Fresh Del Monte Produce (FDP) - 2019 Q1 - Quarterly Report

PART I: FINANCIAL INFORMATION Item 1. Financial Statements This section presents the unaudited consolidated financial statements for the quarter ended March 29, 2019 Consolidated Balance Sheets (Unaudited) Highlights key asset, liability, and equity balances as of March 29, 2019, compared to year-end 2018 Consolidated Balance Sheet Highlights (March 29, 2019 vs. December 28, 2018) | Metric (U.S. dollars in millions) | March 29, 2019 | December 28, 2018 | | :-------------------------------- | :------------- | :---------------- | | Total current assets | $1,189.3 | $1,138.8 | | Total assets | $3,511.4 | $3,255.2 | | Total current liabilities | $620.7 | $586.0 | | Total liabilities | $1,708.7 | $1,485.6 | | Total shareholders' equity | $1,749.9 | $1,717.8 | Consolidated Statements of Operations (Unaudited) Details the company's revenues, costs, and profitability for the first quarter of 2019 versus 2018 Consolidated Statements of Operations Highlights (Quarter Ended March 29, 2019 vs. March 30, 2018) | Metric (U.S. dollars in millions) | Quarter Ended March 29, 2019 | Quarter Ended March 30, 2018 | | :-------------------------------- | :--------------------------- | :--------------------------- | | Net sales | $1,154.2 | $1,106.1 | | Gross profit | $93.3 | $106.5 | | Operating income | $41.3 | $56.5 | | Net income | $37.2 | $43.2 | | Net income attributable to Fresh Del Monte Produce Inc. | $36.1 | $41.5 | | Basic EPS | $0.74 | $0.85 | | Diluted EPS | $0.74 | $0.85 | - Dividends declared per ordinary share decreased from $0.150 in Q1 2018 to $0 in Q1 2019[16] Consolidated Statements of Comprehensive Income (Unaudited) Summarizes net income and other comprehensive income components, including unrealized gains and losses Consolidated Statements of Comprehensive Income Highlights (Quarter Ended March 29, 2019 vs. March 30, 2018) | Metric (U.S. dollars in millions) | Quarter Ended March 29, 2019 | Quarter Ended March 30, 2018 | | :-------------------------------- | :--------------------------- | :--------------------------- | | Net income | $37.2 | $43.2 | | Net unrealized (loss) on derivatives, net of tax | $(4.1) | $(1.8) | | Net unrealized foreign currency translation (loss) gain | $(0.8) | $4.3 | | Comprehensive income | $32.2 | $45.8 | | Comprehensive income attributable to Fresh Del Monte Produce Inc. | $31.1 | $44.1 | Consolidated Statements of Cash Flows (Unaudited) Outlines cash movements from operating, investing, and financing activities for the first quarter Consolidated Statements of Cash Flows Highlights (Quarter Ended March 29, 2019 vs. March 30, 2018) | Metric (U.S. dollars in millions) | Quarter Ended March 29, 2019 | Quarter Ended March 30, 2018 | | :-------------------------------- | :--------------------------- | :--------------------------- | | Net cash (used in) provided by operating activities | $(7.2) | $1.5 | | Net cash used in investing activities | $(29.6) | $(413.9) | | Net cash provided by financing activities | $35.2 | $423.1 | | Net increase in cash and cash equivalents | $0.6 | $12.3 | | Cash and cash equivalents, ending | $21.9 | $37.4 | - Operating cash flow decreased significantly, moving from a positive $1.5 million in Q1 2018 to a negative $7.2 million in Q1 2019[20] - Investing activities saw a much lower cash outflow in Q1 2019 ($29.6 million) compared to Q1 2018 ($413.9 million), primarily due to the Mann Packing acquisition in the prior year[20] Consolidated Statements of Shareholders' Equity and Redeemable Noncontrolling Interest Details the changes in shareholders' equity and redeemable noncontrolling interest during the quarter Shareholders' Equity Highlights (March 29, 2019 vs. December 28, 2018) | Metric (U.S. dollars in millions) | March 29, 2019 | December 28, 2018 | | :-------------------------------- | :------------- | :---------------- | | Total Fresh Del Monte Produce Inc. shareholders' equity | $1,724.5 | $1,692.0 | | Total shareholders' equity | $1,749.9 | $1,717.8 | | Redeemable noncontrolling interest | $52.8 | $51.8 | - Accumulated Other Comprehensive Loss increased from $(41.6) million at December 28, 2018, to $(46.6) million at March 29, 2019[13] Notes to Consolidated Financial Statements (Unaudited) Provides detailed explanations of accounting policies and specific financial statement items 1. General This note provides an overview of the company's business, product sourcing, and distribution regions - The Company is primarily engaged in the worldwide production, transportation, and marketing of fresh produce and prepared food products, sourcing from Central/South/North America, Africa, and the Philippines, and distributing globally[27] - Fresh Del Monte holds exclusive, royalty-free, perpetual licenses to use the DEL MONTE® brand for fresh fruit, vegetables, and certain prepared foods in specific geographic regions[27] - The unaudited Consolidated Financial Statements for Q1 2019 are prepared in accordance with GAAP for interim financial information and are subject to significant seasonal variations[28] 2. Recently Issued Accounting Pronouncements This note outlines recently adopted and not-yet-adopted accounting pronouncements and their impacts - Adopted ASU 2016-02 (Topic 842) on Leases, effective December 29, 2018, using a modified retrospective method, resulting in a $3.0 million retained earnings adjustment due to deferred taxes[35][36] - Elected practical expedients for lease accounting, including not reassessing prior conclusions on lease classification and initial direct costs, and applying a short-term lease recognition exemption[37] - Several ASUs (2018-18, 2018-17, 2018-15, 2018-14, 2018-13, 2016-13) are not yet adopted, with effective dates in fiscal years 2020 and 2021, and their potential impact is currently under evaluation[40][41][42][43][44][46] 3. Asset Impairment and Other Charges, Net The company recorded $3.0 million in asset impairment and other charges for Q1 2019 Asset Impairment and Other Charges, Net (Q1 2019 vs. Q1 2018) | Category (U.S. dollars in millions) | Quarter Ended March 29, 2019 | Quarter Ended March 30, 2018 | | :---------------------------------- | :--------------------------- | :--------------------------- | | Banana segment: Philippine exit activities | $0.2 | $0 | | Fresh and value-added products: Acquisition costs (Mann Packing) | $0 | $2.5 | | Fresh and value-added products: Sanger insurance recoveries | $0 | $(0.9) | | Fresh and value-added products: Impairment of equity investment | $2.8 | $0 | | Total asset impairment and other charges, net | $3.0 | $1.6 | - The Q1 2019 charges include a $2.8 million impairment of an equity investment and $0.2 million for contract terminations in Philippine banana operations[48] 4. Acquisition This note details the acquisition of Mann Packing in February 2018 for $357.2 million - Acquired 100% of Mann Packing on February 26, 2018, for $357.2 million, funded by a promissory note and cash[51][52] - The acquisition resulted in $162.0 million allocated to goodwill and $139.8 million to definite-lived intangible assets (customer lists, trade names, trademarks)[53] Mann Packing Financial Contribution (Partial Q1 2018) | Metric (U.S. dollars in millions) | Period Feb 27 - Mar 30, 2018 | | :-------------------------------- | :--------------------------- | | Net sales | $51.3 | | Net income attributable to Fresh Del Monte Produce, Inc. | $0.9 | Pro Forma Combined Financial Information (Q1 2019 vs. Q1 2018) | Metric (U.S. dollars in millions) | Quarter Ended March 29, 2019 | Quarter Ended March 30, 2018 (Pro Forma) | | :-------------------------------- | :--------------------------- | :--------------------------------------- | | Net sales | $1,154.2 | $1,185.3 | | Net income attributable to Fresh Del Monte Produce, Inc. | $36.1 | $43.5 | 5. Income Taxes The company is contesting income tax deficiencies totaling approximately $142.9 million from two foreign jurisdictions - Taxing authorities in two foreign jurisdictions issued income tax deficiencies of approximately $142.9 million (including interest and penalties) for tax years 2012-2016, related to transfer pricing[58] - The Company strongly disagrees with the proposed adjustments, has filed protests, and has not accrued additional amounts, intending to vigorously contest the matters[58] 6. Financing Receivables Financing receivables, primarily advances to growers, totaled $41.7 million net as of March 29, 2019 - Financing receivables primarily consist of advances to independent growers and suppliers, collateralized by property liens and pledges of produce[61][62] Gross Advances to Growers and Suppliers (March 29, 2019 vs. December 28, 2018) | Category (U.S. dollars in millions) | March 29, 2019 | December 28, 2018 | | :---------------------------------- | :------------- | :---------------- | | Short-term advances | $43.6 | $51.9 | | Long-term advances | $4.7 | $3.7 | | Allowance for advances | $(2.8) | $(2.8) | | Net advances | $41.7 | $49.8 | 7. Share-Based Compensation Share-based compensation expense totaled $4.2 million for Q1 2019, down from $4.7 million in Q1 2018 Share-Based Compensation Expense (Q1 2019 vs. Q1 2018) | Category (U.S. dollars in millions) | Quarter Ended March 29, 2019 | Quarter Ended March 30, 2018 | | :---------------------------------- | :--------------------------- | :--------------------------- | | Stock options | $0 | $0.1 | | RSUs/PSUs | $3.3 | $3.6 | | RSAs | $0.9 | $1.0 | | Total | $4.2 | $4.7 | - Proceeds from stock option exercises decreased from $0.7 million in Q1 2018 to $0.2 million in Q1 2019[68] - 2018 Performance Stock Units (PSUs) were forfeited due to not meeting the performance metric[76] 8. Inventories Total inventories increased to $575.8 million as of March 29, 2019, from $565.3 million at year-end 2018 Inventories (March 29, 2019 vs. December 28, 2018) | Category (U.S. dollars in millions) | March 29, 2019 | December 28, 2018 | | :---------------------------------- | :------------- | :---------------- | | Finished goods | $238.8 | $217.4 | | Raw materials and packaging supplies | $171.1 | $167.0 | | Growing crops | $165.9 | $180.9 | | Total inventories | $575.8 | $565.3 | 9. Leases The company recognized significant lease-related assets and liabilities following the adoption of ASU 2016-02 - Adopted ASU No. 2016-02, 'Leases (Topic 842),' on December 29, 2018, requiring balance sheet recognition for leases over 12 months[80] Lease-Related Assets and Liabilities (March 29, 2019) | Category (U.S. dollars in millions) | Amount | | :---------------------------------- | :----- | | Operating lease right-of-use assets | $192.2 | | Finance lease assets | $1.3 | | Total lease assets | $193.5 | | Current operating lease liabilities | $56.0 | | Noncurrent operating lease liabilities | $109.5 | | Total lease liabilities | $166.4 | Lease Costs (Quarter Ended March 29, 2019) | Category (U.S. dollars in millions) | Amount | | :---------------------------------- | :----- | | Finance lease cost (amortization) | $0.1 | | Operating lease cost | $23.3 | | Short-term lease cost | $2.4 | | Variable lease cost | $1.3 | | Total lease cost | $27.1 | 10. Long-Term Debt and Finance Lease Obligations Total long-term debt and finance lease obligations increased to $700.6 million as of March 29, 2019 Long-Term Debt and Finance Lease Obligations (March 29, 2019 vs. December 28, 2018) | Category (U.S. dollars in millions) | March 29, 2019 | December 28, 2018 | | :---------------------------------- | :------------- | :---------------- | | Senior unsecured revolving credit facility | $699.7 | $661.3 | | Finance lease obligations | $0.9 | $1.1 | | Total long-term debt and finance lease obligations | $700.6 | $662.4 | | Less: Current maturities | $(0.4) | $(0.5) | | Long-term debt and finance lease obligations | $700.2 | $661.9 | - The Credit Facility's borrowing limit was increased from $800 million to $1.1 billion in February 2018, with $699.7 million outstanding at March 29, 2019, at an interest rate of 4.03%[95][96][183] - The Company plans to refinance its Credit Facility, which matures on April 15, 2020, during 2019 and was in compliance with all covenants as of March 29, 2019[180][184] 11. Commitments and Contingencies The company has an ongoing environmental cleanup liability and recently settled a business litigation - Accrued $13.5 million for the Kunia Well Site environmental cleanup as of March 29, 2019, with expected expenditures of $0.3 million in 2019, $1.1 million in 2020, $1.0 million in 2021, and $0.9 million in 2022 and 2023[106] - Settled a business transaction litigation on March 14, 2019, resulting in a net gain of approximately $16.7 million, included in other income, net[107] 12. Earnings Per Share Basic and diluted net income per ordinary share for Q1 2019 was $0.74, a decrease from $0.85 in Q1 2018 Earnings Per Share (Q1 2019 vs. Q1 2018) | Metric (U.S. dollars in millions, except per share data) | Quarter Ended March 29, 2019 | Quarter Ended March 30, 2018 | | :------------------------------------------------------- | :--------------------------- | :--------------------------- | | Net income attributable to Fresh Del Monte Produce Inc. | $36.1 | $41.5 | | Weighted average ordinary shares - Basic | 48,547,698 | 48,781,596 | | Weighted average ordinary shares - Diluted | 48,752,162 | 49,032,952 | | Basic EPS | $0.74 | $0.85 | | Diluted EPS | $0.74 | $0.85 | - Certain unvested RSUs and PSUs were excluded from diluted EPS calculation as their effect would have been antidilutive[111] 13. Retirement and Other Employee Benefits Net periodic benefit costs for pension and post-retirement plans remained stable at $2.4 million Net Periodic Benefit Costs (Q1 2019 vs. Q1 2018) | Metric (U.S. dollars in millions) | Quarter Ended March 29, 2019 | Quarter Ended March 30, 2018 | | :-------------------------------- | :--------------------------- | :--------------------------- | | Service cost | $1.4 | $1.5 | | Interest cost | $1.7 | $1.6 | | Expected return on assets | $(0.8) | $(0.9) | | Amortization of net actuarial loss | $0.1 | $0.2 | | Net periodic benefit costs | $2.4 | $2.4 | - Net periodic benefit costs for other non-U.S.-based plans were $0.8 million for Q1 2019, up from $0.7 million in Q1 2018[115] 14. Business Segment Data The company realigned its reportable segments into 'fresh and value-added products' and 'bananas' - Reportable segments were changed in March 2019 to 'fresh and value-added products' and 'bananas,' with 'other products and services' as ancillary, reflecting management's review of operating results[118][167] Net Sales and Gross Profit by Segment (Q1 2019 vs. Q1 2018) | Segment (U.S. dollars in millions) | Q1 2019 Net Sales | Q1 2019 Gross Profit | Q1 2018 Net Sales | Q1 2018 Gross Profit | | :--------------------------------- | :---------------- | :------------------- | :---------------- | :------------------- | | Fresh and value-added products | $690.0 (60%) | $61.5 (66%) | $616.5 (56%) | $51.3 (48%) | | Banana | $431.5 (37%) | $32.9 (35%) | $453.2 (41%) | $52.1 (49%) | | Other products and services | $32.7 (3%) | $(1.1) (-1%) | $36.4 (3%) | $3.1 (3%) | | Totals | $1,154.2 (100%) | $93.3 (100%) | $1,106.1 (100%) | $106.5 (100%) | Net Sales by Geographic Region (Q1 2019 vs. Q1 2018) | Region (U.S. dollars in millions) | Q1 2019 Net Sales | Q1 2018 Net Sales | | :-------------------------------- | :---------------- | :---------------- | | North America | $748.8 (65%) | $663.4 (60%) | | Europe | $171.3 (15%) | $194.1 (18%) | | Asia | $120.7 (10%) | $112.7 (10%) | | Middle East | $97.8 (9%) | $115.9 (10%) | | Other | $15.6 (1%) | $20.0 (2%) | | Totals | $1,154.2 (100%) | $1,106.1 (100%) | 15. Derivative Financial Instruments The company uses derivatives to hedge exposure to foreign exchange and interest rate fluctuations - Derivative financial instruments are used to reduce exposure to foreign exchange rate and variable interest rate fluctuations, predominantly designated as cash flow hedges[125] Outstanding Foreign Currency Forward Contracts (March 29, 2019) | Currency | Notional Amount (in millions) | | :------------ | :---------------------------- | | Euro (EUR) | 93.6 | | British pound (GBP) | 5.9 | | Japanese yen (JPY) | 3,119.7 | | Korean won (KRW) | 28,291.2 | - Notional value of interest rate contracts outstanding was $400.0 million as of March 29, 2019, maturing in 2024 and 2028[135] Effect of Derivative Instruments on Consolidated Statements of Operations (Q1 2019 vs. Q1 2018) | Derivative Type | Location of (Loss) Income Reclassified from AOCI | Q1 2019 (Loss) Income (millions) | Q1 2018 (Loss) Income (millions) | | :------------------------ | :----------------------------------------------- | :------------------------------- | :------------------------------- | | Foreign exchange contracts | Net sales | $3.3 | $(1.8) | | Foreign exchange contracts | Cost of products sold | $0.6 | $0 | | Interest rate swaps | Interest expense | $(9.2) | $0 | | Total | | $(5.3) | $(1.8) | 16. Fair Value Measurements This note details the fair value measurement of financial instruments and non-financial assets - Derivative instruments are valued using an income approach (discounted cash flow model) and classified as Level 2 due to observable inputs[141] Fair Value Measurements (March 29, 2019) | Category (U.S. dollars in millions) | Level 1 | Level 2 | Level 3 | | :---------------------------------- | :------ | :------ | :------ | | Foreign currency forward contracts, net asset (liability) | $0 | $4.7 | $0 | | Interest rate contracts, net asset (liability) | $0 | $(16.7) | $0 | - The Mann Packing acquisition's goodwill ($162.0 million) and redeemable noncontrolling interest were valued using Level 3 inputs, based on income and market approaches[149][150] - An equity investment in Purple Carrot incurred a $2.8 million impairment charge in Q1 2019, with its fair value of $1.4 million classified as Level 3[154] 17. Accumulated Other Comprehensive Income (Loss) Accumulated other comprehensive loss increased to $(46.6) million at March 29, 2019 Changes in Accumulated Other Comprehensive Income (Loss) (Q1 2019) | Component (U.S. dollars in millions) | Balance at Dec 28, 2018 | Other comprehensive (loss) before reclassifications | Amounts reclassified from AOCI | Net current period other comprehensive (loss) | Balance at Mar 29, 2019 | | :----------------------------------- | :---------------------- | :-------------------------------------------------- | :----------------------------- | :-------------------------------------------- | :---------------------- | | Changes in fair Value of Effective cash Flow hedges | $(5.8) | $(3.6) | $(0.5) | $(4.1) | $(9.9) | | Foreign Currency Translation Adjustment | $(14.9) | $(0.8) | $0 | $(0.8) | $(15.7) | | Retirement Benefit Adjustment | $(20.9) | $(0.2) | $0.1 | $(0.1) | $(21.0) | | Total | $(41.6) | $(4.6) | $(0.4) | $(5.0) | $(46.6) | - A net current period other comprehensive loss of $(5.0) million was recognized in Q1 2019, primarily from derivative losses and foreign currency translation[156] 18. Shareholders' Equity No ordinary shares were repurchased and no dividends were paid in Q1 2019 - As of March 29, 2019, 48,651,755 ordinary shares were issued and outstanding[159] - No ordinary shares were repurchased in Q1 2019; $280.4 million remains available under the $300 million stock repurchase program approved in February 2018[162][163] - No dividends were paid in Q1 2019, compared to $0.150 per ordinary share ($7.3 million total) in Q1 2018, due to credit facility covenant restrictions[164][179] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Provides management's perspective on financial performance, liquidity, and operational results for Q1 2019 Overview Outlines the company's vertically integrated business model and recent strategic segment realignment - Fresh Del Monte is a vertically integrated producer, marketer, and distributor of fresh and fresh-cut fruit and vegetables, and prepared foods, primarily under the DEL MONTE® brand[166] - Business segments were realigned in March 2019 to 'banana' and 'fresh and value-added products' (including Mann Packing), with 'other products and services' as ancillary, to reflect strategic focus and management structure[167][168] Liquidity and Capital Resources Analyzes changes in cash flow, working capital, and capital resources during the first quarter - Net cash used in operating activities was $7.2 million in Q1 2019, a decrease of $8.7 million from Q1 2018, primarily due to lower net income, lower accounts payable, and higher finished goods inventory[169] - Working capital increased by $15.8 million to $568.6 million at March 29, 2019, driven by higher trade accounts receivable and finished goods inventory[170] - Net cash used in investing activities significantly decreased to $29.6 million in Q1 2019 from $413.9 million in Q1 2018, as the prior year included the $371.7 million Mann Packing acquisition[171][172] - Net cash provided by financing activities decreased to $35.2 million in Q1 2019 from $423.1 million in Q1 2018, mainly due to lower net borrowings on long-term debt and no dividends paid in Q1 2019[176][177] - The Company plans to refinance its $1.1 billion Credit Facility, which matures in April 2020, during 2019[178][180] - The Company expects to make payments of approximately $12.4 million in 2019, $105.8 million in 2020, and $20.7 million in 2021 for the building of six new refrigerated container ships[188] Results of Operations Details the operational performance, including analysis of net sales, gross profit, and expenses by segment - Net sales increased by $48.1 million to $1,154.2 million in Q1 2019, primarily driven by the Mann Packing acquisition's contribution of $138.9 million in the fresh and value-added products segment[195] - Fresh and value-added products segment net sales increased $73.5 million, driven by fresh-cut vegetables, vegetables, avocados, and prepared food, partially offset by lower pineapple, melon, and non-tropical fruit sales[196][198] - Banana segment net sales decreased by $21.7 million due to lower sales in Europe and the Middle East, despite a 1% increase in worldwide sales volume[203] - Gross profit decreased by $13.2 million to $93.3 million in Q1 2019, primarily due to lower gross profit in the banana and other products and services segments, partially offset by an increase in fresh and value-added products[201] - Banana segment gross profit decreased $19.2 million due to lower per unit selling prices in Europe, Middle East, and Asia, despite lower fruit costs[205] - Operating income decreased by $15.2 million to $41.3 million in Q1 2019, impacted by lower gross profit, higher SG&A expenses (due to Mann Packing), and increased asset impairment charges[212] - Interest expense increased to $6.9 million in Q1 2019 from $3.7 million in Q1 2018, due to higher average loan balances and interest rates[213] - Other income (expense), net, shifted from an expense of $(3.4) million in Q1 2018 to an income of $11.3 million in Q1 2019, primarily due to a $16.7 million gain from a business transaction litigation settlement[214] Fair Value Measurements Discusses the fair value measurement of assets and liabilities, including Level 3 inputs - A $2.8 million charge for asset impairment related to an equity investment in Purple Carrot was recorded in Q1 2019, with its fair value of $1.4 million classified as Level 3[217] - The purchase price allocation for the Mann Packing acquisition, including $162.0 million goodwill, is subject to revision, with fair values estimated using Level 3 inputs for most assets and Level 2/1 for working capital and cash[220] - The fair value of the redeemable noncontrolling interest from the Mann Packing acquisition is estimated using Level 3 inputs based on income and market approaches[221] Seasonality Notes that interim results are subject to significant seasonal variations - Interim results are subject to significant seasonal variations and may not be indicative of full fiscal year results[222] Item 3. Quantitative and Qualitative Disclosures About Market Risk States there have been no material changes in market risk from the prior annual report - No material changes in market risk have occurred since the disclosures in the Annual Report on Form 10-K for the year ended December 28, 2018[223] Item 4. Controls and Procedures Management concluded that disclosure controls and procedures were effective as of March 29, 2019 - Disclosure controls and procedures were deemed effective as of March 29, 2019[225] - Material changes to internal control over financial reporting occurred due to:[227] - Ongoing integration of Mann Packing's acquired operations[226] - Implementation of a new lease accounting system and process in response to ASU No. 2016-02, 'Leases (Topic 842)'[228] PART II. OTHER INFORMATION Item 1. Legal Proceedings Cross-references legal proceeding details to the Commitments and Contingencies note in the financial statements - Legal proceedings information is cross-referenced to Note 11, 'Commitments and Contingencies,' in the Consolidated Financial Statements[231] Item 1A. Risk Factors States there have been no material changes to the company's risk factors from the prior annual report - No material changes to risk factors have occurred since the Annual Report on Form 10-K for the year ended December 28, 2018, except as updated in this report[232] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The company did not repurchase any ordinary shares during the first quarter of 2019 - No ordinary shares were repurchased during the quarter ended March 29, 2019[233] - As of March 29, 2019, $280,358,086 remained available under the $300 million stock repurchase program approved on February 21, 2018[233][234] Item 4. Mine Safety Disclosures This section states that mine safety disclosures are not applicable to the company - Mine Safety Disclosures are not applicable[236] Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including certifications and XBRL documents - Key exhibits include:[237] - Severance Agreement (10.1**)[237] - CEO and CFO Certifications (31.1**, 31.2**, 32**)[237] - XBRL Instance Document and Taxonomy Extension Documents (101.INS***, 101.SCH***, 101.CAL***, 101.DEF***, 101.LAB***, 101.PRE***) for financial statements and notes[237] Signatures The report is signed by the President & COO and the Senior Vice President & CFO as of April 30, 2019 - The report was signed by Youssef Zakharia (President & COO) and Eduardo Bezerra (SVP & CFO) on April 30, 2019[241][242]