São Paulo, July 6th, 2017 – Odebrecht Engineering & Construction (OEC) discloses today its 2016 consolidated results. OEC’s portfolio of projects finished the year accumulating US$ 16.7 billion, of which 72% correspond to international contracts, whereas the other 28% are entered into in Brazil. Contracts between companies of the group represent 15% of the total.

The Company’s 2016 results contain provisions reflecting those already closed and the estimate for those being negotiated, as well as adjustments of previous years. These effects add up to R$ 4.5 billion. Additionally, the Company presented the numbers of 2015 again, to reflect adhesion to the PRT – Tax Regularization Program (Programa de Regularização de Tributos) of the Federal Government, with an impact on the 2015 net assets of R$ 1.4 billion. These measures are part of the current process of the company’s change and show its disposition to undertake new challenges in the future. 

To reflect the company’s operational reality, the main indicators were calculated without the effect of the provisions and adjustments referring to past years. Adjusted net revenues reached R$ 19.4 billion, being 78% of this resulting from International operations, with revenues in dollars. The fall regarding the 2015 value refers particularly to the Venezuela exchange adjustment in 2016, which neutralized the effect of hyper-inflation in the period, and to the reduction in production in all locations where the company operates.

Revenues generated abroad were R$ 14.5 billion, mostly originated in Latin America, with special mention to Panama, Dominican Republic and Peru. The rest is related to works in Africa and, in a smaller scale, in Portugal and the United Arab Emirates. Brazil represented 22% of the revenues of the Company.

In 2016, OEC’s adjusted net profits were R$ 2.5 billion. However, with adjustments in statements and provisions, Odebrecht Engineering & Construction recorded a loss of 2 billion in the year. 


The reduction in the company’s gross debt is due to the exchange variation (appreciation of 16.5% of the Real in the year) and totaled R$ 10.9 billion, in 2016, with an overbalance of R$ 4 billion, resulting in a net debt of R$ 6.8 billion. Cashflow, when measured in dollars, dropped 51% in 2016, from US$ 2.5 billion at the end of 2015 to US$ 1.3 billion on December 31, 2016. The company, given its size and the fact that it works with clients’ advancements, uses its cashflow entirely in its operations. 

Commitment and deliveries

Last year, Odebrecht Engineering & Construction contributed to the realization of important events in Brazil like the Olympics by participating in enterprises delivered within deadlines agreed. The Olympic Park hosted the competitions of 16 Olympic and nine Paralympic sports, being one of the main stages of the competitions that happened in Rio de Janeiro. Concessionaire Rio Mais, led by Odebrecht, was responsible for part of the construction of the Park, which has approximately 1.18 million sqm, an area bigger than the neighborhood of Ipanema.

In April of 2017, the company resumed the works of the BRT Transbrasil. The project was paralyzed since last year, meeting a request of the Rio 2016 Committee, and should be concluded in June of 2018. 

Internationally, the Laúca Hydro Power plant, the biggest one in Angola, inaugurates its first turbine this July, and is expected to generate power in the middle of the month. Also in Angola, in the end of June the second hydro power plant of Cambambe was inaugurated, benefitting eight million people.

Odebrecht Engineering & Construction employs 33 thousand workers from 70 different nationalities in more than forty sites spread throughout Brazil and the world.

Agreements – Following Odebrecht S.A. agreements with the Federal Public Ministry, with the North American Department of Justice (DoJ) and with Switzerland, the Company continues negotiating with other countries in Latin America. Agreements have been made with the Dominican Republic and Ecuador. The company understands this is the basis to resume the operations in the countries where it operates through ethical, lawful and transparent work.

At the same time, independent monitors hired by Brazilian and US authorities monitor these agreements and strengthen the implementation of best compliance practices, serving as a seal for the operations of the whole Group.

Compliance – Since July of 2016, the group has been strengthening the measures of the Compliance and Governance System. All companies are adapting in order to have in their Board of Administration at least 20% of independent members. Also, at the holding and in each of its businesses, Compliance Committees were created to report directly to the Boards of Administration, granting more independence and autonomy to the work of those responsible for this area.

At OEC, Chief Compliance Officer Mike Munro completed one year on the job and already collects relevant actions in the area, such as concluding the training of 100% of the company’s top leaders. João Pinheiro Nogueira Batista, an economist with executive experience in the financial and industrial sectors, nationally and internationally, has just been elected as an independent advisor.

In December of 2016, the Policy on Compliance was approved at Odebrecht S.A. and, from then on, in all Businesses. Based on International best practices, the Policy has the purpose of guiding the behavior and internal and external relations of participants, regardless of their hierarchic level.

In this sense, Odebrecht improved its Ethics Line channel, which exists since 2014, now managed by a third party, making it possible to denounce irregularities and misconduct of Participants, clients and third parties.

The Company believes it is taking all measures to reflect the effects of the past and in this new phase, is focused on resuming the sustainable growth of its businesses, always with a lawful and ethical posture.