Altri SGPS — Annual Report 2015

Apr 21, 2016

ANNUAL REPORT

DECEMBER 31, 2015

INTRODUCTION 4
MACROECONOMIC BACKGROUND 6
STOCK EXCHANGE EVOLUTION 8
GROUP'S ACTIVITY 10
CORPORATE RESPONSIBILITY AND SUSTAINABILITY 14
FINANCIAL REVIEW 17
ACTIVITY DEVELOPED BY THE NON-EXECUTIVE MEMBERS OF THE BOARD OF DIRECTORS 20
PROPOSAL OF THE BOARD OF DIRECTORS FOR APPROPRIATION OF THE NON CONSOLIDATED NET PROFIT FOR THE YEAR 21
2016 OUTLOOK 22
CORPORATE GOVERNANCE 24
LEGAL MATTERS 56
CLOSING REMARKS 58
STATEMENT UNDER THE TERMS OF ARTICLE 245, PARAGRAPH 1, C) OF THE SECURITIES MARKET CODE 60
DECLARATION OF RESPONSIBILITY 60
APPENDIX I 61

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 2015. 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

The year 2015 was an exceptional year for Altri Group with record levels in terms of production and pulp sales. This operational performance reflected in all financial indicators, in particular EBITDA, operating income, net profit and free cash flow.

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 Euronext Lisbon, integrating PSI 20 (Portuguese Stock Index), the benchmark stock market index. In addition to paper pulp and dissolving 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 540 million Euro, on industrial unities. Currently, Altri owns three pulp mills in Portugal with a total capacity above 1 million tonnes/year of bleached eucalyptus pulp in 2015. There is an ongoing process of small investments to optimize production efficiency.

The forest is a strategic asset of Altri, with a forest area under intervention amounting to 82,120 hectares in Portugal. The company is certified by the Forest Stewardship Council® (FSC®)1 and by the Programme for the Endorsement of Forest Certification (PEFC), two of the most worldwide acknowledged certification entities. Eucalyptus stands out as the main production of Altri's forest, occupying more than 65,500 hectares and ensuring a self-supply of wood and biomass that complements the market supply. Altri Florestal forestry management is certified by the main sustainable forest management certification systems, ensuring the achievement of the company's current and future goals.

Although Altri's forests are scattered across the country, the vast majority are concentrated in Tejo's valley, close to the group's mills, increasing their relevance. This proximity has a strategic importance as it allows the optimization of transportation costs, as well as an increase in efficiency in wood mobility when compared to productions located at higher distances.

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.

Altri's development strategy is clearly based on strengthening its operating efficiency and, at the same time, the diversification of revenue into segments with higher value added, enabling an increase in the value chain. In order to compete in the commodities market and with an adverse exchange rate environment, the company has to cut its operating costs and to invest on the production of higher value added products, allowing for future growth, despite the increases of pulp production capacity in recent years and despite the investments already announced for the near future all over the world.

¹ FSC-C004615

Altri aims to be the most efficient producer in placing pulp at the client's facilities. As so, the Company developed a strategy based on three pillars:

• Cutting cash cost per ton: recent year's projects and ongoing projects do not imply an increase in fixed costs, leading to a dilution of the cash cost per ton;
• Strategic location of its customers: the prime location for Altri's customers is Western and Central Europe, which optimizes the balance between quality of customer service and transportation costs;
• Wood self-sufficiency: Altri has as a forest area under intervention of about 82,000 hectares in Portugal, grating a potential level of wood self-sufficiency of around 25%.

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 several 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.

Altri's organic structure is as follows:

MACROECONOMIC BACKGROUND

The year 2015 was marked, in geopolitical terms, for several events, including the Daesh and the terrorism, which relegated the strong disputes between Russia and Ukraine to a second plan. As in 2014, the year 2015 was also marked by a strong appreciation of the dollar against most world currencies, by a sharp fall in oil.

In Europe, the year of 2015 was very eventful. Beyond constant concerns around Greece coming from prior years, the Volkswagen scandal and the terrorist attacks in Paris also contributed to a more restless year. The economic growth was again very low and the economy hasn´t yet gained its momentum. The accommodative monetary policy pursued by the ECB, particularly the quantitative earning program launched in March, originated economic effects in 2015, assumed a key role and helped to fight the strength of the Euro. These measures led to the decrease of the amplification of the negative impact of a slower global demand and to a reduction of a prolonged deflation period.

The growth in Euro area declined during the year, and has stayed stable at 0.3%, which is insufficient to stimulate the inflation that ended in 0.2%, year on year. The high levels of unemployment (10.5% in November) prevented an inflationary pressure through wages.

Due to inherent risks, the fall of oil price, the uncertainty in emerging economies and the geopolitical risks, it is expected that the ECB will continue with its accommodative monetary policy.

The Portuguese economy, according to INE data, showed a moderate recovery in 2015, with the preliminary GDP data indicating a growth of 1.5%.

In Portugal, private consumption was again relevant, with an improvement in the confidence of families and their financial situation, benefiting from the ECB's measures that have resulted in an increase in loans granted by banks, as well as from the low oil prices, while conducted to a higher disposable income.

The structural imbalance of the Portuguese economy continued: whenever private consumption and investment accelerate, the same happens with the imports. The exports benefited from the devaluation of the Euro and have been penalized by the slowdown in exports to Angola, influenced by the adverse effect on activity and financing conditions due to the sharp drop in oil prices.

The last months of the year were marked by the legislative elections and by the reversal of some measures of the previous government, which brought some concerns to international institutions.

The forecast for 2016 reflects the continuity of the process of moderate economic recovery, as well as the gradual adjustment of macroeconomic imbalances, with the Bank of Portugal anticipating a growth of 1.7% for 2016.

These projections are aligned with the projections of the European Commission (the projections from the OCDE and the IMF are more moderate) and assume a continued growth in terms of exports as well as an acceleration of investment – the evolution of domestic demand should remain compatible with the reduction in the level of leverage of families and non-financial companies.

With regard to the US economy, and after a first quarter with a contraction in growth, due to unusually adverse weather conditions, the economy grew 3.7% in the second quarter. In the 3rd quarter, the economy began to slow down due to a decline in investment and public spending. The reduction in the accumulation of the companies' inventories was a relevant factor in the further quarter to a more sharp slowdown.

After long months of speculation, in December the US Federal Reserve (FEAD) moved forward with the first rise in interest rates since 2006, a widely expected decision and mainly sustained in the strength of the labour market. It is expected that the cycle of rises will gradually continue in 2016, but without relevant limitations to the economy´s expansion.

Concerning Japan, the economy retards to give signs of dynamism. According to the first data of the Japanese GDP, growth has only reached 0.4% in 2015, with the IMF projecting an acceleration to 1.0% in 2016.

In China, the depreciation of the yuan by the central bank and the collapse of the Chinese stock exchanges influenced the slowdown in the last two quarters, with the annual growth in the coming years expected to reach the 6.5% target announced by the Chinese government in its five-year plan for the period 2016-2020.

In terms of future forecasts for the world economy, the IMF has downgraded its forecasts for 2016 and 2017, to 3,4% and 3,6%, respectively. The institution considers that one of the problems is the slowdown of the trade with China and, on the other hand, the low commodity prices.

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.)

Altri's shares recorded an increase of 92.1% in 2015, exceeding the index that recorded an increase of 10.7% in the same period.

Altri's share price closed in 2015 at 4.77 Euro per share. The market capitalization at the end of 2015 was about 978 million Euro.

During 2015, Altri's shares were traded at a maximum price of 5.24 Euro per share and at a minimum of 2.498 Euro per share. In total, 133 million Altri shares were traded in that period, equivalent to 65% of the issued capital.

The main events that marked the evolution of the Company's shares during 2015 may be described chronologically as follows:

• On February 20, 2015, the Company informed to have taken the position held by its subsidiary Celulose Beira Industrial (Celbi), S.A. in a six-year bond loan "CELBI 2014-2020" issued by private placement, on the 16th of April, 2014, in the amount of Euro 50,000,000 (fifty million Euro). This loan was renamed "ALTRI 2014-2020";
• On February 26, the group informed that its subsidiary Celulose Beira Industrial (Celbi), S.A., issued a sixyear bond loan, in the amount of 35,000,000 Euro, by private placement, named "Celbi 2015/2021";
• On February 26, the Group announced its financial performance for the year 2014, standing consolidated net profit of 37 million Euro. The consolidated total revenues amounted to 553 million Euro, representing a decrease of 3% over 2013. Consolidated EBITDA amounted to 114 million Euro. At that date, shares closed quoting at 3.024 Euro per share;
• In a statement made on April 23, 2015, the Company informed the market that the dividends for the year 2014, amounting to 0.08 Euro per share, would be paid from May 11 onwards;
• Through an announcement made on May 8, the Group announced results for the first quarter of 2015. The consolidated total revenues during this period reached 154 million Euro. EBITDA reached 46.6 million Euro and the consolidated net profit was 22.2 million Euro;
• On July 30, Altri announced to the market the results of the 1st half of 2015 presenting a total income of 313 million Euro (+19%), an EBITDA of about 100 million Euro (+92%) and a net profit of about 50 million Euro (+296%);
• On October 30, Altri announced the result of the third quarter of 2015. The Group reached a total revenue of 494.3 million Euro (+21.5%); EBITDA reached 163.2 million Euro (+98.3%) and the net profit was about 84.7 million Euro (+270%). On the same date the group announced the intention to make an advance of the year's net profit in the amount of 51,282,918 Euro, equivalent to 0.25 Euro per share;
• On November 16, 2015, Altri announced the approval of the above mentioned anticipated dividend to be paid from 15 December onwards.

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 F. Ramada Investimentos SGPS, S.A.. 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 investments held by Altri are as follows:

• Caima Indústria de Celulose (Constância), producer and distributor of dissolving 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 2015 is as follows:

Altri's product

Celbi and Celtejo produce eucalyptus pulp, using the sulphate process, or kraft. Caima produces dissolving pulp, for applications in the textile industry, by the sulfite process.

Celbi pulp is bleached without the use of elemental chlorine (ECF pulp, elemental chlorine free). Caima and Celtejo's are TCF pulps (totally chlorine free), they are bleached without using chlorine compounds.

For Celbi and Celtejo's pulp the use of eucalyptus globulus as a raw material, combined with the production process make them particularly suitable for the production of certain types of paper or paperboard.

The characteristics of Celbi's pulp production, make it more adequate for using in the production of fine printing and writing paper, decorative laminate papers and paper to high quality printing. On the other hand, Celtejo's pulp is particularly suitable for the production of tissue papers.

Caima produces dissolving pulp using the Eucalyptus globulus as raw material. This pulp is used in the production of viscose, one of the raw materials of the textile industry, alongside cotton and polyester. There is an ongoing development project in order to make it possible in the future to use this pulp on a wider range of products, with applications in detergent and pharmaceutical industries, etc.

The target markets for pulp are Western Europe, Eastern Europe and the Mediterranean. Dissolving pulp is mainly sold in China, which is the largest producer of viscose.

In addition to the dissolving pulp, Caima also sells magnesium lignosulfonate, which is mainly used in the construction industry, as an additive for concrete.

The produced pulps are approved by Nordic Ecolabelling of Paper Products (Celbi and Celtejo) and the European Ecolabel (Celbi), so that they can be used in products that intend to use this environmental label.

These are both environmental labeling programs based on an analysis of the product life cycle.

Pulp Market

According to Pulp and Paper Products Council (PPPC) World 20, in 2015, total demand for hardwood pulp increased by 5.5%, leading to an absolute incremental growth of 1.2 million tons.

In the 4th quarter of 2015, the BEKP price, in EUR, was marked by a slight increase of 1% compared to previous quarter. Thereby, the average market price was 732EUR/ton, in the 4th quarter of 2015 compared to an average market price (PIX) in 3rd quarter of about 724 EUR / ton.

Market price evolution in BEKP pulp in Europe since 2003 until the end of 2015 (EUR)

Source: Hawkins Wright

In 2015 Altri reached, again, a new record of production and sales of pulp. Thus, during this year Altri's three mills produced 1,022 million tons of pulp (+3.2%), of which about 97,500 tons were dissolving pulp (DP).

In 2015, Altri's total revenues reached 664.8 million Euro, which represents an increase of 20.3% compared to 2014. The pulp sales reached 564.7 million Euro, representing an increase of approximately 25.9% compared to revenues in 2014.

Pulp sales by region and detail by use

In terms of geographical distribution of Altri's sales, Europe (excluding Portugal) is the main destination market of group sales, representing 75% of market sales, that is, approximately 760 thousand tons. Asia is the destination market of the dissolving pulp currently produced in Caima, and is the second biggest destination market, representing 9% of the pulp sales.

In terms of pulp use, tissue paper producers are Altri's main clients, with a share of 49%.

CORPORATE RESPONSIBILITY AND SUSTAINABILITY

Altri believes that the use of renewable raw materials, clean technologies, more efficient production processes in terms of energy and water consumption and sustainable forest management practices are essential to mitigate climate changes and to overcome other environmental challenges that concern us as well as our stakeholders.

The ideal situation, that would please the Company, would be an industry without waste, no emissions, no odors and no water waste.

Although currently unrealistic and utopian, it is a vision of Altri, and one of the main drivers in decision making process regarding new investments, modernization and optimization of production capacities of the group's mills.

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

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 a 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 Research, Development and Innovation system 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 ® 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.

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 is notorious the gradual reduction of fossil CO2 emissions from 2013 onwards.

It has taken a lot of effort on optimizing the balance of power in Altri mills, reflecting the importance of the topic energy to the group. Also the use of water has decreased over the years.

Specific consumption of electric power

The emission of some gaseous 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.

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.

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 euro	2014	2015	2015/2014 Var%
Total Revenues	552,858	664,825	20.3%
Costs of sales	254,825	237,903	-6.6%
External supplies and services	152,040	162,836	7.1%
Payroll expenses	29,778	35,277	18.5%
Others expenses	2,759	4,049	46.8%
Provisions and impairment losses	-78	3,652	ss
Total expenses (a)	439,323	443,717	1.0%
EBITDA (b)	113,535	221,108	94.7%
Margin	20.5%	33.3%	+12.7 pp
Amortization and depreciation	48,520	52,834	8.9%
EBIT (c)	65,015	168,274	158.8%
Margin	11.8%	25.3%	+13.6 pp
Results of associated companies	2,741	2,950	7.6%
Financial costs	-34,506	-31,946	-7.4%
Financial income	7,365	8,274	12.3%
Financial profit	-24,401	-20,722	-15.1%
Profit before income tax	40,614	147,552	263.3%
Income tax Non-controlling interests	-3,223 9	-29,879 17	ss 90.3%
Profit for the period attributable to parent company's shareholders	37,382	117,656	214.7%

(a) Operating costs ex cluding amortisation, financial ex penses and income tax

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

(c) EBIT = Earnings before interest and tax es

Altri's total revenues reached 664.8 million Euro in 2015, which represents a increase of 20.3% compared to 2014. The pulp sale revenues amounted to 564.7 million Euro, which represents an increase of 25.9% compared to 2014.

Excluding depreciation, financial costs and taxes, total costs in 2015 reached approximately 443.7 million Euro, a 1% increase compared to 2014.

Going through the main captions at a higher detail, we can see a decrease in cost of sales of 6.6%, mainly as a result of the ongoing projects to reduce wood and chemicals consumption. Regarding the caption external supplies and services, the increase in 2015 is mainly due to the increase in the pool price of electricity.

In 2015 EBITDA reached approximately 221.1 million Euro, a significant increase of 95% compared to 2014 and EBITDA margin of 2015 reached 33.3% (+12.7 p.p.). The operational result (EBIT) recorded in the year was about 168 million Euro, compared with 65 million Euro in the previous year.

The financial result amounted to a net charge of 20.7 million Euro. The weighted average cost of current total debt is less than 3%.The caption "gains and losses in associated companies" mainly refers to the appropriation of 50% of the profit of EDP Bioeléctrica, a company 50% owned by Altri and consolidated by the equity method.

Consolidated net profit of Altri reached about 117.7 million Euro (37.4 million Euro in 2014).

Key statement of financial position indicators

thousand euros	2014	2015	Var%
Biological assets	105,158.8	101,472.9	-4%
Tangible assets	384,285.5	364,119.6	-5%
Goodw ill	265,531.4	265,531.4	0%
Inv estmens av ailable for sale	10,691.2	10,691.1	0%
Others	43,226.9	42,756.7	-1%
Total non current assets	808,893.7	784,571.7	-3%
Inv entories	54,725.4	56,396.6	3%
Customers	88,868.1	91,521.3	3%
Cash and cash equiv alents	260,855.0	243,154.2	-7%
Others	25,913.7	19,597.6	-24%
Total current assets	430,362.3	410,669.6	-5%
Total assets	1,239,256.0	1,195,241.4	-4%
Shareholder's equity and non controlling interests	272,264.0	322,349.6	18%
Bank loans	103,837.5	153,587.5	48%
Other loans	278,276.9	413,733.4	49%
Reimbursable financial incentiv es	11,723.8	17,439.1	49%
Others	48,330.3	45,566.5	-6%
Total non current liabilities	442,168.5	630,326.6	43%
Bank loans	77.2	10,775.0	13852%
Other current loans	398,648.0	105,438.1	-74%
Reimbursable financial incentiv es	9,082.8	558.9	-94%
Suppliers	61,686.4	61,243.4	-1%
Others	55,329.1	64,549.8	17%
Total current liabilities	524,823.5	242,565.3	-54%

The total investment (CAPEX) performed in 2015 by the industrial units amounted to 32 million Euro.

Altris's nominal remunerated debt net of cash and investments available for sale as of 31 December 2015 reached 442.6 million Euro corresponding to a decrease of 82.8 million Euro compared to 2014 (525.4 million Euro). It should be highlighted that, in 2015, the company paid 67.7 million Euro in dividends. Thus the free cash flow to equity generated in 2015 reached 150.5 million Euro.

Therefore, the company kept its priority financial strategy, which is based on systematic annual reduction of net debt through the free cash flow generated by the operating activity. Thus, it should be noted that, between 2009 and 2015, the net debt was reduced by 357 million Euro.

Evolution of free cash flow to equity since 2010

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

During 2015, 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.

Among others, during 2015, 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 2015, 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

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, a net profit of 103,489,990.30 Euro. The Board of Directors approved on November 16, 2015, an advance on profits of the 2015 financial year, amounting to 51,282,918.00 Euro, corresponding to a gross dividend of Euro 0.25 (twenty-five cents of Euro) per share.

Considering the net profit for the year of 103,489,990.30 Euro and the advance on profits of the 2015 financial year of 51,282,918.00 Euro already paid, the Board of Directors proposes to the General Meeting the following appropriation:

Legal reserve	791,793.55
Free reserves	132,360.75
Dividends distribution	102,565,836.00 *
	----------------------- 103,489,990.30 =============

* The total dividend per share amounts to 0.50 Euro per share in 2015; taking into account that in November 2015 was approved an advance on profits of the 2015 financial year, the remaining amount to be distributed to shareholders will be 51,282,918 Euro, corresponding to 0.25 Euro per share.

2016 OUTLOOK

The year 2015 was marked by the completion of some large projects, in particular the conversion of Caima mill into dissolving pulp production.

In this context, the 2016 financial year will be marked by an increase of small projects related with continuous improvement that take place regularly in all mills, and which aims to improve the operating profitability, namely variable cost by reducing specific consumption.

In terms of the pulp market, some fluctuations in the selling price of pulp produced are expected. Nonetheless, it should be highlighted the strong operational leverage arising from the Euro depreciation against the USD, as the revenues of pulp sales are directly related to that exchange rate.

CORPORATE GOVERNANCE

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

A. SHAREHOLDER STRUCTURE

I. Capital Structure

1. The capital structure

Altri, SGPS, S.A. ("Company" or "Altri") share capital amounts to 25,641,259.00 Euro, fully subscribed and is made up of 205,131,672 ordinary shares with a nominal value of 12.5 Euro cents each.

Of the total issued voting rights, 69.32% are, as far as the Company is aware, attributed to the holders of qualifying holdings listed in II.7.

All the shares representing the company's share capital are traded on the regulated market Euronext Lisbon.

2. Restrictions on the transfer and ownership of shares

Altri's shares have no restrictions on their transfer or on their ownership. Therefore, Altri's shares are freely transferable in accordance with applicable legal standards.

3. Own shares

Altri does not hold any own shares, with reference to December 31, 2015.

4. 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 including any clauses of control change (including after a takeover bid), that is, which come into effect, be amended or terminated in such circumstances. Also, there are 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.

Some financing agreements contain standard clauses of early repayment in the event of change of shareholder control of subsidiaries (and not of the Company). The Company believes that its disclosure would be harmful to her, while not add any benefit to shareholders and considers that these clauses, common in this type of contract, do not aim the adoption of any guarantee or shielding measures in cases of change of control or change in management board composition.

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

It is unknown the existence of any shareholders' agreements involving the Company.

II. Shareholdings and Bonds held

7. Qualifying holdings

As of 31 December 2015 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:

	Nr. of shares held	% Share capital with
Norges Bank	on 31-Dec-2015	voting rights
Directly	4,149,572	2.02%
Total attributable	4,149,572	2.02%
	Nr. of shares held	% Share capital with
JP Morgan Asset Management Holdings Inc.	on 31-Dec-2015	voting rights
Through JP Morgan Asset Management Holdings (Uk) Limited	4,251,854	2.07%
Total attributable	4,251,854	2.07%
	Nr. of shares held	% Share capital with
1 Thing, Investments, SGPS, S.A.	on 31-Dec-2015	voting rights
Directly	11,555,000	5.63%
Through the Board Member Pedro Miguel Matos Borges de Oliveira	2,804,708	1.37%
Total attributable	14,359,708	7.00%
	Nr. of shares held	% Share capital with
Paulo Jorge dos Santos Fernandes	on 31-Dec-2015	voting rights
Directly	650,000	0.32%
Through Actium Capital - SGPS, S.A. (of which he is dominant shareholder and director)	22,925,168	11.18%
Total attributable	23,575,168	11.49%
	Nr. of shares held	% Share capital with
Domingos José Vieira de Matos	on 31-Dec-2015	voting rights
Through Livrefluxo - SGPS, S.A. (of which he is dominant shareholder and director)	23,900,110	11.65%
Total attributable	23,900,110	11.65%
	Nr. of shares held	% Share capital with
João Manuel Matos Borges de Oliveira	on 31-Dec-2015	voting rights
Through CADERNO AZUL- SGPS, SA ( (of which he is shareholder and director) Total attributable	30,000,000 30,000,000	14.62% 14.62%
	Nr. of shares held	% Share capital with
Promendo - SGPS, SA	on 31-Dec-2015	voting rights
Directly (a)	41,954,552	20.45%
Through the Board Member José Manuel de Almeida Archer	1,500	0.00%
Total attributable	41,956,052	20.45%

(a) The 41,954,552 shares held directly by Promendo – S.G.P.S., S.A. are also attributable to Ana Rebelo Carvalho Menéres de Mendonça, who is the dominant shareholder and director of Promendo – S.G.P.S., S.A. and Board Member of Altri.

Altri was not informed of any participation exceeding 33% 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

The shares and bonds held by members of management and supervisory boards in the Company and in companies in a control or group relationship with the Company, directly or through related persons, are disclosed in the appendices to the Management Report as required by Article 447 of the Portuguese Companies Act and number 7 of Article 14 of Regulation 5/2008 of the Portuguese Securities Market Commission (CMVM).

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

II. Corporate Governance Report

ANNUAL REPORT 2015

The fourth article of Altri's articles of association, according to the deliberation of 31 March 2006, assigned 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.

This statutory provision under the paragraph b), number 2, of the article 456 of the CSC , lasted for five years and has not been renewed, in accordance with paragraph 4 of the same legal provision, so that on 31 March 2011 it expired. From that date onwards such power is exclusive of the General Shareholders Meeting.

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

In the year 2015 there were no significant business or commercial transactions between the Company and the holders qualifying shareholdings notified to the Company, except those that are part of the normal activity of the company which were performed under normal market conditions for similar transactions. It should be noted, however, that the amounts involved are not material.

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

As of 31 December 31, 2015, the Board of the General Meeting was composed of the following members: Chairman: José Francisco Pais da Costa Leite Secretary: Cláudia Alexandra Gonçalves dos Santos Dias

The mandate began in 2014 and will have its term in 2016.

b) Exercising the right to vote

12. Restrictions on voting rights

The share capital of the Company is fully represented by a single class of shares, corresponding to each share one vote, there are no statutory limitations on the number of votes that may be held or exercised by any shareholder.

The Company has not issued preferred shares without voting rights.

The participation of shareholders at the General Meeting is dependent, under the law, upon proof of ownership of the shares by reference to the "Record Date".

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.

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 which may be exercised by written declaration, together with the identification of the shareholder and his signature duly recognized, as required by law. 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. In that regard, the Company has not yet triggered the mechanisms required for its implementation

since this modality was never requested by any shareholder and considering that this circumstance does not constitute any constraint or restriction on the exercise of voting rights by shareholders.

The Company discloses, within the legal deadlines, and in all places requested by law, in Portuguese and English, the notice of General Meetings, which contain information on how to enable the shareholders to participate and exercise the right to vote and on procedures to be followed for voting by correspondence or designated representative. The Company discloses also, as required by law, the resolution proposals, preparatory information required by law and the minutes of letter of representation and voting forms for voting by correspondence, all to ensure, promote and encourage shareholder participation, by themselves or by their representatives, in the General Meetings.

13. 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

There is no limitation on the number of votes that can be held or exercised by a single shareholder or group of shareholders.

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

According to the Articles of the Company, the corporate decisions are taken by majority vote, whatever the percentage of share capital represented at the meeting, except when a different majority is required by law.

In a second call, the General Meeting may decide independently of the number of shareholders present and the capital they represent.

The deliberative quorum of the General Meeting is in accordance with the Portuguese Companies Act (CSC).

II. MANAGEMENT AND SUPERVISION

a) Composition

15. Identification of corporate governance model adopted

Altri adopts the model of government called monist, which includes a management structure centralized in a Board of Directors and a supervising structure centralized in a Supervisory Board and a Statutory Auditor.

The Board of Directors is thus the board responsible for management of the Company's business in achieving its social object.

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, one, two or 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 three or four, five or six, seven or more than 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 one, two or 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 currently made up of 7 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, 2015 this corporate board was composed of the following members:

• Paulo Jorge dos Santos Fernandes President and Co-CEO
• João Manuel Matos Borges de Oliveira Vice-President and Co-CEO
• Domingos José Vieira de Matos Member
• Laurentina da Silva Martins Member
• Pedro Miguel Matos Borges de Oliveira Member
• Ana Rebelo de Carvalho Menéres de Mendonça Member
• José Manuel de Almeida Archer Member

All Board of Directors members were appointed by the Shareholder's General Meeting held in April 24, 2014 for the period 2014/16, with the exception of José Manuel de Almeida Archer, appointed in September 29, 2015, to replace in the Board the deceased Board Member Pedro Macedo Pinto de Mendonça.

	FIRST
NAME	APPOINTMENT	END OF MANDATE
Paulo Jorge dos Santos Fernandes	March 2005	December 31, 2016
João Manuel Matos Borges de Oliveira	March 2005	December 31, 2016
Domingos José Vieira de Matos	March 2005	December 31, 2016
Laurentina da Silva Martins	March 2009	December 31, 2016
Pedro Miguel Matos Borges de Oliveira	April 2014	December 31, 2016
Ana Rebelo de Carvalho Menéres de Mendonça	April 2014	December 31, 2016
José Manuel de Almeida Archer	September 2015	December 31, 2016

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

The composition of the Board of Directors complies with a balance between the number of executive and nonexecutive directors.

As of December 31, 2015, the Board of Directors, composed by seven members, included three non-executive members Laurentina da Silva Martins, Ana Rebelo de Carvalho Menéres de Mendonça and José Manuel de Almeida Archer.

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 Laurentina Martins was an employee of the subsidiary Caima – Indústria de Celulose, S.A., the non-executive director Ana Rebelo de Carvalho Menéres de Mendonça, is the director and controlling shareholder of the company Promendo SGPS, S.A., and the non-executive director José Manuel de Almeida Archer is also a shareholder and director of the Company Promendo, S.G.P.S. S.A..

Despite these conditionals, to allow the non-executive directors an independent and informed decision, the Company developed some 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;

• Availability of executive directors for the provision to non-executive directors, of any additional information which they consider relevant or necessary, and to carry out further studies and analyzes in relation to all matters which are the subject of deliberation or that, are under review in some way, in the Company;
• 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.

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.

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 directors during 2015.

19. 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

On December 31, 2015, the President of the Board of Directors and Co-CEO Paulo Jorge dos Santos Fernandes is a director and controlling shareholder of the company ACTIUM CAPITAL - SGPS, S.A., company which owns 11.18% of the share capital of Altri.

The Vice-President of the Board of Directors and Co-CEO João Manuel Matos Borges de Oliveira is a director and shareholder of CADERNO AZUL - SGPS, S.A., company which owns a stake of 14.62% in the capital of Altri.

The director Pedro Miguel Matos Borges de Oliveira is the President of the Board of Directors of the Company 1Thing Investments S.G.P.S., S.A., holder of a 5.63% stake in the capital of Altri, and is brother of the director João Manuel Matos Borges de Oliveira.

The director Domingos José Vieira de Matos is director and dominant shareholder of LIVREFLUXO - SGPS, S.A., company which owns 11.65 % of the share capital of Altri, SGPS, S.A..

The company Promendo SGPS, S.A., holder of 20.45% of the share capital of Altri, SGPS, S.A. has as its director and dominant shareholder Ana Rebelo de Carvalho Menéres Mendonça.

21. Organizational 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

ANNUAL REPORT 2015 II. Corporate Governance Report

The Board of Directors develops its functions of management and coordination of the Group companies on a collective basis and is currently made up of a president and six members, three 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, in most cases, part of the management of the most significant group companies, so as to enable their activities to be more closely monitored.

The Board of Directors believes that due to its organizational structure, the only essential specialized commission taking into account its size and complexity, is the Remuneration Committee, as explained in paragraph 28 below.

The Remuneration Committee is the board responsible for performance evaluation and approving the remuneration of Board members and other corporate bodies, in compliance with the remuneration policy of the Company, approved by shareholders in General Meetings.

Altri's Corporate Finance area, given its integrated and cross-sectional view at the level of all companies in the group, is responsible, on the one hand, for the definition of financial management strategies and policies and, second, to secure interface capital markets, debt and banking. Altri's Corporate Finance also develops the mechanisms necessary to implement the outlined financial management strategies and policies.

The planning and management control area provides support in the implementation of corporate strategies and / or business, followed by the group. This area prepares and analyzes the management information at the level of all companies in the group, as well as at the consolidated level, monthly, quarterly, semi-annual and annual monitoring deviations from the budget and proposes the necessary corrective measures. Also bears responsibility for building business plans, integrating multidisciplinary work teams created for this purpose, activities that develops along with the ongoing development and technical studies and benchmark existing businesses in order to monitor the performance of Altri having regard to its strategic position.

The legal area provides legal support in all areas of group activity, monitoring and ensuring, on the one hand, the legality of the activities, and ensuring, on the other, relations with Euronext Lisbon, with the CMVM and the shareholders when that in question are legal matters. This area is also responsible for monitoring the corporate governance policy with a view to achieving best practice in this area. This area is also responsible for drawing and / or analysis of contracts that maximize safety and reduce legal risks and potential costs, the management of issues relating to intellectual and industrial property used by the group, such as patents and trademarks, logos, domains and copyright, still exercising the corporate secretarial functions on a permanent monitoring of legal compliance, supporting the Board of Directors to implement their strategies.

The area of investor relations establishes the relationship between the group and the financial community, permanently disseminating relevant and updated information on the same activity. This area is also responsible for assisting the Board of Directors in providing updated information on the capital market as well as aid for the management of institutional relations of Altri, establishing permanent contact with institutional investors, shareholders and analysts and representing the group in associations , forums and events (national or international).

In addition, the operating companies of Altri have their own management control areas that exercise their activity at all levels of the subsidiary companies and prepare monthly reports periodically reported to the respective Boards of Directors.

The distribution of functions between the various members of the Board of Directors is carried out as follows:

Generically, Altri's directors focus their activities in managing the Group 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 subsidiary 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 and in the several subsidiaries, the functional organizational 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 regulation is available on the website of Altri (www.altri.pt) (tab "About Altri", section "Governance").

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

The Company's articles of association provide that the Board of Directors shall meet whenever convened by its chairman, on his own initiative or at the request of any other director and at least once a month.

During 2015, the Board of Directors met thirteen times and assiduity corresponded in nine meetings, to 100% and in four meetings was only missing the director Pedro Macedo Pinto de Mendonça, who presented, in all cases, justification for absence, and it was considered acceptable.

The meetings of the Board are scheduled and prepared in advance, and timely documentation relating to the matters contained in its agenda are 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.

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 its subsidiaries, in compliance with the remuneration policy of the Company, approved by shareholders in General Meetings.

The assessment is based on the functions performed by members representing the Board of Directors and other corporate boards of Altri, considering the responsibilities assumed by each of these members, the added value of each and the accumulated knowledge and experience 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 (2014 to 2016) 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.

It should be noted, that the members of Board of Directors showed their total commitment and availability in the exercise of their functions being present and participating in almost 100% of all meetings of that Board.

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 and complexity, is the Remuneration Committee.

Altri has set a Remuneration Committee for the period 2014/2016, which composition is as follows:

• João da Silva Natária President
• José Francisco Pais da Costa Leite Member
• Pedro Nuno Fernandes de Sá Pessanha da Costa Member

ANNUAL REPORT 2015 II. Corporate Governance Report

The Remuneration Committee has a regulation valid for the current term, approved at a meeting of that committee held on December 2014 and which is available for consultation on the Company's website (www.altri.pt) (tab "About Altri", "Governance" section).

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

Altri, considering its organizational structure, and the small size of the Board of Directors, composed by seven members, considers it unnecessary a formal appointment of an Executive Committee on the Board of Directors.

As stated in paragraph 18 of this report, four members of the Board of Directors perform executive functions, observing the following:

• (i) 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;
• (ii) availability of executive directors for the provision to non-executive directors, of any additional information which they consider relevant or necessary, and to carry out further studies and analyses in relation to all matters which are the subject of deliberation or that, are under review in some way, in the Company;
• (iii) 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.

Thus, the Company considers that are guaranteed the necessary conditions for decisions on strategic matters, taken by the Board of Directors as a body composed of all of its members, executive and non-executive, in the normal performance of their duties, enlightened and informed way, totally focused on creating value for shareholders.

However, the Board has regularly reflected on the adequacy of the organization, having been always the result of these reflections completion of the conformity of this structure with the best corporate governance practices, which has been materialized in the positive performance of the Company.

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

As mentioned in paragraphs 27 and 28, the Board of Directors believes that the only specialized committee indispensable to satisfy the needs of the Company, considering its dimension and complexity, is the Remuneration Committee.

According to the Articles of Association, the Remuneration Committee is the corporate board responsible for performance evaluation and approving the remuneration of Board members and other corporate boards, in compliance with the remuneration policy of the Company, approved by shareholders in General Meetings.

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.

III. SUPERVISION

a) Composition

30. Details of the Supervisory Board representing the model adopted

The Supervisory Board and Statutory Auditor are the supervision boards of the Company.

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, for a three years mandate, composed of three members and one or two substitutes, responsible for the supervision of the company and the appointment of the Statutory Auditor. In December 31, 2015, the Supervisory Board was composed by the following members:

• Pedro Nuno Fernandes de Sá Pessanha da Costa President
• André Seabra Ferreira Pinto Member
• José Guilherme Barros Silva Member
• Luis Filipe Alves Baldaque de Marinho Fernandes Substitute

The Supervisory Board members were appointed for the first time in April 2014 for the period 2014/2016.

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 regulation is available on the website of Altri (www.altri.pt) (tab "About Altri", section "Governance").

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

During 2015 the Supervisory Board of the Company met 4 times, with only on absence in one of the meetings that was adequately justified, 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 to be performed by the External Auditor, evaluating if the independence 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 External 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 the potential threats to the independence of the External 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, as provided by article no. 420 of the Portuguese Companies Act.

The Supervisory Board also represents the Company regarding 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 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 2015, 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 2015 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 2014/2016 is Deloitte & Associados, SROC, S.A., represented by Jorge Manuel Araújo de Beja Neves or Miguel Nuno Machado Canavarro Fontes since April 2014.

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

Deloitte & Associados, SROC, S.A., is responsible for the functions of the Statutory Auditor since 2005 and was reelected for another mandate on the proposal of the Supervisory Board, in the General Meeting of April 24, 2014.

The proposal submitted by the Supervisory Board for the election of Deloitte & Associados, SROC, S.A. for a new mandate was supported by a previous study in which we considered the auditor's independence and the advantages and disadvantages of maintaining and presented such a proposal based on the conviction that the quality of the work done by Deloitte & Associados, SROC, S.A. and experience in the sector where Altri acts, overlap the possible drawbacks in maintenance. It was surely conviction of that board that maintaining Deloitte & Associados, SROC, S.A. in functions would not endanger the integrity and the independence with which those functions would be performed in the Company.

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 Jorge Manuel Araújo de Beja Neves or Miguel Nuno Machado Canavarro Fontes.

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 having accomplished three mandates, and its representative changed in April 2014.

The proposal submitted by the Supervisory Board for the election of Deloitte & Associados, SROC, S.A. for a new mandate was supported by a previous study in which it was considered the auditor's independence and the advantages and disadvantages of maintaining and presented such a proposal based on the conviction that the quality of the work done by Deloitte & Associados, SROC, S.A. and experience in the sector where Altri acts, overlap the possible drawbacks in their maintenance. It was surely conviction of that body that maintaining Deloitte & Associados, SROC, S.A. in functions would not damage the integrity and the independence with which they would still exercise in the Company.

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

The policy adopted by the Supervisory Board on this matter has been, previously to the presentation of proposals for the election of the External Auditor for a new term, to carry out a thorough evaluation of the advantages and drawbacks of the maintenance functions of that auditor, and not just adopt the principle of rotation at the end of three terms, if from that evaluation results the conviction that keeping the same auditor beyond that period does not endanger the required and necessary independence of the Auditor.

Regardless of the outcome of this evaluation, a new Partner representing the External Auditor was designated in 2014.

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 assurance services rendered by External Auditor in 2015 include, essentially, services connected with validation of applications to governmental subsidies. The tax consulting services and other services relate mainly with the revision of tax files and tax advisory.

The other 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 & Associados, SROC, S.A. proved to be the most appropriate due to its solid experience and expertise in the field of taxation and fiscal incentives. Moreover, the intervention of Deloitte & Associados, SROC, S.A. is often combined with technicians and experts independent from its network, namely consultants.

In 2015, the fees charged by Deloitte & Associados, SROC, S.A. to Altri's Group represented less than 1% of the total annual turnover of Deloitte & Associados, SROC, S.A. 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.

47. 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		2015	%	2014	%
	Audit and statutory audit (€)	1,000	0.2%	1,000	0.2%
	Other assurance services (€)	-	0.0%	5,000	0.8%
	Tax consulting services (€)	10,000	1.5%	30,500	4.8%
	Other services (€)	4,500	0.7%	-	0.0%
Group companies
	Audit and statutory audit (€)	252,944	38.3%	260,258	41.1%
	Other assurance services (€)	198,044	30.0%	139,234	22.0%
	Tax consulting services (€)	45,453	6.9%	31,968	5.0%
	Other services (€)	147,655	22.4%	165,480	26.1%
Total
	Audit and statutory audit (€)	253,944	38.5%	261,258	41.2%
	Other assurance services (€)	198,044	30.0%	144,234	22.8%
	Subtotal assurance services	451,988	68.5%	405,492	64.0%
	Tax consulting services (€)	55,453	8.4%	62,468	9.9%
	Other services (€)	152,155	23.1%	165,480	26.1%
		659,596	100.0%	633,440	100.00%

C. INTERNAL ORGANIZATION

I. ARTICLES OF ASSOCIATION

48. Rules governing amendment to the articles of association

The statutory amendments follow the applicable legal terms, including the Portuguese Companies Act, which require a two-thirds majority of the issued votes for the adoption of such resolution.

II. REPORTING OF IRREGULARITIES

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

Altri has a code of ethics and conduct that governs the ethical principles common to the whole Group and that apply to all relationships established between group companies and their stakeholders and has the main goal of driving, through common ethical principles, personal and professional behaviors of the group workers regardless their function or position.

The Code of Ethics and Conduct was widely disseminated to all employees and partners and is published on the Company's website (www.altri.pt) (tab "About Altri", "Governance" section).

This code is applied to all Group employees, including the management boards of all group companies, as well as to – with the required adaptions – its external auditors, clients, suppliers and any other service provider, regardless being occasional or permanent services.

All of Altri employees should guide their conduct by the following principles:

• Strict compliance with the law, regulations, recommendations and statutory provisions and the internal rules, policies and guidelines of Altri;
• Integrity, ethics, transparency and honesty in decision-making;
• Cooperation and professionalism in relationships with partners and local communities in which each company is inserted;
• Conducting business within a framework of loyalty, rigorously and good faith in meeting the objectives of Altri;
• High consciousness of the necessity for confidential treatment of all information that is produced or to which it has access in the performance of functions;
• Diligent and thrifty treatment of all work tools or assets of the companies, ensuring their protection and its good condition refraining from any use for their own benefit.

The Supervisory Board is the body which should be addressed any reports of irregularities, by any employee, partner, supplier or any other stakeholder.

Altri Group has a specific mechanism for the reporting of irregularities to substantiate ethical violations or cool with significant impact in the areas of accounting, in the fight against corruption, banking and financial crime (Whistleblowing).

When the Board of Directors receives a request for clarification related to the whistleblowing system, forwards it immediately to the Supervisory Board.

The reporting to the Audit Committee of any irregularity or error indication should be made by letter in a sealed envelope with the reference to its confidentiality, to the following address: Rua General Norton de Matos, number 68, R / C, 4050 424 Porto. Anonymous reports are accepted only exceptionally.

III. INTERNAL CONTROL AND RISK MANAGEMENT

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

Risk management, as a key issue of the principles of good corporate governance is an area considered critical in Altri, which promotes permanent awareness of all employees, at all levels of the organization, putting in them such responsibility in all processes of decision-making.

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.

Altri has been monitoring the appropriation of this risk management model that has proved to be entirely appropriate given the organizational structure of the Company.

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

The Supervisory Board is responsible for supervise action taken related to the evaluation of the operation of risk management mechanisms. It is therefore responsibility of this corporate body the supervision of the actions carried out the Company in these matters.

The External Auditor, in the exercise of their functions, checks the adequacy of mechanisms and procedures involved ensuring the reporting of its conclusions to the Supervisory Board.

The Board of Directors is responsible for monitoring these mechanisms and procedures.

52. Other functional areas responsible for risk control

The Board of Directors is the body responsible for setting the overall strategic guidelines of the group, and is duly supported by the subsidiary management teams, ensuring not only the continuous monitoring, and the reporting to the Board of Directors of Altri, of their situations detected, to ensure continuous and effective risk controls.

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 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 derivatives to reduce the volatility of its results.

Commodities price variability risk

By developing its activity in a sector of commodities (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.

Legal, Fiscal and Regulation risks

Altri, as well as your business, comprises permanently, legal, tax and regulatory advices, which works in conjunction with the business areas, ensuring preventively to protect the group's interests in strict compliance with the legal provisions applicable to the business areas of the Company.

This advice is also supported at national and international level by external service providers which are contracted from firms with established reputation and in accordance with highest standards of competence, rigor and professionalism.

However, Altri and its subsidiaries may be affected by legal changes both in Portugal and in the European Union or other countries where it develops its activities. Altri does not control, of course, such changes, if any, may have an adverse impact on the group's business and may therefore impair or prevent the achievement of strategic objectives.

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

Forest Risk

Altri, through its subsidiary Altri Florestal, has a forest area under intervention amounting to 82,000 hectares, of which 79% is eucalyptus. The forest is certified by FSC®2 (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 Florestal 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.

² FSC-C004615

II. Corporate Governance Report

ANNUAL REPORT 2015

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 Florestal 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

As mentioned in the paragraph 52, the Board of Directors is the body responsible for setting the overall strategic guidelines of the group, and is duly supported by the subsidiary management teams, ensuring not only the continuous monitoring, and the reporting to the Board of Directors of Altri, of their situations detected, to ensure continuous and effective risk controls.

The process of identification and evaluation, monitoring, control and risk management in Altri works as follows:

The risks that the group faces in the normal course of its business are identified. For all identified risks, is measured the impact on financial performance and the value of the group. The risk value is compared with the costs of hedging instruments, if available and, consequently, the development of identified risks and the hedging instruments is monitored, which follows, more or less, in compliance with the following methodology:

• 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 Company has implemented additional risk management strategies that aim to ensure, essentially, that the systems and control procedures and the established policies allow answering expectations of management bodies, shareholders and other stakeholders.

Some of these strategies are the following:

• 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.

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 Altri 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 internal rules for the disclosure of financial information are intended to securing their timing and prevent the asymmetry of the market.

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, previously disclosed in the Information Disclosure System of the CMVM, 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

59. Address(es)

Altri'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 \ about 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

The Remuneration Committee is responsible for approving the remuneration of the Board of Directors and other corporate bodies representing the shareholders, in accordance with the remuneration policy approved by the shareholders at the General Meeting.

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 currently has set a Remuneration Committee, elected by the general meeting of shareholders for a mandate of three years, starting in 2014 and ending in 2016, and whose composition is as follows:

• João da Silva Natária President
• José Francisco Pais da Costa Leite Member
• Pedro Nuno Fernandes de Sá Pessanha da Costa Member

All members of the Remuneration Committee are independent from the members of the Board of Directors. Additionally, in 2015 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

The experience and the professional qualifications of the Remuneration Committee members are in their curricula available on the Company website, www.altri.pt, tab "Investors", Section "General meetings" / "AGM 2014" / "Résumés".

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 14 April 2015, 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 Company and in its subsidiaries
• The responsibility and the added value by individual performance
• Knowledge and experience accumulated on the job
• The economic situation of the Group; and
• The remuneration in the same sector companies and other companies listed on Euronext Lisbon.

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

1. Executive directors

• Fixed component, paid monthly;
• Medium term variable component: Intended to align more strongly the interests of executive directors with those of shareholders and will be calculated covering two mandates period, 2011-2013 and 2014- 2016, based on:
• Total shareholder return (shares valorisation plus distributed dividend)
• Sum of the net consolidated results of six years (2011 to 2016)
• Company's business development

The total amount of the variable component cannot exceed 50% of fixed remuneration earned during the period of 6 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 granting 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.

It should be added in this respect that in 2015 there was no place to any compensation to former directors.

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 Euronext Lisbon. Regarding the latter point, the Remuneration Committee takes into account all national companies of equivalent size, particularly listed on 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

In the General Shareholders Meeting held in 14 April 2015, 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 2016.

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 or any other non-financial benefits.

76. 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, S.A.. 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 2015.

On 2015 no contribution to the fund as made. As of that date the present value of the payable pensions amounts to 418,859 Euro. Additionally during 2015 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 remuneration received by the Board of Directors of Altri during 2015, for their functions, include only fixed remunerations paid directly by Altri S.G.P.S., S.A.. They amounted to Euro 1,390,200 distributed as follows: Paulo Fernandes – Euro 392,000; João Borges de Oliveira – Euro 392,000; Domingos Matos – Euro 225,400; Pedro Borges de Oliveira – Euro 225,400; Ana Mendonça – Euro 59,500; Laurentina Martins – Euro 59,500; José Archer – Euro 21,250; Pedro Mendonça – Euro 15,150.

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 remunerations received by the members of the Board of Directors were fully paid by Altri S.G.P.S., S.A. and there are no directors paid directly by any Group's subsidiaries.

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 2015, the remuneration of Supervisory Board members amounted to Euro 31,620 distributed as follows: Pedro Pessanha – Euro 15,000; André Pinto – Euro 8,310; José Guilherme Silva – 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 2015 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 granting 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.

84. 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 Market 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

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

Altri has no plan to grant shares or stock options to the Board of Directors or to its employees.

86. Characteristics of the plan

Altri 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.

However, the Company conducts its action with principles of rigor and transparency, with scrupulous observance of the competitive market rules.

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 the 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 of the Supervisory Board pursuant to Article 397 of the Portuguese Companies Act. In 2015 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 18 of the notes to the individual financial statements of the Company.

PART II - CORPORATE GOVERNANCE ASSESSMENT

1. Details of the Corporate Governance Code implemented

This report provides a description of the governance structure adopted by Altri, as well as the policies and practices that are adopted.

The report complies with the standards of Article 245-A of the Portuguese Securities Market Code and discloses in accordance with the comply or explain principle, the degree of compliance with the CMVM recommendations incorporated in 2013 CMVM Corporate Governance Code, since this is the Corporate Governance Code adopted by the Company.

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.

All the legal provision referred on this report and the recommendations listed in the Corporate Governance Code of 2013, can be found in www.cmvm.pt.

This report should be read as part of the Annual Management Report and as part of the Individual and Consolidated Financial Statements for the fiscal year 2015.

2. Analysis of compliance with the Corporate Governance Code implemented

Altri encouraged all actions to promote the adoption of best corporate governance practices, basing its policy on high ethical standards and social responsibility.

The integrated and effective management of the group is part of the plan of the Altri's Board of Directors. The Board of Directors of Altri encourages transparent relationships with investors and with the market, and has based its performance on the constant search of value creation, to the promotion of the interests of employees, shareholders and other stakeholders.

Altri, complies with the majority of recommendations on corporate governance issued by the Securities Market Commission (CMVM) on his Corporate Governance Code of 2013 (Article 245º - 1.O), as follows:

RECOMENDATIONS	COMPLIES	REPORT
I. VOTING AND CONTROL OF THE COMPANY
I.1. Companies shall encourage shareholders to attend and vote at general meetings ans shall not set na
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 electroonically.	Adopted	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	13 and 14
I.3. Comapnies 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	12 and 13
I.4- The company's articles of association that provide for 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 generaly assembly (five years 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 votes
issued be counted, without applying said restriction.	Adopted	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	2, 4, 5 and 6

RECOMENDATIONS	COMPLIES	REPORT
II. SUPERVISON, 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.	Adopted	21 and 28
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	21 and 28
II.1.3. The General and Supervisory Board, 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 Supervisory Board,
depending on the model adopted, shall create the necessary committees in order to:
a) Ensure a competent and independent assessment of the performance of the 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.	Adopted	21, 27, 28 and 29
II.1.5. The Board of Directors or the General and Supervisory Board, 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.	Adopted	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	18
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	Not Adopted	18
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.
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	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	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 said can make independent and informed decisions or to ensure the existence of an equivalent
mechanism for such coordination.	Not Adopted	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	32 and 33
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	38
II.2.3. The supervisory board shall assess 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	45
II.2.4. The supervisory board shall assess the functioning of the internal control systems and risk management and
propose adjustments as may be deemed necessary.	Adopted	38
II.2.5. The Audit Committee, the General and Supervisory Board and the Supervisory Board 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	50 and 51

RECOMENDATIONS COMPLIES REPORT 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 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. Adopted 67 II.3.3. A statement on the remuneration policy of the management and supervisory bodies referred to in Article 2 of 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; d) Information regarding the enforceability or unenforceability of payments for the dismissal or termination of appointment of board members. Adopted 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 assess said plan. Not applicable 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 assess said system. Not applicable 76 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 70 III.2. The remuneration of non-executive board members and the remuneration of the members of the supervisory board shall not include any component whose value depends on the performance of the company or of its value. Adopted 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 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 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 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 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 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 69 and 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 control mechanisms and report any shortcomings to the supervisory body of the company.. Adopted 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 supervisory board and explained in its Annual Report on Corporate Governance - said should not exceed more than 30% of the total value of services rendered to the company. Not Adopted 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 supervisory board that explicitly considers the conditions of auditor's independence and the benefits and costs of its replacement. Adopted 40, 42, 43 and 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 90 V.2. The supervisory or oversight board shall establish 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 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 59 to 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 56 to 58

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

Recommendations II.1.7. and II.1.10.:

The Board Directors does not include any member that satisfies the standard of independence referred in recommendation II.1.7 and II.1.10 of Corporate Governance Code issued by the Portuguese Securities Market Regulator (CMVM) since the non-executive director Laurentina da Silva Martins was employee of subsidiary Caima – Indústria de Celulose, S.A., the non-executive director Ana Rebelo de Carvalho Menéres is the manager and controlling shareholder of the Company Promendo SGPS, S.A. and the non-executive director José Manuel de Almeida Archer is also a shareholder and manager of the Company Promendo SGPS, 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;
• Availability of executive directors for the provision to non-executive directors, of any additional information which they consider relevant or necessary, and to carry out further studies and analyzes in relation to all matters which are the subject of deliberation or that, are under review in some way, in the Company;
• 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.

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.

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 directors during 2015.

Recommendation IV.2.:

Altri hired the external auditor for services other than audit services representing more than 30% of the total value of services provided to the Company. However, the scope of these services was approved by the Supervisory Board, it was concluded that they did not put into question the independence of the auditors. In this particular aspect, the hiring of Deloitte proved to be the most appropriate due of its solid experience and expertise in the field of taxation and tax incentives.

Recommendation V.2.:

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.

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, given the above legal obligation, and considering especially the legal requirement of the same legislation that requires the disclosure of these situations in the annual report of the board of directors, that Altri would always give full compliance, we consider all legal requirements are safeguarded as well as all the obligations of full and transparent information disclosure to shareholders and to the market.

3. Other information

In line with what has been said, Altri would like to point out that, of the forty recommendations contained in the CMVM Corporate Governance Code of 2013, six of them are not applicable for the reasons set out above, and the failure to fully adopt only four of the recommendations is largely explained above.

Altri therefore considers that, given the full compliance of thirty of these recommendations, the degree of adoption of the Company to the 2013 Corporate Governance Code's recommendations is practically total, which is materialized in a diligent and prudent management, absolutely focused on creating value for the Company and hence for shareholders.

LEGAL MATTERS

Own Shares

Pursuant to the requirements of article 66 of the Portuguese Companies Act, the Directors inform that as of 31 December 2015 Altri had no own shares and did not acquire or sell any own shares during the year..

Shares held by Altri's corporate boards

Pursuant to the requirements of article 447 of the Portuguese Companies Act, the Directors inform that, as of 31 December 2015, they held the following shares:

Paulo Jorge dos Santos Fernandes (a)	23,575,168
João Manuel Matos Borges de Oliveira (b)	30,000,000
Domingos José Vieira de Matos (c)	23,900.,10
Pedro Miguel Matos Borges de Oliveira	2,804,708
Ana Rebelo de Carvalho Menéres de Mendonça (d)	41,954,552
Laurentina da Silva Martins	0
José Manuel de Almeida Archer	1,500

(a) – Are also considered attributable to Paulo Jorge dos Santos Fernandes, apart from the 650,00 shares of Altri, SGPS, S.A. held on an individual basis, 22,925,168 shares of Altri, SGPS, S.A. held by "ACTIUM CAPITAL – SGPS, S.A." 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 23,575,168 shares, representing 11,49% of capital and voting rights of Altri, SGPS, S.A..

(b) – The 30,000,000 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.

(c) – The 23,900,110 shares represent Altri SGPS, S.A. total shares held by the company LIVREFLUXO – SGPS, S.A., of which Domingos José Vieira de Matos is director and shareholder..

(d) – The 41,954,552 shares represent Altri SGPS, S.A. total shares held by the company PROMENDO – SGPS, S.A., of which Ana Rebelo de Carvalho Menéres de Mendonça is director and shareholder.

As of December 31, 2015, 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 Market 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:

	Nr. of shares held	% Share capital with
Norges Bank	on 31-Dec-2015	voting rights
Directly	4,149,572	2.02%
Total attributable	4,149,572	2.02%
	Nr. of shares held	% Share capital with
JP Morgan Asset Management Holdings Inc.	on 31-Dec-2015	voting rights
Through JP Morgan Asset Management Holdings (Uk) Limited	4,251,854	2.07%
Total attributable	4,251,854	2.07%
	Nr. of shares held	% Share capital with
1 Thing, Investments, SGPS, S.A.	on 31-Dec-2015	voting rights
Directly	11,555,000	5.63%
Through the Board Member Pedro Miguel Matos Borges de Oliveira	2,804,708	1.37%
Total attributable	14,359,708	7.00%
	Nr. of shares held	% Share capital with
Paulo Jorge dos Santos Fernandes	on 31-Dec-2015	voting rights
Directly	650,000	0.32%
Through Actium Capital - SGPS, S.A. (of which he is dominant shareholder and director)	22,925,168	11.18%
Total attributable	23,575,168	11.49%
	Nr. of shares held	% Share capital with
Domingos José Vieira de Matos	on 31-Dec-2015	voting rights
Through Livrefluxo - SGPS, S.A. (of which he is dominant shareholder and director)	23,900,110	11.65%
Total attributable	23,900,110	11.65%
	Nr. of shares held	% Share capital with
João Manuel Matos Borges de Oliveira	on 31-Dec-2015	voting rights
Through CADERNO AZUL- SGPS, SA ( (of which he is shareholder and director)	30,000,000	14.62%
Total attributable	30,000,000	14.62%
	Nr. of shares held	% Share capital with
Promendo - SGPS, SA	on 31-Dec-2015	voting rights
Directly (a)	41,954,552	20.45%
Through the Board Member José Manuel de Almeida Archer	1,500	0.00%
Total attributable	41,956,052	20.45%

(a) The 41,954,552 shares held directly by Promendo – S.G.P.S., S.A. are also attributable to Ana Rebelo Carvalho Menéres de Mendonça, who is the dominant shareholder and director of Promendo – S.G.P.S., S.A. and Board Member of Altri.

Altri was not informed of any participation exceeding 33% of voting rights.

CLOSING REMARKS

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

Oporto, 24 March 2016

The Board of Directors

Paulo Jorge dos Santos Fernandes

__________________________________

__________________________________ João Manuel Matos Borges de Oliveira

__________________________________ Domingos José Vieira de Matos

__________________________________ Laurentina da Silva Martins

__________________________________ Pedro Miguel Matos Borges de Oliveira

__________________________________ Ana Rebelo Carvalho Menéres Mendonça

__________________________________

José Manuel de Almeida Archer

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

The signatories individually declare that, to the best of their knowledge, the Management Report, the Individual and Consolidated Financial Statements and other accounting documents required by law or regulation were prepared in accordance with the International Financial Reporting Standards ("IFRS") as adopted by the European Union, , 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 that the Management Report exposes truly the evolution of business, performance and financial position of Altri, SGPS, S.A. and of its subsidiaries included in the consolidation perimeter as well as a description of the major risks and uncertainties faced.

STATEMENT 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.

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

He 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, S.A.
1997	Director of Grupo Vista Alegre, S.A.
1997	Chairman of the Board of ATLANTIS - Cristais de Alcobaça, S.A.
2000/2001	Director of SIC
2001/2005	Director of V.A.A., S.G.P.S, S.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 2015 are as follows:

• Actium Capital, SGPS, S.A. (a)
• Alteria, S.G.P.S., S.A. (a)
• Altri Abastecimento de Madeira, S.A.
• Altri Participaciones Y Trading, S.L.
• Base Holding, SGPS, S.A. (a)
• Caima Indústria de Celulose, S.A.
• Caima Energia Emp. Gestão e Exploração de Energia, S.A.
• Celulose Beira Industrial (Celbi), S.A.
• Celtejo Empresa de Celulose do Tejo, S.A.
• Cofihold SGPS, S.A. (a)
• Cofina, S.G.P.S, S.A. (a)
• Cofina Media, S.A. (a)
• Elege Valor, S.G.P.S., S.A. (a)
• F. Ramada Investimentos, S.G.P.S., S.A. (a)
• F. Ramada II Imobiliária, S.A. (a)
• Jardins de França Empreendimentos Imobiliários, S.A. (a)
• Malva Gestão Imobiliária, S.A. (a)
• Préstimo Prestígio Imobiliário, S.A. (a)

• Ramada Aços, S.A. (a)

• Ramada Storax, 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, 2015 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, S.A.
1997/2000	Non-executive Director of Vista Alegre, S.A.
1998/1999	Director of Efacec Capital, SGPS, S.A.
2008/2011	Non-executive Director of Zon Multimédia, SGPS, S.A.
2011/2013	Member of ISCTE-IUL CFO Advisory Forum
2008/2015	President of Supervisory Board of Porto Business School

The other companies where he carries out management functions as of 31 December 2015 are as follows:

• Alteria, S.G.P.S., S.A. (a)
• Altri Abastecimento de Madeira, 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.
• Caima Energia Emp. Gestão e Exploração de Energia, S.A.
• Captaraíz Unipessoal, Lda.
• Celulose Beira Industrial (Celbi), S.A.
• Celtejo Empresa de Celulose do Tejo, S.A.
• Cofina, SGPS, S.A. (a)
• Cofina Media, S.A. (a)
• Cofihold SGPS, S.A. (a)
• Elege Valor, S.G.P.S., S.A. (a)
• F. Ramada Investimentos, S.G.P.S., S.A. (a)
• F. Ramada II Imobiliária, S.A. (a)
• Indaz, S.A. (a)
• Jardins de França Empreendimentos Imobiliários, S.A. (a)
• Malva Gestão Imobiliária, S.A. (a)
• Préstimo Prestígio Imobiliário, S.A. (a)
• Ramada Aços, S.A. (a)
• Ramada Storax, S.A. (a)

• Storax Limited (a)

• Sociedade Imobiliária Porto Seguro Investimentos Imobiliários, S.A. (a)

• Torres da Luz Investimentos imobiliários, S.A. (a)
• Universal Afir, S.A. (a)

a) – Companies that, as of December 31, 2015 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 a 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	Director of CORTAL, S.A.
1983	Founding Partner of PROMEDE – Produtos Médicos, S.A.
1998/2000	Director of ELECTRO CERÂMICA, S.A.

The other companies where he carries out management functions as of 31 December 2015 are as follows:

• Alteria, S.G.P.S., S.A. (a)
• Altri Florestal, S.A.
• Base Holding, SGPS, S.A. (a)
• Caima Indústria de Celulose, S.A.
• Celulose Beira Industrial (Celbi), S.A.
• Cofina, SGPS, S.A. (a)
• Cofihold SGPS, S.A. (a)
• Elege Valor, S.G.P.S., S.A. (a)
• F. Ramada Investimentos, S.G.P.S., S.A. (a)
• F. Ramada II Imobiliária, 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)
• Préstimo Prestígio Imobiliário, S.A. (a)
• Ramada Aços, S.A. (a)
• Ramada Storax, S.A. (a)
• Sociedade Imobiliária Porto Seguro Investimentos Imobiliários, S.A. (a)
• Torres da Luz Investimentos imobiliários, S.A. (a)
• Universal Afir, S.A. (a)

(a) – companies that, as of 31 December 2015, cannot be considered as part of the Altri, SGPS, S.A. 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 2015 are as follows:

• EDP Produção Bioeléctrica, S.A.
• Ródão Power Energia e Biomassa do Ródão, S.A.

Pedro Miguel Matos Borges de Oliveira

Holds a degree in Financial Management by the Institute of Administration and Management of Porto. In 2000 completed the Executive MBA in the Enterprise Institute Porto in partnership with ESADE Business School, Barcelona, currently Catholic Porto Business School. In 2009 completed the Business Valuation Course in EGE-Business Management School. Was appointed director of the Company in April 2014.

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

1986/2000	FERÁGUEDA, Lda. - Management advisor
1992	Bemel, Lda. - Director
1997/1999	GALAN, Lda. – Assistant Director
1999/2000	F.Ramada, Aços e Indústrias, S.A. – Assistent Director
2000	F. Ramada, Aços e Indústrias, S.A. - Director
2006	Universal Afir, Aços Especiais e Ferramentas, S.A. - Director
2009	F. Ramada Investimentos, S.G.P.S., S.A. - Director

The other companies where he carries out management functions as of 31 December 2015 are as follows:

• Alteria, S.G.P.S., S.A. (a)
• Altri Florestal, S.A.
• Celulose Beira Industrial (Celbi), S.A.
• Cofihold SGPS, S.A. (a)
• Cofina, 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 II Imobiliária, S.A. (a)
• Jardins de França Empreendimentos Imobiliários, S.A. (a)
• Malva Gestão Imobiliária, S.A. (a)
• Préstimo Prestígio Imobiliário, S.A. (a)
• Ramada Aços, S.A. (a)
• Ramada Storax, S.A. (a)
• Sociedade Imobiliária Porto Seguro Investimentos Imobiliários, S.A. (a)
• Torres da Luz Investimentos imobiliários, S.A. (a)
• Universal Afir, S.A. (a)

• Valor Autêntico, S.G.P.S., S.A. (a)

• 1 Thing, Investments, S.G.P.S., S.A. (a)

(a) – companies that, as of 31 December 2015, cannot be considered as part of the Altri, SGPS, S.A. group.

Ana Rebelo de Carvalho Menéres de Mendonça

Holds a degree in Economics by the Universidade Católica Portuguesa of Lisbon. Was appointed director of the Company in April 2014.

In addition to the Companies where she currently performs management functions, her professional experience includes:

1995	Newspaper "Semanário Económico" - Journalist in the economics area.
1996	Citibank – Commercial Department
1996	Promendo, S.A.- Director
2009	PROMENDO, SGPS, S.A. - Director

The other companies where she carries out management functions as of 31 December 2015 are as follows:

• Cofina, S.G.P.S., S.A. (a)
• F. Ramada Investimentos, SGPS, S.A. (a)
• Jardins de França Empreendimentos Imobiliários, S.A. (a)
• Promendo, SGPS, S.A. (a)
• Préstimo Prestígio Imobiliário, S.A. (a)
• Ramada Aços, S.A. (a)
• Ramada Storax, S.A. (a)

(a) – companies that, as of 31 December 2015, cannot be considered as part of the Altri, SGPS, S.A. group.

José Manuel de Almeida Archer

Holds a degree in law by the Universidade Católica Portuguesa of Lisbon and he is a member of the Lawyers Association since 1984.

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

(1985-1987)	Phoenix Assurance, PLC (Portugal Agency) – Director
(1999-2001)	President of the board of directors of Selecta – Sociedade Gestora do Fundo
	do Investimento Imobiliário Selecto II, S.A.
(1998-2001)	Member of Legal & Tax Committee (Nasdaq Europe)
(2000-2014)	Companhia das Quintas SGPS, S.A. – Director
(2004-2013)	Blues Group (UK) – Director
(2008-2009 e 1997-2001)	Member of Executive Board of FEE - Foundation for Environmental
	Education (Denmark)

The other companies where he carries out management functions as of 31 December 2015 are as follows:

• ABAE Associação Bandeira Azul da Europa (a)
• Banco Finantia Sofinloc, S.A., (Spain) (a)
• Banco Finantia, S.A. (a)
• Correia Afonso Archer & Associados Sociedade de Advogados, RL (a)
• Promendo SGPS, S.A. (a)
• Promendo Promoções Empresariais, S.A. (a)

• Ramazzotti SGPS, S.A. (a)

• Ramazzotti Imobiliária, S.A. (a)

• Vialegis AEIE (Madrid) (a)

Other positions held:

President of the Supervisory Board of:

• Banco Finantia, S.A. (a)
• Finatipar SGPS, S.A. (a)
• Ginásio Clube Português (a).

(a) – companies that, as of 31 December 2015, cannot be considered as part of the Altri, SGPS, S.A. group.

2. Supervisory Board

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

Pedro Nuno Fernandes de Sá Pessanha Da Costa

Qualifications:

Degree in Law from the Faculty of Law of the University of Coimbra in 1981 Complementar training in Company Management and Economic and Financial Analysis at the School of Law of the Portuguese Catholic University, Porto, 1982 and 1983.

Professional Experience:

Member of the Lawyers Association ("Ordem dos advogados) since 1983 President of the General and Supervisory Board of a public company from 1996 to 2010, President of the General Shareholders Meeting of several listed and non-listed companies Co-author of the chapter on Portugal in "Handbuch der Europäischen Aktien- Gesellschaft" – Societas Europaea – by Jannot / Frodermann, published by C.F. Müller Verlag Continuous law practice since 1983, with a special focus on commercial law and corporate law, mergers and acquisitions, foreign investment and international contracts Honorary Consul of Belgium in Porto

Other positions held:

President of the Supervisory Board of Cofina, SGPS, S.A. (a) President of the Supervisory Board of F. Ramada Investimentos, SGPS, S.A. (a) Member of the Cofina, SGPS, S.A. Remuneration Committee (a) Member of the F. Ramada Investimentos, SGPS, S.A. Remuneration Committee (a) President of the Shareholders General Meeting of Unicer Bebidas, S.A. (a) President of the Shareholders General Meeting of SOGRAPE Vinhos, S.A. (a) President of the SOGRAPE Vinhos, S.A. Remuneration Committee (a)

(a) – companies that, as of 31 December 2015, cannot be considered as part of the Altri, SGPS, S.A. group.

André Seabra Ferreira Pinto

Qualifications:	Degree in Economics at University Portucalense Chartered Accountant (ROC no. 1,243) Executive MBA - Management School of Porto - University of Porto Business School
Professional Experience:	Between September 1999 and May 2008, worked in the Audit Department of Deloitte & Associados, SROC, S.A. (initially as a member of staff and since September 2004 as Manager).
	Between June 2008 and December 2010, Senior Manager of Corporate Finance department - Transaction Services at Deloitte Consulting.
	Between January 2011 and March 2013, CFO of companies WireCoWorldGroup Group in Portugal (a)
	Since April 2013, Director (CFO) of Mecwide Group (a)
	Director of MWIDE, SGPS, S.A. (a) as well as of all the companies of Mecwide Group
	Manager of Together We Change Investments, LDA and Virtusai LDA.

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 2015, cannot be considered as part of the Altri, SGPS, S.A. group.

José Guilherme Barros Silva

Qualifications: 1990-1995 Degree in Business Administration and Management, Portuguese Catholic University

Professional Experience: 1995-1997 IC, Arthur Andersen, SC

1997-2010 Vice President of the Board of Directors, Detipin – Comércio de Vestuário, S.A. (a) 2004- Member of the Board of Directors, SEF - Serviços de Saúde e Fisioterapia, S.A. (a) 2005-2010 Member of the Board of Directors, Globaljeans - Comércio de Vestuário, S.A. (a) 2005- Vice-President of the Board of Directors, SEF - Serviços de Saúde e Fisioterapia, S.A. (a) 2005-2009 Vice President of the Board of Directors, AH Business, SGPS, S.A. (a) 2006- Member of the Board of Directors, Fisiofafe, S.A. (a) 2009- Member of the Board of Directors, Clínica de S. Cosme de Gondomar II, Fisioterapia, S.A. (a) 2011- President of the Board of Directors, GNG – Comércio de Vestuário, S.A. (a)

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 2015, cannot be considered as part of the Altri, SGPS, S.A. group.

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-	Acquisition			Shares held at 31-
Members of other Board of Directors	Dec-2014	s	Disposals	Others	Dec-2015
Paulo Jorge dos Santos Fernandes	14,113,168	-	-	(13,463,168)	650,000
Paulo Jorge dos Santos Fernandes(through ACTIUM CAPITAL - SGPS, S.A.)	8,202,000	14,723,168	-	-	22,925,168
João Manuel Matos Borges de Oliveira (through CADERNO AZUL - SGPS, S.A.)	30,000,000	-	-	-	30,000,000
Domingos José Vieira de Matos	13,564,432	-		- (13,564,432)	-
Domingos José Vieira de Matos (through LIVREFLUXO - SGPS, S.A.)	9,885,850	14,014,260	-	-	23,900,110
Pedro Miguel Matos Borges de Oliveira (1)	14,359,708			- - 11,555,000	2,804,708
Ana Rebelo Carvalho Menéres de Mendonça (through PROMENDO - SGPS, S.A.) (1)	42,586,911		367,641 - 1,000,000	-	41,954,552
José Manuel de Almeida Archer (1)	1,500	-	-	-	1,500

(1) initial number of shares corresponds to the number of shares held on the date that this director was elected to the Board of Directors (29-09-2015)

Paulo Jorge dos Santos Fernandes

Date	Type	Volume	Price (€)	Local	Nr of shares
31/Dec/14	-	-	-	-	14,113,168
24/Mar/15	donation	(4,800,000)	3.966000	-	9,313,168
4/Nov/15	donation	(7,763,168)	4.829000	-	1,550,000
25/Nov/15	donation	(900,000)	5.130000	-	650,000
31/Dec/15	-	-	-	-	650,000

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

Date	Type	Volume	Price (€)	Local	Nr of shares
31/Dec/14	-	-	-	-	8,202,000
5/Jan/15	Acquisition	1,000,000	2.411000	Euronext Lisbon	9,202,000
7/Jan/15	Acquisition	1,675	2.598000	Euronext Lisbon	9,203,675
7/Jan/15	Acquisition	2	2.598000	Euronext Lisbon	9,203,677
7/Jan/15	Acquisition	2,000	2.599000	Euronext Lisbon	9,205,677
7/Jan/15	Acquisition	21,323	2.600000	Euronext Lisbon	9,227,000
7/Jan/15	Acquisition	772	2.629000	Euronext Lisbon	9,227,772
7/Jan/15	Acquisition	700	2.629000	Euronext Lisbon	9,228,472
7/Jan/15	Acquisition	643	2.629000	Euronext Lisbon	9,229,115
7/Jan/15	Acquisition	452	2.629000	Euronext Lisbon	9,229,567
7/Jan/15	Acquisition	548	2.629000	Euronext Lisbon	9,230,115
7/Jan/15	Acquisition	1,000	2.629000	Euronext Lisbon	9,231,115
7/Jan/15	Acquisition	2,285	2.634000	Euronext Lisbon	9,233,400
7/Jan/15	Acquisition	642	2.634000	Euronext Lisbon	9,234,042
7/Jan/15	Acquisition	641	2.639000	Euronext Lisbon	9,234,683
7/Jan/15	Acquisition	1,000	2.640000	Euronext Lisbon	9,235,683
7/Jan/15	Acquisition	5,000	2.640000	Euronext Lisbon	9,240,683
7/Jan/15	Acquisition	641	2.640000	Euronext Lisbon	9,241,324
7/Jan/15	Acquisition	5,179	2.645000	Euronext Lisbon	9,246,503
7/Jan/15	Acquisition	641	2.645000	Euronext Lisbon	9,247,144
7/Jan/15	Acquisition	641	2.645000	Euronext Lisbon	9,247,785
7/Jan/15	Acquisition	1,000	2.649000	Euronext Lisbon	9,248,785
7/Jan/15	Acquisition	2,228	2.649000	Euronext Lisbon	9,251,013
7/Jan/15	Acquisition	1,650	2.650000	Euronext Lisbon	9,252,663
7/Jan/15	Acquisition	1,500	2.650000	Euronext Lisbon	9,254,163
7/Jan/15	Acquisition	200	2.650000	Euronext Lisbon	9,254,363
7/Jan/15	Acquisition	1,111	2.650000	Euronext Lisbon	9,255,474
7/Jan/15	Acquisition	505	2.650000	Euronext Lisbon	9,255,979
7/Jan/15	Acquisition	1,806	2.650000	Euronext Lisbon	9,257,785
7/Jan/15	Acquisition	1,376	2.650000	Euronext Lisbon	9,259,161
7/Jan/15	Acquisition	2,163	2.656000	Euronext Lisbon	9,261,324
7/Jan/15	Acquisition	676	2.650000	Euronext Lisbon	9,262,000
8/Jan/15	Acquisition	1,000,000	2.411000	Euronext Lisbon	10,262,000
13/May/15	Acquisition	1,500,000	3.890000	Euronext Lisbon	11,762,000
18/May/15	Acquisition	1,500,000	3.890000	Euronext Lisbon	13,262,000
21/May/15	Acquisition	1,000,000	4.070000	Euronext Lisbon	14,262,000
4/Nov/15	Acquisition	7,763,168	4.829000	Euronext Lisbon	22,025,168
25/Nov/15	Acquisition	900,000	5.130000	Euronext Lisbon	22,925,168
31/Dec/15	-	-	-	-	22,925,168

III. Appendixes to the Management Report

Domingos José Vieira de Matos

Date	Type	Volume	Price (€)	Local	Nr of shares
31/Dec/14	-	-	-	-	13,564,432
25/Nov/15	donation	(13,564,432)	5.130000	-	-
31/Dec/15	-	-	-	-	-

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

Date	Type	Volume	Price (€)	Local	Nr of shares
31/Dec/14	-	-	-	-	9,885,850
8/Jan/15	Acquisition	257,728	2.689000	Euronext Lisbon	10,143,578
13/Jan/15	Acquisition	117,272	2.785000	Euronext Lisbon	10,260,850
20/Jan/15	Acquisition	1,782	2.878000	Euronext Lisbon	10,262,632
20/Jan/15	Acquisition	1,000	2.878000	Euronext Lisbon	10,263,632
20/Jan/15	Acquisition	3,000	2.878000	Euronext Lisbon	10,266,632
20/Jan/15	Acquisition	1,269	2.885000	Euronext Lisbon	10,267,901
20/Jan/15	Acquisition	1,000	2.879000	Euronext Lisbon	10,268,901
20/Jan/15	Acquisition	2,916	2.879000	Euronext Lisbon	10,271,817
20/Jan/15	Acquisition	1,000	2.879000	Euronext Lisbon	10,272,817
20/Jan/15	Acquisition	163	2.879000	Euronext Lisbon	10,272,980
20/Jan/15	Acquisition	1,000	2.883000	Euronext Lisbon	10,273,980
20/Jan/15	Acquisition	3,066	2.883000	Euronext Lisbon	10,277,046
20/Jan/15	Acquisition	1,000	2.883000	Euronext Lisbon	10,278,046
20/Jan/15	Acquisition	3,619	2.883000	Euronext Lisbon	10,281,665
20/Jan/15	Acquisition	1,000	2.880000	Euronext Lisbon	10,282,665
20/Jan/15	Acquisition	8,185	2.880000	Euronext Lisbon	10,290,850
22/Jan/15	Acquisition	17	2.940000	Euronext Lisbon	10,290,867
22/Jan/15	Acquisition	260	2.940000	Euronext Lisbon	10,291,127
22/Jan/15	Acquisition	610	2.940000	Euronext Lisbon	10,291,737
22/Jan/15	Acquisition	7,000	2.940000	Euronext Lisbon	10,298,737
22/Jan/15	Acquisition	500	2.940000	Euronext Lisbon	10,299,237
22/Jan/15	Acquisition	441	2.940000	Euronext Lisbon	10,299,678
29/Jan/15	Acquisition	23,521	2.992000	Euronext Lisbon	10,323,199
29/Jan/15	Acquisition	1,479	2.992000	Euronext Lisbon	10,324,678
29/Jan/15	Acquisition	11,000	2.992000	Euronext Lisbon	10,335,678
25/Nov/15	Acquisition	13,564,432	5.130000	Euronext Lisbon	23,900,110
31/Dec/15	-	-	-	-	23,900,110

Pedro Miguel Matos Borges de Oliveira

Date	Type	Volume	Price (€)	Local	Nr of shares
31/Dec/14	-	-	-	-	14,359,708
9/Dec/15	donation	(11,555,000)	4.942000	-	2,804,708
31/Dec/15	-	-	-	-	2,804,708

Ana Rebelo Carvalho Menéres de Mendonça (through PROMENDO - SGPS, S.A.)

Date	Type	Volume	Price (€)	Local	Nr of shares
31/Dec/14	-	-	-	-	42,586,911
20/Apr/15	Acquisition	82,000	3.970000	Euronext Lisbon	42,668,911
21/Apr/15	Acquisition	85,641	3.990000	Euronext Lisbon	42,754,552
27/Apr/15	Acquisition	105,255	4.080000	Euronext Lisbon	42,859,807
28/Apr/15	Acquisition	94,745	4.060000	Euronext Lisbon	42,954,552
27/Aug/15	Disposal	(209,029)	3.390000	Euronext Lisbon	42,745,523
28/Aug/15	Disposal	(251,500)	3.360000	Euronext Lisbon	42,494,023
31/Aug/15	Disposal	(269,500)	3.330000	Euronext Lisbon	42,224,523
1/Sep/15	Disposal	(269,971)	3.210000	Euronext Lisbon	41,954,552
31/Dec/15	-	-	-	-	41,954,552

ALTRI, SGPS, S.A.

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION AS OF 31 DECEMBER 2015 AND 2014

(Translation of financial statements originally issued in Portuguese – Note 46) (Amounts expressed in Euro)

	Notes ASSETS	31.12.2015	31.12.2014
NON CURRENT ASSETS:
Biological assets	11	101,472,915	105,158,777
Tangible fixed assets	7	364,119,629	384,285,503
Investment properties	8	113,310	456,936
Goodwill	9	265,531,404	265,531,404
Intangible assets	10	83,821	139,448
Investments in associated companies and joint ventures	4.2	12,008,219	9,058,140
Investments available for sale	4.3 and 6	10,691,097	10,691,197
Other non current assets	18	3,490,469	6,031,139
Deferred tax assets	12	27,060,866	27,541,201
Total non current assets		784,571,730	808,893,745
CURRENT ASSETS:
Inventories	11	56,396,615	54,725,440
Customers	6, 13 and 32	91,521,269	88,868,133
Other debtors	6, 14 and 32	8,401,481	7,776,064
State and other public entities	15	8,469,842	15,629,003
Other current assets	16	2,726,281	2,508,606
Cash and cash equivalents	6 and 17	243,154,160	260,855,007
Total current assets		410,669,648	430,362,253
Total assets		1,195,241,378	1,239,255,998
SHAREHOLDERS' FUNDS AND LIABILITIES		31.12.2015	31.12.2014
SHAREHOLDERS' FUNDS:
Share capital	19	25,641,459	25,641,459
Legal reserve	19	4,336,498	3,405,143
Other reserves	19	225,998,128	205,680,587
Advance on profits	19	(51,282,918)
Consolidated net profit / (loss)		117,656,401	37,381,548
Total shareholders' funds attributable to the parent company's shareholders		322,349,568	272,108,737
Non controlling interests	20	-	155,240
Total Shareholders' funds		322,349,568	272,263,977
LIABILITIES:
NON CURRENT LIABILITIES:
Bank loans	6 and 21	153,587,500	103,837,500
Other loans	6 and 21	413,733,394	278,276,931
Reimbursable subsidies	6 and 21	17,439,139	11,723,809
Other non current creditors	6, 23 and 31	-	404,350
Other non current liabilities	24	23,854,161	27,568,617
Deferred tax liabilities	12	15,871,624	15,283,810
Pension liabilities	30	778,000	-
Provisions Total non current liabilities	22	5,062,741 630,326,559	5,073,481 442,168,498
CURRENT LIABILITIES:
Bank loans	6, 17 and 21	10,775,000	77,228
Other loans	6 and 21	105,438,128	398,648,024
Reimbursable subsidies	6 and 21	558,872	9,082,810
Suppliers	6, 25 and 32	61,243,404	61,686,358
Other current creditors	6, 26 and 32	3,908,405	14,170,871
State and other public entities	15	26,453,118	4,351,443
Other current liabilities	27	34,051,538	34,904,492
Derivatives	6 and 28	136,786	1,902,297
Total current liabilities		242,565,251	524,823,523
Total shareholders' funds and liabilities		1,195,241,378	1,239,255,998

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 2015 AND 2014

(Translation of financial statements originally issued in Portuguese – Note 46) (Amounts expressed in Euro)

	Notes	31.12.2015	31.12.2014
Sales	39	646,924,400	533,678,984
Services rendered	39	10,049,985	8,999,558
Other income	34	7,850,855	10,179,203
Cost of sales	11 and 32	(237,903,389)	(254,824,572)
External supplies and services	31, 32 and 41	(162,836,207)	(152,039,869)
Payroll expenses	30 and 40	(35,277,030)	(29,777,623)
Amortisation and depreciation	37	(52,833,682)	(48,520,380)
Provisions and impairment losses	22	(3,651,900)	78,064
Other costs	35	(4,049,341)	(2,758,737)
Gains and losses in associated companies and joint ventures	4.2 and 36	2,950,079	2,740,831
Financial expenses	36	(31,945,538)	(34,506,463)
Financial income	36	8,273,769	7,364,552
Profit before income tax		147,552,001	40,613,548
Income tax	12	(29,878,812)	(3,223,068)
Net profit		117,673,189	37,390,480
Consolidated net profit		117,673,189	37,390,480
Attributable to:
Parent company's shareholders	38	117,656,401	37,381,548
Non controlling interests	20	16,788	8,932
		117,673,189	37,390,480
Earnings per share:
Basic	38	0.57	0.18
Diluted	38	0.57	0.18

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

ALTRI, S.G.P.S., S.A.

CONSOLIDATED STATEMENTS OF PROFIT AND LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEARS ENDED 31 DECEMBER 2015 AND 2014

(Translation of financial statements originally issued in Portuguese – Note 46) (Amounts expressed in Euro)

	Notas	31.12.2015	31.12.2014
Net consolidated profit for the period		117,673,189	37,390,480
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	73,438	1,440,725
Changes in currency translation reserves		31,631	-
Change in fair value of available for sale investments	4.3	-	34,285
		105,069	1,475,010
Other comprehensive income		105,069	1,475,010
Total comprehensive income for the period		117,778,258	38,865,490
Attributable to:
Shareholders' of the parent company		117,761,470	38,856,558
Non controlling interests	20	16,788	8,932

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

ALTRI, S.G.P.S., S.A.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE YEARS ENDED 31 DECEMBER 2015 AND 2014

(Translation of financial statements originally issued in Portuguese – Note 46) (Amounts expressed in Euro)

		Attributable to the parent company's shareholders
	Notes	Share capital	Legal reserve	Others reserves	Advance on Profits	Net profit	Total	Non controlling interests	Total shareholder's funds
Balance as of 1 January 2014	19	25,641,459	2,862,981	157,811,081	-	55,347,961	241,663,482	146,308	241,809,790
Appropriation of the consolidated net profit of 2013	43	-	542,162	54,805,799	-	(55,347,961)	-	-	-
Dividends distribution	43	-	-	(8,615,530)	-	-	(8,615,530)	-	(8,615,530)
Others		-	-	204,227	-	-	204,227	-	204,227
Total comprehensive income for the year		-	-	1,475,010	-	37,381,548	38,856,558	8,932	38,865,490
Balance as of 31 December 2014	19	25,641,459	3,405,143	205,680,587		37,381,548	272,108,737	155,240	272,263,977
Balance as of 1 January 2015	19	25,641,459	3,405,143	205,680,587	-	37,381,548	272,108,737	155,240	272,263,977
Appropriation of the consolidated net profit of 2014	43	-	931,355	36,450,193	-	(37,381,548)	-	-	-
Dividends distribution	43	-	-	(16,410,534)	-	-	(16,410,534)	-	(16,410,534)
Advance on profits	43	-	-	-	(51,282,918)	-	(51,282,918)	-	(51,282,918)
Partial acquisitions of subsidiaries		-	-	22,341	-	-	22,341	(172,028)	(149,687)
Others		-	-	150,472	-	-	150,472	-	150,472
Total comprehensive income for the year		-	-	105,069	-	117,656,401	117,761,470	16,788	117,778,258
Balance as of 31 December 2015	19	25,641,459	4,336,498	225,998,128	(51,282,918)	117,656,401	322,349,568	-	322,349,568

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

ALTRI , SGPS, S.A.

CONSOLIDATED CASH-FLOW STATEMENTS FOR THE YEARS ENDED 31 DECEMBER 2015 AND 2014

(Translation of financial statements originally issued in Portuguese – Note 46) (Amounts expressed in Euro)

	Notes 2015		2014
Operating activities:
Collections from customers		639,795,135		533,210,945
Payments to suppliers		(392,461,406)		(409,260,630)
Payments to personnel		(33,601,440)		(29,586,593)
Other collections/payments relating to operating activities		(9,249,198)		8,984,629
Income tax		1,566,945	206,050,037	9,541,581	112,889,933
Cash flow from operating activities (1)			206,050,037		112,889,933
Investment activities:
Collections relating to:
Investments	17	-		3,707,361
Tangible fixed assets		1,125,366		-
Intangible assets		24,080		-
Investment subsidies	21	7,435,241		9,912,368
Interest and similar income		3,241,445	11,826,131	7,713,817	21,333,546
Payments relating to:
Investments	17	(149,687)		-
Tangible fixed assets		(36,661,671)		(37,762,699)
Intangible assets		(369,029)		-
Investment subsidies	21	(9,082,810)	(46,263,197)	(1,495,878)	(39,258,577)
Cash flow from investment activities (2)			(34,437,066)		(17,925,031)
Financing activities:
Collections relating to:
Loans obtained		247,271,505		107,922,600
Other financial operations		395,828	247,667,333	-	107,922,600
Payments relating to:
Interests and similar costs		(22,276,995)		(34,865,972)
Dividends		(67,693,452)		(8,615,530)
Loans obtained		(346,933,477)	(436,903,923)	(131,000,000)	(174,481,502)
Cash flow from financing activities (3)			(189,236,590)		(66,558,902)
Cash and cash equivalents at the beginning of the year			260,777,779		232,371,780
Variation of cash and cash equivalents: (1)+(2)+(3)			(17,623,619)		28,405,999
Cash and cash equivalents at the end of the year	17		243,154,160		260,777,779

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

1. INTRODUCTORY NOTE

(amounts stated in Euro)

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 Euronext Lisbon 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 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 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".

(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, 2015, were for the first time adopted in the year ended December 31, 2015:

Standard	Effective Date (annual periods beginning on or after)	Observations
IFRIC 21 – Payments to the State	17-jun-14	This amendment establishes the conditions as to timing of the recognition of a liability relating to payment by an entity to the State as a result of a specific event (for example, participation in a specific market), without the payment having specific goods or services received in exchange.
Amendment to IFRS 3 – Concentration of business activities (included in improvements to international financial statement standards – 2011-2013 cycle)	1-jan-15	Clarifies that IFRS 3 excludes from its scope of application the realization of a joint agreement on the financial statements of the joint agreement itself.
Amendment to IFRS 13 – Measurement at fair value (included in improvements to international financial statement standards – 2011-2013 cycle)	1-jan-15	Clarifies that the exception of the application of the standard to financial assets and liabilities with offsetting positions extends to all contracts under IAS 39, independently of their compliance with the definition of financial asset or liability of IAS 32.
Amendment to IAS 40 – Investment properties (included in improvements to international financial statement standards – 2011-2013 cycle)	1-jan-15	Clarifies that it is necessary to apply value judgement to determine if the acquisition of an investment property is the acquisition of an asset or the concentration of business activities covered by IFRS 3.

The effect in the consolidated financial statements of the Group for the year ended as of 31 December 2015, due to the adoption of the standards, interpretations, amendments and revisions mentioned above has not been significant.

(ii) Standards, interpretations, amendments and revisions that will take effect in future financial years

The following standards, interpretations, amendments and revisions, with mandatory application to future financial years, were, until the approval date of the accompanying financial statements, endorsed by the European Union:

Standard	Applicable in the European Union in the years starting on or after	Observations
Amendment to IAS 19 – Employee benefits – Employee contribution	1-feb-15	Clarifies under which circumstances employees' contributions to post-employment benefit plans consist of a decrease in the cost of sort term benefits.
Improvements to international financial statement standards (2010-2012 cycle)	1-feb-15	These improvements involve the clarification of some aspects relating to: IFRS 2 – Share based payments: definition of the vesting condition; IFRS 3 – Concentration of business activities: recording of contingent payments; IFRS 8 – Operating segments: disclosures relating to the aggregation of segments and clarification of the need to reconcile total assets by segment with the amount of the assets in the financial statements; IAS 16 – Tangible fixed assets and IAS 38 – Intangible assets: need to proportionately revalue accumulated amortization in the case of the revaluation of fixed assets; and IAS 24 – Disclosure of related parties: defines that an entity that renders management services to the Company or its parent company is considered a related party; and IFRS 13 – Fair value: clarification relating to the measurement of short term receivables or payables.
Improvements to international financial statement standards (2012-2014 cycle)	1-jan-16	These improvements involve the clarification of some aspects relating to: IFRS 5 – Non-current assets held for sale and discontinued operating units: introduces guidelines on how to proceed in the case of changes as to the expected realization method (sale or distribution to the shareholders); IFRS 7 – Financial instruments: disclosures: clarifies the impact of asset monitoring contracts under the disclosures relating to continued involvement of derecognized investments, and exempts the interim financial statements from the disclosures required relating to the compensation of financial assets and liabilities; IAS 19 – Employee benefits: defines that the rate to be used to discount defined benefits must be determined by reference to high quality bonds of companies issued in the currency that the benefits will be paid; and IAS 34 – Interim financial statements: clarification on the procedures to be used when the information is available in other documents issued together with the interim financial statements.
Amendment to IFRS 11 – Joint Agreements – Recording of acquisitions of interests in joint agreements	1-jan-16	This amendment relates to the acquisition of interests in joint operations. It establishes the requirement to apply IFRS 3 when the joint operation acquired consists of a business activity in accordance with IFRS 3. When the joint operation in question does not consist of a business activity, the transaction must be recorded as the acquisition of assets. This amendment is of prospective application to new acquisitions of interests.
Amendment to IAS 1 – Presentation of Financial Statements - "Disclosure initiative"	1-jan-16	This amendment clarifies some aspects relating to disclosure initiatives, namely: (i) the entity must not make it difficult to understand the financial statements by the aggregation of significant items with insignificant items or the aggregation of significant items of different natures; (ii) the disclosures specifically required by the IFRS need only to be provided if the information in question is significant; (iii) the lines in the financial statements specified by IAS 1 can be aggregated or segregated in accordance with what is significant in relation to the objectives of the financial statement; (iv) the part of other recognized income resulting from the application of the equity method in associates and joint agreements must be presented separately from the remaining elements of other recognized income, also segregating the items that can be reclassified to the statement of profit and loss from those that will not be reclassified; (v) the structure of the notes must be flexible, and should follow the following order: • a declaration of compliance with the IFRS's in the first section of the notes; • a description of the significant accounting policies in the second section; • supporting information for the items on the financial statements in the third section; and • other information in the fourth section.
Amendment to IAS 16 – Tangible fixed assets and IAS 38 – Intangible assets – Acceptable depreciation and amortization methods	1-jan-16	This amendment establishes the presumption (that can be refuted) that income is not an appropriate basis for amortizing an intangible asset and forbids the use of income as a basis for depreciating tangible fixed assets. The presumption established for amortizing intangible assets can only be refuted when the intangible asset is expressed based on the income generated or when utilization of the financial benefits is significantly related to the income generated.
Amendment to IAS 16 – Tangible fixed assets and IAS 41 – Agriculture – Production plants	1-jan-16	This amendment excludes plants that produce fruits or other components used for harvesting and/or removal under the application of IAS 41, becoming covered by IAS 16.
Amendment to IAS 27 – Application of the equity method on separate financial statements	1-jan-16	This amendment introduces the possibility of measuring interests in subsidiaries, joint agreements and associates in separate financial statements in accordance with the equity method, in addition to the measurements methods presently existing. This change applies retrospectively.

IV. Notes to the consolidated Financial statements (amounts stated in Euro)

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

The following standards, interpretations, amendments and revisions, with mandatory application to future financial years, until the approval date of the accompanying financial statements, were not endorsed by the European Union:

Standard	Observations
IFRS 9 – Financial Instruments (2009) and subsequent amendments	This standard is part of the revision of IAS 39 and establishes the new requirements for the classification and measurement of financial assets and liabilities to the methodology for the calculation of impairment and for the application of hedge accounting rules. This standard is of mandatory application for years beginning on or after 1 January 2018.
IFRS 14 – Regulated assets	This standard establishes the financial statement requirements of entities that adopt for the first time IFRS standards applicable to regulated assets.
IFRS 15 – Revenue from Client Contracts	This standard introduces a structure for recognizing revenue based on principles and a model to be applied to all contracts entered into with clients, substituting IAS 18 – Revenue, IAS 11 – Construction contracts; IFRIC 13 – Fidelity programs; IFRIC 15 – Agreements to construct real estate; IFRIC 18 – Transfer of assets from clients and SIC 31 – Revenue – Direct exchange contracts involving services and publicity. This standard is of mandatory application for years beginning on or after 1 January 2018.
IFRS 16 – Leases	This standard introduced the principles for the recognition and measurement of leases, substituting IAS 17 – Leases. The standard defines a single model for recording lease contracts, which results in the recognition by the lessor of assets and liabilities for all lease contracts, except for those for periods of less than twelve months or for leases of assets of reduced value. Lessors will continue to classify leases between operating and finance leases, IFRS 16 not requiring substantial changes for such entities in relation to IAS 17.
Amendments to IFRS 10 – Consolidated Financial Statements, IFRS 12 – Disclosures Relating to Participations in Other Entities and IAS 28 – Investments in Associates and Jointly Controlled Entities	These amendments clarify several aspects relating to the application of the consolidation exception by investment entities.
Amendments to IFRS 10 – Consolidated Financial Statements and IAS 28 – Investments in Associates and Jointly Controlled Entities	These amendments eliminate the conflict existing between these standards, relating to the sale or the contribution of assets between the investor and the associate or between the investor and the jointly controlled entity.

These standards have not been endorsed by the European Union, and as such, were not adopted by the Group in the year ended as of 31 December 2015. No significant impacts are expected to arise in the financial statements as a result of the adoption of these standards.

The accounting policies and measurement criteria adopted by the Group as of 31 December 2015 are consistent with those used in the preparation of the consolidated financial statements as of 31 December 2014.

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.

Annual Report 2015 IV. Notes to the consolidated Financial statements

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 of December of 2015 and 2014 did not exist these types of entities in the consolidated financial statement.

b) Investments in joint ventures

(amounts stated in Euro)

Investments in joint ventures (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.

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 ventures 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.

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 non-controlling 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 re-appreciation 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 cash-generating 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".

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, if there is a loss of control, or transferred to non-controlling interests in case there is no loss of control.

Exchange rates used on translation of affiliate accounts in foreign currency were as follows:

	31.12.2015		31.12.2014
	Year end	Average	Year end	Average
Sw iss franc	1.0835	1.0679	1.2024	1.2146

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
20 to 50
10 to 50
2 to 15
2 to 10
2 to 10
3 to 10

Impairment losses identified in the recoverable amount of tangible assets are recorded in the year in which they arise, by a corresponding charge against the caption "Provisions and impairment losses" in the profit and loss statement.

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".

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.

The analysis of transfers of risks and rewards of ownership of the asset takes into account several factors, including whether or not is contractually conditioned to assume ownership of the asset, the value of minimum future payments over the contract, nature of the leased asset and the duration of the contract taking into consideration the possibility of renewal.

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.

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.

i) Biological assets

Part of Altri's activity consists in in the cultivation of several species of forestry, especially eucalyptus, which are basically used as raw material for 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.

IV. Notes to the consolidated Financial statements (amounts stated in Euro)

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".

The impact of the measurement of the net responsibilities for defined benefit plans, including actuarial gains and losses and the return of the plan assets (where applicable) net of interest, is recognized immediately in the statement of comprehensive income (in equity, in the caption "Retained earnings"), with no impact on the income statement. This measurement impact is not reclassified to the income statement in subsequent years.

The net interest is recognized in the income statement, as well as the cost of any past services is recognized in the income statement in the periods they are incurred.

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).

From May 2014, the Group companies started to grant these pension supplements through defined contribution plans (except Celtejo, Caima Indústria and Altri Florestal in which there are both situations). The Company's contribution is recognized in the period's expenses.

• 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.

Annual Report 2015 IV. Notes to the consolidated Financial statements (amounts stated in Euro)

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.

Equity instruments classified as available for sale are considered to be impaired if there is a significant or prolonged decline in its fair value bellow its acquisition cost.

Held to maturity investments are carried at amortized cost using the effective interest rate, net of capital reimbursements and interest income received.

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.

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

Accounts payable are stated at their nominal value because they do not bear interests and 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.

(amounts stated in Euro)

IV. Notes to the consolidated Financial statements

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.

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 profit 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 are transferred to a third entity the Group derecognises 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 transferred 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 non-appealing factoring operations are recognized in the Group's financial statements until the moment of their 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 that may be drawn 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 disposal 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.

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.

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 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, biological assets and of other tangible and intangible fixed assets, as well as financial investments;

c)Recognition of impairment on assets, namely inventory and account receivables, and provisions;

d)Pension Fund responsibilities calculation;

e) Fair value of Derivative Financial Instruments; and f) Provisions.

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.

When considered necessary, 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.

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.

When 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.

IV. Notes to the consolidated Financial statements (amounts stated in Euro)

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 re-fixing dates of interest rates and the repayments plans of 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 2015 and 2014 the balances stated in USD are as follows:

	31.12.2015	31.12.2014
Accounts receivable	18,702,921	13,340,951
Accounts payable	53,202	702,603
Bank deposits (Note 17)	7,999,537	5,644,642
Factoring (Note 21)	4,340,785	2,205,502
	31,096,446	21,893,698

Additionally, as of 31 December 2015 and 2014 the balances in currencies different from Euro and USD are as follows:

	31.12.2015	31.12.2014
Accounts payable	17,053	122,022
	17,053	122,022

The Board of Directors considers that eventual changes in exchange rates do not have a significant effect in the consolidated financial statements, given the amount of assets and liabilities denominated in foreign currency, and their maturity.

iii) Variability risk on commodities price

By developing its activity in a commodity transactional industry (pulp), the Group is particularly exposed to its price fluctuations, with the correspondent impacts in their results. However, in order to manage this risk, 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 2015 would have implied an increase/decrease on operational results1, approximately of 28.25 million euro, without considering the effects of the pulp's derivatives (Note 28) and keeping everything else constant.

iv) Risks of forest management and eucalyptus production

Altri, through its subsidiary Altri Florestal, has a forest area of about 82,000 hectares under intervention (84,000 in 2014) where 80% are eucalyptus. The forest is certified by FSC ® (Forest Stewardship Council ®2) 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 Florestal 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, Altri Florestal participates, together with 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 Florestal 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 2015 would have implied an increase/decrease on operational results, approximately of 10.6 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.

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.

1 Operational results = earnings before taxes + financial expenses – financial income – gains/losses in joint ventures and associated companies 2 FSC-C004615

IV. Notes to the consolidated Financial statements (amounts stated in Euro)

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.

4. INVESTMENTS

4.1 INVESTMENTS IN SUBSIDIARIES

The companies included in the consolidated financial statements by the full consolidation method, their headquarters, percentage of participation held and main activity as of 31 December 2015 and 2014, are as follows:

Company	Head Office	Percentage Held		Main Activity
		2015	2014
Parent-Company
Altri, SGPS, S.A.	Porto			Investment management
Subsidiaries
Altri Abastecimento de Madeira, S.A.	Figueira da Foz	100%	100%	Wood commercialization
Altri Florestal, S.A.	Figueira da Foz	100%	100%	Forest management
Altri Sales, S.A.	Nyon, Switzerland	100%	100%	Group management support services
Altri, Participaciones Y Trading, S.L.	Madrid, Spain	100%	100%	Commercialization 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 commercialization of pulp
Captaraíz Unipessoal, Lda.	Figueira da Foz	100%	100%	Purchase and sale of properties
Celtejo – Empresa de Celulose do Tejo, S.A.	Vila Velha de Ródão	100%	99.83%	Production and commercialization of pulp
Celulose Beira Industrial (Celbi), S.A.	Figueira da Foz	100%	100%	Production and commercialization of pulp
Inflora – Sociedade de Investimentos Florestais, S.A.	Figueira da Foz	100%	100%	Forest 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 with 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).

IV. Notes to the consolidated Financial statements (amounts stated in Euro)

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 2015 and 2014 are as follows:

Company	Head Office	Statement of financial position		Percentage Held		Activity
		2015	2014	2015	2014
Associated companies:
Operfoz – Operadores do Porto da Figueira da Foz, Lda.	Figueira da Foz	697,453	616,581	33.33%	33.33%	Harbor operations
Joint ventures:
EDP – Produção Bioeléctrica, S.A.	Lisboa	11,310,766	8,441,559	50%	50%	Energy production
		12,008,219	9,058,140

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

The movements occurred in the balance of this caption in the years ended in 2015 and 2014 were as follows:

		Statement of financial position
	31.12.2015		31.12.2014
	Operfoz	EDP Bioeléctrica (a)	Operfoz	EDP Bioeléctrica (a)
Opening Balance	616,581	8,441,589	513,365	8,128,943
Reimbursment of supplementary capital Equity method:	-	-	-	(2,325,000)
Effects on gains and losses in associated companies and joint ventures	80,872	2,869,207	103,216	2,637,646
Closing Balance	697,453	11,310,796	616,581	8,441,589

The total amount of the statement of financial position, assets, equity and net profit for the years ended on 31 December 2015 and 2014 for the main joint ventures and associated companies were as follows:

	31.12.2015	31.12.2014
	EDP Bioeléctrica (b)	EDP Bioeléctrica (b)
Non-current assets	126,905,069	135,778,922
Current assets	15,245,714	9,558,601
Non-current liabilities	70,276,436	79,420,813
Current liabilities	44,620,574	43,661,460
Equity attributable to shareholders of the parent company	27,253,773	22,255,250
Turnover	40,049,682	40,612,712
Net profit	4,998,523	4,867,928
Total comprehensive income	4,998,523	4,867,928

(a) includes loans granted

(b) EDP – Produção Bioeléctrica, S.A holds shares representing 100% of the share 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 2015 and 2014 the investments available for sale and their book value as of that date, were as follows:

	Statement of financial position
	2015	2014
Rigor Capital - Produção de Energia, Lda.	10,527,397	10,527,397
Other Investments	163,700	163,800
	10,691,097	10,691,197

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 that 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 their fair value.

5. CHANGES IN THE GROUP COMPANIES

During the year ended December 31, 2015 and 2014, there were no changes in the consolidation perimeter.

6. FINANCIAL INSTRUMENTS BY CLASS

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

31 December 2015	Notes	Loans and receivables	Available for sale	Total
Non-current Assets
Investments available for sale	4.3	-	10,691,097	10,691,097
		-	10,691,097	10,691,097
Current Assets
Customers	13	91,521,269	-	91,521,269
Other debtors	14	8,401,481	-	8,401,481
Cash and cash equivalents	17	243,154,160	-	243,154,160
		343,076,910	-	343,076,910
		343,076,910	10,691,097	353,768,007
31 December 2014	Notes	Loans and receivables	Available for sale	Total
Non-current Assets
Investments available for sale	4.3	-	10,691,197	10,691,197
		-	10,691,197	10,691,197
Current Assets
Customers	13	88,868,133	-	88,868,133
Other debtors	14	7,776,064	-	7,776,064
Cash and cash equivalents	17	260,855,007	-	260,855,007
		357,499,204	-	357,499,204
		357,499,204	10,691,197	368,190,401

IV. Notes to the consolidated Financial statements (amounts stated in Euro)
RELATÓRIO DO CONSELHO DE ADMINISTRAÇÃO 31 December 2015	Notes	Financial Liabilities	Derivatives	Total
Non-current liabilities
Bank Loans	21	153,587,500	-	153,587,500
Other Loans	21	413,733,394	-	413,733,394
Reimbursable subsidies	21	17,439,139	-	17,439,139
		584,760,033	-	584,760,033
Current liabilities
Bank Loans	21	10,775,000	-	10,775,000
Other Loans - short term	21	105,438,128	-	105,438,128
Reimbursable subsidies	21	558,872	-	558,872
Suppliers	25	61,243,404	-	61,243,404
Other current creditors	26	3,908,405	-	3,908,405
Derivatives	28	-	141,283	141,283
		181,923,809	141,283	182,065,092
		766,683,842	141,283	766,825,125
31 December 2014	Notes	Financial Liabilities	Derivatives	Total
Non-current liabilities
Bank Loans	21	103,837,500	-	103,837,500
Other Loans	21	278,276,931	-	278,276,931
Reimbursable subsidies	21	11,723,809	-	11,723,809
Other non-current creditors	23	404,350	-	404,350
		394,242,590	-	394,242,590
Current liabilities
Bank Loans	21	77,228	-	77,228
Other Loans - short term	21	398,648,024	-	398,648,024
Reimbursable subsidies	21	9,082,810	-	9,082,810
Suppliers	25	61,686,358	-	61,686,358
Other current creditors	26	14,170,871	-	14,170,871
Derivatives	28	-	1,902,297	1,902,297
		483,665,291	1,902,297	485,567,588
		877,907,881	1,902,297	879,810,178

Financial instruments recorded at fair value

Annual Report 2015

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.

	31.12.2015			31.12.2014
	Level 1	Level 2	Level 3	Level 1	Level 2	Level 3
Financial liabilities recorded at fair value
Derivatives (Note 28)	-	141,283	-	-	1,902,297	-

As of 31 December 2015 and 2014 there were no financial assets whose terms have been renegotiated and if they had not been renegotiated they would be overdue or impaired.

IV. Notes to the consolidated Financial statements (amounts stated in Euro)

7. TANGIBLE FIXED ASSETS

During the years ended 31 December 2015 and 2014 the movement occurred in tangible fixed assets and in the corresponding accumulated depreciation and impairment losses was as follows:

					2015
					Gross assets
	Land	Building and other constructions	Plant and machinery	Vehicles	Office equipment	Other tangible assets	Work in progress	Advances on account of fixed assets	Total
Opening balance	26,923,633	104,634,114	963,560,240	4,073,810	10,101,282	14,197,956	41,345,338	509,889	1,165,346,262
Additions	17,887	34,937	29,061,346	247,816	188,402	87,124	3,468,969	955	33,107,436
Disposals	(107,910)	-	(13,093,982)	(354,876)	(164,827)	(219,199)	(184,733)	-	(14,125,528)
Transfers and writte-offs	-	165,000	40,654,697	-	206,300	-	(40,822,503)	-	203,495
Closing balance	26,833,610	104,834,051	1,020,182,302	3,966,750	10,331,157	14,065,881	3,807,072	510,844	1,184,531,666
					Accumulated depreciation
	Land	Building and other constructions	Plant and machinery	Vehicles	Office equipment	Other tangible assets			Total
Opening balance	7,733,478	88,047,528	659,207,379	3,123,241	9,621,223	13,327,910			781,060,759
Additions	308,577	1,439,290	50,346,487	305,471	200,862	145,906			52,746,593
Disposals	-	-	(12,884,581)	(328,591)	(164,827)	(218,417)			(13,596,416)
Transfers and writte-offs	-	-	-	-	201,101	-			201,101
Closing balance	8,042,055	89,486,818	696,669,285	3,100,121	9,858,359	13,255,398			820,412,037
	18,791,554	15,347,233	323,513,017	866,629	472,799	810,482	3,807,072	510,844	364,119,629
					2014
					Gross assets
	Land	Building and other constructions	Plant and machinery	Vehicles	Office equipment	Other tangible assets	Work in progress	Advances on account of fixed assets	Total
Opening 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
Additions	303,323	897,677	5,439,396	704,211	59,382	26,190	35,429,653	-	42,859,832
Disposals	(97,847)	(405,746)	(54,172)	(39,493)	(237,056)	(123,859)	-	-	(958,173)
Transfers and writte-offs	9,355	-	2,671,175	-	30,078	47,951	(3,080,288)	(73,323)	(395,052)
Closing balance	26,923,633	104,634,114	963,560,240	4,073,810	10,101,282	14,197,956	41,345,338	509,889	1,165,346,262
					Accumulated depreciation
	Land	Building and other constructions	Plant and machinery	Vehicles	Office equipment	Other tangible assets			Total
Opening balance	7,492,997	86,891,472	613,193,500	2,860,382	9,682,772	13,205,994			733,327,117
Additions	315,441	1,263,256	46,027,905	296,555	175,507	245,778			48,324,442
Disposals	(74,960)	(107,200)	(14,026)	(33,696)	(237,056)	(123,862)			(590,800)
Transfers and writte-offs	-	-	-	-	-	-			-
Closing balance	7,733,478	88,047,528	659,207,379	3,123,241	9,621,223	13,327,910			781,060,759
	19,190,155	16,586,586	304,352,861	950,569	480,059	870,046	41,345,338	509,889	384,285,503

During the years ended 31 December 2015 and 2014 amortizations amounted to 52,746,593 Euro and 48,324,442 Euro, respectively, and were recorded in the profit and loss statement in caption "Amortisation and depreciation" (Note 37).

The additions of plant and machinery in 2015 relate mainly with the investment project in Celbi to enhance its productive capacity, initiated in 2013 and concluded in 2015, and with the project of conversion of Caima mill into dissolving pulp production. The disposals correspond to equipment that has been replaced under the two projects mentioned above.

The caption "Work in progress" as of 31 December 2015 and 2014 refers to the following projects:

	31-12-2015	31-12-2014
Improvement of the evaporation manufacturing facility	-	22,571,867
Increase of production capacity	163,593	16,999,692
New Turbine	1,260,643	-
Industrial optimization	509,667	-
Reengineering of the landfill of residual waste	367,658	-
Drying machine	333,189	-
Pavements	157,747	-
Other projects	1,014,575	1,773,779
	3,807,072	41,345,338

8. INVESTMENT PROPERTIES

(amounts stated in Euro)

The amount recorded in caption "Investment Properties" in December 31, 2015 and 2014 refers, essentially, to lands that are not used in the Group's main operating 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 2015 and 2014 were as follows:

	2015	2014
	Gross assets	Gross assets
Opening balance	839,227	803,046
Additions	-	78,988
Disposals	(336,246)	(42,807)
Closing balance	502,981	839,227
	Accumulated Depreciations	Accumulated Depreciations
Opening balance	382,291	342,419
Additions	7,381	61,041
Disposals	-	(21,169)
Closing balance	389,672	382,291
Net amount

During the years ended as of 31 December 2015 and 2014 depreciations amounted to 7,381 Euro and 61,041 Euro, respectively, and were recorded in caption "Amortisation and depreciation" (Note 37).

9. GOODWILL

During 2015 and 2014 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 amortized. 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 higher than 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 2015 and 2014, there were not recorded or reverted any impairment losses.

During 2015, in order to assess the existence or not of impairment on the main goodwill amount that resulted from Celulose Beira Industrial (Celbi), 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 pulp, not affected by the short term variations.

The main assumptions used in 2015 and 2014 in this calculation were:

	2015	2014
Inflation rate	1.00%	0.50%
Discount rate	7.35%	7.90%
Growth rate in perpetuity	2.00%	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 2015 was 7.35% (7.90% in 2014) and was calculated according to the WACC (Weighted Average Cost of Capital) method, considering the following assumptions:

	2015	2014
Risk-free interest rate	2.42%	4.99%
Equity risk premium	6.00%	5.00%
Debt risk premium	1.87%	2.78%

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 8.35% 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 2015, 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.

10. INTANGIBLE ASSETS

During 2015 and 2014, the movement in intangible assets, as well as in the corresponding accumulated depreciation and impairment losses, was as follows:

		2015
		Gross assets
	Industrial property and other rights	Software	Other intangible assets	Total
Opening balance Additions	1,320 -	8,112,944 24,080	25,600 -	8,139,864 24,080
Closing balance	1,320	8,137,024	25,600	8,163,944
		Accumulated depreciation
	Industrial property and other rights	Software	Other intangible assets	Total
Opening balance Additions	1,320 -	7,973,496 79,708	25,600 -	8,000,416 79,708
Closing balance	1,320	8,053,203	25,600	8,080,123
	-	83,821	-	83,821
		2014
		Gross assets
	Industrial property and other rights	Software	Other intangible assets	Total
Opening balance	1,320	8,032,884	25,600	8,059,804
Additions	-	80,060	-	80,060
Closing balance	1,320	8,112,944	25,600	8,139,864
		Accumulated depreciation
	Industrial property and other rights	Software	Other intangible assets	Total
Opening balance Additions	1,320 -	7,838,599 134,897	25,600 -	7,865,519 134,897
Closing balance	1,320	7,973,496	25,600	8,000,416
	-	139,448	-	139,448

In 2015 and 2014 the amortisations amounted to 79,708 Euro and 134,897 Euro, respectively, and were recorded in the profit and loss statement caption "Amortisation and depreciation" (Note 37).

11. BIOLOGICAL ASSETS AND INVENTORIES

As of 31 December 2015 and 2014, 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:

	31.12.2015	31.12.2014
Biological assets - gross value	101,852,921	105,538,783
Accumulated impairment losses in biological assets (Note 22)	(380,006)	(380,006)
	101,472,915	105,158,777

As of 31 December 2015 and 2014, the total area managed by Altri amounted to 82,000 and 84,000 hectares, respectively. The eucalyptus' area had the following age distribution:

	31-12-2015	31-12-2014
0 - 5 years	12,101	32,000
6 -10 years	25,398	22,193
> 10 years	27,989	11,908
	65,488	66,101

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

As of 31 December 2015 and 2014, the caption "Inventories" was made up as follows:

	31.12.2015	31.12.2014
Raw, subsidiary and consumable materials	41,090,037	41,019,801
Work in progress	594,728	575,585
Finished and intermediate goods	22,096,632	18,016,209
	63,781,397	59,611,596
Accumulated impairment losses (Note 22)	(7,384,783)	(4,886,156)
	56,396,615	54,725,440

The cost of sales for the year ended 31 December 2015 amounted to 237,903,389 Euro and was computed as follows:

	Raw, subsidiary and consumable materials	Finished and intermediate goods	Work in progress	Biological assets	Total
Opening balance	41,019,801	18,016,209	575,585	105,538,783	165,150,378
Purchases	237,927,615	-	19,143	-	237,946,758
Inventory adjustment	624,616	-	-	(184,045)	440,571
Closing balance	(41,090,037)	(22,096,632)	(594,728)	(101,852,921)	(165,634,318)
	238,481,995	(4,080,423)	-	3,501,817	237,903,389

The cost of sales for the year ended 31 December 2014 amounted to 254,824,572 Euro and was computed as follows:

	Raw, subsidiary and consumable materials	Finished and intermediate goods	Work in progress	Biological assets	Total
Opening balance	38,456,603	20,945,066	313,802	107,502,958	167,218,429
Purchases	254,479,369	-	-	-	254,479,369
Inventory adjustment	(1,578,071)	-	-	(144,777)	(1,722,848)
Closing balance	(41,019,801)	(18,016,209)	(575,585)	(105,538,783)	(165,150,378)
	250,338,100	2,928,857	(261,783)	1,819,398	254,824,572

12. CURRENT AND DEFERRED TAXES

In accordance with current legislation, tax returns are subject to review and correction by the tax authorities during a fouryear 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 2012 to 2015 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 2015 and 2014.

The movements occurred in deferred tax assets and liabilities in the years ended in 31 December 2015 and 2014 were as follows:

	2015
	Deferred tax	Deferred tax
	assets	liabilities
Opening balance as of 1 January 2015	27,541,201	15,283,810
Effects on income statement:
Increases/(Decreases) in prov isions not accepted	285,947	-
Harmonization of depreciation rates	(13,220)	-
Tax losses carried forw ard	(736,798)	-
Other effects	45,832	587,814
Total effect on income statement	(418,239)	587,814
Effects on sharelholders funds:
Fair v alue of deriv ativ es (Note 28)	(62,096)	-
Closing balance as of 31 December 2015	27,060,866	15,871,624
	2014
	Deferred tax	Deferred tax
	assets	liabilities
Opening balance as of 1 January 2014	31,165,814	17,896,214
Effects on income statement:
Increases/(Decreases) in prov isions not accepted	12,114	-
Harmonization of depreciation rates	968,953	-
Change of profit tax rate in Spain	(2,785,226)	(2,987,259)
Other effects	(1,073,985)	703,050
Total effect on income statement	(2,878,144)	(2,284,209)
Effects on sharelholders funds:
Fair v alue of deriv ativ es (Note 28)	(746,469)	(328,195)

IV. Notes to the consolidated Financial statements (amounts stated in Euro)

As of 31 December 2015 and 2014, the detail of deferred tax assets and liabilities, in accordance with the timing differences that originated them, was as follows:

	31.12.2015		31.12.2014
	Deferred tax assets	Deferred tax liabilities	Deferred tax assets	Deferred tax liabilities
Provisions and impairment losses not accepted for tax purposes	3,297,714	-	3,011,768	-
Fair value of derivatives	-	-	62,096	-
Harmonization of accounting principles	9,928,375	-	9,941,595	-
Tax losses carried forward	13,190,079	-	13,926,877	-
Tax amortization of Goodwill	-	15,558,642	-	14,936,296
Other	644,698	312,982	598,865	347,514
	27,060,866	15,871,624	27,541,201	15,283,810

According to the legislation, the Group uses a deferred tax rate of 22.5% that results of the sum of the rate approved for 2016 and subsequent years which amounts to 21% plus the municipal surtax whose rate is 1.5%, except for deferred tax assets that result from tax losses carried forward, where it is used a rate of 21%. Regarding the subsidiary Altri, SL based in Spain the rate used in the calculation of deferred tax assets and liabilities is 25% since it is the tax rate approved to be in force in that country from January 1, 2016 onwards.

According to the legislation, for the year ending on December 31, 2015 the income tax rate was 21% (23% in 2014).

Additionally, according to the legislation, during the year ended on December 31, 2015, state surtax corresponds to the use of an additional tax of 3% on the portion of taxable income between 1.5 and 7.5 million Euro, of 5% on the portion of taxable income between 7.5 and 35 million Euro, and 7% on the portion of taxable income exceeding 35 million Euro.

On December 31, 2015 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, 2015 the deferred tax assets relating to tax losses are from Altri SL and taking into account the perspectives of tax income for the following years it is conviction of Altri's Board of Directors that they are fully recoverable.

According to the tax returns of the companies that recorded deferred tax assets related with tax losses carried forward, these may be detailed as follows, as of 31 December 2015 and 2014:

		31 December 2015			31 December 2014
	Tax loss	Deferred tax assets	Limit of utilization date	Tax loss	Deferred tax assets	Limit of utilization date
With limit of utilization date
Generated in 2007	18,870,508	4,717,626	2025	21,817,695	5,454,424	2025
Generated in 2008	16,666,932	4,166,733	2026	16,666,932	4,166,733	2026
Generated in 2009	12,004,490	3,001,123	2027	12,004,490	3,001,123	2027
Generated in 2010	5,095,252	1,273,813	2028	5,095,252	1,273,813	2028
Generated in 2011	123,134	30,784	2029	123,134	30,784	2029
	52,760,316	13,190,079		55,707,503	13,926,877

Income taxes recorded in the profit and loss statement for the years ended 31 December 2015 and 2014 can be detailed as follows:

	31.12.2015	31.12.2014
Current income tax	(28,872,759)	(2,629,133)
Deferred income tax	(1,006,053)	(593,935)
	(29,878,812)	(3,223,068)

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

	31.12.2015	31.12.2014
Profit before tax	147,552,001	40,613,548
Tax rate (including municipal surtax)	22.50%	24.50%
	(33,199,200)	(9,950,319)
Tax benefits	12,490,236	11,013,360
State surtax	(7,509,085)	(1,374,693)
Other effects	(1,660,763)	(2,911,416)
Income tax	(29,878,812)	(3,223,068)

Tax benefits in 31 December, 2015 and 2014 correspond mainly to the use of the tax credit granted by the Portuguese State to Celulose Beira Industrial (Celbi) S.A. and to Caima – Indústria de Celulose, S.A. under the tax incentive program to support investments in production's capacity increase (Note 21).

13. COSTUMERS

As of 31 December 2015 and 2014 this caption can be detailed as follows:

	31.12.2015	31.12.2014
Customers, current accounts	91,785,794	89,132,659
Customers, doubtful debts	43,116	44,632
	91,828,910	89,177,291
Accumulated impairment losses (Note 22)	(307,641)	(309,158)
	91,521,269	88,868,133

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 2015 and 2014, the age of costumer's balances can be detailed as follows:

	31.12.2015	31.12.2014
Not due	81,381,124	72,698,705
Due with no impairment losses recorded
0 - 30 days	9,551,950	14,805,977
30 - 90 days	454,474	797,098
+ 90 days	133,721	566,353
	91,521,269	88,868,133

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

	31.12.2015	31.12.2014
With credit insurance	75,278,254	69,534,338
Without credit insurance	16,550,656	19,642,954
	91,828,910	89,177,292

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.

IV. Notes to the consolidated Financial statements (amounts stated in Euro)

14. OTHER DEBTORS

As of 31 December 2015 and 2014 this caption can be detailed as follows:

	31.12.2015	31.12.2014
Advances to suppliers	22,927	-
Other debtors	11,791,909	10,039,419
	11,814,836	10,039,419
Accumulated impairment losses (Note 22)	(3,413,355)	(2,263,355)
	8,401,481	7,776,064

As of 31 December 2015, caption "Other debtors" includes an amount of approximately 4.3 million Euro related with Value Added Tax to be received from tax authorities of other countries as a result of sales and purchases made through the ports of those countries. Additionally, on December 31, 2015 this caption also includes an amount receivable of 1,147,450 Euro (1,221,000 Euro as of 31 December, 2014) related with the sale of Sócasca – Recolha e Comércio de Recicláveis, S.A..

As of 31 December 2015 and 2014 the caption "Other debtors" also includes accounts receivable related with guarantees for lease contracts and accounts receivable for which impairment losses were recorded.

As of 31 December 2015 and 2014, the age of the balances in "Other Debtors" can be detailed as follows:

	31.12.2015	31.12.2014
Not due	8,169,934	6,554,814
Due with no impairment losses recorded
0 - 30 days	-	-
30 - 90 days	-	-
> 90 days	231,547	1,221,250
	231,547	1,221,250
	8,401,481	7,776,064

The undue balances do not present any signs of impairment, the net book 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.

15. STATE AND PUBLIC SECTOR

As of 31 December 2015 and 2014, this caption can be detailed as follows:

Debtor balances:	31.12.2015	31.12.2014
Income tax	-	6,937,154
Withholding taxes	-	26,155
Value added tax	8,469,842	8,391,616
Other taxes	-	274,078
	8,469,842	15,629,003
Creditors balances:
Income tax	(23,490,106)	-
Withholding taxes - dependent work	(1,934,792)	(1,116,430)
Social Security contributions	(576,766)	(489,313)
Value added tax	(150,315)	(2,726,639)
Other taxes	(301,139)	(19,061)
	(26,453,118)	(4,351,443)

The balances of the caption "Income tax" on December 31, 2015 and 2014 correspond to payments on account and special payments on account made, net of the income tax for the year.

16. OTHER CURRENT ASSETS

As of 31 December 2015 and 2014 this caption can be detailed as follows:

Accrued income:	31.12.2015	31.12.2014
Others	357,494	727,040
Deferred costs:
Rents paid in advance	1,152,563	1,317,256
Insurances paid in advance	627,887	266,976
Other costs paid in advance	588,337	197,334
	2,726,281	2,508,606

17. CASH AND CASH EQUIVALENTS

As of 31 December 2015 and 2014, the caption "Cash and cash equivalents" can be detailed as follows:

	31.12.2015	31.12.2014
Cash Bank deposits	356,715 242,797,445 243,154,160	15,551 260,839,456 260,855,007
Bank overdrafts (Note 21)	-	(77,228)
Cash and cash equivalents	243,154,160	260,777,779

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 2015 and 2014, the cash and cash equivalents balances in a non-euro currency amounted to 7,999,537 Euro and 5,644,642 Euro, respectively. Since these amounts correspond to bank deposits on demand that are constantly moved, the exchange rate fluctuation effects on cash and cash equivalents held at the beginning and at the end of the years 2015 and 2014 for purposes of the statement of cash flows are immaterial.

During the year ended as of 31 December 2015, the group did not receive any amounts related with financial investments.

The amounts received related with financial investments during the year ended 31 December 2014 are as follows:

	Amount of transaction	Amount received
EDP – Produção Bioelétrica, S.A. (a)	2,325,000	2,325,000
Investments available for sale (Note 4.3)	1,351,836	1,351,836
Sócasca –Recolha e Comércio de Recicláveis, S.A. (b)	2,300,000	30,525
	---------------	---------------
	5,976,836	3,707,361
	=========	=========
(a) – Reimbursement of loans

(b) – Company sold in 2011

During the year ended on 31 December 2014 no payments were made relating to investments. For the year ended on 31 December 2015 there was a payment in the amount of 149,687 Euro for the acquisition of the remaining shares of the share capital of Celtejo.

18. OTHER NON CURRENT ASSETS

(amounts stated in Euro)

As of 31 December 2015 and 2014, this caption can be detailed as follows:

	31.12.2015	31.12.2014
Value added tax (Note 22)	3,210,260	3,210,260
Rents paid in advance	280,209	2,820,879
	3,490,469	6,031,139

19. SHARE CAPITAL AND RESERVES

Share capital

As of 31 December 2015, 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 2015 and 2014, there were no entities holding more than 33% 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.

As of 31 December 2015 and 2014, the Company presented the amount of 4,336,498 Euro and 3,405,143 Euro of legal reserves, respectively, 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

	31.12.2015	31.12.2014
Hedging reserves Other reserves and retained earnings	(136,786) 174,851,996	(219,605) 205,900,192
	174,715,210	205,680,587

The caption "Hedging reserves" reflects the fair value of the derivative financial instruments classified as cash-flows 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 non-consolidated financial statements of the Company, prepared in accordance with the International Financial Reporting Standards, as adopted by the European Union. As of 31 December 2015 distributable reserves amount to 67,051,654 Euro.

20. NON CONTROLLING INTERESTS

The amounts of this caption during the years ended 31 December 2015 and 2014 are as follows:

	31.12.2015	31.12.2014
Opening balance	155,240	146,308
Partial acquisitions of subsidiaries	(172,028)	-
Net profit attributable to non controlling interests	16,788	8,932
Closing balance	-	155,240

(amounts stated in Euro)

IV. Notes to the consolidated Financial statements

21. BANK LOANS, OTHER LOANS AND REIMBURSABLE SUBSIDIES

As of 31 December 2015 and 2014, the captions "Bank loans", "Other loans" and "Reimbursable subsidies" can be detailed as follows:

	2015
		Nominal value		Book value
	Current	Non current	Total	Current	Non current	Total
Bank Loans	11,000,000	154,000,000	165,000,000	10,775,000	153,587,500	164,362,500
Bank Loans	-	154,000,000	165,000,000	10,775,000	153,587,500	164,362,500
Commercial paper Bonds Other loans	64,000,000 - 41,918,791	115,500,000 299,376,900 -	179,500,000 299,376,900 41,918,791	63,519,337 - 41,918,791	115,500,000 298,233,394 -	179,019,337 298,233,394 41,918,791
Other loans	105,918,791	414,876,900	520,795,691	105,438,128	413,733,394	519,171,522
Reimbursable subsidies	558,872	17,439,139	17,998,011	558,872	17,439,139	17,998,011
	106,477,663	586,316,039	703,793,702	116,772,000	584,760,033	701,532,033
			2014
		Nominal value			Book value
	Current	Non current	Total	Current	Non current	Total
Bank Loans Bank overdrafts (Note 17)	- 77,228	105,000,000 -	105,000,000 77,228	- 77,228	103,837,500 -	103,837,500 77,228
Bank Loans	77,228	105,000,000	105,077,228	77,228	103,837,500	103,914,728
Commercial paper	108,600,000	5,000,000	113,600,000	107,220,536	5,000,000	112,220,536
Bonds Other loans	251,300,682 40,722,848	275,000,000 -	526,300,682 40,722,848	250,704,640 40,722,848	273,276,931 -	523,981,571 40,722,848
Other loans	400,623,530	280,000,000	680,623,530	398,648,024	278,276,931	676,924,955
Reimbursable subsidies	9,082,810	11,723,809	20,806,619	9,082,810	11,723,809	20,806,619
	409,783,568	396,723,809	806,507,377	407,808,062	393,838,240	801,646,302

Bank loans

(i) Celbi's bank loans

During 2013, Celbi obtained a bank loan amounting to 75,000,000 Euro, which was renegotiated in June 2014, with an interest rate equal to Euribor 3 months plus a spread, which payment will be in 5 annual instalments of 5,000,000 Euro each, the first of them in June of 2016 and in one last instalment of 50,000,000 Euro in 2021. Therefore, the amount of 5 million Euro is classified as current debt and the remaining amount is classified as non-current debt.

During the year ended 31 December 2014, Celbi contracted a bank loan of 30 million Euro, which bears interest at a rate equal to 3 months Euribor plus a spread. This loan will be repaid in 24 equal consecutive monthly installments, starting in July 2017, so the total amount of the loan is classified as non-current debt.

During the year ended 31 December 2015, Celbi contracted a bank loan of 30 million Euro, which bears interest at a rate equal to 6 months Euribor plus a spread. This loan will be repaid in 5 equal consecutive annual installments, starting in January 2016. Therefore, the amount of 6 million Euro is classified as current debt and the remaining amount is classified as non-current debt.

During the year ended 31 December 2015, Celbi contracted a bank loan of 30 million Euro, which bears interest at a rate equal to 3 months Euribor plus a spread. This loan will be repaid in 3 equal consecutive annual installments, starting in February 2018. Therefore, the total amount of the loan is classified as non-current debt.

(ii) Pledged current accounts

As of 31 December 2015, the Group had pledged current accounts amounting to 15.5 million Euro which were not used (the same amount in 2014).

(iii) Bank overdrafts

As of 31 December 2015, the Group had bank overdrafts amounting to 15 million Euro which were not used (77,228 Euro as of 31 December 2014).

Other loans:

(i) Commercial paper:

The Group has renewable commercial paper programs subscribed by several group companies in the maximum amount of 388,500,000 Euro as of 31 December 2015 (338,500,000 Euro as of 31 December 2014), with guaranteed placement, with interests payable at a rate equal to Euribor for the issuing period (7 to 364 days) plus spread. As of 31 December 2015, the amount in use was 179,500,000 Euro (113,600,000 Euro as of 31 December 2014). The amount of 64,000,000 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 2016 and 2022, of which the amount of 115,500,000 between the years 2017 and 2022, being the Board of Directors belief that there will be no early terminations from any parts to these commercial paper programs.

(ii) 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 December 31, 2014, the liability related to this loan amounts to 251,300,682 Euro, because during the 2014 financial year, the Group has acquired own bonds in the amount of 48,699,318 Euro. In February 2015, this bond loan was fully repaid.

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. In August 2015, it was made an early repayment, as allowed in the agreement.

During the year ended in December 31, 2014, Celulose Beira Industrial (Celbi), S.A. issued two bonds loans: one in the amount of 80 million Euro with a term of 5 five years, in March. The liabilities of the Group at 31 December 2015 for the same amounted to 90,623,100 Euro, once during the year 2015 own bonds were acquired in the amount of 10,623,100 Euro. The second bond in amount of 50 million Euro with a term of 6 years, in April. Regarding the latter, on 20 February 2015, Altri SGPS took over the contractual position held by its subsidiary Celbi, passing the bond to be called "ALTRI 2014/2020". On its turn, Altri SGPS proceeded to issue a bond loan in the amount of 70,000,000 Euro due in 2018.

During the year ended as of 31 December 2015, Celulose Beira Industrial (Celbi), S.A. issued three bond loans: one in the amount of 35 million Euro with a maturity of six years (in February); another in the amount of 35 million Euro with a maturity of 2.5 years (in August); and another in the amount of 40 million Euro with a term of four years (also in August), at a rate equal to Euribor 6 months plus a spread.

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).

(iii) 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 55,000,000 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 2015, the value used amounted to 41,918,791 Euro (40,722,848 Euro as of 31 December 2014).

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:

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 noncurrent liabilities" and "Other current liabilities" (Notes 24 and 27) net of the amount recognized directly as income in the

(amounts stated in Euro)

IV. Notes to the consolidated Financial statements

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 16,526,400 Euro were met, having Celbi classified this amount as "Other non-current liabilities" and "Other current liabilities" 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 2015, this grant is fully paid.

In January 2014 Celbi signed a new contract for granting financial and fiscal incentives under Decree Law. 203/2003, of 10 September, with the Agency for Investment and Foreign Trade of Portugal, EPE (AICEP), and the project of modernization and expansion of the plant, was considered by the Portuguese State of strategic interest and relevance to the national economy. The investment project began on August 19, 2013, and will run until June 30, 2015 and the contract value amounted to 30.251 million Euro. The Portuguese State will grant a refundable financial incentive corresponding to 20% of the costs eligible if Celbi complies with the proposed objectives measured in the late 2016, 2017 and 2019 the Portuguese state still will grant Achievement Award that correspond to non-repayment of up to 75% of the refundable incentive amount. The Portuguese State shall also allow tax incentive corresponding to a tax credit on corporate income tax in the amount of 15% of the relevant applications. Until December 31, 2015 Celbi received the amount of 5,712,999 Euro relating to the refundable incentive.

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 2014 and totalled 3,437,000 Euro. During 2015, an amount of 450,399 Euro was received, so Caima Indústria on 31 December 2015 had a debt related to this reimbursable incentive of 2,288,800 Euro, of which 558,872 Euro was classified as current debt.

Additionally, during 2014, Caima Indústria obtained a reimbursable incentive under the Decree-Law no. 287/2007 issued by the Agência para o Investimento e Comércio Externo de Portugal, for a global investment of 35,161,000 Euro. The investment period of the project shall extend between 2013 and 2015. The maximum reimbursable incentive amounts to 10,511,580 Euro, 30% of the eligible expenses. The Company has already received 9,996,226 Euro, to be repaid between 2017 and 2022, and, at 31 December 2015, this amount is classified as non-current debt. If Caima Indústria complies by the end of the years of 2016, 2017 and 2019 with the goals set on the incentive arrangement, the company will be granted an achievement premium corresponding to the non-repayment of an amount up to 48% of the total reimbursable subsidy.

In the years ended 31 December 2015 and 2014, 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:

	31.12.2015	31.12.2014
Interests (Note 36)	15,840,301	18,943,968
Decrease of 1 b.p. in the interest rate applied to the entire debt	(6,900,000)	(7,857,000)
Increase of 1 b.p. in the interest rate applied to the entire debt	6,900,000	7,857,000

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.

(amounts stated in Euro)

IV. Notes to the consolidated Financial statements

The bank loans, other loans and reimbursable subsidies reimbursement plan as well as the associated interests are as follows:

		31/12/2015
	2016	2017	2018	2019	>2019	Total
Bank loans
Capital	11,000,000	18,500,000	36,000,000	28,500,000	71,000,000	165,000,000
Interests (a)	3,646,350	3,403,260	2,994,427	2,198,860	1,569,035	13,811,932
Commercial paper
Capital	64,000,000	28,000,000	-	-	87,500,000	179,500,000
Interests (a)	5,657,355	3,640,248	2,757,764	2,757,764	2,757,764	17,570,894
Bond loans
Capital	-	-	105,000,000	109,376,900	85,000,000	299,376,900
Interests (a)	7,574,573	7,574,573	7,574,573	4,917,955	2,150,596	29,792,270
Other loans
Capital	41,918,791	-	-	-	-	41,918,791
Interests (a)	586,863	-	-	-	-	586,863
Reimbursable subsidies
Capital	558,872	3,115,183	3,121,502	7,468,303	3,734,151	17,998,011
Interests (a)	-	-	-	-	-	-
Total
Capital	117,477,663	49,615,183	144,121,502	145,345,203	247,234,151	703,793,702
Interests	17,465,141	14,618,081	13,326,764	9,874,578	6,477,395	61,761,958
	134,942,804	64,233,264	157,448,266	155,219,781	253,711,546	765,555,660

		31/12/2014
	2015	2016	2017	2018	>2018	Total
Bank loans
Capital	-	5,000,000	5,000,000	12,500,000	82,500,000	105,000,000
Interests (a)	2,991,300	2,991,300	2,848,857	2,706,414	2,350,307	13,888,178
Bank overdrafts
Capital	77,228	-	-	-	-	77,228
Interests (a)	1,390	-	-	-	-	1,390
Commercial paper
Capital	108,600,000	-	5,000,000	-	-	113,600,000
Interests (a)	4,040,811	177,853	177,853	-	-	4,396,517
Bond loans
Capital	251,300,682	-	-	75,000,000	200,000,000	526,300,682
Interests (a)	6,038,322	5,267,667	5,267,667	5,267,667	3,831,030	25,672,353
Other loans
Capital	40,722,848	-	-	-	-	40,722,848
Interests (a)	601,069	-	-	-	-	601,069
Reimbursable subsidies
Capital	9,082,810	558,872	3,115,183	3,051,390	4,998,364	20,806,619
Interests (a)	-	-	-	-	-	-
Total
Capital	409,783,568	5,558,872	13,115,183	90,551,390	287,498,364	806,507,377
Interests	13,672,892	8,436,820	8,294,377	7,974,081	6,181,337	44,559,507
	423,456,460	13,995,692	21,409,560	98,525,471	293,679,701	851,066,884

(a) Considering the available information related to the interest rates evolution and that the capital repayment occurs in the end of each year.

IV. Notes to the consolidated Financial statements (amounts stated in Euro)

22. ACCUMULATED PROVISIONS AND IMPAIRMENT LOSSES

The movements occurred in provisions and impairment losses during the years ended 31 December 2015 and 2014 can be detailed as follows:

	31/12/2015
	Provisions	Impairment losses in accounts receivable (Notes 13 and 14)	Impairment losses in inventories and biological assets (Note 11)	Total
Opening balance	5,073,481	2,572,513	5,266,162	12,912,156
Increases	300,000	1,150,000	3,000,000	4,450,000
Utilizations	(14,013)	(1,517)	-	(15,530)
Reversals	(296,727)	-	(501,373)	(798,100)
Closing balance	5,062,741	3,720,996	7,764,789	16,548,526

	31/12/2014
	Provisions	Impairment losses in accounts receivable (Notes 13 and 14)	Impairment losses in inventories and biological assets (Note 11)	Total
Opening balance	5,123,914	4,239,817	5,266,162	14,629,893
Increases	-	-	-	-
Utilizations	-	(1,639,673)	-	(1,639,673)
Reversals	(50,433)	(27,631)	-	(78,064)
Closing balance	5,073,481	2,572,513	5,266,162	12,912,156

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, during 2013, 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 2015 and 2014, 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 2015 and 2014, this caption is made up as follows:

	31.12.2015	31.12.2014
Suppliers of fixed assets (Note 31.2)	-	404,350

IV. Notes to the consolidated Financial statements (amounts stated in Euro)

24. OTHER NON CURRENT LIABILITIES

As on 31 December 2015 and 2014 this caption includes non-reimbursable investment subsidies to be recognized as income in the medium and long term (Notes 21 and 27) which are detailed as follows:

	31/12/2015			31/12/2014
	Total	Current (Note 27)	Non current	Total	Current (Note 27)	Non current
Celtejo
POE	1,101,467	403,476	697,991	1,504,943	557,395	947,548
PRIME	2,864,869	1,052,222	1,812,647	3,926,346	1,060,987	2,865,359
Other investment subsidies	-	-	-	-	-	-
	3,966,336	1,455,698	2,510,638	5,431,289	1,618,382	3,812,907
Celbi
PIN	22,569,645	2,958,170	19,611,475	25,621,960	3,039,485	22,582,475
	22,569,645	2,958,170	19,611,475	25,621,960	3,039,485	22,582,475
Caima Indústria
SIME	400,121	133,374	266,747	533,494	133,373	400,121
PRIME	-	-	-	-	-	-
QREN	471,174	94,897	376,277	501,703	62,713	438,990
Other investment subsidies	-	-	-	-	-	-
	871,295	228,271	643,024	1,035,197	196,086	839,111
Altri Florestal
Proder	1,264,979	175,955	1,089,024	395,719	61,595	334,124
	1,264,979	175,955	1,089,024	395,719	61,595	334,124
Viveiros
Proder	332,520	332,520	-	-	-	-
	29,004,775	5,150,614	23,854,161	32,484,165	4,915,548	27,568,617

25. SUPPLIERS

As of 31 December 2015 and 2014 this caption was made up as follows:

			Payable
	31.12.2015	0-90 days	90-180 days	>180 days
Suppliers, current account	41,880,360	41,880,360	-	-
Suppliers, invoices in conference	19,363,043	19,363,043	-	-
	61,243,403	61,243,403	-	-
			Payable
	31.12.2014	0-90 days	90-180 days	>180 days
Suppliers, current account	42,443,990	42,425,317	1,273	17,400
Suppliers, invoices in conference	19,242,368	19,242,368	-	-
	61,686,358	61,667,685	1,273	17,400

As of 31 December 2015 and 2014 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.

26. OTHER CURRENT CREDITORS

As of 31 December 2015 and 2014, the caption "Other current creditors" can be detailed as follows:

			Payable
	31.12.2015	0-90 days	90-180 days	>180 days
Suppliers of fixed assets	1,252,476	1,252,476	-	-
Other debts	2,655,929	2,573,330	9,908	72,691
	3,908,405	3,825,806	9,908	72,691
			Payable
	31.12.2014	0-90 days	90-180 days	>180 days
Suppliers of fixed assets	6,241,656	6,208,322	8,749	24,584
Other debts	7,929,215	7,496,366	37,134	395,715
	14,170,871	13,704,688	45,883	420,299

As of 31 December 2015 and 2014 the caption "Suppliers of fixed assets" includes the amounts of 492,092 Euro and 153,763 Euro, respectively, relating to financial leases (Note 31.2).

27. OTHER CURRENT LIABILITIES

As of 31 December 2015 and 2014, the caption "Other current liabilities" can be detailed as follows:

	31.12.2015	31.12.2014
Accrued expenses:
Amounts payable to employees	3,690,009	3,274,976
Interest payable	2,700,797	4,524,803
Rents	1,124,673	1,588,671
Costs with energy and gas	5,137,376	5,854,874
Discounts to be paid	1,317,624	3,870,317
Fluid rates to be paid	843,294	1,099,212
Other accrued expenses	13,973,441	9,722,589
Current deferred income:
Investment subsidies (Notes 21 and 24)	5,150,614	4,915,548
Others	109,213	53,502
	34,047,041	34,904,492

The caption "Other accrued expenses" in 2015 and 2014 corresponds to costs incurred with operational activities not yet settled.

28. DERIVATIVE FINANCIAL INSTRUMENTS

As of 31 December 2015 and 2014 the companies of the Group operated with contracts for derivatives related to hedge interest rate variations, 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. These contracts were evaluated by their fair value as of 31 December 2015 and 2014, and the correspondent amount has been recognized under the caption "Derivatives".

As of 31 December 2015 and 2014 there were established derivatives contracts which total amounts are as follows:

				Fair value	Fair value
Type	Amount	Maturity	Rate	31.12.2015	31.12.2014
Interest rate sw ap (a)	25,000,000	08/02/2015	Pays a combination of several interest rates and receives Euribor	-	(655,029)
Interest rate sw ap (b)	80,000,000	09/02/2015	Pays fixed interest rate and receives Euribor 6M	-	(1,247,268)
Interest rate sw ap (b)	5,000,000	16/04/2020	Pays fixed interest rate and receives Euribor 6M	(27,673)	-
Interest rate sw ap (b)	5,000,000	16/04/2020	Pays fixed interest rate and receives Euribor 6M	(35,581)	-
Interest rate sw ap (b)	5,000,000	16/04/2020	Pays fixed interest rate and receives Euribor 6M	(32,265)	-
Interest rate sw ap (b)	10,000,000	16/04/2020	Pays fixed interest rate and receives Euribor 6M	2,528	-
Interest rate sw ap (b)	5,000,000	16/04/2020	Pays fixed interest rate and receives Euribor 6M	(13,201)	-
Interest rate sw ap (b)	5,000,000	16/04/2020	Pays fixed interest rate and receives Euribor 6M	(30,594)	-
				(136,786)	(1,902,297)

(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)).

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.

At the beginning of 2015, at the entrance of their maturity, the derivatives were settled. The settlement value was very similar to the fair value at December 31, 2014.

(ii) Pulp price hedging derivatives

In order to reduce its exposure to volatility of pulp price, the Group signed pulp price hedging derivatives through the acquisition of asian put options on the "FOEX PIX Pulp BHKP ", for each month of 2016, with a volume of 5,000 tons per month (total of 60,000 tons).

(iii) Exchange rate derivatives

Altri uses exchange rate derivatives, mainly in order to hedge future cash flows. Thus, Altri, in the year of 2015, engaged some exchange rate forwards of U.S. dollars in order to manage the risk of exchange rate to which it is exposed.

The Group acquired European-style put options of the US dollar, with a volume of USD 7 million per month for the 1st half of 2016 and USD 3 million per month for the 2nd semester 2016.

The movement occurred in the fair value of the financial instruments during the years ended 31 December 2015 and 2014 can be detailed as follows:

2015	Pulp price hedging derivatives	Interest rates derivatives	Total
Opening balance	-	(1,902,297)	(1,902,297)
Derivative fair value variation/cessation
Effects on shareholders funds (Note 19)	-	134,470	134,470
Effects on the profit and loss statement (Note 36)	-	(272,764)	(272,764)
Effects on balance sheet	-	1,899,308	1,899,308
Closing balance	-	(141,283)	(141,283)
2014	Pulp price hedging derivatives	Interest rates derivatives	Total
Opening balance	720,362	(6,004,727)	(5,284,365)
Derivative fair value variation/cessation
Effects on shareholders funds (Note 19)	(720,362)	2,579,361	1,858,999
Effects on the profit and loss statement (Note 36)	-	1,523,069	1,523,069
Closing balance	-	(1,902,297)	(1,902,297)

During 2015, the gains and losses of the year associated to the fair value variation, in the non-matured part (as described in IAS 39), of the hedging instruments, in the amount of 134,470 Euro (1,858,999 Euro as of 31 December 2014), were directly recorded under equity's captions net of the respective deferred tax, in the amount of (62,096) Euro ((418,274) Euro as of 31 December 2014) (Notes 12 and 19).

The gains and losses for the year associated to the fair value variation, during 2015, 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 2015 (Note 36).

29. CONTINGENT LIABILITIES AND GUARANTEES

As of 31 December 2015 and 2014, the bank guarantees provided by Group companies can be detailed as follows:

	31.12.2015	31.12.2014
AICEP/API (Note 21)	7,676,315	13,839,190
Others	1,468,674	1,468,674
	9,144,989	15,307,864

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 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. 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.

In May 2014, the scheme associated to the Tejo Pension Fund was changed, passing from the defined benefit scheme to the defined contribution scheme. As on 30 April 2014, Celtejo's employees were given the choice to change to the defined contribution scheme. Caima and Altri Florestal permanent workers were automatically transferred to the defined contribution plan, with the exception of the workers that on 30 April 2014 were working in the company for more than ten years and were 57 years old or older, these were given the choice to change or to keep the defined benefit plan. As so, on 31 December 2015 both schemes co-existed.

Until 2013, Celbi granted to its employees, under indefinite employment contract, who retired while working for the company, a set of retirement benefits complements defined in the Regulations of the Company Pension Fund, published in the Official Republic diary No. 221 -III series, September 21, 1999, and subsequently amended by a Notice published in the Official Republic Diary No. 294-III series of 20 December 2002.

In 2014 Celbi changed to a defined contribution scheme. This change was approved by Instituto de Seguros de Portugal on 25 September 2014, but had effects since 1 May 2014 (costs with this plan are detailed in Note 40).

With this act, the value of the Fund was distributedby the participants in accordance with the liability for past services as of April 30, 2014, and the managing body opened an individual account in the name of each participant with this initial credit.

IV. Notes to the consolidated Financial statements (amounts stated in Euro)

From May 2014, Celbi makes a contribution to the Pension Fund, which varies annually depending on the results of the Altri Group, assigning each worker's permanent staff a percentage of their pensionable salary depending on the number of years of service.

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 2015, 2014, 2013 as well as the funds' patrimonial situation were as follows:

	2015
	Caima/Celtejo/Altriflorestal	Celbi	Total
Current responsabilities for past services	12,997,878	n.a.	12,997,878
Assets of pension funds	12,220,331	n.a.	12,220,331
	2014
	Caima/Celtejo/Altriflorestal	Celbi	Total
Current responsabilities for past services	14,984,919	n.a.	14,984,919
Assets of pension funds	14,950,902	n.a.	14,950,902
	2013
	Caima/Celtejo/Altriflorestal	Celbi	Total
Current responsabilities 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

n.a. – not applicable

The movement in the present value of responsibilities for past services during the years ended 31 December 2015 and 2014 is as follows:

	2015	2014
Responsabilities in the beginning of the year	14,984,919	23,051,996
Change to defined contribution	(2,266,405)	(7,951,521)
Benefits paid by the Pension Funds	(850,079)	(822,040)
Current services cost	104,179	189,576
Interest costs	697,035	707,067
Actuarial (gains)/losses	328,229	(190,159)
Responsabilities at year end	12,997,878	14,984,919

The change verified on pension funds' patrimonial situation during the years ended 31 December 2015 and 2014 is as follows:

	2015	2014
Pension funds value at the beginning of the year	14,950,902	23,236,599
Change to defined contribution	(1,955,466)	(8,140,208)
Pensions paid	(850,079)	(822,040)
Return on fund's assets	-	676,551
Others	74,974	-
Pension funds value at year end	12,220,331	14,950,902

Considering the difference between the value of responsibilities and the value of the pension funds on 31 December 2015, it was recorded a liability in the amount of 778,000 Euro in order to cover possible liabilities related with to pension plans in effect.

The responsibilities of Celtejo Pension Plan are based, at December 31, 2015, in the following assumptions:

• (i) Calculation method "Projected Unit Credit"
• (ii) Mortality Tables TV 88/90;
• (iii) Income/discount Rate 3.75%;
• (iv) Growth Wage Rate 1%

Characteristics of Celtejo Pension Fund at December 31, 2015:

• (i) Portfolio composition:
• a. 11.20% shares;
• b. 68.27% bonds at fixed rates;
• c. 10.30% bonds at variable rates;
• d. 10.23% liquidity and other assets.
• (ii) Expected return of the assets of the Plan in the long run 3.75%

The responsibilities of Celtejo Pension Plan are based, at December 31, 2014, 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, at December 31, 2014:

• (i) Portfolio composition:
• a. 13.64% shares;
  • b. 68.39% bonds at fixed rates;
  • c. 9.86% bonds at variable rates;
  • d. 10.11% liquidity and other assets.
• (ii) Expected return of the assets of the Plan in the long run 4.5%.
• b) Other commitments

As of 31 December 2015, the contractual obligations for the acquisitions of fixed assets assumed by the Group companies amounted to, approximately, 4,311,000 Euro (22,255,500 Euro as of 31 December 2014) (Note 7).

31. LEASE CONTRACTS

31.1 OPERATIONAL LEASES

During the year ended at 31 December 2015 it was recognized in the profit and loss statement an amount of, proximately, 10,150,000 Euro (9,800,000 Euro during the year ended at 31 December 2014) 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	2015	2014
Until 1 year	9,377,248	10,523,634
Between 1 and 5 years More than 5 years	35,406,375 77,802,569	33,295,243 96,224,287
	122,586,192	140,043,164

31.2 FINANCIAL LEASES

As of 31 December 2015 and 2014, the responsibilities reflected in the statement of financial position related to financial leases had the following maturity:

Year	2015	2014
Until 1 year (Note 26)	492,092	153,763
Between 1 and 5 years (Note 23) More than 5 years	- -	404,350 -
	492,092	558,113

As at December 31, 2015 and 2014, 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.

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 2015 and 2014 the balances and transactions with related parties are as follows:

	Purchases and services obtained		Sales and services rendered		Interest income
Transactions	31.12.2015	31.12.2014	31.12.2015	31.12.2014	31.12.2015	31.12.2014
Associated companies and joint ventures (a)	2,439,999	2,989,095	15,875,568	15,101,881	239,431	293,417
Other related parties (b)	8,286,852	8,185,557	132,238	124,305	-	-
	10,726,851	11,174,652	16,007,806	15,226,186	239,431	293,417
	Accounts payable		Accounts receivable		Loans granted
Balances	31.12.2015	31.12.2014	31.12.2015	31.12.2014	31.12.2015	31.12.2014
Associated companies and joint ventures (a)	284,249	46,356	2,550,399	2,165,278	11,544,780	11,553,565
Other related parties (b)	6,365,430	6,322,445	2,650,057	3,336,721	-	-
	6,649,680	6,368,801	5,200,456	5,501,999	11,544,780	11,553,565

• (a) All entities consolidated by the equity method at December 31, 2015 and 2014 according to Note 4.2 and available for sale investments as described in Note 4.3;
• (b) Were considered as related parties the companies listed below.

During the years ended 31 December 2015 and 2014, 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 2015 can be detailed as follows:

Actium Capital, S.G.P.S., S.A. Adcom Media Anúncios e Publicidade, S.A. Alteria, S.G.P.S., S.A. Caderno Azul, S.G.P.S., S.A. Cofihold, S.G.P.S., S.A. Cofina Media, S.A. Cofina, SGPS, S.A. Destak Brasil – Editora de Publicações, S.A. Destak Brasil – Empreendimentos e Participações, S.A. Elege Valor, S.G.P.S., S.A. F. Ramada – Investimentos, SGPS, S.A. F. Ramada II, Imobiliária, S.A. Grafedisport – Impressão e Artes Gráficas, S.A. Livrefluxo, S.G.P.S., S.A. Malva – Gestão Imobiliária, S.A. Mercados Globais – Publicação de Conteúdos, Lda. Ramada – Aços, S.A. Ramada Storax, S.A. Sociedade Imobiliária Porto Seguro – Investimentos Imobiliários, S.A. Storax Benelux, S.A. Storax España, S.L. Storax Limited Storax S.A. Torres da Luz – Investimentos Imobiliários, S.A. Universal Afir, S.A. Valor Autêntico, SGPS, S.A. VASP – Sociedade de Transportes e Distribuições, Lda.

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 2015 and 2014 amounted to 1,390,200 Euro and 1,412,195 Euro, respectively, corresponding only to fixed remuneration and were fully paid by the Company in 2015 and by its subsidiaries in 2014.

Under Article 3 28/2009 of 19 June, the Company hereby informs that the remuneration received by the Board members can be detailed as follows: Paulo Fernandes - 392,000 Euro; João Borges de Oliveira - 392,000 Euro; Domingos Matos - 225,400 Euro; Pedro Borges de Oliveira - 225,400 Euro; Ana Mendonça - 59,500 Euro; Laurentina Martins - 59,500 Euro; José Archer - 21,250 Euro; Pedro Mendonça - 15,150 Euro.

On December 31, 2015, there are not: (i) plans or incentive systems related to grant of shares to members of the Board, (ii) supplementary pensions or early retirement for directors, or (iiii) 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 present value of pensions in payment related with this director amounted to 418,859 Euro and no contribution to the fund was made in 2015.

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.

IV. Notes to the consolidated Financial statements

34. OTHER INCOME

(amounts stated in Euro)

As of 31 December 2015 and 2014, the caption "Other income" can be detailed as follows:

	31.12.2015	31.12.2014
Subsidies to investments and to exploitation	5,138,483	5,140,018
Gains on disposal or fixed assets	487,179	1,266,670
Gains on commodities derivate contracts (Note 28)	305,060	512,132
Others	1,920,132	3,260,383
	7,850,855	10,179,203

35. OTHER EXPENSES

As of 31 December 2015 and 2014, the caption "Other expenses" can be detailed as follows:

	31.12.2015	31.12.2014
Direct taxes and fees	1,775,215	1,827,048
Losses on commodities derivate contracts (Note 28)	28,355	-
CO2 License	706,000	286,731
Others	1,539,771	644,958
	4,049,341	2,758,737

36. NET FINANCIAL LOSSES

Consolidated net financial losses for the years ended 31 December 2015 and 2014 are made up as follows:

	31.12.2015	31.12.2014
Financial expense:
Interest (Note 21)	(15,840,301)	(18,943,968)
Exchange losses	(6,379,199)	(1,213,849)
Losses in derivatives	(3,257,100)	(2,953,653)
Other financial expenses	(6,468,939)	(11,394,993)
	(31,945,538)	(34,506,464)
Financial income:
Interest	2,584,521	4,833,916
Exchange gains	5,129,561	2,506,662
Other financial income	559,687	23,974
	8,273,770	7,364,552

The caption "Losses on derivatives" corresponds to the 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).

(amounts stated in Euro)

37. AMORTISATION AND DEPRECIATION

As of 31 December 2015 and 2014, the caption "Amortisation and Depreciation" can be detailed as follows:

	31/12/2015	31/12/2014
Tangible fixed assets (Note 7)	52,746,593	48,324,442
Investment properties (Note 8)	7,381	61,041
Intagible Assets (Note 10)	79,708	134,897
	52,833,682	48,520,380

38. EARNINGS PER SHARE

Earnings per share for the years ended 31 December 2015 and 2014 were determined taking into consideration the following amounts:

	31-12-2015	31-12-2014
Number of shares for the computation of basic and diluted earning	205,131,672	205,131,672
Net profit considered for the computation of basic and diluted earning	117,656,401	37,381,548
Earnings per share
Basic	0.57	0.18
Diluted	0.57	0.18

As of 31 December 2015 and 2014, 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 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 2015 and in 2014 by the Group, according to the geographic segments, were as follows:

	31.12.2015	31.12.2014
Domestic market	123,551,976	115,065,667
International market	533,422,409	427,612,875
	656,974,385	542,678,542

40. PAYROLL EXPENSES

During the years ended 31 December 2015 and 2014, the average number of employees of the companies included in the consolidated financial statements by the full consolidation method was of 666 and 662, respectively.

As of 31 December 2015 and 2014, the caption "Personnel expenses" can be detailed as follows:

	31.12.2015	31.12.2014
Remunerations	24,232,014	20,861,003
Social security contributions	4,735,135	4,365,067
Employee benefits	2,128,513	1,838,915
Indemnities	1,707,751	151,936
Insurances	671,754	655,855
Others	1,801,863	1,904,847
	35,277,030	29,777,623

41. EXTERNAL SUPPLIES AND SERVICES

As of 31 December 2015 and 2014, the caption "External Supplies and Services" can be detailed as follows:

	31.12.2015	31.12.2014
Energy	40,762,611	38,515,515
Transport of goods	30,612,214	21,659,963
Fuels	20,095,613	22,630,258
Plantations	16,156,437	14,346,594
Maintenance and repair	13,685,738	14,944,577
Rents and leasing	10,722,571	10,459,472
Others	30,801,023	29,483,490
	162,836,207	152,039,869

42. 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 2015 and 2014, were as follows:

	31.12.2015	31.12.2014
Statutory Audit (in Euro)	253,944	261,258
Other assurance services (in Euro)	198,044	144,234
Tax consulting services (in Euro)	55,453	62,468
Other services (in Euro)	152,155	165,480
	659,596	633,440

43. ALLOCATION OF NET PROFIT

As regards the year 2014, the Board of Directors proposed in its annual report that the individual net profit of Altri, SGPS, S.A. amounting to 18,627,109.20 Euro would be transferred to Legal Reserves - 931,355.46 Euro, to Free Reserves - 1,285,219.98 Euro and the amount of 16,410,533.76 to dividends. These proposals were approved by the General Shareholders' Meeting held on April 14, 2015.

In 2015, it was approved an advance on the net profit of the 2015 financial year in the amount of 51,282,918 Euro.

Considering the net profit for the year and the advance on profits of the 2015 financial year of 51,282,918.00 Euro already paid, the Board of Directors proposes in its annual report the individual net profit of Altri, SGPS, S.A., amounting to 103,489,990.30 Euro, to be allocated as follows:

Legal reserve	791,793.55
Free reserves	132,360.75
Dividends distribution	102,565,836.00 * -----------------------
	103,489,990.30
	=============

* The total dividend per share amounts to 0.50 Euro per share in 2015; taking into account that in November 2015 was approved an advance on profits of the 2015 financial year, the remaining amount to be distributed to shareholders will be 51,282,918 Euro, corresponding to 0.25 Euro per share.

44. 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 91,633 tons of carbon dioxide in 2015. 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 2012, the Group does not expect this legislation to carry significant additional costs.

As of 31 December 2015 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.

45. FINANCIAL STATEMENTS APPROVAL

The financial statements were approved by the Board of Directors and authorized for issuance on 24 March 2016. The final approval depends on the agreement of the General Shareholders Meeting.

46. 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.

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The chartered accountant The Board of Directors

Paulo Jorge dos Santos Fernandes

____________________________________________________ João Manuel Matos Borges de Oliveira

____________________________________________________ Domingos José Vieira de Matos

Laurentina da Silva Martins

Pedro Miguel Matos Borges de Oliveira

____________________________________________________ Ana Rebelo de Carvalho Menéres de Mendonça

José Manuel de Almeida Archer

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 46)

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 2015 which comprise the Consolidated and Individual Statements of Financial Position as of 31 December 2015 (that present a total consolidated and individual net assets of 1,195,241,378 Euro and 282,030,026 Euro, respectively, and consolidated and individual equity of 322,349,568 Euro and 97,684,622 Euro, respectively, including a consolidated net profit attributable to the Company's shareholders of 117,656,401 Euro and an individual net profit of 103,489,990 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.

Page 2 of 2

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 2015, 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, 29 March 2016

______________________________________ Deloitte & Associados, SROC S.A. Represented by Jorge Manuel Araújo de Beja Neves

REPORT AND OPINION OF THE STATUTORY AUDIT BOARD

(Translation of a report originally issued in Portuguese – Note 46)

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 2015, 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 2015, 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 2015, 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. Statement of Responsibility

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 2015. 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, 29 March 2016

The Statutory Audit Board

Pedro Pessanha President of the Statutory Audit Board

André Seabra Ferreira Pinto Member of the Statutory Audit Board

José Guilherme Barros Silva Member of the Statutory Audit Board

ALTRI, SGPS, S.A.

Rua do General Norton de Matos, 68 - R/C 4050 – 424 Porto PORTUGAL Phone: + 351 22 834 65 02

www.altri.pt