| Intangible Assets |
The intangible assets roll-forward, is set forth
below:
| Schedule of intangible assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
| |
Average rate (1) |
|
12.31.23 |
|
Additions |
|
Disposals |
|
Transfers |
|
Monetary correction by Hyperinflation |
|
Exchange rate variation |
|
12.31.24 |
| Cost |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Goodwill |
|
|
3,390,938 |
|
- |
|
- |
|
- |
|
92,444 |
|
287,880 |
|
3,771,262 |
| Trademarks |
|
|
1,873,253 |
|
- |
|
(156) |
|
- |
|
109,314 |
|
23,855 |
|
2,006,266 |
| Non-compete agreement |
|
|
54,892 |
|
737 |
|
(8,436) |
|
- |
|
- |
|
9,826 |
|
57,019 |
| Outgrowers relationship |
|
|
517 |
|
- |
|
(517) |
|
- |
|
- |
|
- |
|
- |
| Patents |
|
|
4,129 |
|
- |
|
(2) |
|
- |
|
1,034 |
|
225 |
|
5,386 |
| Customer relationship |
|
|
1,217,742 |
|
- |
|
- |
|
- |
|
205,074 |
|
231,794 |
|
1,654,610 |
| Software |
|
|
787,048 |
|
474 |
|
(267,404) |
|
154,051 |
|
11,992 |
|
14,047 |
|
700,208 |
| Intangible in progress (2) |
|
|
35,479 |
|
157,734 |
|
(1,434) |
|
(153,507) |
|
(570) |
|
(10) |
|
37,692 |
| |
|
|
7,363,998 |
|
158,945 |
|
(277,949) |
|
544 |
|
419,288 |
|
567,617 |
|
8,232,443 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Amortization |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Non-compete agreement |
41.22% |
|
(47,841) |
|
(5,236) |
|
8,436 |
|
- |
|
- |
|
(9,827) |
|
(54,468) |
| Outgrowers relationship |
- |
|
(419) |
|
(49) |
|
468 |
|
- |
|
- |
|
- |
|
- |
| Patents |
8.47% |
|
(3,195) |
|
(566) |
|
- |
|
- |
|
(230) |
|
(159) |
|
(4,150) |
| Customer relationship |
6.94% |
|
(635,655) |
|
(131,595) |
|
- |
|
- |
|
(119,784) |
|
(147,236) |
|
(1,034,270) |
| Software |
32.79% |
|
(536,450) |
|
(179,702) |
|
266,841 |
|
- |
|
(5,083) |
|
(11,950) |
|
(466,344) |
| |
|
|
(1,223,560) |
|
(317,148) |
|
275,745 |
|
- |
|
(125,097) |
|
(169,172) |
|
(1,559,232) |
| |
|
|
6,140,438 |
|
(158,203) |
|
(2,204) |
|
544 |
|
294,191 |
|
398,445 |
|
6,673,211 |
| (1) | Weighted average annual remaining rate. |
| (2) | Refers to the acquisition of new software. |
| |
|
|
|
| |
Average rate (1) |
|
12.31.22 |
|
Additions |
|
Disposals |
|
Transfers |
|
Monetary correction by Hyperinflation |
|
Exchange rate variation |
|
12.31.23 |
| Cost |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Goodwill |
|
|
3,474,103 |
|
- |
|
- |
|
- |
|
96,843 |
|
(180,008) |
|
3,390,938 |
| Trademarks |
|
|
1,881,199 |
|
- |
|
- |
|
- |
|
114,516 |
|
(122,462) |
|
1,873,253 |
| Non-compete agreement |
|
|
57,426 |
|
465 |
|
- |
|
- |
|
- |
|
(2,999) |
|
54,892 |
| Outgrowers relationship |
|
|
517 |
|
- |
|
- |
|
- |
|
- |
|
- |
|
517 |
| Patents |
|
|
4,878 |
|
- |
|
(675) |
|
- |
|
1,335 |
|
(1,409) |
|
4,129 |
| Customer relationship |
|
|
1,340,251 |
|
- |
|
- |
|
- |
|
156,141 |
|
(278,650) |
|
1,217,742 |
| Software |
|
|
930,090 |
|
140 |
|
(357,470) |
|
214,757 |
|
33,916 |
|
(34,385) |
|
787,048 |
| Intangible in progress (2) |
|
|
77,263 |
|
166,995 |
|
(2,757) |
|
(204,828) |
|
(657) |
|
(537) |
|
35,479 |
| |
|
|
7,765,727 |
|
167,600 |
|
(360,902) |
|
9,929 |
|
402,094 |
|
(620,450) |
|
7,363,998 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Amortization |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Non-compete agreement |
46.01% |
|
(39,336) |
|
(11,353) |
|
|
|
- |
|
- |
|
2,848 |
|
(47,841) |
| Outgrowers relationship |
16.45% |
|
(347) |
|
(72) |
|
|
|
- |
|
- |
|
- |
|
(419) |
| Patents |
8.52% |
|
(3,824) |
|
(448) |
|
675 |
|
- |
|
(834) |
|
1,236 |
|
(3,195) |
| Customer relationship |
6.67% |
|
(622,106) |
|
(101,575) |
|
- |
|
- |
|
(48,487) |
|
136,513 |
|
(635,655) |
| Software |
43.58% |
|
(665,504) |
|
(226,029) |
|
356,053 |
|
|
|
(21,656) |
|
20,686 |
|
(536,450) |
| |
|
|
(1,331,117) |
|
(339,477) |
|
356,728 |
|
- |
|
(70,977) |
|
161,283 |
|
(1,223,560) |
| |
|
|
6,434,610 |
|
(171,877) |
|
(4,174) |
|
9,929 |
|
331,117 |
|
(459,167) |
|
6,140,438 |
| (1) | Weighted average annual remaining rate. |
| (2) | Refers to the acquisition of new software. |
The impairment test of assets is carried out annually
based on the discounted cash flow method, which is prepared in order to determine the value in use of the Company’s cash-generating
units (“CGU”) (note 24), which were defined in line with the management format. In 2024, the Company used its budget, strategic
and financial planning with projections until 2027 and average perpetuity of the cash generating units of 3.5% p.a., based on the history
of recent years, as well as in the economic and financial projections of each market in which the Company operates, in addition to official
information from independent and governmental institutions.
The discount rate used by Management to prepare discounted
cash flows varied from 11.9% p.a. to 13.4% p.a. according to the CGU. The assumptions presented in the table below were also adopted:
| Schedule of assumptions |
|
|
|
|
|
|
| |
|
2025 |
|
2026 |
|
2027 |
| Inflation Brazil (1) |
|
3.93% |
|
4.65% |
|
4.60% |
| Inflation - United States (1) |
|
2.48% |
|
2.57% |
|
2.57% |
| Exchange rate - BRL / USD (2) |
|
5.80 |
|
5.73 |
|
5.69 |
| (1) | Source: Macroeconomic Outlook and Scenarios Report - 05.11.24 (LCA Consultoria
Econômica). |
| (2) | Source: Focus - Market Report - 06.12.24 (Central Bank of Brazil). |
The rates presented above doesn’t
consider the effects of income taxes.
Based on Management’s analysis,
no impairment adjustments were identified.
In addition to the recovery analysis mentioned above,
Management carried out sensitivity analysis, increasing and decreasing by 2 p.p. the operating margin1 (operating income over
net sales) and the nominal discount rate and did not identify any scenarios which would determine the need to set up a provision for impairment
of the CGUs.
¹ Weighted average remaining rate
per year.
Intangible
assets
|
Accounting policy:
Acquired intangible assets are measured at cost at
initial recognition, while those arising from a business combination are recognized at fair value on the acquisition date. After initial
recognition, are presented at cost less accumulated amortization and impairment losses, when applicable. Internally generated intangible
assets, excluding development costs, are not capitalized and the expense is recognized in the statements of income (loss) when incurred.
Intangible assets with definite useful lives are
amortized on a straight-line basis over their economic useful lives. The amortization period and method for an intangible asset with definite
life are reviewed at least at the end of each year, and any changes observed are applied prospectively. The amortization of intangible
assets with finite lives is recognized in the statements of income (loss) in the expense category related to their use.
Intangible assets with indefinite useful lives are
not amortized, but are tested annually for impairment, being allocated to the cash-generating units. The Company records in this subgroup
mainly goodwill and trademarks, which are expected to contribute indefinitely to its cash flows.
In the event of impairment, the company records the
effects in the income statement, according to the nature of the asset.
|
|