Purchase and sale of properties
Celbinave – Tráfego e Estiva SGPS, Unipessoal, Lda.	Figueira da Foz	100%	100%	Freightage of ships
Celtejo – Empresa de Celulose do Tejo, S.A.	Vila Velha de Ródão	99.83%	99.83%	Production and comercialisation of pulp
Celulose Beira Industrial (Celbi), S.A.	Figueira da Foz	100%	100%	Production and comercialisation of pulp
Celulose do Caima, SGPS, S.A.	Figueira da Foz	100%	100%	Investment management
Inflora – Sociedade de Investimentos Florestais, S.A.	Figueira da Foz	100%	100%	Forest exploitation
Invescaima – Investimentos e Participações, SGPS, S.A.	Figueira da Foz	100%	100%	Investment management
Pedro Frutícola, Sociedade Frutícola, S.A.	Constância	100%	100%	Agriculture production
Viveiros do Furadouro Unipessoal, Lda.	Óbidos	100%	100%	Production of plants in nurseries and services related w ith forests and landscapes

All the above companies were included in the consolidated financial statements in accordance with the full consolidation method, as established in Note 2.2.a).

4.2 INVESTMENTS IN ASSOCIATED COMPANIES AND JOINT VENTURES

The associated companies and joint ventures, percentage of capital held and main activity as of 31 December 2013 and 2012 are as follows:

Company		Percentage Held	Activity
	2013	2012
Associated Companies:
Operfoz – Operadores do Porto da Figueira da Foz, Lda.	33.33%	33.33%	Harbor operations
Joint Ventures:
EDP – Produção Bioeléctrica, S.A.	50%	50%	Energy production

These companies were included in the consolidated financial statements in accordance with the equity method, as explained in Note 2.2b) and Note 2.2.c).

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese.

In the event of discrepancies, the Portuguese language version prevails – Note 45)

The book value, total assets, equity and net profit for the year ended on 31 December 2013 for these companies were as follows:

Company	Book Value (a)	Total assets	Equity	Net profit
Associated Companies:
Operfoz – Operadores do Porto da Figueira da Foz, Lda.	513,367	3,282,773	1,540,097	261,493
Joint Ventures:
EDP – Produção Bioeléctrica, S.A. (b)	8,128,942	141,281,742	17,387,324	4,036,378
	8,642,309

(a) includes loans granted

(b) EDP – Produção Bioeléctrica, S.A. is holder of shares representing of 100% of capital of Ródão Power – Energia e Biomassa do Ródão, S.A.

The accounting policies used by these companies do not differ significantly from those used by Altri Group, fact that led to no accounting policies harmonization.

4.3 INVESTIMENTS AVAILABLE FOR SALE

As of 31 December 2013 and 2012 the investments available for sale and their book value as of that date, were as follows:

	Book Value
	2013	2012
Rigor Capital - Produção de Energia, Lda.	10,527,397	10,527,397
Other investments	4,129,512	4,454,506
	14,656,909	14,981,903

Altri Group believes that the book value of investments available for sale, which include financial investments under 20% in companies where Altri Group has no significant influence on its management and are recorded at cost, net of impairment losses according to the accounting policy of the Note 2.3.l) i), does not differ significantly from its fair value. In the particular case of Rigor Capital- Produção de Energia Lda., this assumption is based on an external evaluation.

The caption "Other Investments" includes listed shares which are recorded at market value amounting to 3.965.713 Euros (Note 6).

5. CHANGES IN THE GROUP COMPANIES

During the year ended December 31, 2013 and 2012, there were no changes in the consolidation perimeter.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

6. FINANCIAL INSTRUMENTS BY CLASS

Financial instruments, according to the policies described in Note 2.3.I), were classified as follow:

31 December 2013	Notes	Loans and receivables	Available for sale	Derivatives	Total
Non current assets
Investments available for sale	4.3	-	14,656,909	-	14,656,909
		-	14,656,909	-	14,656,909
Current Assets Customers	13	80,294,638	-	-	80,294,638
Other debtors	14	7,562,193	-	-	7,562,193
Derivatives	28	-	-	1,204,184	1,204,184
Cash and cash equivalents	17	232,450,518	-	-	232,450,518
		320,307,349	-	1,204,184	321,511,533
		320,307,349	14,656,909	1,204,184	336,168,442
31 December 2012	Notes	Loans and receivables	Available for sale	Derivatives	Total
Non current assets
Investments available for sale	4.3	-	14,981,903	-	14,981,903
		-	14,981,903	-	14,981,903
Current Assets
Customers	13	94,859,425	-	-	94,859,425
Other debtors Derivatives	14 28	7,241,482 -	- -	- 261,783	7,241,482 261,783
Cash and cash equivalents	17	112,392,485	-	-	112,392,485
		214,493,392	-	261,783	214,755,175
		214,493,392	14,981,903	261,783	229,737,078
31 December 2013		Notes	Financial	Derivatives	Total
			Liabilities
Non current liabilities
Bank Loans		21	74,212,500	-	74,212,500
Other Loans		21	439,370,297	-	439,370,297
Reimbursable subsidies		21	11,228,419	-	11,228,419
Other non current creditors		23	404,350	-	404,350
			525,215,566	-	525,215,566
Current liabilites
Bank Loans		21	78,693,353	-	78,693,353
Other Loans - short term		21	213,719,587	-	213,719,587
Reimbursable subsidies Suppliers		21 25	71,008 60,034,597	- -	71,008 60,034,597
Other current creditors		26	6,395,461	-	6,395,461
Derivatives		28	-	6,488,549	6,488,549
			358,914,006	6,488,549	365,402,555
			884,129,572	6,488,549	890,618,121
31 de Dezembro de 2012		Notes	Financial	Derivatives	Total
			Liabilities
Non current liabilities
Bank Loans		21	103,556,923	-	103,556,923
Other Loans Reimbursable subsidies		21 21	454,999,132 22,770,236	- -	454,999,132 22,770,236
Other non current creditors		23	528,802	-	528,802
			581,855,093	-	581,855,093
Current liabilites
Bank Loans		21	45,467,181	-	45,467,181
Other Loans - short term		21	139,404,040	-	139,404,040
Reimbursable subsidies		21	11,694,604	-	11,694,604
Suppliers		25	56,343,385	-	56,343,385
Other current creditors		26	6,679,435	-	6,679,435
Derivatives		28	-	22,113,796	22,113,796
			259,588,645	22,113,796	281,702,441
			841,443,738	22,113,796	863,557,534

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

Financial instruments recognized at fair value

The following table details the financial instruments that are measured at fair value after initial recognition, grouped into three levels according to the degree to which the fair value is observable:

Level 1: fair value is measured based on active markets' prices;

Level 2: fair value is measured based on valuation techniques. The main inputs of the valuation models are observable in the market;

Level 3: fair value is measured based on valuation models, whose main inputs are not observable in the market.

	31.12.2013			31.12.2012
	Level 1	Level 2	Level 3	Level 1	Level 2	Level 3
Financial assets recorded at fair value: Investments available for sale (Note 4.3)	3,965,712	-	-	4,310,202	-	-
Derivatives (Note 28)	-	1,204,184	-	-	261,763	-
Financial liabilites recorded at fair value: Derivatives (Note 28)	-	6,488,549	-	-	22,113,796	-

In December 31, 2013 and 2012 did not exist financial assets whose terms have been renegotiated and if they had not been renegotiated they would be overdue or impaired.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

7. TANGIBLE FIXED ASSETS

During the years ended 31 December 2013 and 2012, the movement occurred in tangible fixed assets and the corresponding accumulated depreciation and impairment losses, was as follows:

Gross assets Buildings and other Plant and Advances on account of Land constructions machinery Vehicles Office equipment Other tangible assets Work in progress fixed assets Total Opening Balance 26,682,948 104,438,534 944,046,667 3,415,961 10,157,480 14,262,079 5,552,520 583,212 1,109,139,401 Additions 29,655 3,055 3,626,821 155,519 82,673 52,029 11,470,677 - 15,420,429 Disposals (11,181) (299,406) - (162,388) (5,307) (66,434) - - (544,716) Transfers and w rite-offs 7,380 - 7,830,353 - 14,032 - (8,027,224) - (175,459) Closing balance 26,708,802 104,142,183 955,503,841 3,409,092 10,248,878 14,247,674 8,995,973 583,212 1,123,839,655 Accumulated depreciation Buildings and other Plant and Land constructions machinery Vehicles Office equipment Other tangible assets Total Opening Balance 7,171,076 85,596,101 567,262,506 2,698,422 9,283,098 13,023,035 685,034,238 Additions 321,921 1,467,706 45,930,994 308,248 404,981 249,393 48,683,243 Disposals - (172,335) - (146,288) (5,307) (66,434) (390,364) Transfers and w rite-offs - - - - - - - Closing balance 7,492,997 86,891,472 613,193,500 2,860,382 9,682,772 13,205,994 733,327,117 19,215,805 17,250,711 342,310,341 548,710 566,106 1,041,680 8,995,973 583,212 390,512,538 2012 Gross assets Buildings and other Plant and Advances on account of Land constructions machinery Vehicles Office equipment Other tangible assets Work in progress fixed assets Total Opening Balance 26,590,516 104,388,008 934,861,814 3,466,642 10,033,423 13,820,199 7,545,344 583,212 1,101,289,158 Additions 64,425 57,838 6,425,767 278,657 77,082 363,074 5,178,228 - 12,445,071 Disposals (38,213) (187,695) (3,824,047) (334,030) (32,942) (19,016) - - (4,435,943) Transfers and w rite-offs 66,220 180,383 6,583,133 4,692 79,917 97,822 (7,171,052) - (158,885) Closing balance 26,682,948 104,438,534 944,046,667 3,415,961 10,157,480 14,262,079 5,552,520 583,212 1,109,139,401 Accumulated depreciation Buildings and other Plant and					2013
	Land	constructions	machinery	Vehicles	Office equipment	Other tangible assets		Total
Opening Balance 6,842,055 84,016,057 526,077,781 2,662,606 8,827,445 12,744,331 641,170,275
Additions 329,021 1,741,184 45,091,164 353,974 488,267 277,406 48,281,016
Disposals - (151,255) (3,777,399) (275,060) (2,150) (8,014) (4,213,878)
Transfers and w rite-offs - (9,885) (129,040) (43,098) (30,464) 9,312 (203,175)
Closing balance 7,171,076 85,596,101 567,262,506 2,698,422 9,283,098 13,023,035 685,034,238
19,511,872 18,842,433 376,784,161 717,539 874,382 1,239,044 5,552,520 583,212 424,105,163

During the years ended 31 December 2013 and 2012 the amortisations amounted to 48,683,243 Euro and 48,281,016 Euro, respectively, and were recorded in the profit and loss statement in caption "Amortisation and depreciation" (Note 37).

The caption "Work in progress" as of 31 December 2013 and 2012 refers to the following projects:

	31-12-2013	31-12-2012
Improvement of the evaporation manufacturing facility	1,971,398	2,041,755
Mill optimization	1,221,448	-
Increase of production capacity	3,157,719	-
Cogeneration projects	-	1,925,781
Other projects	2,645,408	1,584,984
	8,995,973	5,552,520

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

8. INVESTMENT PROPERTIES

The amount recorded in caption "Investment Properties" in December 31, 2013 and 2012 refers, essentially, to lands that are not used in the Group's activities.

The Board of Directors believes that the fair value of the investment properties is higher than their net book value.

The movements in caption "Investment properties" during the years ended as of 31 December 2013 and 2012 were as follows:

	2013	2012
	Gross Assets
Opening balance	803,046	1,013,139
Additions	-	-
Disposals	-	(210,093)
Transfers and w rite-offs	-	-
Closing balance	803,046	803,046
	Accumulated Amortisations
Opening balance	335,040	478,913
Additions	7,379	7,381
Disposals	-	(151,254)
Closing balance	342,419	335,040
Net amount	460,627	468,006

During the years ended as of 31 December 2013 and 2012 amortisations amounted to 7,379 Euro and 7,381 Euro, respectively, and were recorded in caption "Amortisation and depreciation" (Note 37).

9. GOODWILL

During 2013 and 2012 there were no movements in goodwill, being its composition as follows:

Celbi	253,391,251
Others	12,140,153
	265,531,404

Goodwill is not amortised. Impairment tests are made on an annual basis and whenever an event or a change in circumstances that reveals that the amount for which the asset is recorded could not be recoverable. Whenever the amount by which the asset is recorded is superior to its recoverable amount an impairment loss is recognized. The recoverable amount is the highest between the net sale price and the value of use. During 2013 and 2012, there were not recorded or reverted any impairment losses.

During 2013, in order to assess the existence or not of impairment on the main goodwill amount that resulted from Celbi - Celulose Beira Industrial, S.A.'s acquisition, in 2006, amounting to 253,391,251 Euro, the Group evaluated this subsidiary, and concluded that there was no impairment. That evaluation was based on Celbi's historical performance and an estimate of discounted cash flows based on a Celbi's 7 year business plan (since it is the Board's understanding that this is the most appropriate period given the cyclical nature of the operations of the Group) considering the long term price of paper pulp, not affected by the short term variations.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

The main assumptions used in 2013 in this calculation were:

Inflation rate	1.50%
Discount rate	10.43%
Grow th rate in perpetuity	2.00%

The discount rate net of taxes (net of tax because the cash flow used in financial projections was also net of tax) used in 2013 was 10.43% and was calculated according to the WACC (Weighted Average Cost of Capital), considering the following assumptions:

Risk-free interest rate	6.68%
Equity risk premium	6.00%
Debt risk premium	2.50%

The Group made a sensitivity analysis of this evaluation to variations in key assumptions, having concluded that if it had been considered a discount rate of 11.5% together with a null perpetual growth rate, the conclusion of no impairment of the affiliate Celbi would remain valid.

Regarding the remaining goodwill amounting to 12,140,153 Euro, in order to analyse the existence or not of impairment losses as of 31 December 2013, the Group made a comparison of net cash flows generated annually by each company, as well as market multiples with their net contributions to the consolidated financial statements including goodwill and concluded that there was no impairment.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese.

In the event of discrepancies, the Portuguese language version prevails – Note 45)

10. INTANGIBLE ASSETS

During 2013 and 2012, the movement in intangible assets, as well as in the corresponding accumulated depreciation and impairment losses, was as follows:

		2013
		Gross assets
	Industrial property and other rights	Softw are	Other intangible assets	Total
Opening blanace	1,320	7,898,438	25,600	7,925,358
Additions	-	-	-	-
Disposals Transfers and w rite-offs	- -	- 134,446	- -	- 134,446
Closing balance	1,320	8,032,884	25,600	8,059,804
		Accumulated depreciation
	Industrial
	property and		Other intangible
	other rights	Softw are	assets	Total
Opening blanace	1,320	7,301,584	17,066	7,319,970
Additions	-	537,015	8,534	545,549
Disposals	-	-	-	-
Transfers and w rite-offs	-	-	-	-
Closing balance	1,320	7,838,599	25,600	7,865,519
	-	194,285	-	194,285
		2012
		Gross assets
	Industrial
	property and		Other intangible
	other rights	Softw are	assets	Total
Opening blanace	1,320	7,724,508	25,600	7,751,428
Additions	-	94,327	-	94,327
Disposals	-	(15,359)	-	(15,359)
Transfers and w rite-offs	-	94,962	-	94,962
Closing balance	1,320	7,898,438	25,600	7,925,358
	Accumulated depreciation
	Industrial
	property and		Other intangible
	other rights	Softw are	assets	Total
Opening blanace	1,320	6,752,220	8,533	6,762,073
Additions	-	564,723	8,533	573,256
Disposals	-	(15,359)	-	(15,359)
Transfers and w rite-offs	-	-	-	-
Closing balance	1,320	7,301,584	17,066	7,319,970

In 2013 and 2012 the amortisations amounted to 545,549 Euro and 573,256 Euro, respectively, and were recorded in the profit and loss statement's caption "Amortisation and depreciation" (Note 37).

• 596,854 8,534 605,388

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

11. BIOLOGICAL ASSETS AND INVENTORIES

As of 31 December 2013 and 2012, the amount recorded in the caption "Biological assets" relates to forest and to plantation charges incurred by the Group and can be detailed as follows:

	31.12.2013	31.12.2012
Biological assets	107,502,958	108,414,774
Accumulated impariment losses in biological assets (Note 22)	(380,006)	(380,006)
	107,122,952	108,034,768

As of 31 December 2013 and 2012, the total area managed by Altri amounted to 84,000 hectares. The eucalyptus' area had the following age distribution:

	31/12/2013	31-12-2012
0 - 5 years	28,714	34,568
6 -10 years	30,507	29,048
> 10 years	7,553	4,089
	66,774	67,705

The rest of the area belongs to others residual forest species with minor importance.

As of 31 December 2013 and 2012 the caption "Inventories" was made up as follows:

	31.12.2013	31.12.2012
Raw , subsidiary and consumable materials	38,456,603	34,825,150
Work in progress	313,802	329,076
Finished and intermediate goods	20,945,066	17,872,209
	59,715,471	53,026,435
Accumulated impairment losses (Note 22)	(4,886,156)	(5,586,156)
	54,829,315	47,440,279

The cost of sales for the year ended 31 December 2013 amounted to 240,343,561 Euro and was computed as follows:

	Raw , subsidiary and consumable materials	Finished and intermediate goods	Work in progress	Biological assets	Total
Opening balance	34,825,150	17,872,209	329,076	108,414,774	161,441,209
Purchases	251,191,633	-	-	-	251,191,633
Inventory adjusment	(1,108,079)	2,312	-	(3,965,085)	(5,070,852)
Closing balance	(38,456,603)	(20,945,066)	(313,802)	(107,502,958)	(167,218,429)
	246,452,101	(3,070,545)	15,274	(3,053,269)	240,343,561

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

The cost of sales for the year ended 31 December 2012 amounted to 208,834,212 Euro and was computed as follows:

	Raw , subsidiary and consumable materials	Finished and intermediate goods	Work in progress	Biological assets	Total
Opening balance	38,910,668	27,051,183	653,194	103,719,508	170,334,553
Purchases	200,933,146	-	-	-	200,933,146
Inventory adjusment	(275,929)	(716,349)	-	-	(992,278)
Closing balance	(34,825,150)	(17,872,209)	(329,076)	(108,414,774)	(161,441,209)
	204,742,735	8,462,625	324,118	(4,695,266)	208,834,212

12. CURRENT AND DEFERRED TAXES

In accordance with current legislation, tax returns are subject to review and correction by the tax authorities during a four-year period (five years for Social Security), except when there have been tax losses, there have been granted tax benefits, or tax inspections or claims are in progress, in which cases the periods may be extended or suspended. Therefore, the tax returns of Altri and its subsidiary and associated companies for the years 2010 to 2013 are still subject to review.

The Board of Directors of Altri believes that any potential corrections resulting from reviews/inspections of these tax returns by the tax authorities will not have a significant effect on the consolidated financial statements as of 31 December 2013 and 2012.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese.

In the event of discrepancies, the Portuguese language version prevails – Note 45)

The movements occurred in deferred tax assets and liabilities in the years ended in 31 December 2013 and 2012 were as follow:

		2013
	Deferred tax assets	Deferred tax liabilities
Opening balance as of 1 January 2013	33,357,371	16,931,978
Effects on income statement:
Increases/(Decreases) in provisions not accepted for tax purposes	586,902	-
Harmonization of depreciation rates	780,766	-
Other effects	(1,009,682)	636,041
Total effect on income statement	357,986	636,041
Effect on shareolders' funds:
Fair value of derivatives (Note 28)	(2,549,543)	328,195
Closing balance as of 31 December 2013	31,165,814	17,896,214
		2012
	Deferred tax assets	Deferred tax liabilities
Opening balance as of 1 January 2012	13,699,322	444,167
Effects on income statement:
Increases/(Decreases) in provisions not accepted for tax purposes	1,316,627	-
Harmonization of depreciation rates	312,860	-
Tax losses carried forw ard	16,429,925	-
Tax amortization of goodw ill	-	16,429,925
Other effects	(301,745)	57,886
Total effect on income statement	17,757,668	16,487,811
Effect on shareolders' funds:
Fair value of derivatives (Note 28)	1,900,382	-
Closing balance as of 31 December 2012	33,357,371	16,931,978

During the year ended in December 31, 2012 the strategic decision to continue the operations of the subsidiary Altri SL, based in Spain, was reinforced. Following this decision: (i) the recording of deferred tax liabilities resulting from tax amortization of goodwill generated in that country following the acquisition of Celulose Beira Industrial (Celbi), SA, was supported, amounting to17,177,112 Euro as of 31 December 2013 and 16,429,925 Euro as of 31 December 2012; and (ii) given the projections for future taxable income of Altri SL the Board of Directors expects to recover past tax losses, which lead to the recognition of deferred tax assets in the same amount of the deferred tax liabilities recorded in December 31, 2013 and 2012.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese.

In the event of discrepancies, the Portuguese language version prevails – Note 45)

As of 31 December 2013 and 2012 the detail of deferred tax assets and liabilities, in accordance with the timing differences that originated them, was as follows:

		31.12.2013		31.12.2012
	Deferred tax assets	Deferred tax liabilities	Deferred tax assets	Deferred tax liabilities
Provision and impairment losses not accepted for tax purposes	2,999,654	-	2,412,752	-
Fair value of derivatives	2,032,500	328,195	4,582,043	-
Harmonization of accounting principles	8,972,642	-	8,191,876	-
Tax losses carried forw ard	17,177,112	-	16,429,925	-
Tax amortization of goodw ill	-	17,177,112	-	16,429,925
Other	(16,094)	390,907	1,740,775	502,053
	31,165,814	17,896,214	33,357,371	16,931,978

According to the legislation, the Group uses a deferred tax rate of 26.5% that results of the sum of the rate approved for 2014 and subsequent years which amounts to 23% plus the municipal surtax whose rate is 1.5% for Altri and the state surtax that Altri estimated that will be an average of 2% except for deferred tax assets that result from tax losses carried forward, where it is used a rate of 23%. Regarding the subsidiary Altri, SL based in Spain the rate used in the calculation of deferred tax assets and liabilities was 30% since it is the tax rate in force in that country.

According to the legislation, for the year ending on December 31, 2013 the income tax rate was 25%.

Additionally, according to the legislation during the year ending on December 31, 2013, state surtax correspond to the application of an additional tax of 3% on the portion of taxable income between 1.5 e 7.5 million Euro and 5% on the portion of taxable income exceeding 7.5 million Euro.

On December 31, 2013 the Group evaluated the recognition of deferred taxes resulting from tax losses. In cases that originated deferred tax assets, these were only recorded to the extent that it is probable that taxable profits will arise in the future and they may be used to recover tax losses or deductible tax differences.

On December 31, 2013 there were tax losses carried forward generated in Altri SL amounting to approximately 63,700,000 Euro of which not all deferred tax assets, were registered by prudence and would amount to approximately 19,100,000 Euro. The deferred tax assets recorded were approximately 17,177,112 Euro.

Income taxes recorded in the profit and loss statement for the years ended 31 December 2013 and 2012 can be detailed as follows:

	31.12.2013	31.12.2012
Current income tax	(9,639,244)	(9,931,148)
Deferred income tax	(278,055)	1,269,857
	(9,917,299)	(8,661,291)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

The reconciliation of the profit before tax to the income tax is as follows:

	31.12.2013	31.12.2012
Profit before tax	65,983,402	60,865,927
Tax rate (including municipal surtax)	26.50%	26.50%
	(17,485,602)	(16,129,471)
Tax benefits	13,247,089	11,255,347
State surtax	(3,218,219)	(2,999,312)
Other effects	(2,460,567)	(787,855)
Income tax	(9,917,299)	(8,661,291)

As of 31 December 2013 and 2012 the caption "Tax Benefits" is, essentially, made up by the use of the tax credit granted by the Portuguese State to Celbi – Celulose Beira Industrial (Celbi) S.A. and Celtejo – Empresa de Celulose do Tejo, S.A. under the tax incentive programme, to the investment in production's capacity increase (Note 21).

13. COSTUMERS

As of 31 December 2013 and 2012 this caption can be detailed as follows:

	31.12.2013	31.12.2012
Costumers, current accounts	82,146,755	97,120,257
Costumers, doubtful debts	112,548	290,181
	82,259,303	97,410,438
Accumulated impairment losses (Note 22)	(1,964,665)	(2,551,013)
	80,294,638	94,859,425

The Group's exposure to credit risk is attributable mainly to the accounts receivable resulting from the Group's operating activity. The amounts recorded in the balance sheet are presented net of accumulated impairment losses for doubtful accounts that were estimated by the Group, in accordance with its experience and based on the economic environment evaluation. The Board of Directors believes that the recorded net amounts are close to their fair value; since these accounts receivable do not pay interests and the discount effect is immaterial.

As of 31 December 2013 and 2012, the age of costumer's balances can be analysed as follows:

	31.12.2013	31.12.2012
Not due	63,456,667	82,838,775
Due w ith no impairment losses recorded
0 - 30 days	10,435,419	6,786,339
30 - 90 days	1,664,459	4,213,661
+ 90 days	4,738,093	1,020,650
	80,294,638	94,859,425

The Group contracted credit insurances to cover the recoverability risk from these accounts receivables as follows:

	31.12.2013	31.12.2012
With credit insurance	73,481,401	78,367,524
Without credit insurance	8,777,902	19,042,914
	82,259,303	97,410,438

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

The Group does not charge any interests as long as defined pay terms (in average 60 days) are met. Once that period ends, interests are charged in accordance with the contract and the applicable law to each particular situation, which only occurs in extreme situations.

The Board of Directors understands that the accounts receivable not overdue will be fully paid, taking into account the payment history and characteristics of the counterparties.

14. OTHER DEBTORS

As of 31 December 2013 and 2012 this caption can be detailed as follows:

	31.12.2013	31.12.2012
Advances to suppliers	6,548	19,420
Other debtors	9,830,797	9,608,852
	9,837,345	9,628,272
Accumulated impairment losses (Note 22)	(2,275,152)	(2,386,790)
	7,562,193	7,241,482

As of 31 December 2013 and 2012 the caption "Other debtors" is, mainly, composed by accounts receivable originated by the disposal of fixed assets, bail for leases and rents and accounts receivable for which impairment losses were recorded. Additionally, on December 31, 2013 this caption also included the amount receivable of 1,252,000 Euro (1,300,000 Euro as of 31 December, 2012) relative to the sale of Sócasca – Recolha e Comércio de Recicláveis, S.A.

As of 31 December 2013 and 2012, the age of the balances in "Other Debtors" can be analysed as follows:

	31.12.2013	31.12.2012
Not due	6,304,756	5,841,541
Due w ith no impairment losses recorded
0 - 30 days	-	-
30 - 90 days	-	-
+ 90 days	1,257,437	1,399,941
	1,257,437	1,399,941
	7,562,193	7,241,482

The not due balances do not present any signs of impairment, the net accounting value of these assets is considered as being close to their fair value and their financial discount effect is not material.

The Board of Directors understands that the accounts receivable not overdue will be fully paid, taking into account the payment history and characteristics of the counterparties.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

15. STATE AND PUBLIC SECTOR

As of 31 December 2013 and 2012 this caption can be detailed as follows:

Debtor balances:	31.12.2013	31.12.2012
Income tax	9,220,451	-
Withholding taxes	1,781	-
Value added tax	10,761,968	9,645,080
Other taxes	239,528	165,457
	20,223,728	9,810,537
Creditor balances:
Income tax	-	(3,784,278)
Withholding taxes - dependent w ork	(1,271,963)	(495,671)
Social Security contributions	(466,874)	(436,028)
Value added tax	(2,838)	(350,882)
Other taxes	(172,481)	(24,197)
	(1,914,156)	(5,091,056)

The debtor balance of the caption "Income tax" on December 31, 2013 corresponds to payments on account and special payments on account made, net of income tax of the year.

16. OTHER CURRENT ASSETS

As of 31 December 2013 and 2012 this caption can be detailed as follows:

Accrued income:	31.12.2013	31.12.2012
Others	377,775	232,946
Deferred costs:
Rents paid in advance	1,839,221	1,021,606
Insurances paid in advance	437,907	534,620
Other costs paid in advance	799,970	758,271
	3,454,873	2,547,443

17. CASH AND CASH EQUIVALENTS

As of 31 December 2013 and 2012 the caption "Cash and cash equivalents" can be detailed as follows:

	31.12.2013	31.12.2012
Cash	17,331	20,718
Bank deposits	232,433,187 232,450,518	112,371,767 112,392,485
Bank overdrafts (Note 21)	(78,738)	(1,767,991)
Cash and cash equivalents	232,371,780	110,624,494

The caption "bank overdrafts" refers to credit balances in current accounts with financial institutions, included in the statement of financial position in the caption "bank loans" (Note 21).

According to Note 2.4) a) ii), on 31 December 2013 and 2012, the cash and cash equivalents balances in a non-euro currency amounted to 26,600,326 Euro and 20,552,601 Euro, respectively. Since these amounts corresponds to bank deposits on demand that are constantly moved, the exchange rate fluctuation effects on cash and cash equivalents held at the begging and at the end of the years 2013 and 2012 for purposes of the statement of cash flows are immaterial.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

The amounts received related with financial investments during the year ended 31 December 2013 are as follows:

	Amount of transaction	Amount received
Sócasca –Recolha e Comércio de Recicláveis, S.A. (b)	2,300,000 ---------------	48,000 ----------
	2,300,000 =========	48,000 =====

The amounts received related with financial investments during the year ended 31 December 2012 are as follows:

	Amount of transaction	Amount received
EDP – Produção Bioeléctrica, S.A. (a)	3,000,000	3,000,000
Sócasca –Recolha e Comércio de Recicláveis, S.A. (b)	2,300,000	500,000
(a) – Reimbursement of loans	--------------- 5,300,000 =========	---------------- 3,500,000 =========

(b) – Company sold in 2011

During 2013 and 2012, the financial investment payments resulted of the acquisition of investments available for sale (Note 4.3).

18. OTHER NON CURRENT ASSETS

As of 31 December 2013 and 2012 this caption can be detailed as follows:

	31.12.2013	31.12.2012
Rents paid in advance Value added tax (Note 22)	348.888 2.722.651	384.915 -
	3.071.539	384.915

19. SHARE CAPITAL AND RESERVES

Share Capital

As of 31 December 2013, the company's fully subscribed and paid up capital consisted of 205,131,672 shares with a nominal value of 12.5 cents of a Euro each.

As of 31 December 2013 and 2012, there were no entities holding more than 20% of the subscribed share capital.

Legal reserves

The Portuguese commercial legislation provides that at least 5% of the annual net profit must be used to reinforce the "Legal reserve" until this caption represents at least 20% of the share capital.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

As of 31 December 2013 and 2012, the Company presented the amount of 2,862,981 Euro of legal reserves, which cannot be distributed to shareholders unless the Company closes, although these reserves can be used to absorb losses after all other reserves are over, or incorporated in share capital.

Other reserves

	31.12.2013	31.12.2012
Hedging reserves Other reserves and retained earnings	(1,660,330) 159,471,411	(12,956,619) 116,069,034
	157,811,081	103,112,415

The caption "Hedging reserves" reflects the fair value of the derivative financial instruments classified as cashflows hedging in the effective hedging component, net of the corresponding deferred tax effect (Note 28).

Under Portuguese legislation, the amount of distributable reserves is determined based on the nonconsolidated financial statements of the Company, prepared in accordance with the International Financial Reporting Standards, as adopted by the European Union. As of 31 December 2013 distributable reserves amount to 22,966,689 Euro.

20. NON CONTROLLING INTERESTS

The amounts of this caption during the years ended 31 December 2013 and 2012 are as follow:

	31.12.2013	31.12.2012
Opening balance	128,166	105,421
Net profit attributable to non controlling interests	18,142	22,745
Closing balance	146,308	128,166

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

21. BANK LOANS, OTHER LOANS AND REIMBURSABLE SUBSIDIES

As of 31 December 2013 and 2012, the captions "Bank loans", "Other loans" and "Reimbursable subsidies" can be detailed as follows:

	2013
		Nominal value			Book value
	Current	Non current	Total	Current	Non current	Total
Bank Loans	78,877,288	75,000,000	153,877,288	78,614,615	74,212,500	152,827,115
Bank overdrafts (Note 17)	78,738	-	78,738	78,738	-	78,738
Bank loans	78,956,026	75,000,000	153,956,026	78,693,353	74,212,500	152,905,853
Commercial paper	181,900,000	66,000,000	247,900,000	181,497,235	65,207,880	246,705,115
Bonds	-	375,000,000	375,000,000	-	374,162,417	374,162,417
Other loans	33,347,002	-	33,347,002	32,222,352	-	32,222,352
Other loans	215,247,002	441,000,000	656,247,002	213,719,587	439,370,297	653,089,884
Reimbursable subsidies	71,008	11,228,419	11,299,427	71,008	11,228,419	11,299,427
	294,274,036	527,228,419	821,502,455	292,483,948	524,811,216	817,295,164

	2012
		Nominal value			Book value
	Current	Non current	Total	Current	Non current	Total
Bank Loans	43,699,190	103,556,923	147,256,113	43,699,190	103,556,923	147,256,113
Bank overdrafts (Note 17)	1,767,991	-	1,767,991	1,767,991	-	1,767,991
Bank loans	45,467,181	103,556,923	149,024,104	45,467,181	103,556,923	149,024,104
Commercial paper	106,000,000	82,000,000	188,000,000	105,717,328	81,894,700	187,612,028
Bonds	-	375,000,000	375,000,000	-	373,104,432	373,104,432
Other loans	34,857,197	-	34,857,197	33,686,712	-	33,686,712
Other loans	140,857,197	457,000,000	597,857,197	139,404,040	454,999,132	594,403,172
Reimbursable subsidies	11,694,604	22,770,236	34,464,840	11,694,604	22,770,236	34,464,840
	198,018,982	583,327,159	781,346,141	196,565,825	581,326,291	777,892,116

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

Bank loans

(i) Altri SL bank loan

In August 2006, the subsidiary Altri, S.L. signed a loan agreement with a bank syndicate amounting to 400,000,000 Euro with the purpose of buying 99.96% of the share capital corresponding to 100% of the voting rights of Celbi. On the date of the acquisition was given as assurance the pledge of Celbi's shares. In 2007 this loan had an extraordinary amortization of 250,000,000 Euro, by that date the open debt amounted 150,000,000 Euro. Interests are payable half-yearly at the end of the period at an interest rate equal to Euribor 6 months plus a spread.

According to the contractual terms of this financing, banks can request the early repayment of the entire debt if there weren't achieved certain ratios of Net Debt/EBITDA and EBITDA/Debt Service. The repayment schedule for this loan was renegotiated during the year ended 31 December, 2012, settling the payment in eleven halfyear instalments, the first to be paid in February 2013 and the last in February 2018. As of 31 December, 2013, this loan amounts to 73,790,322 Euro.

In the early 2014 the amount of 73,790,322 Euro was repaid in advance by Altri SL for which reason in 31 December 2013 that amount was classified as current debt.

In February 25, 2014 Altri SL obtained a new bank loan with maximum limit of 25,000,000 Euro, with an interest rate equal to Euribor 6 months plus a spread, which is a six months' term extendable for equals periods unless either part terminates the program with a pre-defined warning of 30 days before the due date or of the dates of its half-year renewals.

(ii) Celbi bank loan

During 2013 Celbi obtained a bank loan amounting to 75,000,000 Euro, with an interest rate equal to Euribor 3 months plus a spread, which payment will be in 3 annual instalments, the first of them in June of 2016. Therefore the total amount was classified as non-current liabilities.

(iii) Bank overdrafts

As of 31 December 2013, the Group has bank overdrafts amounting to 28 million Euro (64 million as of 31 December 2012) from which were being used 500,000 Euro (14,001,000 Euros as of 31 December 2012), classified in the caption "Bank Loans". Their interests are payable at Euribor between 1 to 3 months plus a spread.

(iv) Other bank loans

As of 2 January 2014 Altri and Celbi obtained a new loan of 50,000,000 Euro, of which 30,000,000 Euro are exclusively for repayment of part of the bond loans of Celbi 2007/2015. The amount will be available in February 2015 and will have a duration of 5 years from the date of signature.

At 31 December 2013 the Group has other bank loans totalling 4,586,966 Euro classified as current debt.

Commercial paper:

The Group has renewable commercial paper programs subscribed by several group companies in the maximum amount of 309,000,000 Euro as of 31 December 2013 (188,000,000 Euro as of 31 December 2012), with guaranteed placement, with interests payable at a rate equal to Euribor for the issuing period (7 to 360 days) plus spread. As of 31 December 2013 the amount in use was 247,900,000 Euro (188,000,000 Euro as of 31 December 2012). The amount of 145,900,000 Euro is classified as current liability because, according to the contracts, both parties can terminate the program with a pre-defined warning of 30 to 60 days, although, if the programs are not terminated before maturity, they will only be repaid between years 2014 and 2018, being the Board of Directors belief that there will be no early terminations from any parts to these commercial paper programs.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

Additionally, Celulose da Beira Industrial (Celbi), S.A. during the year ended on December 31, 2013 signed a new commercial paper program in the maximum amount of 75,000,000 Euro which disbursement will be in February 2015 and intended to the repayment of part of the bond loan Celbi 2007/2015 which occurs in February 2015. Additionally according to the contractual terms of this financing, banks can request the early repayment of the entire debt, if there weren't achieved certain ratios of Net Debt/EBITDA and EBITDA/Debt Service. At 31 December 2013 the amount in use was null.

In January, 27 2014 Celulose da Beira Industrial (Celbi), S.A. signed a new commercial paper program in the maximum amount of 100,000,000 Euro. This program has the objective of treasury support for the repayment of bond loan Celbi 2007/2015 which occurs in February 2015. Additionally, according to the contractual terms of this financing, banks can request the early repayment of the entire debt capital if there weren't achieved certain ratios of Net Debt/EBITDA and Net Debt/Equity.

Bond loans:

Celulose da Beira Industrial (Celbi), S.A. issued, in February 2007, a bond loan amounting to 300,000,000 Euro repayable in 8 years until 2015. Interests are payable half-yearly at the end of the period since the subscription date at a rate equal to Euribor 6 months plus a spread.

In the first semester of 2008 Celulose da Beira Industrial (Celbi), S.A. issued two 10-year bond loans, amounting 50,000,000 Euro and 25,000,000 Euro, respectively. These loans have full repayment in 2018.

The expenses incurred with the issuance of the loans are deducted to their nominal value and deferred and recognized as interest expenses during the period of the loan (Note 36).

Other loans:

(i) Factoring

The Group subscribed factoring contracts with two banks with one year of initial duration, according to which it may transfer accounts receivable up to 50,000,000 Euro, which are automatically renewed for equal periods if not terminated by one of the entities with at least 60 contractual days in advance. On the discounted amounts the Group will pay an interest rate equal to Euribor 3 months plus spread. As of 31 December 2013 the value used amounted to 33,347,002 Euro (34,857,197 Euro as of 31 December 2012).

The Group believes that the risks and benefits associated to the accounts receivable were not transferred to the factoring entity, so they just remove the accounts receivable transferred to the factoring when the original debtor pays, in accordance with the accounting policy described in Note 2.3I) viii).

Reimbursable subsidies:

In February 2005, the application of the subsidiary Celtejo to the financial benefits granted by the "Programa Operacional da Economia – POE" (Operating Economics Program) to finance the expansion and modernization of the industrial unity was approved. The main purpose of this project was to increase the production capacity and establish a better market differentiation of the pine and eucalyptus pulp. This represents an investment of, approximately, 49,464,000 Euro. The financial grant was made up as follows: (i) a repayable benefit up to 14,919,000 Euro; (ii) a success fee similar to a non-repayable benefit with a maximum amount of 14,919,000 Euro that will be deducted to the repayable benefit mentioned in (i); and (iii) a non-repayable grant related with personnel training programs. During the year ended December 31, 2012 this financial benefit was concluded and the total success fee is recorded as "Other non-current liabilities" and "Other current liabilities" (Notes 24 and 27) net of the amount recognized directly as income in the income statement (Note 34) in the proportion of the part of the tangible assets subsidized already depreciated. On 31 December 2012 the amount outstanding of this subsidy amounted to 74,978 Euro, being classified as current debt.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

During 2006 it was submitted an application under the PRIME program within the scope of the pulp bleaching project on Celtejo mill. This investment had an estimated total amount of 72,000,000 Euro and was concluded in 2008. The financial grant was made up as follows: (i) a repayable benefit up to 15,323,000 Euro; (ii) a success fee similar to a non-repayable benefit with a maximum amount of 12,317,330 Euro that will be deducted to the repayable benefit mentioned in (i). The success fee will be awarded according to the fulfilment degree of the contract, determined in measurements to be made at the end of the years 2010, 2011 and 2013. Celtejo estimated the ratios contractually required for the year 2013 and concluded that those ratios were met giving a bonus of, approximately, 3,050,000 Euro which was classified as "Other non-current liabilities" and "Other current liabilities" (Notes 24 and 27) net of the amount recognized directly as income in the income statement (Note 34) in the proportion of the part of the tangible assets subsidized already depreciated according to the accounting policy described in Note 2.3 e).

In January 2007 Altri and Celbi signed a contract for granting financial and tax incentives under Decree-Law no. 203/2003 of 10 September, with AICEP (Agência para o Investimento e Comércio Externo de Portugal, E.P.E.) having the Portuguese Government considered of national interest PIN (Projecto de Interesse Nacional) this project to expand the production capacity of Celbi. The investment project run from 1 January 2007 to 30 June 2010 and the contract value is 320,000,000 Euro and the Portuguese Government will grant a financial incentive equal to 16.5% of the eligible expenses. If Celbi meets the proposed objectives measured at the end of 2009, 2010, 2013 and 2016 the Portuguese Government will give a success fee which will correspond to the non-repayment of up to 80% of the amount of the repayable incentive. The Portuguese Government also granted a tax benefit, corresponding to a tax credit amounting to 12% of relevant applications. Until 31 December 2012 Celbi received the amount of 51,644,921 Euro concerning to the repayable incentive. During 2013 Celbi requested AICEP the anticipation of the 2013 evaluation, given the fact that during the year ended on 31 December 2012 Celbi already fulfilled the criteria's of 2013 measurement. AICEP agreed with the interruption of repayments, however there are some requirements which can only be evaluated in the measurement date. In 31 December 2013 all the requirements for the award of success fee amounting to 16,526,000 Euro were met, having Celbi classified this amount as "Other non-current liabilities" and "Other current liabilities" (Notes 24 and 27) net of the amount recognized directly as income in the income statement (Note 34) in proportion of the part of the tangible assets subsidized already depreciated according to the accounting policy described in Note 2.3 e). On 31 December 2013 the amount outstanding of this subsidy is 8,632,454 Euro and is classified as non-current debt.

During 2011, Caima Indústria obtained a financial repayable benefit of 8,815,500 Euro, under Decree nr. 287/2007 granted by AICEP. The period of this investment was between 2010 and 2013. The granted benefit represents 45% of the eligible costs. The last portion of the benefit was received during 2013 and totalled 3,294,000 Euro. During 2013 a bonus of 627,128 Euro was received, so Caima Industria on 31 December 2013 had a debt of 2,666,000 Euro, of which 71,008 Euro was classified as current debt.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

In the years ended 31 December 2013 and 2012 the Group sensitivity to the change of the interest rate index of more or less 1 basis point, measured as variation on net financial losses, not considering the hedging effects of the derivative financial instruments (Note 28), may be analysed as follows:

	31.12.2013	31.12.2012
Interests (Note 36)	19,043,419	26,462,276
Decrease of 1 b.p. in the interest rate applied to the entire debt	(8,100,000)	(7,750,000)
Increase of 1 b.p. in the interest rate applied to the entire debt	8,100,000	7,750,000

The sensitivity analysis above was calculated based on the exposure to the interest rate existing as of the date of the statement of financial position. This analysis considered as a basic assumption that the structure of financing (remunerated assets and liabilities) has remained stable throughout the year and similar to that presented at the end of each financial year.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese.

In the event of discrepancies, the Portuguese language version prevails – Note 45)

The bank loans, other loans and reimbursable subsidies reimbursement plan as well as the associated interests are as follows:

					31-12-2013
		2014	2015	2016	2017	>2017	Total
Bank loans
	Capital	78,877,288	-	25,000,000	25,000,000	25,000,000	153,877,288
	Interests (a)	7,282,952	3,844,674	4,260,687	3,141,318	1,881,113	20,410,744
	Bank overdrafts
	Capital	78,738	-	-	-	-	78,738
	Interests (a)	1,417	-	-	-	-	1,417
	Commercial paper
	Capital	181,900,000	36,000,000	30,000,000	-	-	247,900,000
	Interests (a)	7,598,691	2,282,607	1,203,954	-	-	11,085,252
Bond loans
	Capital	-	300,000,000	-	-	75,000,000	375,000,000
	Interests (a)	5,169,404	6,644,169	1,744,846	2,196,137	3,127,500	18,882,056
Other loans
	Capital	33,347,002	-	-	-	-	33,347,002
	Interests (a)	722,901	-	-	-	-	722,901
	Reimbulsable subsidies
	Capital	71,008	9,082,853	558,872	1,586,694	-	11,299,427
	Interests (a)	-	-	-	-	-	-
Total
	Capital	294,274,036	345,082,853	55,558,872	26,586,694	100,000,000	821,502,455
	Interests	20,775,366	12,771,450	7,209,487	5,337,455	5,008,613	51,102,369
		315,049,402	357,854,303	62,768,359	31,924,149	105,008,613	872,604,824
					31-12-2012
		2013	2014	2015	2016	>2016	Total
Bank loans
	Capital	43,699,190	27,766,599	22,774,194	22,774,194	30,241,936	147,256,113
	Interests (a)	8,274,464	5,993,883	4,594,052	3,421,270	2,084,223	24,367,892
	Bank overdrafts
	Capital	1,767,991	-	-	-	-	1,767,991
	Interests (a)	38,123	-	-	-	-	38,123
	Commercial paper
	Capital	106,000,000	46,000,000	36,000,000	-	-	188,000,000
	Interests (a)	4,630,779	2,157,255	1,046,020	-	-	7,834,054
Bond loans
	Capital	-	-	300,000,000	-	75,000,000	375,000,000
	Interests (a)	4,673,496	5,302,064	6,332,611	1,560,324	1,889,248	19,757,743
Other loans
	Capital	34,857,197	-	-	-	-	34,857,197
	Interests (a)	612,185	-	-	-	-	612,185
	Reimbulsable subsidies
	Capital	11,694,604	10,057,471	11,820,059	892,706	-	34,464,840
	Interests (a)	-	-	-	-	-	-
Total
	Capital	198,018,982	83,824,070	370,594,253	23,666,900	105,241,936	781,346,141
	Interests	18,229,047	13,453,202	11,972,683	4,981,594	3,973,471	52,609,996

(a) Considering the available information related to the interest rates evolution and that the capital repayment occurs in the end of each year.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

22. ACCUMULATED PROVISIONS AND IMPAIRMENT LOSSES

The movements occurred in provisions and impairment losses during the years ended 31 December 2013 and 2012 can be detailed as follows:

			31-12-2013
	Provisions	Impairment losses in accounts receivable (Notes 13 and 14)	Impairment losses in inventories and biological assets (Note 11)	Total
Opening balance	1,535,342	4,937,803	5,966,162	12,439,307
Increases	3,673,455	24,847	-	3,698,302
Utilizations	-	(507,220)	(700,000)	(1,207,220)
Reversals	(139,751)	(160,745)	-	(300,496)
Transfers	54,868	(54,868)	-	-
Closing balance	5,123,914	4,239,817	5,266,162	14,629,893
			31-12-2012
		Impairment losses in accounts receivable	Impairment losses in inventories and biological
	Provisions	(Notes 13 and 14)	assets (Note 11)	Total
Opening balance	1,149,668	1,585,515	5,266,162	8,001,345
Increases	396,365	3,458,553	700,000	4,554,918
Utilizations	-	(106,265)	-	(106,265)
Transfers	(10,691)	-	-	(10,691)
Closing balance	1,535,342	4,937,803	5,966,162	12,439,307

The increases in impairment losses occurred in the years ended 31 December 2013 and 2012 were recorded against the captions "Provisions and impairment losses" (income of 24,845 Euro) and "Other indirect tax" (loss of 3,422,651 Euro) of the profit and loss statement.

During the year ended at 31 December 2013 the subsidiary Caima Industria da Celulose, S.A., proceeded to the payment of an additional settlement of Value Added Tax to tax authorities of Germany from previous years in the amount of 2,722,651 Euro which was recorded under the caption "Other non-current assets" because the company does not agree with the fundamentals of the settlement (Note 18). During the month of January of 2014 Caima proceeded to an additional payment of Value Added Tax of approximately of 700,000 Euro. To face the risk of such settlements becoming definite, Altri recorded a liability under the caption "Provisions" against the caption "Other indirect taxes" of the profit and loss statement.

The amount recorded under the caption "Provisions", at 31 December 2013 and 2012, is the best estimate of the Board of Directors in order to face all the losses that may be supported due to claims in force.

23. OTHER NON CURRENT CREDITORS

As of 31 December 2013 and 2012 this caption is made up as follows:

	31.12.2013	31.12.2012
Suppliers of fixed assets (Note 31.2)	404,350	528,802

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

24. OTHER NON CURRENT LIABILITIES

On 31 December 2013 and 2012 this caption refers totally to portions of investment subsidies to be recognized as income in the medium and long term (Notes 21 and 27) which are detailed as follows:

		31/12/2013			31/12/2012
		Current			Current
	Total	(Note 27)	Non current	Total	(Note 27)	Non current
Celtejo
POE	2,062,338	557,395	1,504,943	4,547,529	710,927	3,836,602
PRIME	4,978,077	1,060,987	3,917,090	1,490,892	779,965	710,927
Other investment subsidies	143,287	-	143,287	143,287	143,287	-
	7,183,702	1,618,382	5,565,320	6,181,708	1,634,179	4,547,529
Celbi
PIN	28,774,668	3,039,485	25,735,183	18,630,772	1,704,887	16,925,885
Other investment subsidies	-	-	-	927,497	304,881	622,616
	28,774,668	3,039,485	25,735,183	19,558,269	2,009,768	17,548,501
Caima Indústria
SIME	666,868	133,374	533,494	463,389	463,389	-
PRIME	108,318	108,318	-	216,187	216,187	-
QREN	564,417	62,713	501,704	-	-	-
Other investment subsidies	113,512	64,412	49,100	-	-	-
	1,453,115	368,817	1,084,298	679,576	679,576	-
	37,411,485	5,026,684	32,384,801	26,419,553	4,323,523	22,096,030

25. SUPPLIERS

As of 31 December 2013 and 2012 this caption is made up as follows:

		Payable
31.12.2013	0-90 days	90-180 days	>180 days
45,540,200	45,540,200	-	-
14,494,397	14,494,397	-	-
60,034,597	60,034,597	-	-
		Payable
31.12.2012	0-90 days	90-180 days	>180 days
43,457,232	43,457,232	-	-
12,886,153	12,886,153	-	-
66,608,803	56,343,385	-	-

As of 31 December 2013 and 2012 the caption "Suppliers" refers to accounts payable from the normal activities of the Group.

The Board of Directors understands that the book value of these debts is close to their fair value.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

26. OTHER CURRENT CREDITORS

As of 31 December 2013 and 2012 the caption "Other current creditors" can be detailed as follows:

		Payable
31.12.2013	0-90 days	90-180 days	>180 days
2,460,254	2,386,668	11,380	62,206
3,935,207	3,865,834	69,373	-
6,395,461	6,252,502	80,753	62,206
		Payable
31.12.2012	0-90 days	90-180 days	>180 days
1,144,521	1,079,344	65,177	-
5,534,914	5,534,914	-	-
6,679,435	6,614,258	65,177	-

As of 31 December 2013 and 2012 the caption "Suppliers of fixed assets" includes the amounts of 223,741 Euro and 318,177 Euro, respectively, relating to financial leases (Note 31.2).

27. OTHER CURRENT LIABILITIES

As of 31 December 2013 and 2012 the caption "Other current liabilities" can be detailed as follows:

	31.12.2013	31.12.2012
Accrued expenses:
Amounts payable to employees	(3,233,946)	(3,912,292)
Interest payable	(3,841,772)	(5,505,043)
Rents	(1,605,477)	(1,697,517)
Costs w ith energy and gas	(5,667,141)	(4,898,828)
Discounts to be paid	(4,411,336)	(3,906,935)
Fluid rates to be paid	(1,079,823)	(1,362,656)
Other accrued expenses	(6,696,938)	(9,539,999)
Current deferred income:
Investment subsidies (Notes 21 and 24)	(5,026,684)	(4,323,523)
Others	(67,713)	(74,401)
	(31,630,830)	(35,221,194)

The caption "Other accrued expenses" in 2013 and 2012 corresponds to costs incurred with operational activities not yet settled.

28. DERIVATIVE FINANCIAL INSTRUMENTS

On December 31, 2013 and 2012 the companies of the Group operated with contracts for derivatives related to hedge pulp price's variations, interest and exchange rates, which are recorded according to their fair value.

Altri Group's companies only use derivatives to hedge cash flows associated with operations created related with their activities.

(i) Interest rate derivatives

In order to reduce its exposure to interest rates volatility, the Group signed interest rates swap contracts and an interest rate collar. These contracts were evaluated by their fair value as of 31 December 2013 and 2012, and the correspondent amount has been recognized under the caption "Derivatives".

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese.

In the event of discrepancies, the Portuguese language version prevails – Note 45)

As of 31 December 2013 and 2012 there were established derivatives contracts which total amounts are as follows:

				Fair Value	Fair Value
Type	Amount	Maturity	Rate	31.12.2013	31.12.2012
Interest rate collar (c)	143,750,000	31-07-2013	Pays fixed interest rate and receives Euribor 6M	-	(3,276,157)
Interest rate sw ap (a)	25,000,000	08-02-2015	Pays a combination of several interest rates and receives Euribor 6M	(1,816,374)	(3,068,531)
Interest rate sw ap (b)	20,000,000	08-08-2014	Pays fixed interest rate and receives Euribor 6M	(614,399)	(1,207,488)
Interest rate sw ap (b)	80,000,000	09-02-2015	Pays fixed interest rate and receives Euribor 6M	(3,573,954)	(5,865,289)
				(6,004,727)	(13,417,466)

(a) Although these contracts were made with the purpose of risk hedging (and not speculation), these contracts do not fulfil every necessary requirements so they can be classified as hedging (Note 2.3l) v)), and therefore, the variation of their fair value was recorded in the profit and loss statement (Note 36).

(b) In accordance with the accounting policies adopted, these derivatives fulfil every requirement to be accounted as interest rate hedging instruments (Note 2.3I) v)).

(c) Although these contracts were made with the purpose of risk hedging (and not speculation), a part of this contract does not fulfil every necessary requirements so it can be classified as hedging (Note 2.3l) v)), and therefore, the variation of the fair value of the part that does not fulfil the requirements to be classified as hedging was recorded in the profit and loss statement (Note 36).

The fair value of the Group's contracted derivatives is determined by the respective counterparts (financial institutions with whom such contracts were signed). The derivative evaluation model, used by the counterparts is based on the discounted cash flows method, i.e., using the swaps par rates, listed in the interbank market and available at Reuters and Bloomberg, for the applicable periods where the forward rates and the discount factors used to discount the fixed cash flows (fix leg) and the variable cash-flows (variable leg) are computed. The sum of these two components results on the Net Present Value of the future cash flows or on the fair value of the derivatives.

The increase/decrease of 1 b.p. on the interest rate indexes verified during 2013 and estimated for the period of duration of these derivatives would result in an increase/decrease of the financial results of the year ended 31 December 2013 of 640,000 Euro and of the equity's caption "Hedging reserves" of 920,000 Euro/ 925,000 Euros before considering any tax effects.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

(ii) Paper pulp price hedging derivatives

In order to reduce its exposure to volatility of paper pulp price volatility, the Group signed paper pulp price hedging derivatives, which were evaluated according to their fair value as of 31 December 2013 and 2012; the correspondent amount was recognized under the caption "Derivatives".

As of 31 December 2013 and 2012 there were established the following paper pulp derivative contracts which total amounts are as follow:

			Fair Value
Hedged Quantity	Maturity	31.12.2013	31.12.2012
2000 ton/month	31-12-2013	-	(1,933,389)
2000 ton/month	31-12-2012	-	(161,677)
2000 ton/month	31-12-2013	-	(1,717,569)
500 ton/month	31-12-2012	-	(32,965)
500 ton/month	31-12-2012	-	(35,965)
2000 ton/month	30-06-2013	-	(786,651)
2000 ton/month	31-12-2012	-	(51,028)
2000 ton/month	31-12-2013	-	(1,142,036)
1500 ton/month	31-08-2014	375,570	(96,085)
2000 ton/month	31-03-2014	(104,260)	(1,416,573)
2000 ton/month	30-09-2014	(379,562)	(1,322,392)
1000 ton/month	31/12/2014	402,324	-
1000 ton/month	31/12/2014	426,290	-
	Positive fair value	1,204,184	-
	Negative fair value	(483,822)	(8,696,330)
		720,362	(8,696,330)

The fixed price, for the contracts that end in 2013 and 2014 changes between 510 and 582.5 Euro per ton of pulp.

The derivative fair value valuation of the paper pulp price hedging, contracted by the Group was performed by the respective counterparts (financial institutions with whom such contracts were signed). The derivative evaluation model, used by these counterparts is based on the Discounted Cash Flows Method, i.e., it's calculated the difference between the estimated paper pulp price (PIX) and the fixed price for the relevant periods, which is, afterwards, discounted to the evaluation date.

In accordance with the adopted accounting policies, these paper pulp derivatives fulfil with the requirements to be classified as hedging instruments; so the variation on their fair value was recorded in the equity's caption "Hedging reserves".

The increase/decrease of 5% on the paper pulp price indexes (PIX) during the year ended 31 December 2013 and estimated for the period of these derivatives duration would result in a decrease/increase of the operational result of the year ended 31 December 2013 of approximately 3,200,000 Euro and an decrease/increase on the equity's caption "Hedging reserves" of approximately 36,000 Euro, before considering any tax effects.

(iii) Exchange rate derivatives

Altri uses exchange rate derivatives, mainly in order to hedge future cash flows. Thus Altri hired some exchange rate forwards of U.S. dollars in order to manage the risk of exchange rate to which it is exposed.

On December 31, 2012, the fair value of exchange rate derivatives, calculated based on current market values of equivalent exchange rate financial instruments was 261,783 Euro, which ended during the year of 31 December 2013.

Determining the fair value of these financial instruments is based on the discount to the date of the statement of financial position of the amount that is estimated to be received / paid on the date of expiry of the contract. The settlement amount is considered in the assessment as being equal to the reference currency multiplied by the

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese.

In the event of discrepancies, the Portuguese language version prevails – Note 45)

difference between the exchange rate settled and the market rate for the settlement date as of the date of valuation.

The movement occurred in the fair value of the financial instruments during the years ended 31 December 2013 and 2012 can be detailed as follows:

2013	Pulp price hedging derivatives	Interest rates derivatives	Exchange rates derivatives	Total
Opening balance	(8,696,330)	(13,417,466)	261,783	(21,852,013)
Derivatives fair value variation/cessation
Effect on shareholders' funds (Note 19)	9,416,692	1,442,696	-	10,859,388
Effects on the profit and loss statement (Note 36)	-	5,970,043	(261,783)	5,708,260
Closing balance	720,362	(6,004,727)	-	(5,284,365)
2012	Pulp price hedging derivatives	Interest rates derivatives	Exchange rates derivatives	Total
Opening balance	(302,933)	(14,449,051)	-	(14,751,984)
Derivatives fair value variation/cessation
Effect on shareholders' funds (Note 19)	(8,393,397)	1,222,145	-	(7,171,252)
Effects on the profit and loss statement (Note 36)	-	(190,560)	261,783	71,223
Closing balance	(8,696,330)	(13,417,466)	261,783	(21,852,013)

The gains and losses of the year associated to the fair value variation, during 2013, of the hedging instruments in the non-matured part (as described in IAS 39), in the amount of 10,859,388 Euro ((7,171,252) Euro as of 31 December 2012), were directly recorded under equity's captions net of the respective deferred tax, in the amount of (2,877,738) Euro (1,900,382 Euro as of 31 December 2012) (Notes 12 and 19).

The gains and losses for the year associated to the fair value variation, during 2013, of the hedging instruments in the matured part and of the instruments which although had been contracted with a hedging purpose, do not gather the requirements to be classified as so, and their ineffective part were recorded directly in the profit and loss statement for the year ended 31 December 2013 (Note 36).

29. CONTINGENT LIABILITIES AND GUARANTEES

As of 31 December 2013 and 2012, contingent liabilities refer to bank guarantees provided by Group companies, which can be detailed as follows:

	31.12.2013	31.12.2012
AICEP/API (Note 21)	7,689,484	22,456,565
Others	476,996	496,806
	8,166,480	22,953,371

30. FINANCIAL COMMITMENTS NOT INCLUDED IN THE CONSOLIDATED STATEMENT OF FINANCIAL POSITION

a) Pension Fund

Some of the Group companies have assumed commitments related with retirement pensions not included in the consolidated statement of financial position, since these commitments are covered by autonomous pension funds as follows.

The Caima and Altri Florestal Pension Fund, managed by "BPI Pensões - Sociedade Gestora de Fundos de Pensões, S.A." was created by a public deed held 31 December 1987, and aims to provide the employees who (i) at their normal retirement age or (ii) at the end of their contract with the company have completed at least 10 years of continuous service and 57 years old, with a monthly pension complement based on their average gross salary for the two years preceding the date of their retirement, beginning in the usual year of retirement. Following a decision of Caima's Board of Directors and after obtaining approval from "Instituto de Seguros de

ALTRI, S.G.P.S., S.A. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

Portugal" (the Portuguese insurance institute), the Caima and Altri Florestal Pension Fund was divided into two independent funds in December 1998. During the year ended December 31, 2010, Caima and Altri Florestal transferred their shares of the collective fund that they had in BPI Pensões to Celtejo's plan, integrating the so called plan C. The transfer was requested to the Instituto de Seguros de Portugal, on September 23, 2010 and approved on March 3, 2011. In April 2011, the pension fund of Altri Florestal and Caima was incorporated in Celtejo's pension fund.

Under the set of laws of the Social Benefits Regulation, the employees of the permanent board of Celtejo with at least five years of continuous service, are entitled to a monthly pension complement after their retirement or if they become disabled. This complement is defined according with a formula that takes into consideration the net monthly salary applicable to the employee as of the retirement date and the number of years of continuous service, in a maximum of 30 years, also guarantying survival pensions to the employees' spouses and direct descendants. To cover those responsibilities there is an autonomous pension fund named Tejo Pension Fund.

Celbi grants to its workers, with non-defined term labour contract, who retire while working for Celbi, a set of benefits in accordance with the company's Rules for Pension Funds, published in the Republic Newspaper ("Diário da República") number 221-III series, dated 21 September 1999.

In accordance with those rules, Celbi grants the following benefits:

i) Retirement by age limit:

The participants that retire in the normal timing will be entitled to an annual pension, equal to 11.5% of the pensionable annual salary;

ii) Retirement due to disability:

Plan A – If the participant retires himself permanently due to disability by the normal regime of social security, or is accepted as so by the medical services of the company and the fund manager, the Fund secures the payment of a pension calculated in accordance with the following formulas:

Pension 1:

1. With less than 10 years of service – 50% of the annual pensionable salary;

2. With 10 or more years of service – 80% of the annual pensionable salary. The amount of the annual pension is deducted to the annual pension computed as described above.

Pension 2:

The participants will be entitled to an amount equal to one fifth of the monthly salary earned at the retirement date by each year of service.

Pension 3:

If the disability happens when the participant is more than 55 years old, to the amount referred to in Pension 2 is added 50% of the annual pensionable salary.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

Plan B - If the participant retires himself permanently due to disability by the normal regime of social security, or is accepted as so by the medical services of the company and the fund manager, the Fund secures the payment of an annual pension equal to 11.5% of the pensionable annual salary.

Only the participants working for the company when the present change took place can benefit from Plan A. In relation to these workers and in relation to plans A and B the most favourable will be applicable. To the other participants is applicable the Plan B.

This regime applies to all Celbi's workers.

In accordance with the latest actuarial valuation prepared by the funds' managers, the present value of the past service liabilities with retired and current employees as of 31 December 2013, 2012, 2011 and 2010 as well as the funds' patrimonial situation were as follows:

	2013
	Caima/Celtejo/Altriflorestal	Celbi	Total
Current responsibilities for past services	15,100,475	7,951,521	23,051,996
Assets of pension funds	15,096,391	8,140,208	23,236,599
	2012
	Caima/Celtejo/Altriflorestal	Celbi	Total
Current responsibilities for past services	14,926,583	7,526,613	22,453,196
Assets of pension funds	15,262,570	7,767,609	23,030,179
	2011
	Caima/Celtejo/Altriflorestal	Celbi	Total
Current responsibilities for past services	14,884,715	6,933,935	21,818,650
Assets of pension funds	14,789,841	7,095,598	21,885,439
	2010
	Caima/Celtejo/Altriflorestal	Celbi	Total
Current responsibilities for past services	13,954,156	6,771,450	20,725,606
Assets of pension funds	14,085,096	7,667,099	21,752,195

The detail of the amounts recorded in the profit and loss statement related with the defined benefit pension plans for the years ended 31 December 2013 and 2012 is as follows:

	2013	2012
Current services cost	(434,227)	(466,555)
Interest on responsibilities	(998,646)	(969,606)
Actuarial gains/(losses)	(29,164)	(235,637)
Return on plan's assets	1,135,118	1,962,937
	(326,919)	291,139

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

The movement in the present value of responsibilities for past services during the years ended 31 December 2013 and 2012 is as follows:

2013	2012
22,453,196	21,818,650
(863,237)	(1,037,252)
434,227	466,555
998,646	969,606
29,164	235,637
23,051,996	22,453,196

The movement verified on pension funds' patrimonial situation during the years ended 31 December 2013 and 2012 is as follows:

	2013	2012
Pension funds value at the beginning of the year	23,030,179	21,885,439
Pensions paid	(863,237)	(1,037,252)
Return on fund's assets	1,135,118	1,962,937
Others	(65,461)	219,055
Pension funds value at the end of the year	23,236,599	23,030,179

The responsibilities of Celtejo Pension Plan are based in the following assumptions:

• (i) Calculation method "Projected Unit Credit"
• (ii) Mortality Tables TV 88/90;
• (iii) Disability Tables EKV-80;
• (iv) Income/discount Rate 4.5%;
• (v) Growth Wage Rate 0%

Characteristics of Celtejo Pension Fund:

• (i) Portfolio composition:
• a. 13.92% shares;
• b. 71.99% bonds at fixed rates;
• c. 6.53% bonds at variable rates;
• d. 7.56% liquidity and other assets.
• (ii) Expected return of the assets of the Plan in the long run 4.5%

The responsibilities of Celbi Pension Plan are based in the following assumptions:

• (i) Calculation method "Projected Unit Credit"
• (ii) Mortality Tables GKF95;
• (iii) Disability Tables SR 2001;
• (iv) Income/discount Rate until the retirement age 4% and after the retirement age 3%;
• (v) Growth Wage Rate 2.5%

Characteristics of Celbi Pension Fund:

• (i) Portfolio composition:
• a. 18% shares;
  • b. 42.1% bonds at fixed rates;
  • c. 25% bonds at variable rates;
• d. 14.9% liquidity and other assets.
• (ii) Expected return of the assets of the Plan in the long run 4% until the retirement age and 3% after retirement age.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

b) Other commitments

As of 31 December 2013, the contractual obligations for the acquisitions of fixed assets assumed by the Group companies amounted to, approximately, 24,000,000 Euro (2,400,000 Euro as of 31 December 2012) (Note 7).

31. LEASE CONTRACTS

31.1 OPERATIONAL LEASES

During the year ended at of 31 December 2013 it was recognized in the profit and loss statement an amount of, proximately, 9,300,000 Euro (9,310,000 Euro during the year ended at 31 December 2012) of operational leases rents, essentially, related with lands explored by the Group.

Additionally, at the balance sheet date the Group held as lessee, operational lease contracts, which minimal lease payments present the following maturity:

Year	2013	2012
Until 1 year	10,369,844	11,031,106
Betw een 1 and 5 years	36,037,750	34,302,051
More than 5 years	92,653,066	90,735,796
	139,060,660	136,068,953

31.2 FINANCIAL LEASES

As of 31 December 2013 and 2012, the responsibilities reflected in the statement of financial position related to financial leases had the following maturity:

Year	2013	2012
Until 1 year (Note 26) Betw een 1 and 5 years (Note 23)	223,741 404,350	318,177 528,802
More than 5 years	- 628,091	- 846,979

As at December 31, 2013 and 2012, Altri estimates that the fair value of financial obligations in leasing contracts corresponds to approximately its book value.

Obligations under finance lease contracts are guaranteed by the reserve of ownership of the leased assets.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

32. RELATED PARTIES

The subsidiary companies of the Group have between each other transactions that classify as transactions with related parties and which are made at market prices.

In the consolidation procedures the transactions between the companies included in consolidation by the full consolidation method are eliminated, once the consolidated financial statements present the owner and its subsidiaries information as one single company, therefore they are not disclosed in this note.

As of 31 December 2013 and 2012 the balances and transactions with related parties are as follows:

	Purchases and services obtained		Sales and services rendered		Interest income
Transactions	31.12.2013	31.12.2012	31.12.2013	31.12.2012	31.12.2013	31.12.2012
Associated companies and joint ventures (a)	2,181,663	1,460,419	4,712,657	4,209,987	320,072	712,261
Other related parties (b)	6,135,933	6,867,062	-	-	-	-
	8,317,596	8,327,481	4,712,657	4,209,987	320,072	712,261
	Accounts payable		Accounts receivable		Loans Granted
Balances	31.12.2013	31.12.2012	31.12.2013	31.12.2012	31.12.2013	31.12.2012
Associated companies and joint ventures (a)	91,556	467,432	521,439	108,129	13,807,905	13,807,905
Other related parties (b)	6,169,358	7,057,514	124,335	258,066	-	-
	6,260,914	7,524,946	645,774	366,195	13,807,905	13,807,905

(a) All entities consolidated by the equity method at December 31, 2013 and 2012 according to Note 4.2 and available for sale investments as described in Note 4.3;

(b) Were considered as related parties Group Ramada companies.

Besides the transactions identified above, there are no other transactions with related companies.

During the years ended 31 December 2013 and 2012, there were no transactions or loans granted to the members of the Board of Directors.

Besides the companies included in consolidation (Note 4), entities considered as related parties as of 31 December 2013 can be detailed as follows:

Adcom Media Anúncios e Publicidade, S.A. Alteria, S.G.P.S., S.A. Storax – Equipements, S.A. Caderno Azul, S.G.P.S., S.A. Actium Capital, S.G.P.S., S.A. Cofihold, S.G.P.S., S.A. Cofina, SGPS, S.A. Cofina B.V. Cofina Media, SGPS, S.A. Cofina Eventos e Comunicação, S.A. Destak Brasil – Editora de Publicações, S.A. Destak Brasil – Empreendimentos e Participações, S.A. Edisport – Sociedade de Publicações, S.A. Edirevistas – Sociedade Editorial, S.A. Efe Erre Participações, S.G.P.S., S.A. Elege Valor, S.G.P.S., S.A. F. Ramada – Investimentos, SGPS, S.A. F. Ramada – Aços e Indústrias, S.A. F. Ramada – Produção e Comercialização de Estruturas Metálicas de Armazenagem, S.A. F. Ramada II, Imobiliária, S.A. F. Ramada Serviços de Gestão, Lda. Grafedisport – Impressão e Artes Gráficas, S.A. Livre Fluxo, S.G.P.S., S.A. Malva – Gestão Imobiliária, S.A. Mediafin, SGPS, S.A. Metronews – Publicações S.A. Mercados Globais – Publicação de Conteúdos, Lda. Presselivre – Imprensa Livre, S.A. Sociedade Imobiliária Porto Seguro – Investimentos Imobiliários, S.A.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

Storax Racking Systems, Ltd. Storax Benelux Transjornal – Edição de Publicações, S.A. Torres da Luz – Investimentos Imobiliários, S.A. Universal Afir – Aços, Máquinas e Ferramentas, S.A. VASP – Sociedade de Transportes e Distribuições, Lda Web Works – Desenvolvimento de Aplicações para Internet, S.A. Valor Autêntico, SGPS, S.A.

33. KEY MANAGEMENT COMPENSATION

Compensation paid to key managers, who in Altri's case correspond to the Board of Directors, due to its corporate governance model, during the years ended 31 December 2013 and 2012 amounted to 1,079,120 Euro and 1,303,820 Euro, respectively, corresponding only to fixed remuneration and were fully paid by its subsidiaries.

On December 31, 2013, there are not: (i) plans or incentive systems related to grant of shares to members of the Board, (ii) paid or payable indemnities to former directors in relation to the transfer of functions during the year (iii) supplementary pensions or early retirement for directors, or (iv) non-cash benefits considered as remuneration.

The director Laurentina Martins benefits from a pension plan assigned before her appointment to the Board of Directors because, at the grant date, she was a worker of the subsidiary Caima - Indústria de Celulose, SA. The main features and information about the referred plan are detailed in Note 30 a). On that date, the liabilities for past services related with this director amounted to 430,090 Euro and no contribution to the fund was made in 2013.

Altri, SGPS, SA does not have any plan to grant shares or stock options to the members of the governing boards or to its employees.

34. OTHER INCOME

As of 31 December 2013 and 2012 the caption "Other income" can be detailed as follows:

	31.12.2013	31.12.2012
Subsidies to investments and to explotation	10,066,808	9,968,769
Gains on disposal of fixed assets	141,684	395,732
Others	3,291,998	2,355,257
	13,500,490	12,719,758

35. OTHER EXPENSES

As of 31 December 2013 and 2012 the caption "Other expenses" can be detailed as follows:

	31.12.2013	31.12.2012
Direct taxes and fees	(1,517,611)	(1,413,107)
Losses on commodities derivate contracts (Note 28)	(8,793,869)	(5,412,800)
Others	(1,822,892)	(3,527,061)
	(12,134,372)	(10,352,968)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

36. NET FINANCIAL LOSS

Consolidated net financial loss for the years ended 31 December 2013 and 2012 are made up as follows:

	31.12.2013	31.12.2012
Financial expenses:
Interest (Note 21)	(19,043,419)	(26,462,276)
Exchange losses	(2,553,845)	(1,864,399)
Losses in derivatives	(3,579,253)	(5,007,167)
Other financial expenses	(5,809,223)	(6,571,031)
	(30,985,740)	(39,904,873)
Financial income:
Interest	3,087,608	2,871,751
Exchange gains	1,929,342	1,323,010
Other financial income	205,921	85,805
	5,222,871	4,280,566

As of 31 December 2013 and 2012, the caption "Losses on derivatives" corresponds to the gains and losses originated by the changes of the derivatives fair value and the loss on interest rate derivatives instruments that matured or were paid until that date (Note 28).

The caption "Other financial expenses" includes, mainly, expenses with loans setup, which are recognized in the profit and loss statement through the duration of those loans (Note 21).

The caption "Gains and losses in associated companies" corresponds, mainly, to the appropriation of the group's share in the results of the investments in associated companies (Note 4.2).

37. AMORTISATION AND DEPRECIATION

As of 31 December 2013 and 2012 the caption "Amortisation and Depreciation" can be detailed as follows:

	31-12-2013	31-12-2012
Tangible fixed assets (Note 7)	48,683,243	48,281,016
Investment properties (Note 8)	7,379	7,381
Intangible assets (Note 10)	545,549	573,256
	49,236,171	48,861,653

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro)

(This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

38. EARNING PER SHARE

Earnings per share for the years ended 31 December 2013 and 2012 were determined taking into consideration the following amounts:

	31-12-2013	31-12-2012
Share number considered for the computation of basic and diluted earning	205,131,672	205,131,672
Net profit considered for the computation of basic and dilluted earning	55,347,961	52,181,891
Earnings per share
Basic	0.27	0.12
Diluted	0.27	0.12

As of 31 December 2013 and 2012 there are no dilution effects of the number of shares issued.

39. SEGMENTAL INFORMATION

On 16 April 2008 was signed the Altri SGPS, S.A. spin-off public deed. Under the terms of that project, the planned reorganization implies the split of Altri's two business units that manage equity holdings in the pulp and paper sector and in the steel and storage systems sector. This reorganization aimed a bigger focus and transparency on ALTRI's business, and giving each of the areas an opportunity to be better seen and better evaluated by the market. This allows for the Altri Group to focus its activity on its core business, production and commercialization of bleached paper pulp from eucalyptus, so the Board of Directors believes that there is only one business segment and the management information is reported and analysed on this basis.

Sales and services rendered in 2013 and in 2012 by the Group, according to the geographic segments, were as follows:

	31.12.2013	31.12.2012
Domestic market	111,464,720	111,621,517
International market	447,605,331	418,485,768
	559,070,051	530,107,285

40. NUMBER OF PERSONNEL

During the years ended 31 December 2013 and 2012, the average number of employees of the companies included in the consolidated financial statements by the full consolidation method was of 651 and 638, respectively.

41. FEES OF STATUTORY AUDITOR

The remuneration paid to auditors of the Group and other individuals or entities belonging to the same network, by all the group companies in 2013 and 2012, were as follows:

	31.12.2013	%	31.12.2012	%
Statutory audit	267,147	43.6%	280,925	56.0%
Other assurance services	163,493	26.7%	102,891	20.5%
Sub-total audit	430,640	70.2%	383,816	76.5%
Tax consulting services	27,075	4.4%	-	0.0%
Other services	155,467	25.4%	118,117	23.5%
	613,182	100.0%	501,933	100.0%

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

42. APPLICATION OF NET PROFIT

As regards the year 2012, the Board of Directors proposed in its annual report that the individual net loss of Altri, SGPS, S.A. amounting to 4,145,968.07 Euro to be transferred to retained earnings. It was also proposed the distribution of free reserves in the amount of 5,128,292.80 Euro as dividends. These proposals were approved by the General Shareholders' Meeting held on April 18, 2013.

As regards the year 2013, the Board proposes in its annual report that the individual net profit of Altri, SGPS, S.A. amounting to 10,843,235.78 Euro is applied as follows:

Legal reserves	542,161.79
Free reserves	1,685,543.77
Dividend distribution	8,615,530.22
	10,843,235.78

43. ENVIRONMENTAL INFORMATION

Following the Kyoto Protocol, the European Union committed herself to reduce the emission of greenhouse gases. Therefore, it has issued a Directive that predicts the commercialisation of carbon dioxide emission licenses. This directive was transposed to the Portuguese legislation and became mandatory since 1 January 2005, namely, for the pulp and paper industry.

Following the ministerial dispatch number 38/2013 dated 15 March 2013, the Portuguese government distributed to the companies the carbon dioxide emission licenses. The Group companies received a free license for the emission of 94.951 tons of carbon dioxide in 2013. If the Group exceeds that amount it will have to buy in the market the remaining licenses. The distribution of the carbon dioxide emission licenses is made in the beginning of the following year, being the emission amounts presented subject to a certification made by an independent entity.

Bearing in mind that these licenses refer to the period 2013-2020, in accordance with the estimates for the year 2013, the Group does not expect this legislation to carry significant additional costs.

As of 31 December 2013 the Group has not recorded any liability concerning environmental issues, nor has disclosed any environmental contingency, since the Board of Directors believes that, as of that date, no obligations and responsibilities arising from past events have occurred that lead to significant costs to the Group.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 31 DECEMBER 2013

(Amounts expressed in Euro) (This is a translation of a report originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 45)

44. FINANCIAL STATEMENTS APPROVAL

The financial statements were approved by the Board of Directors and authorized for issuance in 27 March 2014. The final approval depends on the agreement of the General Shareholders Meeting.

45. EXPLANATION ADDED FOR TRANSLATION

These consolidated financial statements are a translation of financial statements originally issued in Portuguese in accordance with International Financial Reporting Standards, some of which may not conform or be required by generally accepted accounting principles in other countries. In the event of discrepancies, the Portuguese language version prevails.

The Board of Directors

Paulo Jorge dos Santos Fernandes

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____________________________________________

____________________________________________

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João Manuel Matos Borges de Oliveira

____________________________________________ Pedro Macedo Pinto de Mendonça

Domingos José Vieira de Matos

Laurentina da Silva Martins

STATUTORY AUDIT AND AUDITOR'S REPORT

(This is a translation of a report originally issued in Portuguese in the event of discrepancies, the Portuguese language version prevails – Note 45)

Introduction

1. In compliance with the applicable legislation we hereby present our Statutory Audit and Auditor's Report on the consolidated and individual financial information contained in the Board of Directors' Report, and on the accompanying consolidated and individual financial statements of Altri, SGPS., S.A. ("Company") and subsidiaries for the year ended 31 December 2013 which comprise the Consolidated and Individual Statements of Financial Position as of 31 December 2013 (that present a total consolidated and individual net assets of 1,221,377,826 Euro and 146,414,724 Euro, respectively, and consolidated and individual equity of 241,809,790 Euro and 52,013,291 Euro, respectively, including a consolidated net profit attributable to the Company's shareholders of 55,347,961 Euro and an individual net profit of 10,843,236 Euro), the Consolidated and Individual Statements of profit and loss, comprehensive income, changes in equity and cash-flows for the year then ended and the corresponding Notes.

Responsibilities

• 1. The Board of Directors is responsible for: (i) the preparation of consolidated and individual financial statements that present a true and fair view of the financial position of the Company and of the group of companies included in the consolidation, the consolidated and individual results of their operations, comprehensive income, changes in equity and their consolidated and individual cash-flows; (ii) the preparation of historical financial information in accordance with the International Financial Reporting Standards as adopted by the European Union and that is complete, true, up-to-date, clear, objective and licit, as required by the Securities Market Code; (iii) the adoption of adequate accounting policies and criteria and the maintenance of an appropriate system of internal control; and (iv) informing on any significant facts that have influenced the operations of the Company and of the group of companies included in the consolidation, their financial position or their results and comprehensive income.
• 1. Our responsibility is to examine the consolidated and individual financial information contained in the documents referred to above, includind verifying that, in all material respects, the information is complete, true, up-to-date, clear, objective and licit, as required by the Securities Market Code, and to issue a professional and independent report based on our examination.

Scope

1. Our examination was performed in accordance with the Technical/Audit Standards ("Normas Técnicas e as Directrizes de Revisão/Auditoria") issued by the Portuguese Institute of Statutory Auditors ("Ordem dos Revisores Oficiais de Contas"), which require that the examination be planned and performed with the objective of obtaining reasonable assurance about whether the consolidated and individual financial statements are free of material misstatement. Such an examination includes verifying, on a sample basis, evidence supporting the amounts and disclosures in the consolidated and individual financial statements and assessing the estimates, based on judgments and criteria defined by the Board of Directors, used in their preparation. Such an examination also includes verifying the consolidation procedures, the application of the equity method and that the financial statements of the companies included in the consolidation have been appropriately examined, assessing the adequacy of the accounting principles used and their uniform application and disclosure, taking into consideration the circumstances, verifying the applicability of the going concern concept, verifying the adequacy of the overall presentation of the consolidated and individual financial statements and assessing that, in all material respects, the consolidated and individual financial information is complete, true, up-to-date, clear, objective and licit. Our examination also comprises verifying that the financial information contained in the Board of Directors' Report is in accordance with the consolidated and individual financial statements, as well to perform the verifications established in the numbers 4 and 5 of the article 451º of the Portuguese Company Law ("Código das Sociedades Comerciais"). We believe that our examination provides a reasonable basis for expressing our opinion.

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Opinion

1. In our opinion, the consolidated and individual financial statements referred to in paragraph 1 above, present fairly in all material respects, the consolidated and individual financial position of Altri, SGPS, S.A. as of 31 December 2013, the consolidated and individual results of their operations, consolidated and individual comprehensive income, changes in consolidated and individual equity and their consolidated and individual cash flows for the year then ended, in accordance with the International Financial Reporting Standards as adopted by the European Union and the information contained therein is, in terms of the definitions included in the technical and audit standards referred to in paragraph 4 above, complete, true, up-to-date, clear, objective and licit.

Report on other legal requirements

1. It is also our opinion that the financial information included in the Board of Directors' Report is in accordance with the consolidated and individual financial statements of the year and that the Corporate Governance Report includes the information required to the Company, as established by the article 245º- A of the Securities Market Code.

Porto, 27 March 2014

______________________________________ Deloitte & Associados, SROC S.A. Represented by António Manuel Martins Amaral

REPORT AND OPINION OF THE STATUTORY AUDIT BOARD

(Translation of a report originally issued in Portuguese – Note 45)

To the Shareholders of Altri, SGPS, S.A.

1. Report

In compliance with the applicable legislation and our mandate, we hereby submit our Report and Opinion, which covers the Board of Director's Report and the individual and consolidated Financial Statements of Altri, SGPS, S.A. ("Company") for the year ended 31 December 2013, which are the responsibility of the Company's Board of Directors.

During the year under analysis, the Statutory Audit Board accompanied the operations of the Company and its affiliates, the timely writing up of accounting records, compliance with statutory and legal requirements and the effectiveness of the risk management and internal control systems, having held meetings with the periodicity and length considered appropriate and having always obtained, from the Board of Directors and personnel of the Company and its affiliates, all the information and explanations required.

As part of its duties, the Statutory Audit Board examined the individual and consolidated statement of financial position as of 31 December 2013, the individual and consolidated statements of profit and loss, comprehensive income, cash flow, and changes in shareholders' funds for the year then ended, and the corresponding notes. Additionally, the Statutory Audit Board examined the Report of the Board of Directors for the year 2013, and fulfilled its duties concerning the review of the qualifications, independence and work of the Statutory Auditor, and reviewed the Statutory Audit and Auditor's Report and was in agreement with its content.

2. Opinion

Considering the above, in the opinion of the Statutory Audit Board, the Board of Director's Report and the individual and consolidated Financial Statements are in accordance with accounting, legal and statutory requirements and consequently may be approved by the General Shareholders' Meeting.

3. Responsibility Statement

In accordance with paragraph a), number 1 of article 8 of the Regulation of CMVM 5/2008, the members of the Statutory Audit Board declare that, to their knowledge, the information contained in the Management Report and the individual and consolidated financial statements were prepared in accordance with the International Financial Reporting Standards as adopted by the European Union, giving a true and fair view, in all material respects, of the assets and liabilities, financial position and the results of the Company and companies included in the consolidation perimeter as of 31 December 2013. Also it is their understanding that the Management Report faithfully describes the business evolution, performance and financial position of the Company and of the companies included in the consolidation perimeter and contains a description of the major risks and uncertainties that they face.

We wish to thank the Company's Board of Directors and the departments of the Company and its affiliates involved for the assistance provided to us.

Porto, 27 March 2014

The Statutory Audit Board

João da Silva Natária President of the Statutory Audit Board

Manuel Tiago Alves Baldaque de Marinho Fernandes Member of the Statutory Audit Board

Cristina Isabel Linhares Fernandes Member of the Statutory Audit Board