Table of Contents

 

 

 

United States
Securities and Exchange Commission

Washington, D.C. 20549

 

FORM 6-K

 

Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the
Securities Exchange Act of 1934

 

For the month of

 

July, 2017

 

Vale S.A.

 

Avenida das Américas, No. 700
22640-100 Rio de Janeiro, RJ, Brazil

(Address of principal executive office)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

(Check One) Form 20-F x Form 40-F o

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1)

 

(Check One) Yes o No x

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7)

 

(Check One) Yes o No x

 

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

 

(Check One) Yes o No x

 

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b). 82-      .

 

 

 



Table of Contents

 

 

Interim Financial Statements

June 30, 2017

 

 

BRGAAP in R$ (English)

 

1



Table of Contents

 

 

Vale S.A. Interim Financial Statements

Contents

 

 

Page

Report on the review of the quarterly information - ITR

3

Consolidated and Parent Company Income Statement

5

Consolidated and Parent Company Statement of Comprehensive Income

7

Consolidated and Parent Company Statement of Cash Flows

8

Consolidated and Parent Company Statement of Financial Position

10

Consolidated Statement of Changes in Equity

11

Consolidated and Parent Company Value Added Statement

12

Selected Notes to the Interim Financial Statements

13

1.

Corporate information

13

2.

Basis for preparation of the interim financial statements

13

3.

Information by business segment and by geographic area

14

4.

Costs and expenses by nature

18

5.

Financial result

19

6.

Income taxes

19

7.

Basic and diluted earnings per share

21

8.

Accounts receivable

21

9.

Inventories

22

10.

Other financial assets and liabilities

22

11.

Non-current assets and liabilities held for sale and discontinued operations

22

12.

Acquisitions and divestitures

24

13.

Investments in associates and joint ventures

25

14.

Intangibles

27

15.

Property, plant and equipment

28

16.

Loans, borrowings, cash and cash equivalents and financial investments

29

17.

Liabilities related to associates and joint ventures

31

18.

Financial instruments classification

35

19.

Fair value estimate

35

20.

Derivative financial instruments

36

21.

Provisions

42

22.

Litigation

42

23.

Employee postretirement obligations

44

24.

Stockholders’ equity

45

25.

Related parties

46

26.

Commitments

48

27.

Parent Company information (individual interim information)

48

28.

Additional information about derivatives financial instruments

53

 

Members of the Board of Directors, Fiscal Council, Advisory Committees and Executive Officers

58

 

2



Table of Contents

 

GRAPHIC

 

 

KPMG Auditores Independentes

Rua do Passeio, 38 Setor 2 17º andar

20021-290 - Rio de Janeiro, RJ - Brasil

 

 

Central Tel

Fax

Internet

 

 

55 (21) 2207-9400

55 (21) 2207-9000

www.kpmg.com.br

 

Report on the review of quarterly information - ITR

 

(A free translation of the original report in Portuguese, as filed with the Brazilian Securities and Exchange Commission (CVM), prepared in accordance with the accounting practices adopted in Brazil, rules of the CVM and of the International Financial Reporting Standards - IFRS)

 

To

The Board of Directors and Stockholders of

Vale S.A.

Rio de Janeiro - RJ

 

Introduction

 

1.                                      We have reviewed the interim accounting information, individual and consolidated, of Vale S.A. (“the Company”), identified as Parent Company and Consolidated, respectively, included in the quarterly information form - ITR for the quarter ended June 30, 2017, which comprises the individual and consolidated balance sheet as of June 30, 2017 and the respective statements of income and comprehensive income for three and six months periods ended on June 30, 2017, the individual and consolidated statements of changes in equity for the six-month period and the individual statment of cash flows for the six-month period and the consolidated statement of cash flows for the three and six month periods then ended, including the explanatory notes.

 

2.                                      The Company`s Management is responsible for the preparation of these interim accounting information in accordance with the CPC 21(R1) — Demonstração Intermediária and the IAS 34 - Interim Financial Reporting, issued by the International Accounting Standards Board — IASB, as well as the presentation of these information in accordance with the standards issued by the Brazilian Securities and Exchange Commission, applicable to the preparation of quarterly information - ITR. Our responsibility is to express our conclusion on this interim accounting information based on our review.

 

Scope of the review

 

3.                                      We conducted our review in accordance with Brazilian and International Interim Information Review Standards (NBC TR 2410 - Revisão de Informações Intermediárias Executada pelo Auditor da Entidade and ISRE 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively). A review of interim information consists of making inquiries primarily of the management responsible for financial and accounting matters and applying analytical procedures and other review procedures. The scope of a review is significantly less than an audit conducted in accordance with auditing standards and, accordingly, it did not enable us to obtain assurance that we were aware of all the material matters that would have been identified in an audit. Therefore, we do not express an audit opinion.

 

3



Table of Contents

 

Conclusion on the interim accounting information

 

4.                                      Based on our review, we are not aware of any fact that might lead us to believe that the individual and consolidated interim accounting information included in the aforementioned quarterly information was not prepared, in all material respects, in accordance with CPC 21(R1) and IAS 34, issued by the IASB, applicable to the preparation of the quarterly review - ITR, and presented in accordance with the standards issued by the Brazilian Securities and Exchange Commission.

 

Other matters

 

Statements of added value

 

5.                                      The individual and consolidated statements of value added for the quarter ended June 30, 2017, prepared under the responsibility of the Company’s management, and presented as supplementary information for the purposes of IAS 34, were submitted to the same review procedures followed together with the review of the Company’s interim financial information. In order to form our conclusion, we evaluated whether these statements were reconciliated to the interim financial information and to the accounting records, as applicable, and whether their form and content are in accordance with the criteria set on Technical Pronouncement CPC 09 - Statement of Value Added. Based on our review, nothing has come to our attention that causes us to believe that the accompanying statements of value added were not prepared, in all material respects, in accordance with the individual and consolidated interim financial information taken as a whole.

 

Rio de Janeiro, July 26, 2017

 

KPMG Auditores Independentes

CRC SP-014428/O-6 F-RJ

 

(Original report in Portuguese signed by)

Manuel Fernandes Rodrigues de Sousa

 

Accountant CRC RJ-052428/O-2

 

4



Table of Contents

 

 

Income Statement

In millions of Brazilian Reais, except earnings per share data

 

 

 

 

 

Consolidated

 

 

 

 

 

Three month period ended
June 30,

 

Six month period ended
June 30,

 

 

 

Notes

 

2017

 

2016

 

2017

 

2016

 

 

 

 

 

 

 

(i)

 

 

 

(i)

 

Continuing operations

 

 

 

 

 

 

 

 

 

 

 

Net operating revenue

 

3(c)

 

23,363

 

21,576

 

50,105

 

42,150

 

Cost of goods sold and services rendered

 

4(a)

 

(16,462

)

(15,102

)

(31,327

)

(30,171

)

Gross profit

 

 

 

6,901

 

6,474

 

18,778

 

11,979

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

Selling and administrative expenses

 

4(b)

 

(426

)

(449

)

(814

)

(865

)

Research and evaluation expenses

 

 

 

(257

)

(257

)

(463

)

(468

)

Pre operating and operational stoppage

 

 

 

(286

)

(385

)

(650

)

(767

)

Other operating expenses, net

 

4(c)

 

(271

)

(503

)

(518

)

(644

)

 

 

 

 

(1,240

)

(1,594

)

(2,445

)

(2,744

)

Impairment and other results on non-current assets

 

12 and 15

 

(726

)

(228

)

877

 

(228

)

Operating income

 

 

 

4,935

 

4,652

 

17,210

 

9,007

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial income

 

5

 

1,482

 

13,300

 

4,489

 

24,926

 

Financial expenses

 

5

 

(5,823

)

(6,280

)

(10,724

)

(13,185

)

Equity results in associates and joint ventures

 

13

 

(83

)

656

 

142

 

1,242

 

Impairment and other results in associates and joint ventures

 

17

 

(110

)

(3,999

)

(301

)

(3,999

)

Income before income taxes

 

 

 

401

 

8,329

 

10,816

 

17,991

 

 

 

 

 

 

 

 

 

 

 

 

 

Income taxes

 

6

 

 

 

 

 

 

 

 

 

Current tax

 

 

 

(222

)

(1,415

)

(1,807

)

(2,692

)

Deferred tax

 

 

 

378

 

(3,203

)

(253

)

(5,305

)

 

 

 

 

156

 

(4,618

)

(2,060

)

(7,997

)

 

 

 

 

 

 

 

 

 

 

 

 

Net income from continuing operations

 

 

 

557

 

3,711

 

8,756

 

9,994

 

Net income attributable to noncontrolling interests

 

 

 

99

 

54

 

147

 

51

 

Net income from continuing operations attributable to Vale’s stockholders

 

 

 

458

 

3,657

 

8,609

 

9,943

 

 

 

 

 

 

 

 

 

 

 

 

 

Discontinued operations

 

11

 

 

 

 

 

 

 

 

 

Loss from discontinued operations

 

 

 

(388

)

(72

)

(645

)

(27

)

Net income attributable to noncontrolling interests

 

 

 

10

 

 

13

 

20

 

Loss from discontinued operations attributable to Vale’s stockholders

 

 

 

(398

)

(72

)

(658

)

(47

)

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

169

 

3,639

 

8,111

 

9,967

 

Net income attributable to noncontrolling interests

 

 

 

109

 

54

 

160

 

71

 

Net income attributable to Vale’s stockholders

 

 

 

60

 

3,585

 

7,951

 

9,896

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share attributable to Vale’s stockholders:

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted earnings per share:

 

7

 

 

 

 

 

 

 

 

 

Preferred share (R$)

 

 

 

0.01

 

0.70

 

1.54

 

1.92

 

Common share (R$)

 

 

 

0.01

 

0.70

 

1.54

 

1.92

 

 


(i) Period restated according to Note 11.

 

The accompanying notes are an integral part of these interim financial statements.

 

5



Table of Contents

 

 

Income Statement

In millions of Brazilian Reais, except earnings per share data

 

 

 

Parent company

 

 

 

Three month period ended
June 30,

 

Six month period ended
June 30,

 

 

 

2017

 

2016

 

2017

 

2016

 

Continuing operations

 

 

 

 

 

 

 

 

 

Net operating revenue

 

15,502

 

12,210

 

32,664

 

20,374

 

Cost of goods sold and services rendered

 

(8,338

)

(7,085

)

(16,089

)

(14,047

)

Gross profit

 

7,164

 

5,125

 

16,575

 

6,327

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

Selling and administrative expenses

 

(235

)

(249

)

(461

)

(489

)

Research and evaluation expenses

 

(152

)

(136

)

(273

)

(255

)

Pre operating and operational stoppage

 

(212

)

(175

)

(404

)

(339

)

Equity results from subsidiaries

 

(1,449

)

580

 

1,616

 

3,457

 

Other operating expenses, net

 

(257

)

(91

)

(85

)

(518

)

 

 

(2,305

)

(71

)

393

 

1,856

 

Impairment and other results on non-current assets

 

(27

)

 

(68

)

 

Operating income

 

4,832

 

5,054

 

16,900

 

8,183

 

 

 

 

 

 

 

 

 

 

 

Financial income

 

1,029

 

12,348

 

3,515

 

23,710

 

Financial expenses

 

(5,285

)

(5,938

)

(9,679

)

(12,658

)

Equity results in associates and joint ventures

 

(83

)

656

 

142

 

1,242

 

Impairment and other results in associates and joint ventures

 

(101

)

(3,999

)

(292

)

(3,999

)

Income before income taxes

 

392

 

8,121

 

10,586

 

16,478

 

 

 

 

 

 

 

 

 

 

 

Income taxes

 

 

 

 

 

 

 

 

 

Current tax

 

166

 

(1,281

)

(1,066

)

(2,298

)

Deferred tax

 

(100

)

(3,183

)

(911

)

(4,237

)

 

 

66

 

(4,464

)

(1,977

)

(6,535

)

Net income from continuing operations

 

458

 

3,657

 

8,609

 

9,943

 

 

 

 

 

 

 

 

 

 

 

Loss from discontinued operations

 

(398

)

(72

)

(658

)

(47

)

Net income

 

60

 

3,585

 

7,951

 

9,896

 

 

 

 

 

 

 

 

 

 

 

Earnings per share attributable to Vale’s stockholders:

 

 

 

 

 

 

 

 

 

Basic and diluted earnings per share:

 

 

 

 

 

 

 

 

 

Preferred share (R$)

 

0.01

 

0.70

 

1.54

 

1.92

 

Common share (R$)

 

0.01

 

0.70

 

1.54

 

1.92

 

 

The accompanying notes are an integral part of these interim financial statements.

 

6



Table of Contents

 

 

Statement of Comprehensive Income

In millions of Brazilian Reais

 

 

 

Consolidated

 

 

 

Three month period ended
June 30,

 

Six month period ended
June 30,

 

 

 

2017

 

2016

 

2017

 

2016

 

Net income

 

169

 

3,639

 

8,111

 

9,967

 

Other comprehensive income:

 

 

 

 

 

 

 

 

 

Items that will not be reclassified subsequently to the income statement

 

 

 

 

 

 

 

 

 

Retirement benefit obligations

 

(933

)

(641

)

(1,026

)

(972

)

Tax recognized within other comprehensive income

 

289

 

193

 

311

 

297

 

Total items that will not be reclassified subsequently to the income statement

 

(644

)

(448

)

(715

)

(675

)

 

 

 

 

 

 

 

 

 

 

Items that may be reclassified subsequently to the income statement

 

 

 

 

 

 

 

 

 

Cumulative translation adjustments

 

4,532

 

(7,793

)

2,356

 

(14,222

)

Cash flow hedge

 

 

2

 

 

23

 

Net investments hedge

 

(1,267

)

 

(420

)

 

Equity results in associates and joint ventures, net of taxes

 

 

16

 

 

16

 

Transfer of realized results to net income, net of taxes

 

 

(266

)

 

(276

)

Tax recognized within other comprehensive income

 

244

 

27

 

(104

)

(525

)

Total of items that may be reclassified subsequently to the income statement

 

3,509

 

(8,014

)

1,832

 

(14,984

)

Total comprehensive income (loss)

 

3,034

 

(4,823

)

9,228

 

(5,692

)

 

 

 

 

 

 

 

 

 

 

Comprehensive income attributable to noncontrolling interests

 

275

 

(434

)

192

 

(901

)

Comprehensive income (loss) attributable to Vale’s stockholders

 

2,759

 

(4,389

)

9,036

 

(4,791

)

 

 

 

Parent company

 

 

 

Three month period ended
June 30,

 

Six month period ended
June 30,

 

 

 

2017

 

2016

 

2017

 

2016

 

Net income

 

60

 

3,585

 

7,951

 

9,896

 

Other comprehensive income:

 

 

 

 

 

 

 

 

 

Items that will not be reclassified subsequently to the income statement

 

 

 

 

 

 

 

 

 

Retirement benefit obligations

 

(20

)

(19

)

(40

)

(40

)

Tax recognized within other comprehensive income

 

6

 

6

 

13

 

13

 

Equity results in subsidiaries, associates and joint ventures, net of taxes

 

(630

)

(435

)

(688

)

(648

)

Total items that will not be reclassified subsequently to the income statement

 

(644

)

(448

)

(715

)

(675

)

 

 

 

 

 

 

 

 

 

 

Items that may be reclassified subsequently to the income statement

 

 

 

 

 

 

 

 

 

Cumulative translation adjustments

 

4,179

 

(7,278

)

2,077

 

(13,772

)

Net investments hedge

 

(1,267

)

 

(420

)

 

Equity results in associates and joint ventures, net of taxes

 

 

18

 

 

 

26

 

Transfer of realized results to net income, net of taxes

 

 

(266

)

 

(266

)

Tax recognized within other comprehensive income

 

431

 

 

143

 

 

Total of items that may be reclassified subsequently to the income statement

 

3,343

 

(7,526

)

1,800

 

(14,012

)

Total comprehensive income (loss)

 

2,759

 

(4,389

)

9,036

 

(4,791

)

 

The accompanying notes are an integral part of these interim financial statements.

 

7



Table of Contents

 

 

Statement of Cash Flows

In millions of Brazilian Reais

 

 

 

Consolidated

 

 

 

Three month period ended
June 30,

 

Six month period ended
June 30,

 

 

 

2017

 

2016

 

2017

 

2016

 

 

 

 

 

(i)

 

 

 

(i)

 

Cash flow from operating activities:

 

 

 

 

 

 

 

 

 

Income before income taxes from continuing operations

 

401

 

8,329

 

10,816

 

17,991

 

Continuing operations adjustments for:

 

 

 

 

 

 

 

 

 

Equity results in associates and joint ventures

 

83

 

(656

)

(142

)

(1,242

)

Impairment and other results on non-current assets

 

726

 

228

 

(877

)

228

 

Impairment and other results in associates and joint ventures

 

110

 

3,999

 

301

 

3,999

 

Depreciation, amortization and depletion

 

2,907

 

2,945

 

5,758

 

5,998

 

Financial results, net

 

4,341

 

(7,020

)

6,235

 

(11,741

)

Changes in assets and liabilities:

 

 

 

 

 

 

 

 

 

Accounts receivable

 

4,377

 

256

 

5,347

 

(3,546

)

Inventories

 

(787

)

81

 

(1,495

)

(239

)

Suppliers and contractors

 

791

 

1,305

 

1,101

 

139

 

Payroll and related charges

 

568

 

133

 

(153

)

136

 

Other assets and liabilities, net

 

(360

)

916

 

(964

)

1,485

 

 

 

13,157

 

10,516

 

25,927

 

13,208

 

Interest on loans and borrowings paid

 

(1,351

)

(1,276

)

(2,946

)

(3,134

)

Derivatives paid, net (note 20)

 

(15

)

(1,236

)

(353

)

(3,212

)

Interest on participative stockholders’ debentures paid

 

(221

)

(117

)

(221

)

(117

)

Income taxes

 

(101

)

(250

)

(1,257

)

(858

)

Income taxes - Settlement program

 

(387

)

(351

)

(766

)

(694

)

Net cash provided by operating activities from continuing operations

 

11,082

 

7,286

 

20,384

 

5,193

 

Net cash provided by operating activities from discontinued operations

 

4

 

121

 

294

 

132

 

Net cash provided by operating activities

 

11,086

 

7,407

 

20,678

 

5,325

 

 

 

 

 

 

 

 

 

 

 

Cash flow from investing activities:

 

 

 

 

 

 

 

 

 

Financial investments redeemed (invested)

 

115

 

(384

)

(52

)

(6

)

Loans and advances - Net receipts (payments)

 

(314

)

 

(769

)

(15

)

Additions to investments

 

(1,081

)

(476

)

(1,110

)

(838

)

Additions to property, plant and equipment and intangible (note 3(b))

 

(2,852

)

(4,078

)

(6,339

)

(9,279

)

Proceeds from disposal of assets and investments (note 12)

 

28

 

40

 

1,642

 

87

 

Dividends and interest on capital received from associates and joint ventures

 

266

 

403

 

266

 

405

 

Others investments activities

 

(64

)

(75

)

(68

)

(163

)

Net cash used in investing activities from continuing operations

 

(3,902

)

(4,570

)

(6,430

)

(9,809

)

Net cash used in investing activities from discontinued operations

 

(263

)

(209

)

(460

)

(393

)

Net cash used in investing activities

 

(4,165

)

(4,779

)

(6,890

)

(10,202

)

 

 

 

 

 

 

 

 

 

 

Cash flow from financing activities:

 

 

 

 

 

 

 

 

 

Loans and borrowings

 

 

 

 

 

 

 

 

 

Additions

 

963

 

5,005

 

4,539

 

17,955

 

Repayments

 

(5,899

)

(6,215

)

(9,432

)

(10,934

)

Transactions with stockholders:

 

 

 

 

 

 

 

 

 

Dividends attributed to stockholders

 

(4,660

)

 

(4,660

)

 

Dividends and interest on capital paid to noncontrolling interest

 

(14

)

(252

)

(23

)

(269

)

Transactions with noncontrolling stockholders (note 12)

 

 

 

799

 

(69

)

Net cash provided by (used in) financing activities from continuing operations

 

(9,610

)

(1,462

)

(8,777

)

6,683

 

Net cash provided by (used in) financing activities from discontinued operations

 

107

 

(12

)

(1

)

(16

)

Net cash provided by (used in) financing activities

 

(9,503

)

(1,474

)

(8,778

)

6,667

 

 

 

 

 

 

 

 

 

 

 

Increase (decrease) in cash and cash equivalents

 

(2,582

)

1,154

 

5,010

 

1,790

 

Cash and cash equivalents in the beginning of the period

 

21,279

 

13,461

 

13,891

 

14,022

 

Effect of exchange rate changes on cash and cash equivalents

 

225

 

(1,238

)

65

 

(2,435

)

Cash and cash equivalents from disposals subsidiaries

 

 

 

(44

)

 

Cash and cash equivalents at end of the period

 

18,922

 

13,377

 

18,922

 

13,377

 

 

 

 

 

 

 

 

 

 

 

Non-cash transactions:

 

 

 

 

 

 

 

 

 

Additions to property, plant and equipment - capitalized loans and borrowing costs

 

265

 

749

 

587

 

1,439

 

 


(i)             Period restated according to Note 11.

 

The accompanying notes are an integral part of these interim financial statements.

 

8



Table of Contents

 

 

Statement of Cash Flows

In millions of Brazilian Reais

 

 

 

Parent company

 

 

 

Six month period ended June 30,

 

 

 

2017

 

2016

 

Cash flow from operating activities:

 

 

 

 

 

Income before income taxes from continuing operations

 

10,586

 

16,478

 

Continuing operations adjustments for:

 

 

 

 

 

Equity results in associates, subsidiaries and joint ventures

 

(1,758

)

(4,699

)

Results on measurement or sale of non-current assets

 

68

 

 

Impairment and other results in associates and joint ventures

 

292

 

3,999

 

Depreciation, amortization and depletion

 

2,693

 

2,398

 

Financial results, net

 

6,164

 

(11,052

)

Changes in assets and liabilities:

 

 

 

 

 

Accounts receivable

 

12,695

 

2,896

 

Inventories

 

(373

)

19

 

Suppliers and contractors

 

28

 

925

 

Payroll and related charges

 

(54

)

106

 

Other assets and liabilities, net

 

(779

)

442

 

 

 

29,562

 

11,512

 

Interest on loans and borrowings paid

 

(2,978

)

(2,847

)

Derivatives paid, net

 

(132

)

(672

)

Interest on participative stockholders’ debentures paid

 

(221

)

(117

)

Dividends received from interest on capital and associates

 

 

59

 

Income taxes

 

(678

)

(81

)

Income taxes - Settlement program

 

(750

)

(681

)

Net cash provided by operating activities

 

24,803

 

7,173

 

 

 

 

 

 

 

Cash flow from investing activities:

 

 

 

 

 

Financial investments redeemed (invested)

 

(97

)

6

 

Loans and advances - Net receipts (payments)

 

(432

)

85

 

Additions to investments

 

(913

)

(1,282

)

Additions to property, plant and equipment and intangible (note 27)

 

(3,737

)

(6,276

)

Proceeds from disposal of assets and investments

 

15

 

13

 

Dividends and interest on capital received from associates and joint ventures

 

424

 

403

 

Others investments activities

 

(54

)

(188

)

Net cash used in investing activities

 

(4,794

)

(7,239

)

 

 

 

 

 

 

Cash flow from financing activities:

 

 

 

 

 

Loans and borrowings

 

 

 

 

 

Additions

 

6,742

 

6,315

 

Repayments

 

(19,414

)

(6,750

)

Transactions with stockholders:

 

 

 

 

 

Dividends and interest on capital paid to noncontrolling interest

 

(4,660

)

 

Transactions with noncontrolling stockholders

 

 

447

 

Net cash provided by (used in) financing activities

 

(17,332

)

12

 

 

 

 

 

 

 

Increase (decrease) in cash and cash equivalents

 

2,677

 

(54

)

Cash and cash equivalents in the beginning of the period

 

1,203

 

518

 

Cash and cash equivalents at end of the period

 

3,880

 

464

 

 

 

 

 

 

 

Non-cash transactions:

 

 

 

 

 

Additions to property, plant and equipment - capitalized loans and borrowing costs

 

585

 

827

 

 

The accompanying notes are an integral part of these interim financial statements.

 

9



Table of Contents

 

 

Statement of Financial Position

In millions of Brazilian Reais

 

 

 

 

 

Consolidated

 

Parent company

 

 

 

Notes

 

June 30, 2017

 

December 31,
2016

 

June 30, 2017

 

December 31,
2016

 

Assets

 

 

 

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

16

 

18,922

 

13,891

 

3,880

 

1,203

 

Accounts receivable

 

8

 

5,654

 

11,937

 

13,761

 

26,223

 

Other financial assets

 

10

 

7,255

 

1,184

 

2,409

 

1,231

 

Inventories

 

9

 

12,783

 

10,913

 

4,420

 

3,982

 

Prepaid income taxes

 

 

 

718

 

518

 

634

 

312

 

Recoverable taxes

 

 

 

4,306

 

5,296

 

2,895

 

3,962

 

Others

 

 

 

1,412

 

1,814

 

461

 

406

 

 

 

 

 

51,050

 

45,553

 

28,460

 

37,319

 

Non-current assets held for sale

 

11

 

14,654

 

27,994

 

8,808

 

8,936

 

 

 

 

 

65,704

 

73,547

 

37,268

 

46,255

 

Non-current assets

 

 

 

 

 

 

 

 

 

 

 

Judicial deposits

 

22(c)

 

3,107

 

3,135

 

2,676

 

2,681

 

Other financial assets

 

10

 

11,032

 

2,046

 

2,281

 

2,178

 

Prepaid income taxes

 

 

 

1,815

 

1,718

 

 

 

Recoverable taxes

 

 

 

2,424

 

2,368

 

2,300

 

2,223

 

Deferred income taxes

 

6(a)

 

23,473

 

23,931

 

14,545

 

15,299

 

Others

 

 

 

1,053

 

894

 

722

 

618

 

 

 

 

 

42,904

 

34,092

 

22,524

 

22,999

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments

 

13

 

11,926

 

12,046

 

109,893

 

107,539

 

Intangibles

 

14

 

23,856

 

22,395

 

12,566

 

11,314

 

Property, plant and equipment

 

15

 

180,821

 

180,616

 

102,318

 

102,056

 

 

 

 

 

259,507

 

249,149

 

247,301

 

243,908

 

Total assets

 

 

 

325,211

 

322,696

 

284,569

 

290,163

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

 

 

 

Suppliers and contractors

 

 

 

12,393

 

11,830

 

7,179

 

7,116

 

Loans and borrowings

 

16

 

6,823

 

5,410

 

5,470

 

4,171

 

Other financial liabilities

 

10

 

2,900

 

3,539

 

6,304

 

10,845

 

Taxes payable

 

 

 

2,122

 

2,144

 

1,895

 

1,883

 

Provision for income taxes

 

 

 

850

 

556

 

 

 

Liabilities related to associates and joint ventures

 

17

 

975

 

951

 

975

 

951

 

Provisions

 

21

 

2,761

 

3,103

 

1,589

 

1,792

 

Dividends and interest on capital

 

 

 

 

2,602

 

 

2,602

 

Others

 

 

 

2,581

 

2,921

 

1,231

 

353

 

 

 

 

 

31,405

 

33,056

 

24,643

 

29,713

 

Liabilities associated with non-current assets held for sale

 

11

 

3,604

 

3,554

 

 

 

 

 

 

 

35,009

 

36,610

 

24,643

 

29,713

 

Non-current liabilities

 

 

 

 

 

 

 

 

 

 

 

Loans and borrowings

 

16

 

85,318

 

90,154

 

38,332

 

47,877

 

Other financial liabilities

 

10

 

10,400

 

6,932

 

62,225

 

59,681

 

Taxes payable

 

 

 

16,083

 

16,170

 

15,753

 

15,838

 

Deferred income taxes

 

6(a)

 

5,179

 

5,540

 

 

 

Provisions

 

21

 

20,021

 

18,730

 

4,388

 

4,396

 

Liabilities related to associates and joint ventures

 

17

 

2,394

 

2,560

 

2,394

 

2,560

 

Deferred revenue - Gold stream

 

 

 

6,563

 

6,811

 

 

 

Others

 

 

 

5,632

 

5,487

 

2,951

 

2,857

 

 

 

 

 

151,590

 

152,384

 

126,043

 

133,209

 

Total liabilities

 

 

 

186,599

 

188,994

 

150,686

 

162,922

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

24

 

 

 

 

 

 

 

 

 

Equity attributable to Vale’s stockholders

 

 

 

133,883

 

127,241

 

133,883

 

127,241

 

Equity attributable to noncontrolling interests

 

 

 

4,729

 

6,461

 

 

 

Total stockholders’ equity

 

 

 

138,612

 

133,702

 

133,883

 

127,241

 

Total liabilities and stockholders’ equity

 

 

 

325,211

 

322,696

 

284,569

 

290,163

 

 

The accompanying notes are an integral part of these interim financial statements.

 

10



Table of Contents

 

 

Statement of Changes in Equity

In millions of Brazilian Reais

 

 

 

Share
capital

 

Results on
conversion of
shares

 

Results from
operation with
noncontrolling
interest

 

Profit
reserves

 

Treasury
stocks

 

Unrealized
fair value gain
(losses)

 

Cumulative
translation
adjustments

 

Retained
earnings

 

Equity
attributable to
Vale’s
stockholders

 

Equity
attributable to
noncontrolling
interests

 

Total
stockholders’
equity

 

Balance at December 31, 2016

 

77,300

 

50

 

(1,870

)

13,698

 

(2,746

)

(3,739

)

44,548

 

 

127,241

 

6,461

 

133,702

 

Net income

 

 

 

 

 

 

 

 

7,951

 

7,951

 

160

 

8,111

 

Other comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retirement benefit obligations

 

 

 

 

 

 

(715

)

 

 

(715

)

 

(715

)

Net investments hedge

 

 

 

 

 

 

 

(277

)

 

(277

)

 

(277

)

Translation adjustments

 

 

 

 

 

 

(30

)

2,107

 

 

2,077

 

32

 

2,109

 

Transactions with stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends and interest on capital of Vale’s stockholders

 

 

 

 

(2,065

)

 

 

 

 

(2,065

)

 

(2,065

)

Dividends of noncontrolling interest

 

 

 

 

 

 

 

 

 

 

(336

)

(336

)

Acquisitions and disposal of participation of noncontrolling interest (note 12)

 

 

 

(329

)

 

 

 

 

 

(329

)

(1,672

)

(2,001

)

Capitalization of noncontrolling interest advances

 

 

 

 

 

 

 

 

 

 

84

 

84

 

Balance at June 30, 2017

 

77,300

 

50

 

(2,199

)

11,633

 

(2,746

)

(4,484

)

46,378

 

7,951

 

133,883

 

4,729

 

138,612

 

 

 

 

Share
capital

 

Results on
conversion of
shares

 

Results from
operation with
noncontrolling
interest

 

Profit
reserves

 

Treasury
stocks

 

Unrealized
fair value gain
(losses)

 

Cumulative
translation
adjustments

 

Retained
earnings

 

Equity
attributable to
Vale’s
stockholders

 

Equity
attributable to
noncontrolling
interests

 

Total
stockholders’
equity

 

Balance at December 31, 2015

 

77,300

 

50

 

(1,881

)

3,846

 

(2,746

)

(3,873

)

58,464

 

 

131,160

 

8,259

 

139,419

 

Net income

 

 

 

 

 

 

 

 

9,896

 

9,896

 

71

 

9,967

 

Other comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retirement benefit obligations

 

 

 

 

 

 

(675

)

 

 

(675

)

 

(675

)

Cash flow hedge

 

 

 

 

 

 

26

 

 

 

26

 

 

26

 

Translation adjustments

 

 

 

 

 

 

453

 

(14,491

)

 

(14,038

)

(972

)

(15,010

)

Transactions with stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends of noncontrolling interest

 

 

 

 

 

 

 

 

 

 

(641

)

(641

)

Acquisitions and disposal of participation of noncontrolling interest (note 12)

 

 

 

4

 

 

 

 

 

 

4

 

 

4

 

Capitalization of noncontrolling interest advances

 

 

 

 

 

 

 

 

 

 

61

 

61

 

Balance at June 30, 2016

 

77,300

 

50

 

(1,877

)

3,846

 

(2,746

)

(4,069

)

43,973

 

9,896

 

126,373

 

6,778

 

133,151

 

 

The accompanying notes are an integral part of these interim financial statements.

 

11



Table of Contents

 

 

Value Added Statement

In millions of Brazilian Reais

 

 

 

Consolidated

 

Parent company

 

 

 

Six month period ended June 30,

 

Generation of value added from continuing operations

 

2017

 

2016

 

2017

 

2016

 

 

 

 

 

(i)

 

 

 

 

 

Gross revenue

 

 

 

 

 

 

 

 

 

Revenue from products and services

 

50,800

 

42,771

 

33,172

 

20,715

 

Results on measurement or sale of non-current assets

 

868

 

(228

)

(68

)

 

Revenue from the construction of own assets

 

3,144

 

6,829

 

2,875

 

5,275

 

Allowance for doubtful accounts

 

(14

)

(4

)

6

 

 

Other revenues

 

264

 

264

 

195

 

125

 

Less:

 

 

 

 

 

 

 

 

 

Acquisition of products

 

(1,027

)

(835

)

(343

)

(347

)

Material, service and maintenance

 

(12,423

)

(15,157

)

(8,165

)

(9,650

)

Oil and gas

 

(1,967

)

(2,144

)

(1,348

)

(1,337

)

Energy

 

(1,434

)

(1,147

)

(674

)

(489

)

Freight

 

(4,566

)

(4,052

)

(42

)

(24

)

Impairment of non-current assets and other results

 

(292

)

(3,999

)

(292

)

(3,999

)

Impairment of descontinued operations

 

 

 

(658

)

 

Other costs and expenses

 

(3,051

)

(2,727

)

(427

)

(478

)

Gross value added

 

30,302

 

19,571

 

24,231

 

9,791

 

Depreciation, amortization and depletion

 

(5,758

)

(5,998

)

(2,693

)

(2,398

)

Net value added

 

24,544

 

13,573

 

21,538

 

7,393

 

 

 

 

 

 

 

 

 

 

 

Received from third parties:

 

 

 

 

 

 

 

 

 

Equity results from entities

 

142

 

1,242

 

1,758

 

4,699

 

Equity results from descontinued operations

 

 

 

 

(47

)

Financial income

 

571

 

329

 

212

 

169

 

Monetary and exchange variation of assets

 

156

 

(7,037

)

18

 

(7,181

)

Total value added from continuing operations to be distributed

 

25,413

 

8,107

 

23,526

 

5,033

 

Value added from discontinued operations to be distributed

 

251

 

843

 

 

 

Total value added to be distributed

 

25,664

 

8,950

 

23,526

 

5,033

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

3,651

 

3,628

 

1,720

 

1,377

 

Taxes and contributions

 

4,247

 

3,665

 

3,045

 

3,232

 

Current income tax

 

1,807

 

2,692

 

1,066

 

2,298

 

Deferred income tax

 

253

 

5,305

 

911

 

4,237

 

Financial expense (excludes capitalized interest)

 

5,138

 

1,045

 

6,165

 

2,004

 

Monetary and exchange variation of liabilities

 

1,346

 

(18,959

)

1,009

 

(19,547

)

Other remunerations of third party funds

 

873

 

784

 

1,659

 

1,536

 

Reinvested net income

 

7,951

 

9,896

 

7,951

 

9,896

 

Net income attributable to noncontrolling interest

 

147

 

51

 

 

 

Distributed value added from continuing operations

 

25,413

 

8,107

 

23,526

 

5,033

 

Distributed value added from discontinued operations

 

251

 

843

 

 

 

Distributed value added