Earnings Release 3Q16

Portuguese

12:00 PM BR (09:00 AM U.S. ET) Phone: +55 (11) 3728-5971/3127-4971

Code: Heringer

English

12:00 PM BR (09:00 AM U.S. ET) Phone: +1 (516) 300 1066

Code: Heringer

Investor Relations

Phone: +55 (19) 3322-2294

ri@heringer.com.br www.heringer.com.br/ri

• Delivery volume totaled 1.3 million metric tons in 3Q16, 17.0% down from 1.6 million metric tons in 3Q15, and 3.1 million metric tons in 9M16, 16.4% lower than in 9M15;

• Third-quarter net revenue came to R$1,512.5 million, 24.8% lower than in 3Q15. In 9M16, net revenue totaled R$3,821.8 million, 16.7% down on 9M15;

• EBITDA stood at R$85.0 million in 3Q16, 6.1% higher than the R$80.1 million recorded in 3Q15, and R$111.6 million in 9M16, 8.1% up on the R$103.2 million reported in 9M15;

• The net financial expense fell by a substantial 89.9%, from R$384.9 million in 3Q15 to R$38.9 million in 3Q16 (appreciation of the real). In 9M16, the net financial expense totaled R$89.5 million, an 86.4% improvement over the R$656.5 million recorded in 9M15;

• Net income totaled R$22.5 million in 3Q16, reversing the R$209.5 million net loss recorded in 3Q15. In 9M16, Heringer posted a R$9.3 million net loss, versus a R$389.7 million net loss in 9M15; and

• Deliveries of specialty products recorded year-on-year growth in both periods - 2.4% in 3Q16 and 9.5% in 9M16. As a result, their share of the Company's portfolio increased from 39% to 48% between 3Q15 and 3Q16 and from 38% to 49% between 9M15 and 9M16.

According to the National Fertilizer Association (ANDA), fertilizer deliveries in Brazil totaled 11.2 million metric tons in 3Q16, 6.3% more than in 3Q15. In 9M16, deliveries came to 24.4 metric tons, 9.6% up on 9M15.

In the first nine months, deliveries of nitrogen (N) fertilizers climbed by 13.6%, due to increased demand from sugarcane, corn and coffee.

Deliveries of phosphate (P2O5) fertilizers moved up by 5.8% between 9M15 and 9M16, thanks to increased deliveries for the 2016/2017 soybean and summer corn crop.

In 9M16, deliveries of potassium (K2O) fertilizers increased by 8.0% over the same period last year, due to higher demand from corn, soybean, sugarcane and coffee.

Mato Grosso state, the absolute leader in deliveries, accounted for 5,081 thousand metric tons, followed by Paraná, with 3,263 thousand metric tons; Rio Grande do Sul, with 2,916 thousand metric tons; São Paulo, with 2,769 thousand metric tons; and Minas Gerais, with 2,565 thousand metric tons.

Domestic fertilizer production totaled 6.7 million metric tons in the first nine months, in line with the same period last year.

In order to meet increased market demand, fertilizer imports grew by 19.5% in 3Q16 and 7.8% in 9M16, reaching 17.3 million metric tons. In the first nine months of 2016, imports were 4% lower than in the same period in 2014, when Brazil posted record deliveries, indicating a reduction in inventories.

BRAZILIAN FERTILIZER MARKET - DELIVERIES

Source: ANDA

BRAZILIAN FERTILIZER MARKET - DOMESTIC PRODUCTION

Source: ANDA

BRAZILIAN FERTILIZER MARKET - IMPORTS

Source: ANDA

The Company delivered 1.3 million metric tons in 3Q16, 17.0% less than the 1.6 million metric tons delivered in 3Q15, but in line with the business plan for the period.

This quarter, deliveries for corn and coffee moved up by 13.0% and 22.8%, respectively, over 3Q15.

Source: Heringer/Anda

In 9M16, the Company's deliveries totaled 3.1 million metric tons, 16.4% down on 9M15.

The decline in deliveries for other crops in the period was basically concentrated in reforestation, tobacco, pasture, cotton and wheat due to adverse weather conditions in certain crops and market conditions in others.

Source: Heringer/Anda