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Investor Presentaiton

2016 Braskem | Annual Report 3. VINYLS The Vinyls segment had net sales revenue of BRL 3 billion in 2016, a 9% growth over the previous year. This increase is mainly explained by higher levels of PVC prices in the international market and by the greater export efforts adopted by the Company to compensate for the recession of the domestic market. In 2016, exports showed a 79% increase compared to 2015. In the Brazilian market, sales totaled 528 kton, maintaining the same level recorded in 2015, since, despite the market recession, the Company increased sales to the Agribusiness sector (irrigation tubes), reaching a market share of 52%, which was 1 p.p. higher than in 2015. In 2016, the average utilization rate of PVC plants was 84%, an increase of 7 p.p. over 2015, and production volume increased by 10% compared to the previous year. STRUCTURE OF THE VINYLS SEGMENT The Vinyls segment consists of the industrial and commercial operations of the PVC, chlorine, and caustic soda units, as well as other products such as hydrogen and sodium hypochlorite. Industrial operations include three PVC plants and two chlorine-soda plants located in the petrochemical complex in Camaçari and Alagoas. The Company's annual production capacity for PVC and caustic soda is 710 kton and 539 kton, respectively. FINANCIAL OVERVIEW (BRL MILLION) VINYLS Net Sales Revenue Cost of Goods Sold 4T16 3T16 4T15 (A) (B) (c) VAR. (A)/(B) VAR. 2016 (A)/(C) (D) 2015 (E) VAR. (D)/(E) 794 740 724 7% 10% 3,016 2,780 9% (732) (698) (568) 5% 29% (2,834) (2,416) 17% Gross Income 62 62 33 43 156 45% (60%) 183 364 (50%) Gross Margin 8% 6% 22% 2 p.p. (14 p.p.) 6% 13% (7 p.p.) SG&A (68) (62) (64) 9% 6% (241) (225) 7% Other Operating Income (Expenses) (48) 0 (42) 14% (49) (27) 83% EBITDA for the Segment 38 75 75 108 (50%) (65%) 241 355 (32%) EBITDA Margin for the Segment 5% 10% 15% (5 p.p.) (10 p.p.) 8% 13% (5 p.p.) 41
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