Altri SGPS — Interim / Quarterly Report 2011

Nov 11, 2011

ALTRI, SGPS, S.A. Public Company

Head Office: Rua do General Norton de Matos, 68, r/c – Porto Fiscal Number: 507 172 086 Share Capital: 25.641.459 Euro

Financial Information – 3rd Quarter of 2011 (Unaudited)

Operational activity

During the first nine months of 2011, total revenues excluding financial income, reached 370 million euro, representing a decrease of 1% compared with the same period of the previous year.

The three Altri industrial units, Celbi, Caima and Celtejo, produced and sold 624.6 and 607.2 thousand tons of pulp, respectively.

During this period, net revenues of electric power, liquor and bark amounted to 23.2 million euro. On the same period of the previous year, it amounted to 21.8 million euro.

Operational costs (excluding amortizations) reached 278.4 million euro, rising 13% compared with the same period of 2010.

Cost increases result from the rising wood cost, mainly from the wood imports. It is expected that these costs will slightly decrease during the rest of the year.

EBITDA over 91 million euro

EBITDA reached 91.1 million euro in the first nine months of 2011, representing a 29% decrease compared with EBITDA obtained in the first nine months of 2010. EBITDA margin for the period was 24.7%.

EBIT reached 51.5 million euro, representing a 42% decrease relatively to the same period of 2010.

Net income after minority interest reached 23.1 million euro.

Income Statement of Sep11 vs. Sep10

Financial information was prepared in accordance with the International Financial Reporting Standards (IFRS).

thousand euros	9M 2011*	9M 2010*	9M11/9M10 Var%
Sales	358.518	364.507	-1,6%
Services rendered	4.680	1.206	288,1%
Other income	6.339	7.977	-20,5%
Total revenues	369.536	373.690	-1,1%
Costs of sales	150.503	116.743	28,9%
External supplies and services	94.554	89.148	6,1%
Payroll expenses	24.472	22.868	7,0%
Provisions and impairment losses	-44	156	-
Other expenses	8.930	16.879	-47,1%
Total expenses (a)	278.415	245.795	13,3%
EBITDA (b)	91.121	127.895	-28,8%
Margin	24,7%	34,2%	-9,6 pp
Amortisation and depreciation	39.654	38.526	2,9%
EBIT (c)	51.466	89.369	-42,4%
Margin	13,9%	23,9%	-10,0 pp
Gains and losses in associated companies and joint ventures	872	838	4,1%
Financial expenses	-30.833	-27.679	11,4%
Financial income	6.225	1.966	216,7%
Financial profit	-23.736	-24.876	-4,6%
Profit before income tax	27.730	64.493	-57,0%
Income tax Minority interests	-4.596 -1	-17.617 5	-73,9% -126,6%
Profit for the period from discountinued operations attributable to parent company's shareholders	23.136	46.871	-50,6%
Profit for the period from discountinued operations	-37	469	s s
Consolidates net profit attributable to parent company's shareholders	23.099	47.340	-51,2%

* Considering the subsidiary in descontinuation

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

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

(c) EBIT = Earnings before interest and taxes

Financial Information – 3Q 2011

3Q11 Main indicators

During the 3rd quarter of 2011, total revenues reached 118.8 million euro, representing a decrease of 5% compared with the 2 nd quarter of 2011. During this period, Altri produced 216.4 thousand tons of pulp (219.1 thousand tons on the 2nd quarter of 2011) and sold 206.7 thousand tons (201.9 thousand tons in the 2nd quarter of 2011). During the 3rd quarter, the selling price of the pulp (PIX) dropped 3.8% in Europe, while in Asia and spot markets there have been stronger drops.

Net revenues of electric power, liquor and bark amounted, during the 3 rd quarter of 2011, to 6.4 million euro. In the previous quarter it amounted to 9.1 million euro. This decrease was related with the strong increase of the electricity price in the 3rd quarter.

Operating costs drop by 4% in the quarter

Operational costs (excluding amortizations) reached 90.7 million euro, decreasing approximately 4% compared with the 2 nd quarter of 2011. This reduction was driven primarily by a decrease of 8% in cost of sales relating mostly to the cost of wood.

2011 Quarterly analysis of "Cost of Sales" (thousand euro)

The line "Staff costs" include about 1.3 million euro related to reorganization costs. Not considering these costs, the evolution of this line would be only 1.2% when compared with the same period of the last year.

Financial Information – 3Q 2011

Income Statement of 3Q11

thousand euros	3Q 2011*	3Q 2010*	2Q 2011*	3Q11/3Q10 Var%	3Q11/2Q11 Var%
	114.759	131.786	121.694
Sales Services rendered	2.209	31	1.430	-12,9% s.s	-5,7% 54,5%
Other income	1.831	991	1.879	84,7%	-2,5%
Total revenues	118.799	132.809	125.003	-10,5%	-5,0%
Costs of sales	46.812	39.300	50.992	19,1%	-8,2%
External supplies and services	33.120	29.196	31.740	13,4%	4,3%
Payroll expenses	8.543	7.829	8.389	9,1%	1,8%
Provisions and impairment losses	-44	56	0	-	-
Other expenses	2.305	7.518	3.130	-69,3%	-26,4%
Total expenses (a)	90.736	83.900	94.251	8,1%	-3,7%
	28.063	48.909	30.752	-42,6%	-8,7%
EBITDA (b)
Margin	23,6%	36,8%	24,6%	-11,3 pp	-1,1 pp
Amortisation and depreciation	13.278	12.850	12.960	3,3%	2,5%
EBIT (c)	14.785	36.059	17.792	-59,0%	-16,9%
Margin	12,4%	27,2%	14,2%	-12,1 pp	-0,8 pp
Gains and losses in associated companies and joint ventures	515	660	608	-22,0%	-15,4%
Financial expenses	-11.581	-10.333	-10.008	12,1%	15,7%
Financial income	2.857	743	1.537	s.s	85,9%
Financial profit	-8.210	-8.930	-7.863	-8,1%	4,4%
Profit before income tax	6.575	27.129	9.929	-75,8%	-33,8%
Income tax	-1.227	-6.878	-1.336	-82,2%	-8,1%
Minority interests	-2	4	3	-149,6%	s.s.
Profit for the period from discountinued operations attributable
to parent company's shareholders	5.350	20.246	8.590	-73,6%	-37,7%
Profit for the period from discountinued operations	-48	401	-9	s s	s s
Consolidates net profit attributable to parent company's shareholders	5.303	20.647	8.581	-74,3%	-38,2%

* Considering the subsidiary in descontinuation

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

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

(c) EBIT = Earnings before interest and taxes

Investment and debt

Total investment (CAPEX) during the first 9 months of 2011 was 11.9 million euro.

Altri's nominal remunerated net debt net of cash and investments available for sale as of 30 September 2011 was 722.1 million euro. During the 3 rd quarter, the group increased its outflows due mainly to the working capital variation of 20.8 million euro, when compared with the same period of the previous year.

The average cost of net debt amounts to 4.5%.

Detail of the remunerated net debt

million euros	30-Sep-11	31-Dec-10
Cash and cash equivalents	70,8	129,8
Investments available for sale	10,1	10,1
Bank loans and overdrafts	166,5	166,6
Other remunerated liabilities	22,5	22,5
Commercial paper	239,0	274,5
Bonds	375,0	395,0
Remunerated net debt	722,1	718,7

Financing needs are fully assured. Altri holds 65 million euro in available financing lines not used.

Financial Information – 3Q 2011

Condensed Balance sheet

million euros	9M 2011	2010	Var%
Biological assets	100,9	93,6	8%
Tangible assets	469,8	500,5	-6%
Goodwill	265,5	269,6	-2%
Investments available for sale	10,1	10,1	0%
Others	22,6	26,6	-15%
Total non current assets	868,9	900,4	-4%
Inventories	73,4	49,5	48%
Customers	82,2	92,1	-11%
Cash and cash equivalents	70,8	129,9	-45%
Others	30,2	18,6	63%
Assets in discontinuation	8,2	0,0	-
Total current assets	264,8	290,1	-9%
Total assets	1.133,7	1.190,5	-5%
Shareholders's equity and minority interests	139,8	115,2	21%
Bank loans	117,0	139,2	-16%
Other loans	539,1	548,5	-2%
Others	22,2	26,8	-17%
Total non current liabilities	678,4	714,4	-5%
Bank loans	34,1	27,0	26%
Other current loans	132,7	154,7	-14%
Suppliers	60,2	82,7	-27%
Others	85,2	96,6	-12%
Liabilities associated with assets in discontinuation	3,4	0,0
Total current liabilities	315,5	360,9	-13%
Total liabilities	993,9	1.075,3	-8%

Pulp market

The 3 rd quarter of 2011 was marked by a sharp decrease in the demand for pulp followed by a drop on the sales price, when compared with the previous quarters. The price in Europe of eucalyptus pulp (BEKP) began the quarter at 850 USD / ton and ended at about 750 USD / ton.

During the 1st quarter of 2011, the global demand increased 10% compared with the same period of the previous year. On the 2nd and 3rd quarters, global demand increased about 5%. Nevertheless, the demand on Western Europe in the 3rd quarter of 2011 was strongly affected by macroeconomic instability driven by the sovereign debt crisis in the region, having fallen 10% during this period (year on year).

The average market price of BEKP during the first nine months of 2011 was 848 USD / ton, which resulted in 604 € / ton.

Market price evolution in BEKP pulp in € (source: FOEX): 2002-Sep11

Altri – business profile

Altri is a reference in European eucalyptus pulp producers. In addition to pulp production, the Company is also present in the renewable power production business from forest base sources namely industrial cogeneration through black liquor and biomass. The forestry strategy is based on the full use of all the components provided by the forest: pulp, black liquor and forest wastes.

Currently, Altri manages over 84,000 hectares of forest in Portugal. The company obtained certification from the Programme for the Endorsement of Forest Certification (PEFC), one of the most worldwide acknowledged certification entities.

Nowadays, Altri's major assets are three pulp mills, with a total capacity above 785 thousand tons/year of bleached eucalyptus pulp in 2010. In a full speed stage, Altri's nominal production capacity will be 900.000 tons/year.

Altri's organic structure is as follows:

Oporto, November 2nd , 2011

CONSOLIDATED FINANCIAL STATEMENTS

ALTRI, SGPS, S.A.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 SEPTEMBER 2011 AND 31 DECEMBER 2010

(Translation of financial statements originally issued in Portuguese – Note 21) (Amounts expressed in Euro)

ASSETS	Notes	30.09.2011	31.12.2010
NON CURRENT ASSETS:
Biological assets		100.863.348	93.551.872
Tangible fixed assets		469.792.057	500.486.555
Investment property		509.035	214.213
Goodwill		265.531.404	269.593.886
Intangible assets		196.993	523.807
Investments in associated companies and joint ventures	4.2	6.705.548	10.721.629
Investments available for sale	4.3	10.089.935	10.101.484
Other non current assets		1.125.708	516.976
Deferred tax assets	7	14.081.918	14.712.478
Total non current assets		868.895.946	900.422.900
CURRENT ASSETS:
Inventories		73.376.873	49.548.856
Customers		82.245.084	92.068.214
Other debtors		6.207.689	4.569.242
State and other public entities		19.416.021	7.733.949
Other current assets		4.602.029	6.265.601
Cash and cash equivalents	6	70.808.795	129.867.635
		256.656.491	290.053.497
Assets classified as held for sale or discontinued	4.4	8.185.173	-
Total current assets		264.841.664	290.053.497
Total assets		1.133.737.610	1.190.476.397
SHAREHOLDERS' FUNDS AND LIABILITIES		30.09.2011	31.12.2010
SHAREHOLDERS' FUNDS:
Share capital	8	25.641.459	25.641.459
Legal reserve		2.862.981	2.862.981
Other reserves		88.135.856	24.531.445
Consolidated net profit / (loss)		23.098.880	62.014.069
Total shareholders' funds attributable to the parent company's shareholders		139.739.176	115.049.954
Non controlling interests		107.950	112.365
Total Shareholders' funds		139.847.126	115.162.319
LIABILITIES:
NON CURRENT LIABILITIES:
Bank loans	9	132.019.840	139.152.447
Other loans	9	524.128.789	548.481.286
Other non current creditors		-	373.396
Other non current liabilities		19.458.599	23.628.430
Deferred tax liabilities	7	772.290	777.344
Provisions	10	1.980.728	1.980.728
Total non current liabilities		678.360.246	714.393.631
CURRENT LIABILITIES:
Bank loans Other loans	9 9	34.082.923 132.676.397	26.959.384 154.668.303
Suppliers		60.151.314	82.686.678
Other current creditors		36.202.260	39.869.439
State and other public entities		9.508.224	13.606.447
Other current liabilities		24.936.990	19.673.418
Derivatives	11	14.584.616	23.456.778
		312.142.724	360.920.447
Liabilities associated with assets classified as held for sale or discontinued	4.4	3.387.514	-
Total current liabilities		315.530.238	360.920.447
Total shareholders' funds and liabilities		1.133.737.610	1.190.476.397

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

ALTRI, SGPS, S.A.

CONSOLIDATED STATEMENTS OF PROFIT AND LOSS FOR THE NINE AND THREE MONTHS PERIODS ENDED 30 SETEMBER 2011 AND 2010

(Translation of financial statements originally issued in Portuguese – Note 21) (Amounts expressed in Euro)

		NINE MONTHS PERIODS ENDED				QUARTER ENDED
	Notes	30.09.2011*	30.09.2010*	30.09.2010	30.09.2011*	30.09.2010*	30.09.2010
Continuing operations
Sales		358.517.800	364.506.950	369.413.689	114.759.294	131.785.970	133.471.866
Services rendered		4.679.534	1.205.702	1.205.702	2.208.925	31.473	31.473
Other income	14	6.338.602	7.977.288	8.113.906	1.831.077	991.277	1.014.619
Cost of sales		(150.503.313)	(116.743.001)	(119.111.408)	(46.811.933)	(39.300.141)	(40.056.716)
External supplies and services		(94.554.320)	(89.148.426)	(90.960.796)	(33.120.002)	(29.196.433)	(29.883.470)
Payroll expenses		(24.472.401)	(22.868.379)	(23.164.850)	(8.543.186)	(7.829.445)	(7.931.123)
Amortisation and depreciation		(39.654.164)	(38.526.019)	(38.916.170)	(13.277.726)	(12.850.342)	(12.976.617)
Provisions and impairment losses	10	44.304	(155.877)	(158.624)	44.304	(55.877)	(58.624)
Other expenses	15	(8.929.651)	(16.879.110)	(17.037.935)	(2.305.387)	(7.517.742)	(7.569.285)
Gains and losses in associated companies and joint ventures	12	871.739	837.770	837.770	514.588	659.854	659.854
Financial expenses	12	(30.833.099)	(27.679.330)	(27.725.905)	(11.581.463)	(10.332.812)	(10.343.394)
Financial income	12	6.225.423	1.965.531	1.965.531	2.856.882	742.861	742.861
Profit before income tax		27.730.454	64.493.099	64.460.910	6.575.373	27.128.643	27.101.444
Income tax		(4.595.959)	(17.616.507)	(17.616.630)	(1.227.257)	(6.878.200)	(6.878.243)
Net profit		23.134.495	46.876.592	46.844.280	5.348.116	20.250.443	20.223.201
Attributable to:
Parent company's shareholders	13	23.135.916	46.871.240	46.838.928	5.350.099	20.246.444	20.219.202
Non controlling interests		(1.421)	5.352	5.352	(1.983)	3.999	3.999
Discontinued operations
Profit/(loss) for the period from discontinued operations	4.4	(37.036)	468.953	501.265	(47.582)	400.612	427.854
Attributable to:
Parent company's shareholders		(37.036)	468.953	501.265	(47.582)	400.612	427.854
Non controlling interests		-	-	-	-	-	-
Consolidated net profit		23.097.459	47.345.545	47.345.545	5.300.534	20.651.055	20.651.055
Attributable to:
Parent company's shareholders	13	23.098.880	47.340.193	47.340.193	5.302.517	20.647.056	20.647.056
Non controlling interests		(1.421)	5.352	5.352	(1.983)	3.999	3.999
		23.097.459	47.345.545	47.345.545	5.300.534	20.651.055	20.651.055
Earnings per share:
Continuing operations
Basic	13	0,11	0,23	0,23	0,03	0,10	0,10
Diluted	13	0,11	0,23	0,23	0,03	0,10	0,10
Continuing and discontinued operations
Basic	13	0,11	0,23	0,23	0,03	0,10	0,10
Diluted	13	0,11	0,23	0,23	0,03	0,10	0,10

* Considering the subsidiary Sócasca - Recolha e Comércio de Recicláveis, S.A. in descontinuation (Note 4.4)

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

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE NINE AND THREE MONTHS PERIODS ENDED 30 SEPTEMBER 2011 AND 2010

(Translation of financial statements originally issued in Portuguese – Note 21) (Amounts expressed in Euro)

			NINE MONTHS PERIODS ENDED	QUARTER ENDED
	Notes	30.09.2011	30.09.2010	30.09.2011	30.09.2010
Net consolidated profit / (loss) for the period		23.097.459	47.345.545	5.300.534	20.651.055
Change in fair value of cash flow hedging derivatives	11	5.712.261	(7.951.188)	832.382	11.949.406
Other comprehensive income		5.712.261	(7.951.188)	832.382	11.949.406
Total comprehensive income for the period		28.809.720	39.394.357	6.132.916	32.600.461
Attributable to: Shareholders' of the parent company Non controlling interests		28.811.141 (1.421)	39.389.005 5.352	6.134.899 (1.983)	32.596.462 3.999

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

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITYFOR THE NINE AND THREE MONTHS PERIODS ENDED 30 SEPTEMBER 2011 AND 2010

(Translation of financial statements originally issued in Portuguese – Note 21) (Amounts expressed in Euro)

				Attr ibut abl the e to	t co pa ren mp any	's s har eho lde rs
					Oth er r ese rve s
					Oth ers and res erv es				Non	Tot al
				Hed ing g	reta ine d	Tot al o the rs			trol ling con	sha reh old er's
	Not es	Sha ital re c ap	Leg al r ese rve	res erv es	nin ear gs	res erv es	ofit Ne t pr	Tot al	inte ts res	fun ds
Bal f 1 Jan y 2 010 anc e a s o uar		25. 641 .45 9	2.8 62. 981	(10 .20 5.9 00)	50. 285 .29 1	40. 079 .39 1	(10 .91 0.0 16)	673 .81 57. 5	109 .37 1	783 .18 6 57.
App riat ion of t he sol idat ed fit o f 20 09 net rop con pro		-	-	-	(10 .91 0.0 16)	(10 .91 0.0 16)	10. 910 .01 6	-	-	-
Oth ers		-	-	-	48. 751	48. 751	-	48. 751	-	48. 751
Tot al c hen sive inc e fo r th erio d om pre om e p		-	-	(7. 951 .18 8)	-	(7. 951 .18 8)	47. 340 .19 3	39. 389 .00 5	5.3 52	39. 394 .35 7
Bal f 30 Se mb er 2 010 pte anc e a s o		25. 641 .45 9	2.8 62. 981	(18 .15 7.0 88)	39. 424 .02 6	21. 266 .93 8	47. 340 .19 3	97. 111 .57 1	114 .72 3	97. 226 .29 4
Bal f 1 Jan y 2 011 anc e a s o uar		25. 641 .45 9	2.8 62. 981	(14 .85 5.8 70)	39. 387 .31 5	24. 531 .44 5	62. 014 .06 9	115 .04 9.9 54	112 .36 5	115 .16 2.3 19
App riat ion of t he sol idat ed net fit o f 20 10 rop con pro		-	-	-	62. 014 .06 9	62. 014 .06 9	(62 69) .01 4.0	-	-	-
Div ide nds	19	-	-	-	(4. 3) 102 .63	(4. 3) 102 .63	-	(4. 3) 102 .63	-	(4. 3) 102 .63
Oth ers		-	-	-	(19 6) .28	(19 6) .28	-	(19 6) .28	(2. ) 994	(22 0) .28
Tot al c hen sive inc e fo r th erio d om pre om e p		-	-	5.7 12. 261	-	5.7 12. 261	23. 098 .88 0	28. 811 .14 1	(1. ) 421	28. 809 .72 0
Bal f 30 Se mb pte er 2 011 anc e a s o		25. 641 .45 9	2.8 62. 981	(9.1 ) 43. 609	97. 279 .46 5	88. 135 .85 6	23. 098 .88 0	139 .73 9.1 76	107 .95 0	139 .84 7.1 26

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

The official chartered accountant

The Board of Directors

ALTRI , SGPS, S.A.

CONDENSED CONSOLIDATED CASH-FLOW STATEMENTS

FOR THE NINE AND THREE MONTHS PERIODS ENDED 30 SEPTEMBER 2011 AND 2010

(Translation of financial statements originally issued in Portuguese – Note 21)

(Amounts expressed in Euro)

		NINE MONTHS PERIODS ENDED		QUARTER ENDED
	Notes	30.09.2011	30.09.2010	30.09.2011	30.09.2010
Operating activities:
Cash flow from operating activities (1)		29.843.726	80.097.608	7.944.728	32.792.084
Investment activities:
Collections relating to:
Investments	18	5.060.000	1.175.000	565.000	-
Tangible assets		1.776.300	221.357	361.563	(37.196)
Investment subsidies		-	887.948	-	887.948
Interest and similar income		5.030.401	2.793.812	2.941.289	651.535
Payments relating to:
Investments		(16.259)	-	-	-
Intangible assets		(1.006.908)	(450.000)	(793.136)	(450.000)
Tangible assets		(16.367.455)	(20.936.373)	(4.710.053)	(4.164.483)
Cash flow from investment activities (2)		(5.523.921)	(16.308.256)	(1.635.337)	(3.112.196)
Financing activities:
Collections relating to:
Loans obtained		35.360.002	28.295.620	16.352.205	15.120.620
Payments relating to:
Loans obtained		(81.615.458)	(52.144.915)	(78.615.458)	(17.482.048)
Lease contracts		(16.187)	(160.492)	(16.187)	(53.499)
Interest and similar costs		(33.325.052)	(23.613.769)	(14.734.156)	(10.354.553)
Dividends	19	(4.102.633)	-	-	-
Cash flow from financing activities (3)		(83.699.328)	(47.623.556)	(77.013.596)	(12.769.480)
Cash and cash equivalents at the beginning of the period		129.653.370	77.632.800	140.871.958	76.888.188
Effect of change in the companies consolidated		(115.072)	-	-	-
Variation of cash and cash equivalents: (1)+(2)+(3)		(59.379.523)	16.165.796	(70.704.205)	16.910.408
Cash and cash equivalents at the end of the period	6	70.158.775	93.798.596	70.167.753	93.798.596

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

(Translation of notes originally issued in Portuguese – Note 21)

(Amounts expressed in Euro)

1. INTRODUCTORY NOTE

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

Altri was incorporated as a result of the reorganization process of Cofina, SGPS, S.A. occurred in 2005, through the spin-off of the investment previously held by this group in Celulose do Caima, SGPS, S.A. (representing 97.23% of this company's share capital), under a simple demerger operation predicted in item 1.a), article 118 of the Commercial Companies Code ("Código das Sociedades Comerciais").

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 eucalyptus paper pulp through three production mills (Celbi in Figueira da Foz, Caima in Constância do Ribatejo and Celtejo in Vila Velha de Ródão).

Due to this new reality of Altri Group, the Board of Directors believes that there is only one business segment (production and commercialization of bleached eucalyptus paper pulp) and management's information is also analyzed on this basis, for which the segmental information mentioned in Note 16 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.

2. MAIN ACCOUNTING POLICIES AND BASIS FOR PRESENTATION

The consolidated financial statements as of 30 September 2011 were prepared using accounting policies consistent with the International Financial Reporting Standards and in accordance with International Accounting Standard 34 – Interim Financial Reporting and includes the statement of financial position, the statement of profit and loss, the statement of comprehensive income, the statement of changes in equity and the condensed statement of cash flows as well as the selected explanatory notes.

The accounting policies used in the preparation of the consolidated financial statements of Altri are consistent with those used in the year ended 31 December 2010, being the accounting policies relating to joint ventures, and relating to investment property, as follows:

(i) Joint ventures

Investments in joint ventures (Altri has joint control of a company when it has shared participation in the financial and operating decisions of that company - usually investments representing 50% of the company's share capital) are recorded under the equity method.

Under the equity method, financial investments in joint ventures are initially recorded at acquisition cost, which is increased or decreased by the amount corresponding to the proportion of the equity of these companies, reported at the date of acquisition or at the first application of the equity method. Investments are then adjusted annually, recording as profits or losses the amount corresponding to the net profits of the jointly controlled companies. Dividends from these companies are recorded as a reduction of investment value, and the proportional changes in equity is recorded as a variation of the equity of the Group.

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

An evaluation of investments held in joint ventures 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 reversed in the statement of profit and losses of the period.

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

(Translation of notes originally issued in Portuguese – Note 21)

(Amounts expressed in Euro)

(ii) Investment property

Investment property represents Altri's property which is not related to the activity of the Group, not intended for use in the production or supply of goods or services, or for administrative purposes, or for sale in the ordinary course of business.

Investment property is initially measured at cost (which includes transaction costs) and, subsequently, maintained at acquisition or production cost, deducted from any accumulated impairment losses.

3. CHANGES IN ACCOUNTING POLICIES AND CORRECTION OF MISTAKES

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

Additionally, considering the specific nature of each item, some reclassifications and redenomination were made at the consolidated statement of financial position as of 31 December 2010, which, although not distorting in a material way such consolidated financial statements, contribute to a better understanding of them, as follows:

• (i) The caption "Investments in associated companies" was renamed to "Investments in associated companies and joint ventures";
• (ii) The caption "Consolidation differences" was renamed to "Goodwill";
• (iii) Other reclassifications:

		31-12-2010
	Initial version	Reclassifications	Final version
Tangible fixed assets	500.152.206	334.349	500.486.555
Investment property	-	214.213	214.213
Investments available for sale	10.650.046	(548.562)	10.101.484

4. INVESTMENTS

4.1 INVESTMENTS IN SUBSIDIARIES

The companies included in the consolidated financial statements by the full consolidation method, their headquarters, percentage participation held and main activity as of 30 September 2011 and 31 December 2010, are as follows:

Company	Head Office		Percentage Held	Activity
Holding-Company: Altri, SGPS, S.A.	Oporto	2011	2010	Investment management
Group Caima / Celtejo / Celbi:
Celulose do Caima, SGPS, S.A.	Lisbon	100%	100%	Investment management
Caima Indústria de Celulose, S.A.	Lisbon	100%	100%	Production and commercialization of pulp
Altri Florestal, S.A.	Lisbon	100%	100%	Sylvan exploration
Caima Energia – Empresa de Gestão e Exploração de Energia, S.A.	Lisbon	100%	100%	Production of thermal and electrical energy
Invescaima – Investimentos e Participações, SGPS, S.A.	Lisbon	100%	100%	Investment management
Inflora – Sociedade de Investimentos Florestais, S.A.	Lisbon	100%	100%	Sylvan exploration
Sócasca – Recolha e Comércio de Recicláveis, S.A. (a)	Águeda	100%	100%	Commercialization of recycled products
Celtejo – Empresa de Celulose do Tejo, S.A.	Vila Velha de Ródão	99,83%	99,83%	Production and Commercialization of pulp
Altri - Energias Renováveis, SGPS, S.A.	Lisbon	99,83%	99,83%	Investment management
Celulose Beira Industrial (Celbi), S.A.	Figueira da Foz	100%	100%	Production and Commercialization of pulp
Celbinave – Tráfego e Estiva SGPS, Unipessoal, Lda.	Figueira da Foz	100%	100%	Freightage of ships
Viveiros do Furadouro Unipessoal, Lda.	Óbidos	100%	100%	Production of plants in nurseries and services related w ith forests and landscapes
Altri, Participaciones Y Trading, S.L.	Madrid, Spain	100%	100%	Investment management and commercialization of pulp
Altri Sales, S.A.	Nyon, Sw itzerland	100%	100%	Commercialization of pulp
Pedro Frutícola, Sociedade Frutícola, Lda.	Constância	100%	100%	Agriculture production
Captaraíz Unipessoal, Lda.	Lisbon	100%	100%	Property buying and selling

(Translation of notes originally issued in Portuguese – Note 21)

(Amounts expressed in Euro)

(a) – company whose assets and liabilities were classified as discontinued since 2011 (Note 4.4)

All the above companies were included in the consolidated financial statements in accordance with the full consolidation method.

4.2 INVESTMENTS IN ASSOCIATED COMPANIES AND JOINT VENTURES

The associated companies and joint ventures included in the Altri Group consolidation in accordance with the equity method, percentage of capital held and main activity as of 30 September 2011 and 31 December 2010 are as follows:

Company	Percentage held		Activity
	2011	2010
Associated companies:
Operfoz – Operadores do Porto da Figueira da Foz, Lda.	33,33%	33,33%	Harbor operations
Joint ventures:
EDP – Produção Bioeléctrica, S.A.	50%	50%	Electric energy production

The book value, net assets, share capital and net profit for the period ended on 30 September 2011 for these associated companies and joint ventures are as follows:

Company	Book value (a)	Net Assets	Equity	Net profit
Associated companies:
Operfoz – Operadores do Porto da Figueira da Foz, Lda.	376.642	3.698.353	1.213.384	235.747
Joint ventures:
EDP – Produção Bioeléctrica, S.A.	6.328.906	156.031.973	8.098.282	1.323.785
	6.705.548

(a) – includes loans granted.

4.3 INVESTMENTS AVAILABLE FOR SALE

As of 30 September 2011 and 31 December 2010 the investments available for sale and their book value as of those dates, are as follows:

Company	Book value
	2011	2010
Rigor Capital - Produção de Energia. Lda.	10.000.000	10.000.000
Others investments	89.935	101.484
	10.089.935	10.101.484

The caption "Investments available for sale" includes financial investments below 20% in companies where the Group has no significant influence on the management.

4.4 ASSETS CLASSIFIED AS HELD FOR SALE OR DISCONTINUED

During the period ended 30 September 2011 Altri Group started negotiations aiming to sell in the short term its subsidiary Socasca – Recolha e Comércio de Recicláveis, S.A. ("Socasca"). Altri's Board of Directors estimates this process to be concluded until the year-end thus the assets and liabilities of this subsidiary were classified as discontinued.

ALTRI, S.G.P.S., S.A. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF 30 SEPTEMBER 2011 (Translation of notes originally issued in Portuguese – Note 21)

(Amounts expressed in Euro)

The detail of assets and liabilities of Socasca classified as discontinued in 30 September 2011 is as follows:

	30.09.2011
Goodwill associated to the acquisition of Socasca	4.062.482
Non current assets:
Tangible fixed assets	2.104.464
Other non current assets	81.820
Current assets:
Inventories	626.831
Customers	1.262.653
Other debtors	44.038
Cash and cash equivalents	2.885
Assets classified as held for sale or discontinued	8.185.173
Non current liabilities:
Bank loans	(642.938)
Current liabilities:
Bank loans	(945.551)
Suppliers	(1.711.185)
Other current liabilities	(87.840)
Liabilities associated w ith assets classified as held for sale or discontinued	(3.387.514)
Net assets classified as held for sale or discontinued	4.797.659

During the period ended 30 September 2011, the net loss of Socasca – Recolha e Comércio de Recicláveis, S.A. (net of intercompany operations) amounted to 37,036 Euros (33,312 Euros in 30 September 2010) which is presented in the profit and loss statement's caption "Profit/(loss) for the period from discontinued operations".

The detail of profits and losses of Socasca as of 30 September 2011 is as follows:

	30.09.2011
Sales and services rendered	3.260.648
Other income	471.461
Cost of sales	(1.375.176)
External supplies and services	(1.771.332)
Payroll expenses	(260.679)
Other expenses	(49.938)
Amortisation and depreciation	(236.336)
Financial expenses	(71.679)
Profit before income tax	(33.031)
Income tax	(4.005)
Net profit/(loss)	(37.036)

The detail of the cash flows attributed to Socasca during the period ended 30 September 2011 is as follows:

(306.764)
124.881
69.695
115.072
(112.187)
2.885

(Translation of notes originally issued in Portuguese – Note 21)

(Amounts expressed in Euro)

In addition, during the period ended 30 September 2010, the net profit from CPK – Companhia Produtora de Papel Kraftsack, S.A. (net from intercompany operations), which was closed as of 30 November 2010, reached 501.265 Euro, which is presented in the consolidated statement of profit and loss in the caption "Profit/(loss) for the period from discontinued operations".

5. CHANGES OCCURED IN THE CONSOLIDATION PERIMETER

During the period ended 30 September 2011, there were no changes in the consolidation perimeter beyond the one referred in Note 4.4.

During the year ended 31 December 2010 the companies Sosapel – Sociedade Comercial de Sacos de Papel, Lda. and CPK – Companhia Produtora de Papel Kraftsack, S.A., were dissolved without significant impacts to the Group's consolidated financial statements.

6. CASH AND CASH EQUIVALENTS

As of 30 September 2011 and 2010, the caption "Cash and cash equivalents" can be detailed as follows:

	30.09.2011	30.09.2010
Cash	14.829	26.759
Bank deposits	70.793.966	93.771.837
	70.808.795	93.798.596
Bank overdrafts (Note 9)	(650.020)	-
Cash and cash equivalents	70.158.775	93.798.596

7. CURRENT AND DEFERRED TAXES

In accordance with current legislation, tax returns are subject to review and correction by the tax authorities during a four-year period (five years for Social Security), except when there have been tax losses, when 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 company tax returns for the periods 2007 to 30 September 2011 are still subject to review.

The Board of Directors 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 30 September 2011.

The movements occurred in deferred tax assets and liabilities in the periods ended in 30 September 2011 and 2010 were as follows:

	201
	Deferred tax assets	Deferred tax liabilities
Opening balance as of 1.1.2011	14.712.478	777.344
Effects on income statement:
Harmonization of depreciation rates	1.318.110	-
Other effects	110.853	(5.054)
Total effect on income statement	1.428.963	(5.054)
Effect on shareholders' funds:
Fair values of derivatives (Note 11)	(2.059.523)	-
Closing balance as of 30.09.2011	14.081.918	772.290

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 30 SEPTEMBER 2011

(Translation of notes originally issued in Portuguese – Note 21)

(Amounts expressed in Euro)

		201
	Deferred tax assets	Deferred tax liabilities
Opening balance as of 1.1.2010	18.063.845	981.007
Effects on income statement:
Increases/ (Decreases) of tax losses carried forward	(6.369.888)	-
Other effects	724.147	(10.508)
Total effect on income statement	(5.645.741)	(10.508)
Effect on shareholders' funds:
Fair values of derivatives (Note 11)	2.866.755	-
Closing balance as of 30.09.2010	15.284.859	970.499

8. SHARE CAPITAL

As of 30 September 2011 the company's fully subscribed and paid up capital consisted of 205,131,672 shares with a nominal value of 0.125 Euro each.

As at 9 February 2011 Altri, SGPS, S.A. was notified that pursuant to decision of the President of the Notaries and Registrars Institute ("Instituto dos Registos e Notariado") the appeal brought by Altri against the decision of the Commercial Registry Office of Oporto, which on account of doubts registered as provisional the corporate change approved at the General Shareholders' Meeting of Altri held on 17 May 2010, specifically changing the nominal value of the shares of the company's capital (Altri's shares) from 0.25 Euro to 0.125 Euro, as result of which the share capital of Altri, in the amount of 25,641,459.00 Euro would be represented by 205,131,672 shares. On 22 February 2011, the shares began trading on NYSE Euronext Lisbon with the new nominal value, having the restatement operationally achieved by dividing each share in two, on 25 February 2011.

As of 30 September 2011 there were no entities holding more than 10% of the Company's subscribed share capital.

9. BANK LOANS AND OTHER LOANS

As of 30 September 2011 and 31 December 2010, the captions "Bank loans" and "Other loans" can be detailed as follows: 30-09-2011

		Nominal Value		Book Value
	Current	Non current	Total	Current	Non current	Total
Bank loans	33.432.903	132.330.000	165.762.903	33.432.903	132.019.840	165.452.743
Bank overdrafts (Note 6)	650.020	-	650.020	650.020	-	650.020
Bank loans	34.082.923	132.330.000	166.412.923	34.082.923	132.019.840	166.102.763
Commercial paper	126.000.000	113.000.000	239.000.000	125.591.497	112.814.409	238.405.906
Bonds	-	375.000.000	375.000.000	-	370.724.015	370.724.015
Other loans	7.084.900	40.590.365	47.675.265	7.084.900	40.590.365	47.675.265
Other loans	133.084.900	528.590.365	661.675.265	132.676.397	524.128.789	656.805.186
	167.167.823	660.920.365	828.088.188	166.759.320	656.148.629	822.907.949
			31-12-2010
		Nominal Value			Book Value
	Current	Non current	Total	Current	Non current	Total
Bank loans	26.968.039	139.420.756	166.388.795	26.745.119	139.152.447	165.897.566
Bank overdrafts	214.265	-	214.265	214.265	-	214.265
Bank loans	27.182.304	139.420.756	166.603.060	26.959.384	139.152.447	166.111.831
Commercial paper	130.500.000	144.000.000	274.500.000	130.267.617	143.764.128	274.031.745
Bonds	20.000.000	375.000.000	395.000.000	19.940.429	369.930.527	389.870.956
Other loans	4.460.257	34.786.631	39.246.888	4.460.257	34.786.631	39.246.888
Other loans	154.960.257	553.786.631	708.746.888	154.668.303	548.481.286	703.149.589
	182.142.561	693.207.387	875.349.948	181.627.687	687.633.733	869.261.420

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 30 SEPTEMBER 2011

(Translation of notes originally issued in Portuguese – Note 21)

(Amounts expressed in Euro)

As of 30 September 2011, there are bank overdrafts amounted to 11,650,000 Euro (17,797,500 Euro as of 30 September 2010), classified in the caption "Bank Loans".

The expenditures with the setting-up of the loans were deducted from its nominal value being recognized as interest along the loan's duration period(Note 12).

10. ACCUMULATED PROVISIONS AND IMPAIRMENT LOSSES

The movements occurred in provisions and impairment losses for the periods ended at 30 September 2011 and 2010 can be detailed as follows:

	30.09.2011
		Impairment losses in
	Provisions	accounts receivable	Total
Opening balance	1.980.728	6.791.109	8.771.837
Increases	-	-	-
Utilizations	-	(44.304)	(44.304)
Closing balance	1.980.728	6.746.805	8.727.533

	30.09.2010
Opening balance	Provisions	accounts receivable	Total
	2.424.509	6.703.074	9.127.583
Increases	158.624	-	158.624
Utilizations	(173.747)	(390.567)	(564.314)
Closing balance	2.409.386	6.312.507	8.721.893

The increases in impairment losses occurred in the periods ended 30 September 2011 and 2010 were recorded against the caption "Provisions and impairment losses" of the consolidated profit and loss statement.

The amount recorded under the caption "Provisions" as at 30 September 2011 and 2010 is the best estimate of the Administration in order to face all the losses that may arise due to the general risks from the activity of Altri's Group.

11. DERIVATIVE FINANCIAL INSTRUMENTS

As of 30 September 2011 and 2010 the companies of Altri's Group had contracts concerning financial derivative instruments to hedge changes in pulp price, interest rates and exchange rates (these only as of 30 September 2010), being these instruments recorded according to its fair value.

The companies of Altri Group only use derivatives to hedge cash flows from the operations generated by its activity.

As of 30 September 2011 and 2010 the detail of the financial derivative instruments is as follows:

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 30 SEPTEMBER 2011

(Translation of notes originally issued in Portuguese – Note 21)

(Amounts expressed in Euro)

	Pulp price hedging derivatives	Interest rates derivatives	Exchange rates derivatives	Total
Opening balance as of 31.12.2010	(8.735.277)	(14.721.501)	-	(23.456.778)
Derivatives fair value variation/cessation
Effects on shareholders' funds	6.503.834	1.267.950	-	7.771.784
Effects on the profit and loss statement	-	1.100.378	-	1.100.378
Closing balance as of 30.09.2011	(2.231.443)	(12.353.173)	-	(14.584.616)
	Pulp price hedging derivatives	Interest rates derivatives	Exchange rates derivatives	Total
Opening balance as of 31.12.2009	(5.603.720)	(10.060.728)	(2.548.666)	(18.213.114)
Derivatives fair value variation/cessation
Effects on shareholders' funds	(3.647.684)	(8.427.596)	1.257.337	(10.817.943)
Effects on the profit and loss statement	-	544.177	-	544.177
Closing balance as of 30.09.2010	(9.251.404)	(17.944.147)	(1.291.329)	(28.486.880)

12. FINANCIAL RESULTS

The financial results for the periods ended at 30 September 2011 and 2010 are detailed as follows:

	30-09-2011	30-09-2010
Financial expenses:
Interest	20.299.164	15.128.465
Other financial expenses	10.533.935	12.597.440
	30.833.099	27.725.905
Financial income:
Interest	4.366.861	1.662.233
Other financial income	1.858.562	303.298
	6.225.423	1.965.531

The caption "Other financial expenses" includes, mainly, expenses incurred with the setting-up of loans which are being recorded as costs through the duration period of the respective loan (Note 9) and losses relative to interest rate and exchange rate financial derivative instruments.

The "Gains and losses in associated companies and joint ventures" relate to the appropriation of the Group share in the net profit or loss of the investments in the associated companies and joint ventures (Note 4.2).

13. EARNINGS PER SHARE

Earnings per share in the nine months periods ended as of 30 September 2011 and 2010 were calculated considering the following amounts:

	30-09-2011	30-09-2010*	30-09-2010
Share number considered for the computation of basic and diluted earning	205.131.672	205.131.672	102.565.836
Net profit considered for the computation of basic and diluted earning for continuing operations	23.135.916	46.838.928	46.838.928
Continuing operations earnings per share Basic Diluted	0,11 0,11	0,23 0,23	0,46 0,46
Net profit considered for the computation of basic and diluted earning for continuing and non-continuing activities	23.098.880	47.340.193	47.340.193
Continuing and non-continuing operations earnings per share Basic Diluted	0,11 0,11	0,23 0,23	0,46 0,46

* Pro-form simulating that Altri SGPS, S.A. number of shares as of 30 September 2010 was already 205,131,672

14. OTHER INCOME

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 30 SEPTEMBER 2011

(Translation of notes originally issued in Portuguese – Note 21)

(Amounts expressed in Euro)

As of 30 September 2011 and 2010 this caption respects mainly to income obtained with the sale of tangible fixed assets and investment grants.

15. OTHER EXPENSES

As of 30 September 2011 and 2010 this caption corresponds mainly to losses with derivative contracts (Note 11).

16. SEGMENTAL INFORMATION

On 16 April 2008, the Board of Directors of Altri, S.G.P.S., S.A. approved a spin-off of this company which lead to the split of Altri's two business units operating 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 more visible and better evaluated by the market and allows Altri Group to focus its activity on its core business: production and trade of bleached eucalyptus paper pulp. Thus the Board of Directors considers there is only one business segment and management's information is reported and analyzed on this basis.

17. RELATED PARTIES

The subsidiaries of Altri Group have transactions between them that are classified as transactions with related parties and which were made at market prices.

In the consolidation process the transactions between the companies included in consolidation by the full consolidation method are eliminated, since the consolidated financial statements present the owner and its subsidiaries information as one single company, therefore they are not disclosed in this note.

During the periods ended at 30 September 2011 and 2010, there were no transactions with the Directors of the Group and were no granted loans.

As of 30 September 2011 and 2010 the balances and transactions with related parties are as follows:

		Purchases and services obtained	Sales and services rendered		Interest income
Transactions	30.09.2011	30.09.2010	30.09.2011	30.09.2010	30.09.2011	30.09.2010
Associated companies and joint ventures (a)	46.236	3.420.922	4.526.666	1.245.484	483.224	480.343
Other related parties (b)	2.877.354	4.050.000	-	58.194	-	-
	2.923.590	7.470.922	4.526.666	1.303.678	483.224	480.343
		Accounts payable	Accounts receivable		Granted Loans
Balances	30.09.2011	30.09.2010	30.09.2011	30.09.2010	30.09.2011	30.09.2010
Associated companies and joint ventures (a)	306.366	427.698	187.466	1.205.912	16.807.905	21.667.905
Other related parties (b)	15.658	6.682.776	-	4.586.457	-	-
	322.024	7.110.474	187.466	5.792.369	16.807.905	21.667.905

(a) All entities consolidated by the equity method as of 30 September 2011 and 2010 (Note 4.2);

(b) CPK – Papel Kraft, S.A. (Note 4.4) and the companies of Ramada Group were considered as related parties.

Besides the transactions identified above, there are no other transactions with related companies.

Besides the companies included in consolidation (Note 4), entities considered as related parties as of 30 September 2011 can be detailed as follow:

Adcom Media Anúncios e Publicidade, S.A. Alteria, S.G.P.S., S.A. Storax Equipements, S.A. Caderno Azul, S.G.P.S., S.A. Caminho Aberto, S.G.P.S., S.A. Cofihold, S.G.P.S., S.A. Cofina, SGPS, S.A. Cofina B.V. Cofina Media, SGPS, S.A. Cofina Eventos e Comunicação, S.A. Destak Brasil – Editora de Publicações, S.A.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS OF 30 SEPTEMBER 2011

(Translation of notes originally issued in Portuguese – Note 21)

(Amounts expressed in Euro)

Destak Brasil – Empreendimentos e Participações, S.A. Edisport – Sociedade de Publicações, S.A. Edirevistas – Sociedade Editorial, S.A. Efe Erre Participações, S.G.P.S., S.A. Elege Valor, S.G.P.S., S.A. F. Ramada – Investimentos, SGPS, S.A. F. Ramada – Aços e Indústrias, S.A. F. Ramada – Produção e Comercialização de Estruturas Metálicas de Armazenagem, S.A. F. Ramada II, Imobiliária, S.A. F. Ramada Serviços de Gestão, Lda. Grafedisport – Impressão e Artes Gráficas, S.A. Livre Fluxo, S.G.P.S., S.A. Malva – Gestão Imobiliária, S.A. Mediafin, SGPS, S.A. Metronews – Publicações S.A. Mercados Globais – Publicação de Conteúdos, Lda. Presselivre – Imprensa Livre, S.A. Sociedade Imobiliária Porto Seguro – Investimentos Imobiliários, S.A. Storax Racking Systems, Ltd. Storax Benelux, S.A. Transjornal – Edição de Publicações, S.A. Torres da Luz – Investimentos Imobiliários, S.A. Universal Afir – Aços, Máquinas e Ferramentas, S.A. VASP – Sociedade de Transportes e Distribuições, S.A. Web Works – Desenvolvimento de Aplicações para Internet, S.A. Valor Autêntico, SGPS, S.A.

18. PAYMENTS AND COLLECTIONS RELATED TO FINANCIAL INVESTMENTS

During the period ended at 30 September 2011, payments and collections related to financial investments can be detailed as follows:

	Transaction amount	Amount collected
EDP – Produção Bioeléctrica, S.A. (a)	4.860.000	4.860.000
Socasca – Recolha e Comércio de Recicláveis, S.A. (b)	200.000 ---------------	200.000 ----------------
	5.060.000	5.060.000
	=========	=========

(a) – Repayment of loans granted;

(b) – Advances received due to the sale of Socasca – Recolha e Comércio de Recicláveis, S.A. (Note 4.4).

During the period ended 30 September 2010, the collections related to financial investments can be detailed as follows:

	Transaction amount	Amount collected
EDP – Produção Bioeléctrica, S.A. (a)	1.175.000 ---------------	1.175.000 ----------------
	1.175.000	1.175.000
(a) – Repayment of loans granted	========	=========

19. NET PROFIT / (LOSS) APPROPRIATION

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

AS OF 30 SEPTEMBER 2011

(Translation of notes originally issued in Portuguese – Note 21)

(Amounts expressed in Euro)

Relating to the year ended in 2010, the Board of Directors proposed, in the Directors' report, that the standalone net loss of Altri, SGPS, S.A. amounting to 2,000,082.96 Euro would be transferred to retained earnings. The proposal was approved in the General Shareholders' Meeting held on 26 May 2011.

The General Shareholders' Meeting also approved the proposal of the Board of Directors regarding the distribution of free reserves as dividends in the amount of 4,102,633.44 Euro, corresponding to a dividend of 0.02 Euro by share.

20. FINANCIAL STATEMENTS APPROVAL

These financial statements were approved by the Board of Directors and authorized for issuance in 31 October 2011.

(Translation of notes originally issued in Portuguese – Note 21)

(Amounts expressed in Euro)

21. EXPLANATION ADDED FOR TRANSLATION

These consolidated financial statements are a translation of financial statements originally issued in Portuguese, prepared using accounting policies consistent with the International Financial Reporting Standards and with accordance with the International Accounting Standard 34 – Interim Financial Reporting, some of which may not conform or be required by generally accepted accounting principles in other countries. In the event of discrepancies, the Portuguese language version prevails.

The Board of Directors,

Paulo Jorge dos Santos Fernandes – President

João Manuel Matos Borges de Oliveira

Pedro Macedo Pinto de Mendonça

Domingos José Vieira de Matos

Laurentina da Silva Martins