Earnings
Release
Release de
Resultados
1Q16
4T10
São Paulo, May 16th, 2016
Banco Sofisa S.A. (SFSA4), a multiple bank specializing in originating credit o
small and medium enterprises, announces today its results for the first quarter
of 2016 (1Q16). Except where stated otherwise, all operating and financial
information is in Brazilian real and presented on a consolidated basis, in
accordance with Brazilian Corporate Law.
Highlights

Net Income in 1Q16 of R$8.4 mn;

Basel Ratio (100% Tier 1) of 23.5%;

Cash of R$ 1,195.9 mn;

95.8% classification credit portfolio of the ratings of AA-C.

Reduction of R$3.7 in expenses for doubtful accounts in 1Q16 compared to 4Q15;
Message from the CEO
The first quarter of the year was marked by the deepening of Brazil’s recession, which began at the end of 2014.
Consequently, we maintained a highly conservative credit policy and continued not prioritizing loan portfolio
growth, at least while the current situation lasts.
The Bank generated Income before Taxes and Minority Interest in line with the healthy results of the previous year,
although Income and Social Contribution Taxes substantially reduced Net Income, mainly due to the impact of the
exchange variations. However, this impact may even out as the year goes on.
We will continue to focus on maintaining the good quality indicators of our loan portfolio and high level of
capitalization, exemplified by a Basel III ratio of 23.5% and an excellent free cash level of R$1.2 billion.
The public tender offer by our controlling shareholder continues to move ahead in line with the normal
procedures associated with such offers.
Alexandre Burmaian
Chief Executive Officer
1Q16 Earnings Conference Call
th
May 17 , 2016
PORTUGUESE
10:00 a.m. (NY) / 11:00 a.m. (Brasilia)
Dial-in: +55 (11) 2188-0155
Code: Banco Sofisa
www.sofisa.com.br/ir
Investor Relations
+55 (11) 3176-5836 / 5834 ri@sofisa.com.br
Plinio de Lucca Junior
Executive Board of Corporate Governance,
Risks and IR
Márcio do N. Miguel
IR Manager
1
1Q16
4T10
Earnings
Release
Release de
Resultados
Main Indicators
R$ millions (except where indicated)
1Q16
4Q15
1Q15
1Q16/4Q15
(1)
1,195.9
1,047.8
1,185.6
14.1%
0.9%
Loan Operations(2) (A)
Funding (B)
1,839.1
1,918.1
1,897.0
-4.1%
-3.1%
3,398.9
3,152.0
2,996.7
7.8%
13.4%
Total Deposits
3,067.5
2,843.0
2,366.5
7.9%
29.6%
Balance Sheet
Free Cash
1Q16/1Q15
Loan Operations / Funding Index (A/B)
54.1%
60.9%
63.3%
-6.8 p.p.
-9.2 p.p.
Shareholders' Equity (C)
711.4
691.0
675.2
3.0%
5.4%
Leverage (A/C)
2.6
2.8
2.8
1Q16
4Q15
1Q15
61.9
56.6
5.2
4.8
Personnel Expenses
(16.7)
Other Administrative Expenses
(13.1)
Results
Result from Financial Intermediation
Income from Services Provided
Employees profit sharing
-6.9%
-8.0%
1Q16/4Q15
1Q16/1Q15
32.7
9.3%
89.2%
3.7
9.3%
40.3%
(16.5)
(12.7)
1.6%
31.8%
(13.2)
(13.5)
-0.7%
-3.0%
(4.2)
(1.8)
(3.9)
138.5%
9.1%
8.4
19.6
21.5
-57.3%
-61.0%
1Q16
4Q15
1Q15
0.06
0.14
0.16
137,747
137,747
137,747
-
-
5.16
5.02
4.90
3.0%
5.4%
Dividends + Net Interest on Equity
-
21.7
-
-100.0%
-
Dividends + Net Interest on Equity per share | (R$)
-
0.16
-
-100.0%
-
82.9%
66.7%
1Q16/4Q15
1Q16/1Q15
Net Income
Shares
Net Income per Share (R$)
Number of Shares Outstanding | (thousands)
Asset Value per Share | (R$)
Market Value
Eficiency / Profitability (%)
516.6
282.4
309.9
1Q16
4Q15
1Q15
1Q16/4Q15
-57.3%
1Q16/1Q15
-61.0%
ROAE
4.8%
11.4%
12.9%
-6.6 p.p.
-8.1 p.p.
ROAA
0.8%
1.8%
2.2%
-1.0 p.p.
-1.4 p.p.
7.1%
8.1%
4.6%
-1.0 p.p.
2.5 p.p.
43.9%
44.3%
46.7%
-0.4 p.p.
-2.8 p.p.
23.5%
21.0%
21.2%
2.5 p.p.
(3)
Net Interest Margin
Efficiency
(3)
Basel Ratio
Credit Portfolio Quality (%)
1Q16
Provision for Loan Losses / Loan Operations(2)
(4)
Delinquency Cred. w/more than 90 days / Loan Oper.
(1)
(2)
1Q15
1Q16/4Q15
2.3 p.p.
1Q16/1Q15
3.2%
3.3%
3.9%
-0.1 p.p.
-0.7 p.p.
0.8%
0.9%
1.0%
-0.1 p.p.
-0.2 p.p.
Cash and cash equivalents + short - term investments + securities - open market funding. |
www.sofisa.com.br/ir
4Q15
(2)
Excludes provisions for NPL .
2
Earnings
Release
Release de
Resultados
1Q16
4T10
Operating Highlights | Total Loan Portfolio (R$mn)
Due to the economic slowdown in the period and consequent caution in lending, the loan operation totaled R$
1,839.1 mn at the end of 1Q16, representing the decrease of 4.1% in relation to 4Q15 and of 3.1% over the same
period last year.
1,897.0
1Q15
1,918.1
4Q15
1,839.1
1Q16
The credits demonstrate satisfactory dilution, and the largest debtor represented only 1.4% of Credit Operations
and the largest sectoral participation represented 16.6% at the end of 1Q16.
About the distribution operations by maturities, the predominance of operations remained in the short term, with
86.6% of the operations has a term of up to 1 year.
R$ millions
Portfolio Breakdown | (R$mn)
1Q16
4Q15
1Q15
Overdraft-Secured Account
564.4
603.9
566.7
-6.5%
-0.4%
Working Capital
946.3
990.2
1,021.8
-4.4%
-7.4%
(1)
328.3
323.5
305.7
1.5%
7.4%
1,839.0
1,917.6
1,894.2
-4.1%
-2.9%
0.1
0.5
2.8
-73.8%
-95.3%
1,839.1
1,918.1
1,897.0
-4.1%
-3.1%
Others
Subtotal
Acquired Financings
Total
1Q16/4Q15
1Q16/1Q15
(1) Includes: discounted bonds, import financing and export advances to depositors, check company, leases, vehicles, payroll loans, CDC, other receivables and
exchange.
www.sofisa.com.br/ir
3
1Q16
4T10
Earnings
Release
Release de
Resultados
Collateral Breakdown | (R$ mn)
R$ millions
1Q16
Trade Notes Receivable
4Q15
% of Total
% of Total
1,300.4
70.7%
1,398.8
72.9%
Pledge on Real Estate, Vehicles and Equipments
145.9
7.9%
147.2
7.7%
Rent and Property Receivables
139.8
7.6%
141.2
7.4%
Investments
66.1
3.7%
52.4
2.7%
Post-dated Checks
21.0
1.1%
10.1
0.5%
Warrants and Lien
9.3
0.5%
9.6
0.5%
Overseas Companies Withdrawals
9.2
0.5%
9.6
0.5%
Joint Obligations from other Financial Institutions
6.2
0.3%
5.5
0.3%
Agreements and Blocked Accounts
5.1
0.3%
5.8
0.3%
Others
0.2
0.0%
0.7
0.0%
Subtotal
1,703.2
Promissory Notes
92.6%
135.9
Total
1,780.9
7.4%
1,839.1
92.8%
137.2
100.0%
1,918.1
7.2%
100.0%
Loan Operations | Delinquency and Provisions for Losses
The pulverization linked with our selectivity in lending, resulted in maintaining the level of our reserves even in this
scenario of greater insolvency of companies.
1Q16
4Q15
Own Portfolio Provision
Credits "AA - C"
28.5
47.7%
1,833.9
29.9
46.8%
31.2
52.3%
84.2
34.0
53.2%
1,839.1
59.7
100.0%
1,918.1
63.9
100.0%
-
3.2%
-
-
3.3%
-
-
1.7%
-
-
1.8%
-
-
0.8%
-
-
0.9%
-
(2)
Overdue More Than 90 Days(1)/Credit Portfolio (2)
(1)
Considers credits and installments overdue than 90 days.|
(2)
% of Total
77.1
Provision/Credit Portfolio (2)
Provision D-H/Credit Portfolio
Provision
1,762.0
Credits "D - H"
Total
Own Portfolio
% of Total
Including credit assignments with recourse.
The impact of the strong management of the company, due to the quality protection strategy of assets, is evident
when checked the evolution of indicators of default and coverage in the last 12 months.
In relation to the loan portfolio in 1Q16 the provisions represented 3.2% (3.9% in 1Q15), provisions for loans loss
with D-H ratings represented 1.7% (2.3% in 1Q15) and overdue loans over 90 days amounted to 0.8% (1.0% in 1Q16).
Maintains a high coverage ratio, which was 432.6% in the 1Q16 and 394.0% in the 1Q15.
2, 700. 0
5. 0%
3.9%
3.9%
300. 0
3.9%
3.3%
3.2%
550. 0%
432.6%
4. 0%
2, 500. 0
2.3%
2.4%
1.0%
1.0%
250. 0
2.4%
3. 0%
1.8%
2, 300. 0
1.3%
0.9%
1.7%
0.8%
394.0%
394.9%
450. 0%
307.1%
365.4%
2. 0%
200. 0
350. 0%
150. 0
250. 0%
100. 0
150. 0%
1. 0%
2, 100. 0
0. 0%
1, 900. 0
- 1. 0%
- 2. 0%
1, 700. 0
1,897.0
1,829.6
1,889.7
2Q15
3Q15
1,918.1
50. 0
1,839.1
1, 500. 0
- 3. 0%
- 4. 0%
1Q15
4Q15
1Q16
PORTFOLIO (R$ MM)
OVERDUE CREDITS > 90 DAYS/PORTFOLIO
PROVISION D-H/PORTFOLIO
PROVISION/PORTFOLIO
www.sofisa.com.br/ir
50. 0%
73.4
71.1
73.5
63.9
59.7
1Q15
2Q15
3Q15
4Q15
1Q16
-
- 50. 0%
PROVISION
COVERAGE RATIO (OVERDUE CREDITS > 90 D / PROVISION)
4
Earnings
Release
Release de
Resultados
1Q16
4T10
Shareholders’ Equity
The Bank’s Shareholders’ Equity stood at R$711.4 mn in 1Q16, as the following table shows:
R$ millions
Position as of 12.31.2015
691.0
MTM Adjustments
12.0
Results of the period
8.4
Position as of 03.31.2016
711.4
Funding
Funding totaled R$3.4 bn in 1Q16, representing the increase of 7.8% compared to 4Q15 and of 13.4% compared to
1Q15.
R$ millions
Funding
1Q16
Demand Deposits
Time Deposits + Agribusiness, Financial and Real Estate Letters of Credit
Up to 1 year
4Q15
1Q15 1Q16/4Q15 1Q16/1Q15
64.9
95.6
132.0
-32.1%
1,803.2
1,568.7
1,455.8
14.9%
23.9%
1,167.9
1,024.4
1,035.3
14.0%
12.8%
More than 1 year
-50.8%
635.3
544.3
420.5
16.7%
51.1%
Interbank Deposits
108.9
106.4
50.9
2.3%
113.9%
Open Market Funding
Foreign Borrowings and Onlending Obligations(1)
163.4
148.2
208.6
10.3%
-21.7%
168.0
160.9
421.6
4.4%
-60.2%
Time Deposit with Special Guarantee ("DPGE")
1,090.5
1,072.2
727.8
1.7%
49.8%
3,398.9
3,152.0
2,996.7
7.8%
13.4%
Total
(1)
Includes foreign loans and onlendings, promissory notes, repo, linked notes and fixed rate notes.
Ratings
The credit-rating agencies maintained the ratings assigned to Banco Sofisa, reflecting the excellent quality of its
assets, the conservative policy adopted by its Management, its vast expertise in the SME segment, as well as its
healthy liquidity and capitalization.
Aa3.br/Br-1 (domestic)
September 2015
www.sofisa.com.br/ir
A-(bra): Long Term
Low Risk: Mid Term
F2(bra): Short Term
Disclosure: Excellent
December 2015
April 2016
5
Earnings
Release
Release de
Resultados
1Q16
4T10
Annex I – Consolidated Balance Sheet
R$ thousands
ASSETS
1Q16
4Q15
1Q16/4Q15 1Q16/1Q15
1Q15
% Change
% Change
Cash and cash equivalents
43,852
27,664
96,691
Interbank investments
221,280
135,624
123,873
63.2%
78.6%
Securities and derivatives
942,789
470,661
250,057
100.3%
277.0%
58.5%
-54.6%
Interbank accounts
24,021
16,524
61,595
45.4%
-61.0%
Lending operations
1,472,417
1,554,312
1,531,167
-5.3%
-3.8%
Leasing operations
Other credits
915
157,238
960
174,236
1,210
180,127
-4.7%
-9.8%
-24.4%
-12.7%
Other assets
8,375
7,618
4,798
9.9%
74.6%
2,870,887
203,000
2,387,599
127,523
2,249,518
161,899
20.2%
59.2%
27.6%
25.4%
Securities and derivatives
670,588
1,011,606
896,211
-33.7%
-25.2%
Lending operations
Leasing operations
237,876
515
229,779
421
222,247
862
3.5%
22.3%
7.0%
-40.3%
Other credits
338,008
346,142
306,532
-2.3%
10.3%
20,281
1,470,268
21,535
1,737,006
23,008
1,610,759
-5.8%
-15.4%
-11.9%
-8.7%
Current Assets
Interbank investments
Other assets
Long-Term Assets
Investiments
Property and equipment
Deferred
Permanent Assets
Total Assets
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
Money market funding
Funds from acceptance and issuance of securities
907
907
907
0.0%
0.0%
35,428
61
35,655
71
36,630
104
-0.6%
-14.1%
-3.3%
-41.3%
36,396
36,633
37,641
-0.6%
-3.3%
4,377,551
4,161,238
3,897,918
5.2%
12.3%
1Q16
4Q15
1Q15
1,675,833
127,266
1,491,123
60,314
1,273,873
148,158
12.4%
111.0%
1Q16/4Q15 1Q16/1Q15
% Change
% Change
31.6%
-14.1%
197,898
223,144
458,627
-11.3%
-56.8%
Interbank and Interdepartmental accounts
Borrowings
61,959
77,007
83,850
83,696
28,671
128,766
-26.1%
-8.0%
116.1%
-40.2%
Onlendings
55,983
3,373
22,911
1559.7%
144.3%
8
103,481
2,258
117,723
892
62,980
-99.6%
-12.1%
-99.1%
64.3%
2,299,435
1,188,271
2,065,481
1,104,432
2,124,878
818,407
11.3%
7.6%
8.2%
45.2%
Money market funding
36,123
87,849
60,490
-58.9%
-40.3%
Funds from acceptance
Borrowings
41,214
-
39,922
1,276
53,147
8,262
3.2%
-100.0%
-22.5%
-100.0%
Derivatives
Other payables
Current Liabilities
Deposits
Onlendings
Other payables
Long-term Liabilities
Deferred income
Shareholders' Equity
Minority shareholders' Equity
Total liabilities and Shareholders' Equity
www.sofisa.com.br/ir
58,789
47,802
-100.0%
-100.0%
100,543
1,366,151
-
112,463
1,404,731
109,340
1,097,448
-10.6%
-2.7%
-8.0%
24.5%
89
98
76
-9.2%
17.1%
675,221
295
3.0%
-716.9%
5.4%
61.0%
3,897,918
5.2%
12.3%
711,401
475
4,377,551
691,005
(77)
4,161,238
6
Earnings
Release
Release de
Resultados
1Q16
4T10
Annex II – Consolidated Income Statement
R$ thousands
1Q16
Lending operations
Leasing operations
Securities operations
Derivatives
Foreign-exchange operations
Sales operations or transfer of financial assets
Income from financial intermediation
Funding operations
Borrowing and onlending operations
Leasing operations
Sales operations or transfer of financial assets
Allowance for loan losses
Expenses on financial intermediation
Gross profit from financial intermediation
Income from services provided
Personnel expenses
Other administrative expenses
Tax expenses
Other operating income
Other operating expenses
Other operating income (expenses)
Income from operations
Non-operating result
Income before taxes and minority interest
Income and social contribution taxes
Provision for Income and social contribution taxes
Deferred taxes
Employees profit sharing
Minority interest in controlled companies
Net income
www.sofisa.com.br/ir
4Q15
1Q16/4Q15
% Change
1Q15
1Q16/1Q15 %
Change
102,295
392
57,528
5,439
5,397
10
171,061
(103,338)
(1,019)
(327)
(4,508)
(109,192)
61,869
5,241
(16,723)
108,920
1,156
50,963
(7,771)
1,991
27
155,286
(96,025)
6,677
(1,086)
(8,249)
(98,683)
56,603
4,794
(16,452)
-6.1%
103,058
-66.1%
2,688
12.9%
35,191
-170.0%
10,192
171.1%
23,065
-63.0%
122
10.2% 174,316
7.6%
(77,659)
-115.3%
(60,781)
-69.9%
(2,538)
-45.4%
(640)
10.6% (141,618)
9.3%
32,698
9.3%
3,735
1.6%
(12,689)
(13,139)
(6,717)
4,083
(7,815)
(35,070)
26,799
133
26,932
(14,355)
(11,884)
(2,471)
(4,231)
16
(13,228)
(5,508)
6,164
(8,774)
(33,004)
23,599
232
23,831
(2,741)
2,071
(4,812)
(1,774)
273
-0.7%
21.9%
-33.8%
-10.9%
6.3%
13.6%
-42.7%
13.0%
423.7%
-673.8%
-48.6%
138.5%
-94.1%
(13,549)
(4,043)
25,984
(6,877)
(7,439)
25,259
(351)
24,908
(2,315)
(3,794)
1,479
(3,879)
2,747
-3.0%
66.1%
-84.3%
13.6%
371.4%
6.1%
-137.9%
8.1%
520.1%
213.2%
-267.1%
9.1%
-99.4%
8,362
19,589
-57.3%
21,461
-61.0%
2015
-0.7%
413,304
-85.4%
5,673
63.5%
168,680
-46.6%
37,148
-76.6%
74,736
-91.8%
281
-1.9% 699,822
33.1% (337,586)
-98.3% (152,771)
-87.1%
(5,332)
(10,842)
604.4%
(24,711)
-22.9% (531,242)
89.2% 168,580
40.3%
17,176
31.8%
(57,231)
2014
2015/2014 %
Change
341,295
51,072
102,343
15,419
36,282
1,513
547,924
(256,354)
(47,827)
(49,375)
(7)
(36,893)
(390,456)
157,468
13,908
(49,999)
21.1%
-88.9%
64.8%
140.9%
106.0%
-81.4%
27.7%
31.7%
219.4%
-89.2%
154785.7%
-33.0%
36.1%
7.1%
23.5%
14.5%
(54,510)
(18,679)
52,590
(13,601)
(74,255)
94,325
(2,522)
91,803
(1,129)
(11,748)
10,619
(11,023)
4,256
(53,818)
(22,203)
32,145
(7,256)
(87,223)
70,245
(2,666)
67,579
(21,915)
(11,701)
(10,214)
(10,563)
959
1.3%
-15.9%
63.6%
87.4%
-14.9%
34.3%
-5.4%
35.8%
-94.8%
0.4%
-204.0%
4.4%
343.8%
83,907
36,060
132.7%
7
1Q16
4T10
Earnings
Release
Release de
Resultados
Annex III – Consolidated Cash Flow Statement
R$ thousands
1Q16
Adjusted Net Income
Net Income
Provision for Loan Losses
Deferred tax
Depreciation and Amortization
Exchange Variation of Cash and Cash Equivalents
Changes in Assets and Obligations
(Increase) Decrease in Short-Term Interbank Investments
(Increase) Decrease in Securities and Derivatives Financial Instruments
(Increase) Decrease in Interbank Accounts
(Increase) Decrease in Credit, Leasing and Other Credit Operations
(Increase) Decrease in Other Credit and Other Assets
Income tax and social contribution paid
Increase (Decrease) in Deposits
Increase (Decrease) in Money Market Funding
4Q15
2015
16,794
13,197
111,755
8,362
19,589
83,907
4,508
8,249
24,711
(15,470)
802
829
3,137
3,122
478
(2,797) (185,305)
(160,614) 486,384
(160,419)
(119,076) (406,910) (347,245)
(29,388)
59,341
83,294
69,241
(26,206)
68,715
25,628
34,403
4,682
2,890
3,187
268,549
225,103
333,356
15,226 (112,577)
(41,922)
2014
76,317
36,060
36,893
3,364
(100,080)
(55,992)
(41,131)
(1,768)
(234,865)
(4,106)
13,649
448,491
(38,304)
Increase (Decrease) in Resources from Securities Issued
(23,954) (290,154)
(52,866)
66,345
Increase (Decrease) in Borrowing and Onlending Obligations
Increase (Decrease) in Derivative Financial Instruments
Increase (Decrease) in Other Obligations
Increase (Decrease) in Deferred Income
Exchange Variation of Cash and Cash Equivalents
Interest on Equity
Dividends Payments
Minority interest in controlled companies
Capital Decrease
OPERATING ACTIVITIES - Net Cash Generated (Used)
Investments
PP&E Disposal
Deferred
(14,143)
(2,250)
(29,052)
(9)
(3,122)
552
17,272
(575)
10
(21,247)
(106)
62,132
(16,000)
(147)
10,400
(1,343)
11
(84,655)
1,818
39,659
34
(25,500)
(4,256)
(73,550)
(1,701)
43
(155,193)
(1,223)
(10,699)
(176)
(6,000)
(24,000)
(5,108)
(50,000)
(23,763)
39,374
1,079
-
(565)
(1,332)
(1,658)
40,453
16,707
9,068
(75,208)
16,690
56,263
72,970
47,195
56,263
131,471
56,263
114,781
131,471
16,707
9,068
(75,208)
16,690
INVESTMENT ACTIVITIES - Net Cash Generated (Used)
CASH AND EQUIVALENTS INCREASE (DECREASE)
Cash and Cash Equivalents at the Beginning of the Period
Cash and Cash Equivalents at the End of the Period
CASH AND CASH EQUIVALENTS NET INCREASE (DECREASE)
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