Laying the foundations
for a new growth cycle
Message from the CEO

Despite the
difficulties,
we fulfilled
our commitments:
the infrastructure
for the
Olympic Games
in Rio is
one example

In more than seven decades of activity, the Odebrecht Group has faced times that have challenged its growth and even its survival. Without question, the year 2015 was one of those times.

In the national context, Brazil faced one of the most acute political crises in its history and an unprecedented economic recession characterized by a tight monetary policy, soaring inflation and interest rates, the strong rise of the US dollar against the Brazilian real, the beginning of a surge in unemployment and, above all, a credit crunch. The country lost its Investment Grade position, shaking the confidence of Brazilian and foreign investors.

On the international level, our Businesses were impacted by the strong contraction in the oil and gas sector, in which we operate and provide services - although that impact was tempered by the increased value of our exports of petrochemicals and agro-industrial products and major Engineering & Construction projects garnered in Africa, Latin America, and the United States.

We also faced an ethical and institutional crisis triggered by the Federal Public Prosecutor’s investigation of Petrobras, within the framework of Operation Car Wash. The Odebrecht Group’s reputation and image were directly affected, and it also saw the suspension of contract with the state-owned oil company.

bandeiras-2

Measures focused on ethics, integrity and transparency

The mistakes made and the lessons learned have led us to develop a range of measures aimed at laying the foundations for a new Group, with a focus on ethics, integrity and transparency. We are also bolstering our long-standing commitments to the public, our Members and their families, and our Clients, Partners and Shareholders.

In this regard, we are dedicated to updating and improving internal policies, especially those concerning corporate Governance and Compliance, which will guide our practices in relation to the public sector to guarantee the integrity of contracts and transparency in all our operations.

We have created a specific committee to deal with compliance and set goals for our Businesses to qualify as Pro-Ethics Companies according to the Ministry of Transparency, Inspection and Control (MTFC), which represents compliance with preventive measures and combating corruption and other types of fraud. We have also joined the United Nations Global Compact, which aims to mobilize the international business community to adopt recognized values in the areas of human rights, labor relations, the environment and the fight against corruption.

Public commitment to evolve along with Brazil

Despite the difficulties we faced in 2015, we maintained efficiency in the performance of our contracts and investments: among other highlights, we guaranteed the quality of the projects developed for the 2016 Olympic Games in Rio de Janeiro, inaugurated Ethylene XXI, a project of strategic importance for Mexico, achieved record productivity in the agroindustrial area, and won significant new contracts, such as the reconstruction of the city of Colón in Panama.

Thus, in 2015, Odebrecht reaffirmed its delivery capacity, increased its productivity and sought to ratify  the trust of Clients and investors.

With united and motivated teams, technical qualifications, consolidated internationalization and robust performance in social responsibility, we are striving to fulfill contracts and preserve more than 120,000 direct and indirect jobs.

We are also seeking to ensure our financial health and plan the Businesses' sustainable growth in the next few years. To this end, we have formulated a program to restructure our debt, focusing on the sale of assets worth approximately BRL 12 billion (part of which has already been achieved) and establishing a balanced net debt/EBITDA ratio (about 3.0), which will enable us to leverage new investments.

From the social standpoint, we have maintained our professional education and work and income creation programs in the communities in which we are present. In the last decade, our voluntary programs have benefited more than 6.5 million people, totaling about BRL 830 million. In 2015 alone, the Odebrecht Group’s voluntary investments in social and environmental programs amounted to more than BRL 100 million, plus another BRL 600 million in contractual obligations.

The lessons learned in recent years have led to behavioral changes and the adjustment of our organizational macrostructure. They have also led us to make a public commitment to evolve along with Brazil and all the other countries in which we are present. These ongoing changes will allow us to maintain Odebrecht’s solidity, build the foundations for a new cycle of growth and follow the process of organizational renewal, to be continued by the next generations.

Newton de Souza
CEO of Odebrecht S.A.

These ongoing
changes will
allow us
to maintain
Odebrecht’s
solidity and
build the
foundations for
a new cycle
of growth