Good day, ladies and gentlemen. At this time, we would like to welcome everyone to SABESP's Conference Call to discuss its results for 2015. The audio for this conference is being broadcast simultaneously through the Internet on the website, www.sabesp.com.br. In that same address, you can find the slideshow presentation available for download. We inform you that all participants will only be able to listen to the conference during the company's presentation. After the company's remarks are over, there will be a Q&A period. At that time, further instructions will be given. [Operator Instructions] Before proceeding, let me mention that forward-looking statements are being made under the Safe Harbor of the Securities Litigation Reform Act of 1996. Forward-looking statements are based on the beliefs and assumptions of SABESP's Management and on information currently available to the company. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions because they relate to future events and, therefore, depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions, industry conditions and other operating factors could also affect the future results of SABESP and could cause results to differ materially from those expressed in such forward-looking statements. Today with us, we have Mr. Rui Affonso, Chief Financial Officer and Investor Relations Officer; Mr. Mário Arruda Sampaio, Head of Capital Market and Investor Relations and Mr. Marcelo Miyagui, Head of Accounting. Now, I'll turn the call over to Mr. Arruda Sampaio. Sir, you may begin your conference. Mário Arruda Sampaio: Okay. Thank you and good afternoon, everybody. We're here for one more earnings call. We have a presentation. After the presentation, we'll be available for a Q&A session. So let's get started on Slide 3. We show the company's billed water and sewage…

Thank you. At this time, we will begin the question-and-answer session. [Operator Instructions] Our first question will come from Michael Gaugler of Janney Montgomery Scott. Please go ahead.

Good afternoon, everyone. Mário Arruda Sampaio: Good afternoon, Michael.

Hi Michael.

Just one question gentlemen, I remember we acquired in the drought, I believe it was 2016 or 2017 what was going to be a time when SABESP and ARSESP considered adjusting tariffs and perhaps regulation from the initial regulation when it was implemented. And I am wondering is that reexamination still planned or has that changed given the adjustments that were made during the recent drought conditions? Mário Arruda Sampaio: Michael, I think you're making reference to the tariff review that is planned to occur in 2017. So the first cycle was from '13 to '16 and the second cycle will be from '17 and four years. So there is no change that we are on track for that. The regulatory agency has not yet put out the schedule and agenda for the process. We're obviously waiting for that, but it's definitely a full blown review. ll way from the WACC, regulatory WACC estimate to discussions around CapEx, OpEx, volume, x-factor looking back balancing all this period, we’ve gone through during the crisis, which obviously changed our business plan, agreed business plan for this cycle and all the adjustments needed as we move forward.

Thanks. And I do have a follow up. I would guess that order volumes probably wouldn’t increase since or after the adjustments go away on May 1. Just wondering what your thoughts were maybe about how quickly volumes could return to the pre-drought levels by the customers? Mário Arruda Sampaio: Okay. Michael, Mário again. Our understanding is that some memory will hold in there as we saw in 2004 when we adopted a similar bonus program, but that time we went through this about four to six months. Now we're at 25 months almost. So I think this is very much impacting on behavior. So we don’t know. We do expect recovery at some point, but not as steep as we saw in the past.

Okay. That’s all I had. Mário Arruda Sampaio: Change this behavior.

Okay. All right. Thank you gentlemen.

[Operator Instructions] And at this time, we will conclude the question- and-answer session. I would like to turn the conference back over to SABESP for their final remarks. Oh! I’m sorry. We do have another question, if you’d like to take it. Mário Arruda Sampaio: Yes, let’s take it.

This would be from Carlos Remeika of Covalis Capital. Please go ahead.

Good afternoon. Thank you very much for taking my question. I just had a quick follow-up on the lack update. I was wondering if that’s going to be a structural formula update. Do you have some simple update for example for risk free and cost of debt or its most probably going to be a debate in a sense that it's more qualitative? Mário Arruda Sampaio: Yes Carlos, let me check here with my colleague especially its Miyagui tariff next to me, just a second. Carlos, we're not sure. It's not defined yet, if there is going to be any change in previous methodology to estimate the WACC. So we had one adopted methodology, which we're not absolutely sure if this will happen again and mostly in defining the debt component of the WACC. Okay. So anytime soon.

So as I understand from the previous call that you had today and that around May we will see this further detail from ARSESP with some at least timeline soon, is that correct? Mário Arruda Sampaio: Yes. We expect any time soon that they put out the schedule.

And is there going to be just a schedule or something like a basic guidelines too with it? Mário Arruda Sampaio: Well, first the schedule and then we'll know what’s in front of us and as we move forward they will put out guidelines if there is any change upon the last methodology. And after that we will prepare our argument around the WACC and we will start working on the business plan. We will start reviewing how much the ex factor, how much the business plan for this cycle is off track and all the component, OpEx, CapEx and volume and how much of the contingence -- the extraordinary tariff review we had in June did compensate for the past and with this compensating for the future from that day to the end of the cycle. So there is a lot in front of us, but we don’t see today why we should have and go through the same higher [components] we went through to establish the first tariff cycle.

Thank you very much. Mário Arruda Sampaio: Okay. Welcome.

And at this time, there appear to be no further questions. I would like to turn the conference back over to SABESP for their final remarks. Mário Arruda Sampaio: Okay. Well again thank you very much for those who attended and there were not many questions, but you can always call us and we will answer any of your questions at IR team. So see you next quarter. Good bye.

Thank you. Ladies and gentlemen, the conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines.