We are pleased to present the results for 2006, a year which will be remembered as transformational for our business. The period shows the strength of ALL’s fundamentals and competitive advantages, for we achieved our financial goals facing an adverse agricultural market and managed, with agility, to increase our volume in the ports and reach new industrial segments. 2006 also will be remembered for the largest acquisition of our history, the purchase, in May, of Brasil Ferrovias, totally carried out through the capital markets, focusing on the States of Midwestern Brazil and in São Paulo. These markets have a low presence of the railroad modal and with a great growth opportunity from the railroad infrastructure recovery.

The good results achieved have only been possible through our staff commitment, which has worked with the solid intent of delivering the best service to our clients, with safety and constant productivity gains. This commitment is a result of a meritocratic culture, incessant in cost reduction and in the search for results.

The year of 2006 was transformational for ALL for five main reasons:

1. EBITDAR grew by 23% over 2005, reaching R$591 million in 2006. This growth was comprised of a 25% increase in Ebitdar of ALL Brasil, to R$547 million, and a 9% increase in Ebitdar of ALL Argentina, to P$64 million. Our consolidated revenue grew by 15% compared to 2005, to R$1,430 million, and in 2006 the consolidated volume had a 10.6% growth, reaching 22.047 billion RTK.

Our ability to provide integrated logistics solutions to clients, associated with the tireless focus on the reduction of expenses and productivity gains, allowed us to grow in an adverse scenario in the agricultural market, with an unfavorable foreign exchange and depreciated prices in the first half of the year. In May, we faced the stoppage of farmers, which interrupted flows of agricultural transportation for 25 days, both in Midwestern and Southern Brazil. Even though, the volume of agricultural commodities grew by 13.4%, from 10.2 billion RTK, in 2005, to 11.6 billion RTK, in 2006.

In the industrial market, we continued our growth curve above 20% in intermodal volumes, main steel products, refrigerated cargos and containers. In the highway market we maintained our strategy of focusing on dedicated operations and grew by 44% our operating result, reaching new operations in the Beverages (AmBev), Consumption (Unilever) and Automotive (Renault) segments.

In Argentina, even facing a weak soybean, corn and wheat crop, our volume grew by 6%, basically pushed by the improvement in our operating indicators. The reliability of our assets and the safety level had a significant improvement in the year. For the first time, we entered into long-term agreements with investments of clients, such as AGD, Iecsa, Agrenco and Cia Argentina de Granos.

In Brasil Ferrovias, we promoted a significant reduction in the cost base. During the second half of 2006, period in which the company was already totally under the management of ALL, EBITDAR grew by 86%, increasing from R$92 million in 2H05 to R$171 million in 2H06. Every cost adjustment, both personnel and renegotiation of agreements with suppliers and financial debts has already been made, totaling a gain of synergies higher than R$80 million. The adjustment process had a cost of R$400 million and all existing liabilities are presented in the 2006 balance sheet.

With the acquisition of Brasil Ferrovias, we leveraged the net debt/Ebitda ratio from the level of 0.2x at the end of 2005 to 3.8x at the end of 2006. The debt of R$1.6 billion of Brasil Ferrovias, incorporated to our balance sheet, has a long-term profile, taken with BNDES and governmental bodies, with more attractive rates than the market, and with present value in a very positive level. Our result and cash generation growth curve makes us calm concerning the financing and reduction of this indebtedness as planned. In addition, the intensive use of the EVA, both in the corporate level and in our business units, allowed us to grow at the same time we kept on reducing the invested capital, so that we can obtain a growing free cash flow.

Our Investor Relations areas has dedicated itself a lot in the proximity and education of our business with the financial market, as we are the only logistics publicly-held company in Brazil, with superior corporative governance practices and being followed closely by more than 10 prime analysts and investors all over the world. The performance of our shares, with a 377% appreciation since their launch in June 2004, compared to a 114% appreciation of IBOVESPA in the period, is the acknowledgment of our transparency and demonstrates the trust of the capital markets in the fundamentals of our business. In addition, we are already in the Ibovespa and IBrX-50 indexes and have received several awards for our Investor Relations website.

2. The history of ALL is repeated with the acquisition of Brasil Ferrovias. In May 2006, we acquired, through an exchange of shares, the operations of Brasil Ferrovias, preserving ALL’s cash forthe restructuring and investment process in the operational recovery of this network and its assets. It had 4.7 thousand of railroad, 7.8 thousand railcars and 280 locomotives. The history of ALL is repeated with the opportunity of operationally changing Brasil Ferrovias into a viable railroad operation and starting to commercially grow its share in the transportation matrix. For comparison purposes, currently the railroad share in the Port of Santos stands at 27%, against 60% in Paranaguá.

The operational indicators of safety, track conditions, reliability of locomotives and turnover of railcars show significant gaps to those already reached by our operation in Southern Brazil. We believe this improvement process, which already starts showing small results, will take from two to three years to be concluded. The operational and administrative systems have already been implemented and our Operational Control Center (CCO) already controls by satellite from Curitiba the railroad operations in our entire network in Brazil. We created five more operational
production units and two business units in São Paulo. Our management system by guidelines, individual goals and performance championships has already been implemented for all our employees. Therefore, all processes, procedures and goals have already been consolidated and we have been operating in a unified manner since January 2007.

3. Good improvement in the service, productivity and safety levels. We reached new levels of productivity and reliability for railcars and locomotives, with an improvement in the terminals turnover and the remunerated/km of our trucks. The diesel consumption (liters/000gtk) was again reduced by 3% over 2005, and we had significant gains in the services and material purchases contracts.

In 2006, we had our best performance in operational safety, rewarding the discipline in the compliance with the conduction procedures, with audits in 100% of mountain range travels and strong use of technology. Thus, we improved our gravity indicators and the number of accidents, with 12.2 accidents by million of train/km in the southern rail network, against 83.2 in 1997, which made ALL southern rail network one of the safest cargo railroads of the world.

Our clients’ satisfaction survey showed an improvement in relation to 2005, rewarding our quality policies in the execution of operational processes. The commercial proximity with our clients has been the key to accelerate our growth with joint expansion projects.

4. Strong advance in sales agreements and investments of clients and of our own. We entered into several long-term sales agreements, ensuring new volumes and investments of clients, showing the trust and acknowledgment with our service level and their strategic decision to expand their businesses in ALL’s influence area. There were more than 1,500 railcars, among new and refurbished ones, from clients such as Bunge, Coamo, Álcool PR, Klabin, Sadia, Votorantim, Ipiranga, among others. We also had terminals inaugurated in ALL’s operational areas such as the plate terminal of Masisa, in São Paulo, of Standard, for container, in Cambé and Cascavel, of Meridian, for grains, in Maringá, and the duplication of Pasa, for sugar, in Paranaguá.

Various new operations were added to the company, strengthening our presence in Brazil and Argentina as an Intermodal Logistics Operator, growing in dedicated operations, storage, transfers, urban distribution and border services. As an example, we have the management of the whole logistics network of Calpar, of Bunge Fertilizantes PR, and of the supply of High Maltose to Ambev’s plants, in addition to the dedicated highway operations of Unilever, Ford, Scania and White Martins. In the 4th quarter, we also took over the entire intermodal logistics
of refrigerated products of Sadia in west Paraná and the dedicated highway operation of Renault in Mercosur.

Within the several projects developed, we highlight the two most important ones. The first one is the new port in Zarate, Argentina, with a static capacity of 150 thousand tonnes/year, under construction by Agrenco, which will allow a better outflow of the Argentine and Paraguayan crop. The second one is TGG, new grains terminal in the port of Santos, with static capacity of 240,000 tonnes, built in a partnership between Bunge, Amaggi and ALL. These two large-extent projects, which significantly increase the railroad competitiveness, will be under
operation as from February 2007.

ALL also continues its policy of intense investments of its own. In 2006 investments added up to R$300 million, focusing on information technology, with the launch of the 2nd generation Board Computer, the implementation of detectors of railcar derailment and barrier falls, and the development of CCP (Yard Circulation Control), which will allow us to manage the maneuvers and movement of railcars in the yards. Since the privatization, in 1997, more than R$1.2 billion was invested in new technologies, track, rolling stock and training.

5. Improvement of our employees’ satisfaction and integration with the community. More than 4.7 thousand employees were trained by our Corporate University in technical and management courses, and we obtained a significant improvement in our internal research of the organizational environment. This was also a year of great proximity with the community, where important projects of Corporate Responsibility were developed, such as the Talent Workshop project that graduates youngsters from public schools in Basic Engineering, the signaling of more than 200 Level Crossings in places with a wide circulation of vehicles and the Environmental Train program that benefited more than one thousand youngsters from the communities close to the railroad.We are already in the newly created Bovespa Corporate Sustainability Index (ISE), the first Latin American indicator targeted at companies with a responsible attitude towards theenvironment, society, clients, suppliers and governments.

2007 Outlook: Operational reliability to grow in volume and result. The strong Balance allows us to concretize our growth and investment plan, regardless of the financial market fluctuations. In 2007, the commercial market scenario is very promising, with the recovery of the grain crop and the growth trend for industrial volumes. The adaptation of 40 locomotives and refurbishment of 1,800 railcars of the dead fleet, improvement in track, port terminals and information system have already been provided to support the ambitious growth planned. By means of the right allocation of these investments, we are working to give one more step towards growth, with significant profitability and productivity results in 2007.

Finally, we would like to thank all our clients, suppliers and regulation bodies for the support shown during these years, our shareholders for the constant support, and our employees, who in every moment show a differentiated commitment, always in pursuit of our vision, which is “To be the best logistics company of Latin America”.

Wilson Delara
Chairman of the Board of Directors

Alexandre Behring
Vice Chairman of the Board of Directors

Bernardo Hees
Chief Executive Officer