UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K/A
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of December, 2023
Commission File Number: 001-41638
AMBIPAR EMERGENCY RESPONSE
(Exact name of registrant as specified in its charter)
Avenida Angélica, nº 2346, 5th Floor
São Paulo, São Paulo, Brazil, 01228-200
Tel: +55 (11) 3429-5000
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒        Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Yes ☐        No ☒
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
Yes ☐        No ☒



EXHIBIT INDEX



SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: December 15, 2023
AMBIPAR EMERGENCY RESPONSE
By:/s/Thiago da Costa Silva
Name:Thiago da Costa Silva
Title:Director


Exhibit 99.1
Summary Results for the Nine months ended September 30, 2023
The information set forth below updates certain information about us included in the prospectus contained in our Registration Statement on Form F-1 (Registration No. 333-270493) which we refer to herein as the “Prospectus,” and should be read in conjunction with the information set forth in the Prospectus under “Financial Statement Presentation,” “Risk Factors,” “Unaudited Pro Forma Condensed Combined Financial Information” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Quantitative and Qualitative Disclosures about Market Risk” and our audited consolidated financial statements and unaudited pro forma condensed financial information and the historical financial statements of Witt O’Brien’s and the respective notes thereto included elsewhere in the Prospectus, as well as with our unaudited interim condensed consolidated financial statements as of September 30, 2023 and for the six-month periods ended September 30, 2023 and 2022, contained in a report on Form 6-K (SEC File No. 001-41638) that was furnished to the SEC on December 15, 2023 (the “Third Quarter Financial Statements Report”).
The following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those discussed in the forward-looking statements as a result of various factors, including those set forth including those set forth in “Cautionary Statement Regarding Forward-Looking Statements,” “Industry and Market Data” and “Risk Factors.” of the Prospectus
The following table reflects selected financial information for the nine months ended September 30, 2023:
For the nine months ended September 30,
202320232022Variation
(Unaudited)
(in US$ millions)(1)
(in R$ millions)%
Net revenue369.4 1,849.4 1,052.6 75.7 %
Cost of services rendered(298.9)(1,496.7)(830.2)80.3 %
Gross profit70.5 352.8 222.4 58.6 %
Operating profit45.3 226.9 204.2 11.1 %
Net finance cost(24.6(123.0)(59.9)105.5 %
Income tax and social contribution(14.1)(70.8)(27.0)162.5 %
(1)For convenience purposes only, certain amounts in reais have been translated to U.S. dollars using an exchange rate of R$5.0070 to US$1.00, the commercial selling rate for U.S. dollars as of September 29, 2023, as reported by the Central Bank. These translations have not been audited and should not be considered representations that any such amounts have been, could have been or could be converted at that or any other exchange rate. See “Risk Factors — Risks Relating to the Markets Where We Operate — Exchange rate instability can harm the economy of emerging markets where we operate and, consequently, affect us” in the Prospectus.
Net revenue
Net revenue for the nine months ended September 30, 2023 amounted to R$1,849.4 million, compared to R$1,052.6 million in the nine months ended September 30, 2022, which represents an increase of R$796.8 million, or 75.7%.
1

The increase in revenues was primarily due to increased operations in our North America and Brazil segments, which reached gross revenue of R$949.3 million and R$724.1 million in the nine months ended September 30, 2023, respectively, from R$440.0 million and R$394.6 million in the nine months ended September 30, 2022, respectively, as a result of a wider regional reach and, consequently, an increase in the overall number of subscription contracts and spot contracts. These increases were partially offset by (i) a negative effect of 2.5 percentage points on our gross revenue as a result of the depreciation of the U.S. dollar, Canadian dollar and British pound against the real, (ii) a 6.9% gross revenue increase in our Latin America segment due to a strong gross revenue comparable basis in the region in the nine months ended September 30, 2022 arising from an oil spill response and (iii) a 3.4% gross revenue decline in our Europe segment due to a mild industrial sector demand for our services.
Cost of services rendered
Cost of services rendered for the nine months ended September 30, 2023 amounted to R$1,496.7 million, compared to R$830.2 million for the nine months ended September 30, 2022, which represents an increase of R$666.5 million, or 80.3%. This increase was primarily due to the acquisitions we completed in 2022, the increase in operations, consistent with the increase in revenues described above, and the increase in third party costs due to a greater use of third party providers in North America to provide services in remote locations where we have limited capacity. These increases were partially offset by a positive effect of 2.5 percentage points on our cost of services as a result of the depreciation of the U.S. dollar, Canadian dollar and British pound against the real.
Gross profit
Gross profit for the nine months ended September 30, 2023 amounted to R$352.8 million, compared to R$222.4 million in the nine months ended September 30, 2022. Gross profit represented 19.1% and 21.1% of our net revenue, respectively, for the nine months ended September 30, 2023 and 2022. The decrease in gross profit margin was primarily due to an increase, as a result of the WOB acquisition, in resilience consulting services, which have lower gross margins than our previous existing businesses.
Operating profit
Operating profit for the nine months ended September 30, 2023 amounted to R$226.9 million, compared to an operating profit of R$204.2 million in the nine months ended September 30, 2022, mainly due to increased operations in our North America and Brazil segments, as partially offset by the extraordinary expenses incurred in connection with the conclusion of the HPX transaction in March, which had a non-recurring negative impact of R$100.9 million in the period.
Net finance cost
Our net finance cost increased by R$63.1 million, to R$123.0 million for the nine months ended September 30, 2023 from R$59.9 million for the nine months ended September 30, 2022. Finance income increased by R$20.5 million, or 322.2%, to R$26.8 million in the nine months ended September 30, 2023 from R$6.4 million in the nine months ended September 30, 2022, primarily due to the net proceeds raised with the HPX transaction, which resulted in an increase in revenues from interest-earning bank deposits. Our finance costs increased by R$83.6 million, or 126.3%, to R$149.8 million in the nine months ended September 30, 2023 from R$66.2 million in the nine months ended September 30, 2022, primarily due to an increase in debenture interest and interest on loans, primarily as a result of the First Issuance of Debentures, the Second Issuance of Debentures and the borrowing under the IBBA Loan Agreement with Itau BBA International PLC to finance the WOB Acquisition in 2022.
2

Income tax and social contribution
Income tax and social contribution expense for the nine months ended September 30, 2023 was R$70.8 million, compared to R$27.0 million in the nine months ended September 30, 2022, which represents an increase of R$43.8 million, or 162.2%, primarily due to higher income before taxes reported in the operating subsidiaries in the nine months ended September 30, 2023.
About Ambipar Emergency Response
Ambipar Response specializes in environmental services, and operates in six main business units: emergency response, fire response, marine response, medical response, industrial response and environmental response. The Company is present in 39 countries across all six continents, providing standardized services across all regions.
The Company was founded in 1995 by Tercio Borlenghi Jr.
For more information, visit ambipar.com and http://ir-response.ambipar.com/
3
Exhibit 99.2
AMBIPAR EMERGENCY RESPONSE
Condensed Consolidated Interim statement of financial position (Unaudited)
As of September 30, 2023, and December 31, 2022
Contents

AMBIPAR EMERGENCY RESPONSE
Condensed Consolidated Interim statement of financial position (Unaudited)
As of September 30, 2023, and December 31, 2022
(Values expressed in thousands of Brazilian Reais)
NoteSeptember 30, 2023 (unaudited)December 31, 2022
Assets
Current assets
Cash and cash equivalents4510,919 271,607 
Trade and other receivables, net5795,622 711,892 
Current income tax and social6.17,493 6,388 
Other taxes recoverable6.250,718 29,740 
Prepaid expenses33,526 37,806 
Advances to suppliers54,989 29,864 
Inventories35,677 18,128 
Other accounts equivalents49,345 36,498 
Current assets1,538,289 1,141,923 
Non-current assets
Related parties loans1626,025 26,180 
Non-current income tax and social 6.12,854 2,854 
Non-current other taxes recoverable6.2847 392 
Deferred taxes2223,824 25,420 
Judicial deposits15895 826 
Other accounts receivable33,295 37,599 
Investments7— 7,620 
Property, plant and equipment, net8692,552 516,081 
Right of use, net870,248 68,275 
Goodwill91,272,435 1,192,302 
Intangible assets9376,868 420,197 
Total Non-current assets2,499,843 2,297,746 
Total assets4,038,132 3,439,669 
The accompanying notes are an integral part of the Unaudited Condensed Consolidated Interim Financial Statements.
2
AMBIPAR EMERGENCY RESPONSE
Condensed Consolidated Interim statement of financial position (Unaudited)
As of September 30, 2023, and December 31, 2022
(Values expressed in thousands of Brazilian Reais)

NoteSeptember 30, 2023 (unaudited)December 31, 2022
Liabilities
Current liabilities
Loans and financing1056,819 67,656 
Debentures1157,622 84,187 
Trade and other payables12146,309 155,523 
Labor obligations89,151 114,941 
Dividends Payable1642,074 76,909 
Current income tax and social
contribution payable		13.120,664 12,998 
Other tax payable13.230,863 33,719 
Obligations from acquisition of investment7165,124 141,698 
Lease liabilities1422,088 14,411 
Other bills to pay42,048 36,345 
Current liabilities672,762 738,387 
Non-current liabilities
Loans and financing10614,005 649,762 
Debentures11465,530 516,533 
Other taxes payable138,016 7,986 
Related parties loans16634,356 769,792 
Deferred income tax and social contribution22199,695 190,833 
Obligations from acquisition of investment749,591 81,728 
Provision for contingencies15375 607 
Lease liabilities1430,364 32,648 
Warrant and Earn-out3.4.238,243 — 
Other bills to pay10,326 4,305 
Non-current liabilities2,050,501 2,254,194 
Total liabilities2,723,263 2,992,581 
Shareholders' equity
Capital17.11,434,717 261,920 
Earn-out(162)— 
Profit reserves— 302,817 
Capital transactions17.5(84,729)(110,218)
Accumulated translation adjustment17.4(173,164)(89,165)
Accumulated loss(32,022)— 
 
Equity attributable to owners of the group1,144,640 365,354 
Non-controlling interest170,229 81,734 
Total equity1,314,869 447,088 
Total shareholders' equity and liabilities4,038,132 3,439,669 
The accompanying notes are an integral part of the Unaudited Condensed Consolidated Interim Financial Statements.
3
AMBIPAR EMERGENCY RESPONSE
Condensed Consolidated Interim statements of income (Unaudited)
For the periods ending September 30, 2023, and 2022
(Amounts expressed in thousands of Brazilian Reais, except earnings per share)





NoteSeptember 30, 2023 (unaudited)September 30, 2022 (unaudited)
Net Revenue191,849,431 1,052,619 
Cost of services rendered20(1,496,686)(830,234)
Gross profit352,745 222,385 
 
Selling, general and administrative expenses20(21,925)(21,468)
Other income, net expenses20(103,887)3,323 
Operating expenses(125,812)(18,145)
 
Operating profit226,933 204,240 
 
Finance expenses21(149,834)(66,220)
Finance income2126,838 6,356 
(122,996)(59,864)
Net income before income and social103,937 144,376 
 
Current income tax and social contribution22(63,553)(23,661)
Deferred income tax and social22(7,223)(3,298)
 
Profit for the period33,161 117,417 
 
Profit (loss) Attributable to:
Controlling interest(32,022)102,670 
Non-controlling interests65,183 14,747 
Number of shares at period end55,429,851 261,920,439 
Earnings (loss) per share (basic and diluted) at the end of the year – in R$0,600,45
The accompanying notes are an integral part of the Unaudited Condensed Consolidated Interim Financial Statements.
4
AMBIPAR EMERGENCY RESPONSE
Condensed Consolidated Interim statements of comprehensive income (Unaudited)
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of US Dollars)
September 30, 2023
(unaudited)
September 30, 2022
(unaudited)
Profit for the period33,161 117,417 
Items that are or may be reclassified subsequently to profit or loss:
Equity valuation adjustment— (984)
Exchange rate change on goodwill on investee abroad27,020 (1,070)
Accumulated translation adjustment(151,695)(80,306)
Other comprehensive loss for the period, net of tax(124,675)(82,360)
Total comprehensive income (loss), net of taxes(91,514)35,057 
Attributable to:
Controlling interest(156,697)20,310 
Non-controlling interest65,183 14,747 
(91,514)35,057 
The accompanying notes are an integral part of the Unaudited Condensed Consolidated Interim Financial Statements.
5
AMBIPAR EMERGENCY RESPONSE
Condensed Consolidated Interim statements of changes in equity (Unaudited)
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
       Profit Reserves              
 Capital Earn-out Expenses on the issuance of shares Legal reserve Unrealized income reserve Capital transactions Equity valuation adjustment Accumulated translation adjustment Retained earnings Total attributable to the controlling shareholder Non-controlling interests Total
Balances at January 1st, 2022261,920 — — 13,939 165,617 (116,486)984 3,428 — 329,402 11,924 341,326 
 
Adjustment from previous years— — — — 123 15,214 — — — 15,337 — 15,337 
Participation of non-controllers— — — — — — — — — — 44,113 44,113 
Other comprehensive loss— — — — — — (984)(81,376)— (82,360)— (82,360)
Net income for the period— — — — — — — — 102,670 102,670 14,747 117,417 
 
Balance, September 30, 2022261,920 — — 13,939 165,740 (101,272)— (77,948)102,670 365,049 70,784 435,833 
 
Balance at January 1st, 2023261,920 — — 22,013 280,804 (110,218)— (89,165)— 365,354 81,734 447,088 
 
Issuance of 177.977.323 new shares263,004 — — — — — — — — 263,004 — 263,004 
Adjustment from previous years— — — — — (2,411)— — — (2,411)— (2,411)
Equity valuation adjustment— — — — — — — (3,356)— (3,356)— (3,356)
Net income for the period— — — — — — — — 13,288 13,288 7,885 21,173 
Initial transactions with shareholders 03.03.2023307,714 — — (22,013)(280,804)16,940 — (8,549)(13,288)— — — 
Adjustment from previous years— — — — — — — — — — 15,427 15,427 
Private Investments in Public Equity (PIPE)595,746 — — — — — — — — 595,746 — 595,746 
HPX trust account balance at CST&T48,083 — — — — — — — — 48,083 — 48,083 
Incorporated equity HPX 03.03.2023(41,750)— — — — — — — — (41,750)— (41,750)
Earn-out— (162)— — — — — — — (162)— (162)
Exchange variation on capital transactions— — — — — 10,960 — (10,960)— — — — 
Expenses on the issuance of shares— — (119,822)— — — — — — (119,822)— (119,822)
Realization of costs in the issuance of shares— — 119,822 — — — — — — 119,822 — 119,822 
Net income for the period— — — — — — — — (32,022)(32,022)65,183 33,161 
Equity valuation adjustment— — — — — — — (61,134)— (61,134)— (61,134)
 
Balance, September 30, 20231,434,717 (162)— — — (84,729)— (173,164)(32,022)1,144,640 170,229 1,314,869 
The accompanying notes are an integral part of the Unaudited Condensed Consolidated Interim Financial Statements.
6
AMBIPAR EMERGENCY RESPONSE
Condensed Consolidated Interim statements of cash flows (Unaudited) – Indirect Method
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
September 30, 2023
(unaudited)
September 30, 2022
(unaudited)
Cash flows from operating activities
Profit for the period33,161 117,417 
Adjustments for non-cash items
Depreciation and amortization124,673 71,575 
Expected credit losses(216)— 
Residual value of written-off property, plant and equipment and intangible assets16,313 9,100 
Provision for contingencies(232)675 
Income tax and social contribution – Deferred7,223 3,298 
Interest on loans and financing, debentures and exchange-rate change121,686 55,272 
Changes in assets and liabilities:
Accounts receivable(54,429)(99,658)
Recoverable taxes(20,455)(133)
Prepaid expenses4,606 (32,087)
Advances to suppliers(2,747)33,033 
Inventories(8,534)(2,537)
Other accounts receivable(6,883)(5,977)
Suppliers(42,424)(13,119)
Salaries and social security charges(28,646)19,631 
Taxes payable16,925 8,386 
Other accounts payable(3,183)(27,717)
Cash generated from operating activities156,838 137,159 
Interest paid on loans and financing(44,483)(8,923)
Interest paid on debentures(94,549)(25,274)
Interest paid on leases(2,392)(672)
Income tax and social contribution(18,330)(11,561)
 
Net Cash generated / (used in) from operating activities(2,916)90,729 
Cash flow from investing activities
Cash spent on companies’ acquisitions; net of cash received(36,813)(254,128)
Payment of obligations from acquisition of investments(114,034)(57,489)
Acquisition of property, plant and equipment and intangible assets(163,808)(107,167)
 
Net cash used in investing activities(314,655)(418,784)
Cash flow from financing activities
Attributed to shareholders
Profit distribution – prior periods(56,689)(314)
Increase in minority interest699,532 — 

The accompanying notes are an integral part of the Unaudited Condensed Consolidated Interim Financial Statements.
7
AMBIPAR EMERGENCY RESPONSE
Condensed Consolidated Interim statements of cash flows (Unaudited) – Indirect Method
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
September 30, 2023
(unaudited)
September 30, 2022
(unaudited)
Attributed to financing
Related parties122,897 135,560 
Lease payments – Principal(70,850)(22,550)
Proceeds from loans and financing68,050 532,732 
Proceeds from debentures— 335,500 
Payments of loans and financing – Principal(141,863)(60,941)
(55,917)— 
Payment of share issue costs— (5,065)
Net cash generated from financing activities565,160 914,922 
Increase in cash and cash equivalents247,589 586,867 
Exchange rate change in cash and cash equivalents(8,277)(37,685)
Cash and cash equivalents at the beginning of the period271,607 118,918 
Cash and cash equivalents at the end of the period510,919 668,100 
The accompanying notes are an integral part of the Unaudited Condensed Consolidated Interim Financial Statements.
8
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
As of September 30, 2023, and December 31, 2022
(Values expressed in thousands of Brazilian Reais)
1.General information
Ambipar Emergency Response (“Group”) is a direct subsidiary of Ambipar Participações e Empreendimentos S.A. (“Ambipar Group” or “Company”) in the Emergency Response segment, it’s part of the Group’s essence the commitment to sustainable matters, working on the ESG (“Environment, Social and Governance”) pillars within its business and supporting its clients.
The Ambipar Emergency Response is engaged in the response to accidents with chemical products and pollutants, fighting fires, environmental emergencies on highways, railways, airports, ports, industries, mining and pipelines, and natural disasters. The Group also offers the environmental services in specialized industrial clean.
The Ambipar Emergency Response is also specialized in Crisis Management and attendance to environmental, chemical, and biological emergencies that affect the health, the environment, and property. Supported by state-of-the-art professionals, with excellence, technological equipment using techniques in the most security protocols, in order to contribute to excellence in care. The Ambipar Emergency Response owns more than 300 bases around the world, employs more than 150,000 trained collaborators and responds to emergencies on call 24 hours a day, 365 days a year.
On July 6, 2022, Emergência Participações (“Ambipar Response”) entered into a business combination agreement with HPX Corp. (“HPX”), a Special Purpose Acquisition Company (SPAC), to further accelerate the Company's growth. On March 3, 2023, after compliance with all corporate and regulatory requirements, the transaction was concluded. Thus, as of March 6, 2023, Ambipar Response became listed, and its common shares and warrants began to be traded on the NYSE American under the codes “AMBI” and “AMBI.WS”, respectively.
1.1.Activity in the Response segment
The principal business activities of the Ambipar Emergency Response comprise operating in prevention, management, and emergency response to accidents involving hazardous or non-hazardous products in all modes of transportation, with its own bases and presence in 16 countries in South America, Europe, Africa, North America, and Antarctica. In addition, it provides industrial firefighters who work at customer’s facilities and has the largest and most complete training field in Latin America, training employees and clients with the most complete structure focused on emergency response and management in multimodal scenarios.
As of September 30, 2023, and December 31, 2022, the Ambipar Emergency Response’s equity interests and their respective areas of activity are shown in Note 1.2 “Organization and Plan of Business Operation”.
9
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
As of September 30, 2023, and December 31, 2022
(Values expressed in thousands of Brazilian Reais)
1.2.Relevant events
Completion of the transaction with HPX and listing of Ambipar Emergency Response on the NYSE
On March 3, 2023, the Company completed the transaction with HPX Corp, pursuant to the terms of the Business Combination Agreement entered into on July 5, 2022, by the Company, together with its subsidiaries, Emergência Participações, Ambipar Emergency Response and Ambipar Merger Sub ("Closure"). As a result, Emergência Participações became a wholly owned subsidiary of Ambipar Emergency Response, a company incorporated in the Cayman Islands. Ambipar Emergency Response (“AMBI”) is classified as a foreign private issuer, emerging growth company and non-accelerated filer with shares listed on the New York Stock Exchange (NYSE American). The Company now holds a 70.8% interest in AMBI after the conclusion of the de-SPAC process. Additional details regarding the accounting impacts of the de-SPAC process for the Company's consolidated financial statements are presented in Note 7.
1.3.Organization and Plan of Business Operation
a)Transfer of Ambipar Response Limited and Ambipar Howells Consultancy Limited to Emergência Participações S.A.
As per decided at the general meeting of the extraordinary reorganization on October 2021, following the plan of business operation for companies under common control, the entities Ambipar Response Limited (United Kingdom) and Ambipar Howells Consultancy Limited, both previously directly controlled by the Ambipar Group, became the wholly subsidiaries of Emergência Participações S.A. that provides the same activities as the original companies.
b)Incorporation of Ambipar Holding USA, Ambipar Holdings UK Limited, Ambipar Holding Canada e Ambipar Holding Ireland
In 2020 and 2021, the Ambipar Emergency Response set up four holding companies, Ambipar Holding USA, Inc (“Ambipar USA”) Ambipar Holding Canada, Inc (“Ambipar Canada”), Ambipar Holdings UK Limited (“Ambipar UK”) and Ambipar Holding Ireland Limited (“Ambipar Ireland”) in order to acquire business in those locations, following the Ambipar Emergency Response’s plan of business operation.
c)Acquisition of Inversiones Disal Emergencia
On June 28, 2021, the Group acquired 100% of the shares of Inversiones Disal Emergencia (“acquired”). As a result, the company Inversiones Disal Emergencia ("Acquired”) became a subsidiary of Emergência Participações S.A. with the same activities as the original company (See in Note 1.3).
10
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
List of subsidiaries
The Unaudited Condensed Consolidated Interim Financial Statements include the individual statements of the entities of the Ambipar Emergency Response, listed below:
Ownership held by Group
CompanyPlace of Business/ Country of IncorporationController09.30.202312.31.202209.30.202312.31.2022Consolidation method
    %%%% 
Emergência Participações S.A.BrazilAmbipar Participações100.00100.00——Full
Ambipar Response S.A.BrazilEmergência Participações100.00100.00——Full
Ambipar Insurance – Correta de Seguros LtdaBrazilEmergência Participações—100.00——Full
Ambipar Response Insurance – Atendimento a Seguros LtdaBrazilEmergência Participações100.00100.00——Full
Atmo Hazmat LtdaBrazilEmergência Participações—100.00——Full
Ambipar Response Chile S.A.ChileEmergência Participações100.00100.00——Full
Ambipar Response Training S.A.ChileSuatrans Chile99.9999.990.010.01Full
Ambipar Response Mineros e Integrales S.A.ChileSuatrans Chile99.9999.990.010.01Full
Ambipar Response Mexico S. de R.L. de C.V.MéxicoSuatrans Chile50.00—50.00–Full
Ambipar Peru SACPeruSuatrans Chile99.7899.780.220.22Full
Ambipar Uruguay S.A.UruguaiSuatrans Chile100.00100.00——Full
Ambipar Colombia S.A.SColombiaSuatrans Chile100.00100.00——Full
Ambipar Response Colombia S.A.SColombiaSuatrans Chile100.00100.00——Full
Ambipa Response Chile SpAChileEmergência Participações100.00100.00——Full
Ambipar Holding USA, INCUnited States of AmericaEmergência Participações100.00100.00——Full
Ambipar Response AIE, LLCUnited States of AmericaAmbipar Holding USA100.00100.00——Full
Ambipa Response OSE, LLCUnited States of AmericaAmbipar Holding USA100.00100.00——Full
Ambipar Response Intracoastal, LLCUnited States of AmericaAmbipar Holding USA100.00100.00——Full
Ambipar Response CES, IncUnited States of AmericaAmbipar Holding USA100.00100.00——Full
Ambipar Response EMS, IncUnited States of AmericaAmbipar Holding USA100.00100.00——Full
Ambipar Response Swat, Inc.United States of AmericaAmbipar Holding USA100.00100.00——Full
Ambipar Response PERS, LLCUnited States of AmericaAmbipar Holding USA100.00100.00——Full
11
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
Ownership held by Group
CompanyPlace of Business/ Country of IncorporationController09.30.202312.31.202209.30.202312.31.2022Consolidation method
    %%%% 
Ambipar Response L1, IncUnited States of AmericaAmbipar Holding USA100.00100.00——Full
Witt O'Brien"s LLCUnited States of AmericaAmbipar Holding USA100.00100.00——Full
Navigate Communications Pte. Ltd.SingaporeWitt O'Brien"s LLC100.00100.00——Full
Navigate Response (Asia) Pte. Ltd.SingaporeWitt O'Brien"s LLC100.00100.00——Full
Navigate PR LimitedEngland and WalesWitt O'Brien"s LLC100.00100.00——Full
Navigate Response LimitedEngland and WalesWitt O'Brien"s LLC100.00100.00——Full
Strategic Crisis Advisors LLCGeorgiaWitt O'Brien"s LLC100.00100.00——Full
Witt O’Brien’s PR LLCPuerto RicoWitt O'Brien"s LLC100.00100.00——Full
Witt O'Brien's USVI, LLCU.S. Virgin IslandsWitt O'Brien"s LLC100.00100.00——Full
Witt O'Brien's Payroll Management LLCDelawareWitt O'Brien"s LLC100.00100.00——Full
O'Brien's Response Management, L.L.C.DelawareWitt O'Brien"s LLC100.00100.00——Full
O'Brien's do Brasil Consultoria em Emergências e Meio Ambiente S/A (c)BrazilWitt O'Brien"s LLC—100.00——Full
Witt O'Brien's Insurance Services, LLCNew JerseyO'Brien's Response Management, L.L.C.100.00100.00——Full
Witt Associates do Brasil Consultoria Ltda. (c)BrazilWitt O'Brien"s LLC—50.00—50.00No
Ambipar Holdings UK LimitedUnited KingdomEmergência Participações100.00100.00——Full
Ambipar Response LimitedUnited KingdomAmbipar Holdings UK Limited100.00100.00——Full
Ambipar Response LimitedIrelandAmbipar Response Limited100.00100.00——Full
Ambipar Howells Consultancy LimitedUnited KingdomAmbipar Response Limited100.00100.00——Full
Groco 404 LimitedUnited KingdomAmbipar Holding UK100.00100.00——Full
Ambipar Site Service LimitedUnited KingdomGroco 404 Limited100.00100.00——Full
Ambipar Holding Ireland LimitedIrelandAmbipar Holding UK100.00100.00——Full
Ambipar Response Ireland LimitedIrelandAmbipar Holding Ireland100.00100.00——Full
Ambipar Holding Canadá, INCCanadáEmergência Participações100.00100.00——Full
Ambipar Response Industrial Services E Inc.CanadáAmbipar Holding Canadá100.00100.00——Full
Ambipar Response Industrial Services L Inc.CanadáAmbipar Holding Canadá100.00100.00——Full
Orion Environmental Services Ltd.CanadáAmbipar Holding Canadá100.00100.00——Full
Orion Tank Soluitons Ltd.CanadáAmbipar Holding Canadá100.00100.00——Full
Ambipar Response Emergency Services Canada F IncCanadáAmbipar Holding Canadá100.00100.00——Full
Ridgeline Canada IncCanadáAmbipar Holding Canadá100.00100.00——Full
Ambipar Response Industrial Services G Inc.CanadáAmbipar Holding Canadá100.00100.00——Full
DFA Contracting LtdCanadáAmbipar Holding Canadá100.00–——Full
12
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
Ownership held by Group
CompanyPlace of Business/ Country of IncorporationController09.30.202312.31.202209.30.202312.31.2022Consolidation method
    %%%% 
Ambipar Response ES S.A.BrazilEmergência Participações70.0070.0030.0030.00Full
Ambipar Response Environmental Services LtdaBrazilAmbipar Response ES70.0070.0030.0030.00Full
Ambipar Response Orbitgeo Ltda.BrazilAmbipar Response ES70.0070.0030.0030.00Full
Ambipar Response OGTEC Facilities Ltda.BrazilAmbipar Response ES70.0070.0030.0030.00Full
Ambipar Response Wastewater Control Ltda.BrazilAmbipar Response ES70.0070.0030.0030.00Full
Ambipar Response Geoweb Ltda.BrazilAmbipar Response ES70.0070.0030.0030.00Full
Ambipar Response Geociências Ltda. (a)BrazilAmbipar Response ES38.5038.5061.5061.50Full
Ambipar Response Analytical S/A (b)BrazilAmbipar Response ES35.70—64.30—Full
Ambipar Response Fauna e Flora LtdaBrazilAmbipar Response ES70.00—30.00—Full
Ambipar Response Environmental Consulting Offshore S/ABrazilAmbipar Response ES42.00—58.00—Full
Solução Ambiental Engenharia, Participações e Negócios LtdaBrazilAmbipar Response ES51.00—49.00—Full
Reconditec Sistemas e Participações LtdaBrazilSolução Ambiental Engenharia, Participações e Negócios Ltda51.00—49.00—Full
RMC2 Soluções Ambientais LtdaBrazilReconditec Sistemas e Participações Ltda25.50—74.50—Full
RG Response S.A.BrazilEmergência Participações51.0051.0049.0049.00Full
RG Consultoria Técnica Ambiental Brasil Ltda.BrazilRG Response51.0051.0049.0049.00Full
JM Serviços Integrados S/ABrazilEmergência Participações70.0070.0030.0030.00Full
JM Serviços e Locações S/ABrazilEmergência Participações70.0070.0030.0030.00Full
Lacerda & Lacerda Serviços de Transportes e Emergências Ambientais LtdaBrazilEmergência Participações100.0070.00—30.00Full
Desentupidora Belo Ltda.BrazilEmergência Participações—70.00—30.00Full
Ambipar Response Gás Ltda.BrazilEmergência Participações100.00100.00——Full
Ambipar Atendimento Médico Hospitalar Ltda.BrazilEmergência Participações—100.00——Full
Fênix Emergências Ambientais Ltda.BrazilEmergência Participações100.00100.00——Full
APW Ambiental e Transporte Ltda.BrazilEmergência Participações100.00100.00——Full
Ambipar Response Dracares Apoio Marítimo e Portuário S/ABrazilEmergência Participações51.0051.0049.0049.00Full
Ambipar Response Marine S.A.BrazilAmbipar Response Dracares40.80—59.20—Full
Ambipar Flyone Serviço Aéreo Especializado, Comércio e Serviço S.A.BrazilEmergência Participações51,0051,0049,0049,00 
Ambipar Response Tank Cleaning S/ABrazilEmergência Participações51,00—49,00— 
13
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
Ownership held by Group
CompanyPlace of Business/ Country of IncorporationController09.30.202312.31.202209.30.202312.31.2022Consolidation method
    %%%% 
Ambipar C-Safety Comércio, Indústria e Serviços Ltda.BrazilAmbipar Response Tank Cleaning51,00—49,00— 
Ambipar Response Industrial Services S/ABrazilAmbipar Response Tank Cleaning26,01—73,99— 
(a)     The subsidiary Ambipar Response ES has a 55% interest in Ambipar Response Geociências Ltda. The Company has a 70% interest in Ambipar Response ES, thus the Group has 38.50% control over the subsidiary.
(b)     The subsidiary Ambipar Response ES has a 51% interest in Bioenv Análises Ambientais Ltda. The Company has a 70% interest in Ambipar Response ES, thus the Group has 35.70% control over the subsidiary.
(c)     As described in Note 1 – General Information, the Company acquired, through its subsidiary Emergência Participações S.A., 100% of the company Witt O’Briens and the acquisition was completed on October 25, 2022; as a result, there was a joint agreement with the acquisition of 50% of O'Brien's do Brasil Consultoria em Emergências e Meio Ambiente S.A., characterizing a joint venture.
14
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
1.4.Objective of preparing and presenting the unaudited interim condensed consolidated financial information for the nine-months period ended September 30, 2023
The unaudited interim condensed combined interim financial information for the nine-months period ended September 30, 2023, presented for comparative purposes as required by International Accounting Standard 34, Interim Financial Reporting, (“IAS 34”), has been prepared on a combined basis as common control transaction to reflect the reorganization completed by December 31, 2021, disclosed in note 1.2 (a). Therefore, this audited interim condensed combined interim financial information presents properly the Ambipar Emergency Response’s performance for 9 nine-months period ended September 30, 2021 considering that Emergência Participações S.A. was the parent company of the Ambipar Emergency Response.
After the reorganization referred above Emergência Participações S.A. became the parent company of all the entities belonging to the Ambipar Emergency Response. Consequently, the interim financial information for the nine-months period ended September 30, 2022 has been prepared and presented on a consolidated basis in accordance with IFRS 10 – Consolidated financial statements.
1.5.Authorization to issue these Unaudited Condensed Consolidated Interim Financial Statements
The issue of these Unaudited Condensed Consolidated Interim Financial Statements was authorized by the Management on December 1, 2023.
2.Description of significant accounting policies
2.1.Basis of presentations
As a result of the reorganization described below, these financial statements have been presented for all periods as if the Company was the holding company of the Group.
The Company became the holding company of the Group in March 2023 through a business combination (note 1.2) and as a result Emergência Participações S.A. (predecessor entity) became a wholly owned subsidiary of Ambipar Emergency Response.
These transactions are being accounted for on the predecessor values basis as common control transactions, based on the predecessor values recognized by the Company in its consolidated financial statements from the dates that it obtained control of the Group.
Upon conclusion of the business combination, the results of operations of the Group were included in the consolidated financial statements of the Company as if the company had always owned the Group.
The Unaudited Condensed Consolidated Interim Financial Statements have been prepared and presented in accordance with International Accounting Standard 34, Interim Financial Reporting, within the framework of International Financial Standards as issued by the International Accounting Standards Board.
The Unaudited Condensed Consolidated Interim Financial Statements are expressed in thousands of Reais ("R$"), and the reporting of amounts in other currencies, when needed, is also expressed in thousands, unless otherwise indicated.
15
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
The preparation of Unaudited Condensed Consolidated Interim Financial Statements requires Management to make judgments, use estimates and adopt assumptions that affect the amounts presented for revenues, expenses, assets and liabilities, including contingent liabilities. However, uncertainty relating to these judgments, assumptions and estimates could lead to results that require a significant adjustment to the book value of certain assets and liabilities in future years.
Ambipar Emergency Response’s Management states and confirms that all relevant information for the Unaudited Condensed Consolidated Interim Financial Statements is being evidenced and corresponds to the one used by Management in the administration.
The Unaudited Condensed Consolidated Interim Financial Statements have been prepared on the historical cost’s basis, except certain financial assets and liabilities that measured at their fair value.
The Ambipar Emergency Response’s businesses included in these Unaudited Condensed Consolidated Interim Financial Statements are not generated as a single legal entity. These Unaudited Condensed Consolidated Interim Financial Statements are, therefore, not necessarily indicative of performance, cash flows obtained, and possessing actual equity and financial situation, as if this Ambipar Emergency Response had operated in a single legal entity during the years, or indicative of future results.
The Unaudited Condensed Consolidated Interim Financial Statements have been prepared on a going concern basis, which assumes that the Ambipar Emergency Response will be able to discharge its liabilities.
2.2.Basis of consolidation
These Unaudited Condensed Consolidated Interim Financial Statements include the results of the Company and all its subsidiary undertakings made up to the same accounting date. All intra-Group balances, transactions, income and expenses are eliminated in full on consolidation. The results of subsidiary undertakings acquired or disposed of during the period are included or excluded from the consolidated income statement from the effective date of acquisition or disposal.
2.3.New and amended standards adopted
A number of amended standards became applicable for the current reporting period. The Ambipar Emergency Response was not required to change its accounting policies or make retrospective adjustments as a result of adopting the applicable amended standards.
2.4.New accounting standards issued but not yet effective
Certain new accounting standards and interpretations have been published that are not mandatory for the current period and have not been early adopted. Of those standards applicable to the Ambipar Emergency Response, they are not expected to have a material impact on these Unaudited Condensed Consolidated Interim Financial Statements.
16
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
3.Basis of measurement
3.1.Currency translation
(a)Functional and presentation currency
Items included in Ambipar Emergency Response’s Interim Consolidated Financial Statements are measured using the currency of the primary economic environment in which companies operate ("the functional currency"). The Unaudited Condensed Consolidated Interim Financial Statements are presented in Reais (R$). All financial information disclosed has been rounded to the nearest value, except otherwise indicated.
(b)Foreign currency
Transactions with foreign currencies are converted into functional currency by using exchange rates prevailing on the transaction or valuation dates when the items are measured. Exchange gains and losses resulting from the settlement of those transactions and from the translation at year-end exchange rates referring to monetary assets and liabilities in foreign currencies, are recognized in the statement of income. Foreign exchange gains and losses related to accounts receivable, suppliers and loans are presented in the statement of income as financial revenue or expense.
(c)Foreign operations
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated in euro at the exchange rates at the reporting date. The income and expenses of foreign operations are translated into euro at the exchange rates at the dates of the transactions.
Foreign currency differences are recognized in OCI and accumulated in the Translation reserve, except to the extent that the translation difference is allocated to NCI.
When a foreign operation in disposed of in its entirety or partially such as that the control, significant influence, or joint control is lost, the cumulative amount in the translation reserve related to that foreign operation in reclassified to profit or loss as part of the gain or loss on disposal. If the Group disposes part of its interest in a subsidiary but retains control, then the relevant proportion of the cumulative amount is reattributed to NCI. When the Group disposes only part of an associate or joint venture while retaining significant influence or joint control, the relevant proportion of the cumulative amount is reclassified to profit or loss.
3.2.Use of accounting estimates and judgment
The preparation of the Unaudited Condensed Consolidated Interim Financial Statements in accordance with IFRS issued by IASB and interpretations requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenues, and expenses. Actual results may differ from these estimates. The settlement of transactions involving these estimates may result in significantly different amounts due to the lack of precision inherent to the process of their determination.
Estimates and assumptions are reviewed in a continuous manner. Revisions to accounting estimates are recognized in the year in which the estimates are revised and in any future periods affected. The information on critical judgments that refer to accounting policies adopted that have effects on amounts recognized in the Unaudited Condensed Consolidated Interim Financial Statements is presented in the following notes:
17
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
Impairment of non-financial assets
As stated in note 3.6, impairment testing involves calculating the value in use or the fair value less cost of disposal, when applicable, of the cash generating units to which the goodwill or other non-financial assets have been assigned. The value in use is determined by estimating five years of future cash flows, a perpetual value and using a discount rate that comprises three components: time value in money, the appropriate risk premium and uncertainty about the future cash flows. Hence, it relies on several critical judgements, estimates and assumptions. For more information on estimates and assumptions used in impairment testing, refer to note 8.
Revenue recognition
The Group applies certain judgment in assessing the terms of revenue from contracts with customers to determine whether the contract involves the delivery of service (revenue recognized over time). The Group evaluates each contract individually, its critical terms and business relationship with its customer and any associated third party.
Lease term
The Group determines the lease term as the non-cancellable term of the lease, together with any periods covered by an option to extend the lease if it is reasonably certain to be exercised, or any periods covered by an option to terminate the lease, if it is reasonably certain not to be exercised. The Group has the option, under some of its leases, to lease the assets for additional terms. The Group applies judgment in evaluating whether it is reasonably certain to exercise the option to renew, it considers all relevant factors that create an economic incentive for it to exercise the renewal such as contractual terms and conditions for the optional periods compared with market rates and the length of a non-cancellable period of a lease.
After the commencement date, the Group reassesses the lease term if there is a significant event or change in circumstances that is within its control and affects its ability to exercise (or not to exercise) the option to renew (e.g., a change in business strategy).
Residual value and estimated useful life of property, plant and equipment and intangible asset (finite useful lives)
As stated in note 3.5 and 3.7, Intangible and property, plant and equipment assets are amortized over their useful lives. The useful life is based on management’s estimates for the period in which the assets will contribute to generate revenue and is periodically reviewed. Changes in estimates may result in significant changes in the book value. Revisions to these estimates are recognized prospectively.
Business Combination Accounting
We recognize, separately from goodwill, the identifiable assets acquired, and liabilities assumed at their estimated acquisition date fair values. We measure and recognize goodwill as of the acquisition date as the excess of: (a) the aggregate of the fair value of consideration transferred, the fair value of any non-controlling interest in the acquiree (if applicable) and the acquisition date fair value of our previously held equity interest in the acquiree (if applicable), over (b) the fair value of net assets acquired, and liabilities assumed. At the acquisition date, we measure the fair values of all assets acquired and liabilities assumed that arise from contractual contingencies. We measure the fair values of all non-contractual contingencies if, as of the acquisition date, it is more likely than not that the contingency will give rise to an asset or liability.
18
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
Expected credit losses related to trade and other receivables
The expected loss on doubtful accounts is established when there is objective evidence that the Group will not be able to collect all amounts according to the accounts receivable original terms.
It is formed in an amount considered adequate by Management to cover probable losses arising on collection of accounts receivable, based on analysis of each client’s default risk considering a reasonable and supportable information available at the time that demonstrates that the credit risk has not increased significantly since initial recognition, the customer’s financial situation committed in the market, history of negotiations carried out, signed agreements not being fulfilled, mainly taking into consideration risk scenarios in which it has observable behavior in the market, and with special attention to long-standing overdue credits.
Income taxes
The calculation of current and deferred income taxes requires us to make estimates and assumptions and to exercise judgement regarding the carrying values of assets and liabilities which are subject to accounting estimates inherent in those balances, the interpretation of income tax legislation across various jurisdictions, expectations about future operating results, the timing of reversal of temporary differences and possible audits of income tax filings by the tax authorities.
Changes or differences in underlying estimates or assumptions may result in changes to the current or deferred income tax balances on the consolidated statements of financial position, a charge or credit to income tax expense in the Consolidated statements of operations and comprehensive income (loss) and may result in cash payments or receipts.
All income tax filings are subject to audits and reassessments. Changes in interpretations or judgements may result in a change in our income tax provisions in the future. The amount of such a change cannot be reasonably estimated.
3.3.Cash and cash equivalents
Cash and cash equivalents include cash, bank deposits, highly liquid short-term investments, redeemable in up to three months or less, with an insignificant risk of change in fair value and for the purpose of meeting short-term commitments.
3.4.Financial instruments
3.4.1.Financial assets
Recognition and measurement
Purchases and sales of financial assets are recognized on trading date, Investments are initially recognized at fair value plus transaction cost for all financial assets not classified at fair value recognized in income (loss).
Financial assets at fair value recognized in the income (loss) are initially recognized at fair value, and transaction costs are charged to statement of income in the period they occur.
19
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
The fair value of publicly quoted investments is based on the current purchase price. If the market of a financial asset is not active, the Ambipar Emergency Response establishes the fair value using valuation techniques. These techniques include the use of recent transactions contracted from third parties, reference to other instruments that are substantially similar, analysis of discounted cash flows and option pricing models, privileging market information and minimizing the use of information generated by Management.
Classification
In the initial recognition, a financial asset is classified as measured at: (i) amortized cost; (ii) fair value through other comprehensive income (“FVTOCI”); or (iii) fair value through profit or loss (“FVTPL”).
A financial asset is measured at amortized cost if it meets both conditions below: (i) the asset is held within a business model whose purpose is to collect contractual cash flows; and (ii) the contractual terms of financial assets give rise, on specific dates, to cash flows that are only payments of principal and interest on the outstanding principal value.
A financial asset is measured in FVOCI only if it meets both conditions below: (i) the asset is maintained within a business model whose purpose is achieved by both the collection of contractual cash flows and the sale of financial assets; and (ii) the contractual terms of financial assets give rise, on specific dates, to cash flows that refer to payments of principal and interest on the outstanding principal value. All other financial assets are classified as measured at fair value through profit or loss.
In addition, upon initial recognition, the Ambipar Emergency Response may, irrevocably, designate a financial asset that satisfies the requirements to be measured at amortized cost, FVTOCI or even FVTPL. This designation is intended to eliminate or significantly reduce a possible accounting mismatch stemming from the result produced by the respective asset.
Financial assets – Business model assessment
The Ambipar Emergency Response makes an assessment of the objective of the business model in which a financial asset is held at a portfolio level because this best reflects the way the business is managed, and information is provided to management. The information considered includes:
•the stated policies and objectives for the portfolio and the operation of those policies in practice. These include whether management’s strategy focuses on earning contractual interest income, maintaining a particular interest rate profile, matching the duration of the financial assets to the duration of any related liabilities or expected cash outflows or realizing cash flows through the sale of the assets;
•how the performance of the portfolio is evaluated and reported to the Ambipar Emergency Response’s management;
•the risks that affect the performance of the business model (and the financial assets held within that business model) and how those risks are managed;
•how managers of the business are compensated – e.g. whether compensation is based on the fair value of the assets managed or the contractual cash flows collected; and
•the frequency, volume and timing of sales of financial assets in prior periods, the reasons for such sales and expectations about future sales activity.
Transfers of financial assets to third parties in transactions that do not qualify for derecognition are not considered sales for this purpose, consistent with the Ambipar Emergency Response’s continuing recognition of the assets.
20
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
Financial assets that are held for trading or are managed and whose performance is evaluated on a fair value basis are measured at FVTPL.
Financial assets – Assessment whether contractual cash flows are solely payments of principal and interest
For the purposes of this assessment, ‘principal’ is defined as the fair value of the financial asset on initial recognition, ‘Interest’ is defined as consideration for the time value of money and for the credit risk associated with the principal amount outstanding during a particular period of time and for other basic lending risks and costs (e.g., liquidity risk and administrative costs), as well as a profit margin.
In assessing whether the contractual cash flows are solely payments of principal and interest, the Ambipar Emergency Response considers the contractual terms of the instrument. This includes assessing whether the financial asset contains a contractual term that could change the timing or amount of contractual cash flows such that it would not meet this condition, in making this assessment, the Ambipar Emergency Response considers:
•contingent events that would change the amount or timing of cash flows.
•terms that may adjust the contractual coupon rate, including variable‑rate features;
•prepayment and extension feature; and
•terms that limit the Ambipar Emergency Response’s claim to cash flows from specified assets (e.g., non‑recourse features).
A prepayment feature is consistent with the solely payments of principal and interest criterion if the prepayment amount substantially represents unpaid amounts of principal and interest on the principal amount outstanding, which may include reasonable compensation for early termination of the contract. Additionally, for a financial asset acquired at a discount or premium to its contractual per amount, a feature that permits or requires prepayment at an amount that substantially represents the contractual par amount plus accrued (but unpaid) contractual interest (which may also include reasonable compensation for early termination) is treated as consistent with this criterion if the fair value of the prepayment feature is insignificant at initial recognition.
21
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
Financial assets – Subsequent measurement and gains and losses
Financial assets at FVTPLThese assets are subsequently measured at fair value, Net gains and losses, including any interest or dividend income, are recognized in profit or loss.
Financial assets at amortized costThese assets are subsequently measured at amortized cost using the effective interest method. The amortized cost is reduced by impairment losses, Interest income, foreign exchange gains and losses and impairment are recognized in profit or loss. Any gain or loss on derecognition is recognized in profit or loss.
Debt investments at FVOCIThese assets are subsequently measured at fair value, Interest income calculated using the effective interest method, foreign exchange gains and losses and impairment are recognized in profit or loss. Other net gains and losses are recognized in OCI. On derecognition, gains and losses accumulated in OCI are reclassified to profit or loss.
Equity investments at FVOCIThese assets are subsequently measured at fair value, Dividends are recognized as income in profit or loss unless the dividend clearly represents a investment’s cost part recovery. Other net gains and losses are recognized in OCI and are never reclassified to profit or loss.
Trade accounts receivable
Trade accounts receivable correspond to the amount’s receivable from clients for the rendering of service carried out in the normal course of Group’s activities. If the payment term is equivalent to one year or less (or any other term that is in conformity with Group's normal cycle), accounts receivable are classified as current assets. Otherwise, they are presented in non-current assets.
Trade accounts receivable are initially recognized at fair value and, subsequently, measured at amortized cost using the effective interest rate method less expected impairment losses on accounts receivable, in practice, they are usually recognized at the billed amount, adjusted by provision for impairment, if necessary.
Recognition and derecognition
The financial instrument is recognized in the Unaudited Condensed Consolidated Interim Financial Statements when the entity becomes a party to the financial instrument contract. An entity removes a financial liability from its statement of financial position when its obligation is extinguished. An entity removes a financial asset from its statement of financial position when its contractual rights to the asset’s cash flows expire; when it has transferred the asset and substantially all the risks and rewards of ownership; or when it has transferred the asset and has retained some substantial risks and rewards of ownership, but the other party may sell the asset. The risks and rewards retained are recognized as assets.
Impairment of financial assets
Expected credit losses
The expected loss on doubtful accounts is established when there is objective evidence that the Group will not be able to collect all amounts according to the accounts receivable original terms.
22
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
It is formed in an amount considered adequate by Management to cover probable losses arising on collection of accounts receivable, based on analysis of each client’s default risk considering a reasonable and supportable information available at the time that demonstrates that the credit risk has not increased significantly since initial recognition, the customer’s financial situation committed in the market, history of negotiations carried out, signed agreements not being fulfilled, mainly taking into consideration risk scenarios in which it has observable behavior in the market, and with special attention to long-standing overdue credits.
a)Recognition
The Ambipar Emergency Response recognizes loss allowances for Expected Credit Loss (ECLs) on:
•financial assets measured at amortized cost;
•debt investments measured at FVOCI; and
•contract assets.
The Ambipar Emergency Response also recognizes loss allowances for ECLs on lease receivables, which are disclosed as part of trade and other receivables.
The Ambipar Emergency Response measures loss allowances at an amount equal to lifetime ECLs, except for the following, which are measured at 12‑month ECLs:
•debt securities that are determined to have low credit risk at the reporting date; and
•other debt securities and bank balances for which credit risk (i.e. the risk of default occurring over the expected life of the financial instrument) has not increased significantly since initial recognition.
Loss allowances for trade receivables (including lease receivables) and contract assets are always measured at an amount equal to lifetime ECLs.
When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECLs, the Ambipar Emergency Response considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Ambipar Emergency Response’s historical experience and informed credit assessment, that includes forward‑looking information.
The Ambipar Emergency Response assumes that the credit risk on a financial asset has increased significantly if it is more than 30 days past due.
The Ambipar Emergency Response considers a financial asset to be in default when:
•the debtor is unlikely to pay its credit obligations to the Ambipar Emergency Response in full, without recourse by the Ambipar Emergency Response to actions such as realizing security (if any is held); or
•the financial asset is more than 90 days past due.
The Ambipar Emergency Response considers a debt security to have low credit risk when its credit risk rating is equivalent to the globally understood definition of ‘investment grade’.
Lifetime ECLs are the ECLs that result from all possible default events over the expected life of a financial instrument.
23
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
12‑month ECLs are the portion of ECLs that result from default events that are possible within the 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months).
The maximum period considered when estimating ECLs is the maximum contractual period over which the Ambipar Emergency Response is exposed to credit risk.
b)Measurement
ECLs are a probability‑weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash flows that the Ambipar Emergency Response expects to receive).
ECLs are discounted at the effective interest rate of the financial asset.
c)Credit-impaired financial assets
At each reporting date, the Ambipar Emergency Response assesses whether financial assets carried at amortized cost and debt securities at FVOCI are credit‑impaired. A financial asset is ‘credit‑impaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.
Evidence that a financial asset is credit‑impaired includes the following observable data:
•significant financial difficulty of the debtor;
•a breach of contract such as a default or being more than 90 days past due;
•the restructuring of a loan or advance by the Ambipar Emergency Response on terms that the Ambipar Emergency Response would not consider otherwise;
•it is probable that the debtor will enter bankruptcy or other financial reorganization; or
•the disappearance of an active market for a security because of financial difficulties.
d)Presentation of allowance for ECL in the statement of financial position
Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets.
For debt securities at FVOCI, the loss allowance is charged to profit or loss and is recognized in OCI.
e)Write-off
The gross carrying amount of a financial asset is written off when the Group has no reasonable expectations of recovering a financial asset in its entirety or a portion thereof. For individual customers, the Group has a policy of writing off the gross carrying amount when the financial asset is 180 days past due based on historical experience of recoveries of similar assets. For corporate customers, the Group individually makes an assessment with respect to the timing and amount of write‑off based on whether there is a reasonable expectation of recovery. The Group expects no significant recovery from the amount written off. However, financial assets that are written off could still be subject to enforcement activities in order to comply with the Group’s procedures for recovery of amounts due.
24
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
Derecognition of financial assets
A financial asset (or, when appropriate, part of a financial asset or part of a group of similar financial assets) is written off when: (i) the rights to receive cash flows from the asset have expired; and (ii) the Group transferred its rights to receive cash flows of the asset or has assumed an obligation to fully pay cash flows received, without significant delay, to a third party under terms of an "on lending" agreement; and (a) the Group has substantially transferred all risks and benefits related to the asset; or (b) the Group has not transferred and has not substantially retained all risks and benefits related to the asset, but has transferred control over that asset.
When the Group transfers its rights to receive cash flows from an asset or enters into a transfer agreement and does not transfer or substantially retain all risks and benefits related to the asset, an asset is recognized to the extent of the Group’s ongoing involvement with this asset.
3.4.2.Financial liabilities
Initial recognition, classification and measurement
A financial asset or financial liability is measured initially at fair value. Subsequent measurement depends on the category of financial instrument.  Some categories are measured at amortized cost, and some at FVTPL. A financial liability is classified as at FVTPL if it is classified as held‑for‑trading, it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method, Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in profit or loss.
Interest rate benchmark reform
When the basis for determining the contractual cash flows of a financial asset or financial liability measured at amortized cost changed as a result of interest rate benchmark reform, the Group updated the effective interest rate of the financial asset or financial liability to reflect the change that is required by the reform. A change in the basis for determining the contractual cash flows is required by interest rate benchmark reform if the following conditions are met:
•the change is necessary as a direct consequence of the reform; and
•the new basis for determining the contractual cash flows is economically equivalent to the previous basis – i.e., the basis immediately before the change.
When changes were made to a financial asset or financial liability in addition to changes to the basis for determining the contractual cash flows required by interest rate benchmark reform, the Group first updated the effective interest rate of the financial asset or financial liability to reflect the change that is required by interest rate benchmark reform. After that, the Group applied the policies on accounting for modifications to the additional changes.
Borrowing costs
Cost of loans attributed to the acquisition, construction or production of an asset that necessarily demands a substantial period of time to become ready for intended use or sale is capitalized as part of this asset’s cost.
25
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
Loan costs are comprised by interest and other costs that the Group incurs in connection with fundraising.
Derecognition of financial liabilities
A financial liability is derecognized when the obligation under the liability is discharged, canceled, or expired. When an existing financial liability is replaced by another of the same lender with substantially different terms, or the terms of an existing liability are significantly changed, this substitution or alteration is treated as a write-off of the original liability and recognition of a new liability, whereas the difference in the corresponding book value is recognized in the statement of income.
Loans and financing
Borrowings and financing are initially recognized at fair value, net of costs incurred in the transaction and are subsequently stated at amortized cost.
Any difference between the amounts raised (net of transaction costs) and the settlement amount is recognized in the income statement during the period while the loans are outstanding, under the effective interest rate method.
Loans and financing are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the balance sheet date.
Warrant and Earn-out
Warrant is a financial instrument that confers the right, but not the obligation, to acquire shares at a specified price during a specific period. It is recognized as a financial liability, and the subsequent measurement of fair value is recognized in profit or loss for the period.
Earn-out is related to the achievement of certain objectives in merger and acquisition operations, in which a part of the purchase price is deferred and based on the future performance of the company. It is recognized as a financial liability, and the subsequent measurement of fair value is recognized in the equity transaction account in the Company's equity.
Such operations are classified in IAS 32/IFRS 9 and are classified as derivative financial instruments, assets and liabilities. Fair value is calculated according to a Monte Carlo simulation model at each measurement date.
3.5.Intangible assets and Goodwill
(i)Software
Costs associated with maintaining software programs are recognized as an expense as incurred. Development costs that are directly attributable to the design and testing of identifiable and unique software products controlled by the Group are recognized as intangible assets where the following criteria are met:
•it is technically feasible to complete the software so that it will be available for use;
•management intends to complete the software and use or license it there is an ability to use or sell the software;
•it can be demonstrated how the software will generate probable future economic benefits;
26
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
•adequate technical, financial and other resources to complete the development and to use or sell the software are available; and
•the expenditure attributable to the software during its development can be reliably measured.
Directly attributable costs that are capitalized as part of the software include employee´s costs and an appropriate portion of relevant overheads.
Capitalized development costs are recorded as intangible assets and amortized from the point at which the asset is ready for use.
(ii)Goodwill
Goodwill is measured as described in note 9, Goodwill on acquisitions of subsidiaries is included in intangible assets, Goodwill is not amortized but it is tested for impairment annually, or more frequently if events or changes in circumstances indicate that it might be impaired and is carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating units or groups of cash-generating units that are expected to benefit from the business combination in which the goodwill arose. The units or groups of units are identified at the lowest level at which goodwill is monitored for internal management purposes.
(iii)Research and development
Expenditure on research activities is recognized in profit or loss as incurred.
Development expenditure is capitalized only if the expenditure can be measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable, and the Group intends to and has sufficient resources to complete development and to use or sell the asset. Otherwise, it is recognized in profit or loss as incurred. Subsequent to the initial recognition, development expenditure is measured at cost less accumulated amortization and any accumulated impairment losses.
(iv)Other Intangibles
Other intangible assets, including client’s portfolio, patents and trademarks, that are acquired by the Group and have finite useful lives are measured at cost less accumulated amortization and any accumulated impairment losses.
(v)Amortization
Amortization is recognized in the Unaudited Condensed Consolidated Interim statement of Income (loss) based on the straight-line method in relation to the estimated useful lives, since this method is the closest that reflects the consumption pattern of future economic benefits incorporated into the asset. The estimated useful lives of intangible assets are as measured as described in note 9 (b).
The assets' net book values and useful lives are reviewed at each reporting date, and adjusted prospectively, where applicable.
27
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
In September 30, 2023, the Group reviewed the estimated useful lives of these assets, and no significant change was identified.
Other intangible assets, including customer relationships, work force, that are acquired by the Group and have finite useful lives are measured at cost less accumulated amortization and any accumulated impairment losses.
3.6.Impairment of non-financial assets
An impairment loss is recognized in the Unaudited Condensed Consolidated Interim Financial Statements statement of income (loss) for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows that are largely independent of the cash inflows from other assets or groups of assets (cash-generating units).
Goodwill and intangible assets that have an indefinite useful life are not subject to amortization and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other non-financial assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period. Therefore, impairment losses recognized for goodwill cannot be reversed in a subsequent period.
3.7.Property, plant, and equipment
Property, plant, and equipment (PPE) are stated at historical cost less accumulated depreciation and accumulates impairment losses (if applicable). Historical cost includes expenses directly attributable to the acquisition of items. Historical cost also includes financing costs related to the acquisition of qualifying assets.
Subsequently incurred costs are added to the asset's book value or are recognized as a separate asset, as applicable, and only when it is likely that associated future economic benefits will flow and that the item's cost can be reliably measured.
The book value of replaced items and parts is written off. All other maintenance and repair costs are recorded as a contra entry to income (loss) for the year, when incurred.
Lands are not depreciated. Depreciation of other assets is calculated using the straight-line method, with the costs of other assets being allocated to their residual values over the estimated useful life. Assets under development are not depreciated until they are available for use. Property, plant, and equipment useful lives are disclosed in note 8.
Residual values and the useful lives of material assets are reviewed and adjusted, if adequate, at the end of each year and depreciated using the straight-line method.
An asset's book value is immediately written down to its recoverable amount if the asset's book value is greater than its estimated recoverable amount, as impairment.
28
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
An item of property and equipment is de-recognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on de-recognition of the asset (calculated as the difference between net disposal proceeds and the carrying amount of the asset) is included as a gain or loss in the Consolidated statement of operations in the period the asset is de-recognized.
Gains and losses from disposals are determined when the asset is derecognized by the comparison of results with the book value and are recognized in "Other net operating revenues (expense)" in the statement of income, as incurred.
3.8.Trade accounts payable and other accounts payable
Trade accounts payable and other accounts payable are obligations due for assets or services acquired from suppliers in the normal course of businesses and are classified as current liabilities if payment is due within one year. Otherwise, trade accounts payable are presented as non-current liabilities.
They are initially recognized at fair value and, subsequently, measured at amortized cost using the effective interest rate method. In practice, they are usually recognized at the amount of the related invoice.
3.9.Provisions
Provisions for lawsuits (labor, civil and tax) are recognized when: the Group has a present or constructive obligation as result of past events; it is likely that an outflow of funds will be required to settle the obligation; and if the amount can be estimated reliably, Provisions are not recognized for future operating losses.
When there is a series of similar obligations, the probability of settling them is determined by considering all obligation as a whole. A provision is recognized even if the likelihood of settlement related to any individual item included in the same class of obligations is small.
The provisions are measured at the present value of the expenditures that shall be necessary to settle the obligation, using a pre-tax rate which reflects the current market evaluations as to the value of the cash over time and the specific risks of the liability. The increase in the obligation over time is recognized as a financial expense.
3.10.Income tax
Income tax expense comprises current and deferred tax. It is recognized in profit or loss except to the extent that it relates to a business combination, or items recognized directly in equity or in OCI.
The Group has determined that interest and penalties related to income taxes, including uncertain tax treatments, do not meet the definition of income taxes, and therefore accounted for them under IAS 37 Provisions, Contingent Liabilities and Contingent Assets.
29
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
3.10.1. Current tax
Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax payable or receivable is the best estimate of the tax amount expected to be paid or received that reflects uncertainty related to income taxes, if any. It is measured using tax rates enacted or substantively enacted at the reporting date. Current tax also includes any tax arising from dividends.
Companies under the deemed income system
There are companies that opted for taxation based on estimated profit. The income tax and social contribution, both current and deferred, are calculated based on the rates of 15% plus a surcharge of 10% more than R$ 240 for income tax and 9% for social contribution, both applied to a percentage of 32% gross revenue.
Companies under the taxable income system
The income tax and social contribution of current year are calculated based on the rates of 15% plus a surcharge of 10% on taxable income more than R$ 240 for income tax and 9% on taxable income for social contribution on net income and take into account (if any) tax loss carry forward and negative basis of social contribution, limited to 30% of taxable income.
The Group operates in several international tax jurisdictions. Judgement is required in respect of the interpretation of state, federal and international tax law and practices as service provider and tax continues to evolve.
3.10.2. Deferred tax
Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized for:
•temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss;
•temporary differences related to investments in subsidiaries, associates and joint arrangements to the extent that the Group is able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future; and
•taxable temporary differences arising on the initial recognition of goodwill.
Temporary differences in relation to a right‑of‑use asset and a lease liability for a specific lease are regarded as a net package (the lease) for the purpose of recognizing deferred tax.
Deferred tax assets are recognized for unused tax losses, unused tax credits and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be used. There are no unrecognized tax losses or tax credits.
Future taxable profits are determined based on the reversal of relevant taxable temporary differences. If the amount of taxable temporary differences is insufficient to recognize a deferred tax asset in full, then future taxable profits, adjusted for reversals of existing temporary differences, are considered, based on the business plans for individual subsidiaries in the Group. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized; such reductions are reversed when the probability of future taxable profits improves.
30
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
The measurement of deferred tax reflects the tax consequences that would follow from the manner which the Group expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities. For this purpose, the carrying amount of investment property measured at fair value is presumed to be recovered through sale, and the Group has not rebutted this presumption.
Deferred tax liabilities are offset if a legally enforceable right exists to set off current income tax assets against current income tax liabilities and the deferred tax relates to the same taxable entity and the same taxation authority.
3.11.Revenue recognition
The revenue is stated net of taxes, returns, rebates or discounts, its recognition is in accordance with IFRS 15 – Revenue from customer contracts, which establishes a five-steps model to determine how and when it will be recognize, as well as its measurement, provided that revenues and costs can be measured reliably.
The Group revenue recognizes revenue when control of the promised services is transferred to the customer, in an amount that reflects the consideration the Group expects to be entitled to in exchange for those services.
In addition, specific criteria for each of the Group’s activities must be met, as described below:
Rendering of services
The Group provides emergency services that includes prevention, training, and emergency response.
Revenues are generated from services at customer sites or other locations. Response services for environmental emergencies include any scale from man-made disasters such as oil spills, to natural disasters such as hurricanes. Emergency response services are provided based on purchase orders or agreements with customers and include prices generally based upon daily, hourly or job rates for equipment, materials and personnel.
The Group recognizes revenue for these services over time, as the customer receives and consumes the benefits of the service as they are being performed and the Group has a right to receive for performance completed to date. The Group uses the input method to recognize revenue over time, based on time and materials incurred. The duration of such services can be over the number of hours, days or even months for larger scale projects. In this situation, can be recognized unbilled revenue.
3.12.Leases liabilities
As a lessee
At inception of a contract, the Group assesses whether a contract is, or contains, a lease liability. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for of the period agreed time in exchange for consideration.
At commencement or on modification of a contract that contains a lease component, the Group allocates the consideration in the contract to each lease component based on its relative stand‑alone prices. However, for the leases of property the Group has elected not to separate non‑lease components and account for the lease and non‑lease components as a single lease component.
31
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
The Group recognizes a right‑of‑use asset and a lease liability at the lease commencement date. The right‑of‑use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received.
The right‑of‑use asset is subsequently depreciated using the straight‑line method from the commencement date to the end of the lease term, unless the lease transfers ownership of the underlying asset to the Group by the end of the lease term or the cost of the right‑of‑use asset reflects that the Group will exercise a purchase option. In that case the right‑of‑use asset will be depreciated over the useful life of the underlying asset, which is determined on the same basis as those of property and equipment. In addition, the right‑of‑use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group’s incremental borrowing rate. Generally, the Group uses its incremental borrowing rate as the discount rate.
The Group determines it’s the range incremental borrowing rate from 7,08% to 8,5% as each year by obtaining interest rates from various external financing sources and makes certain adjustments to reflect the terms of the lease and type of the asset leased.
Lease payments included in the measurement of the lease liability comprise the following:
•fixed payments, including in‑substance fixed payments;
•variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;
•amounts expected to be payable under a residual value guarantee; and
•the exercise price under a purchase option that the Group is reasonably certain to exercise, lease payments in an optional renewal period if the Group is reasonably certain to exercise an extension option, and penalties for early termination of a lease unless the Group is reasonably certain not to terminate early.
The lease liability is measured at amortized cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Group’s estimate of the amount expected to be payable under a residual value guarantee, if the Group changes its assessment of whether it will exercise a purchase, extension or termination option or if there is a revised in‑substance fixed lease payment.
When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right‑of‑use asset or is recorded in profit or loss if the carrying amount of the right‑of‑use asset has been reduced to zero.
From January 1st, 2021, where the basis for determining future lease payments changes as required by interest rate benchmark reform, the Group remeasures the lease liability by discounting the revised lease payments using the revised discount rate that reflects the change to an alternative benchmark interest rate.
32
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
The Group presents right‑of‑use assets that do not meet the definition of investment property in ‘property, plant and equipment’ and lease liabilities in ‘loans and borrowings’ in the statement of financial position.
Short-term leases and leases of low-value assets
The Group has elected not to recognize right‑of‑use assets and lease liabilities for leases of low‑value assets and short‑term leases, including IT equipment. The Group recognizes the lease payments associated with these leases as an expense on a straight‑line basis over the lease term.
3.13.Distribution of dividends and interest on own capital
Payment of dividends and interest on capital to Group shareholders is recognized as a liability in the Unaudited Condensed Consolidated Interim Financial Statements at the end of the year, based on the by-laws that govern the Group’s companies.
Any amount above the mandatory minimum is provisioned only on the date of its approval by the shareholders.
The tax benefit of interest on own capital is recognized in the statement of income.
3.14.Business combinations
The Group accounts for business combinations using the acquisition method when the acquired set of activities and assets meets the definition of a business and control is transferred to the Group. In determining whether a particular set of activities and assets is a business, the Group assesses whether the set of assets and activities acquired includes, at least, an input and substantive process and whether the acquired set has the produce outputs ability.
The Group has an option to apply a ‘concentration test’ that permits a simplified assessment of whether an acquired set of activities and assets is not a business. The optional concentration test is met if substantially all the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets.
The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets acquired. The goodwill constituted in the business combination is recorded in non-current assets, subgroup of intangible assets. Any goodwill that arises is recorded in intangible assets and tested annually for impairment. Any gain on a bargain purchase is recognized in profit or loss immediately. Transaction costs are expensed as incurred, except if related to the issue of debt or equity securities.
The consideration transferred does not include amounts related to the settlement of pre‑existing relationships. Such amounts are generally recognized in profit or loss.
Any contingent consideration is measured at fair value at the date of acquisition. If an obligation to pay contingent consideration that meets the definition of a financial instrument is classified as equity, then it is not remeasured, and settlement is accounted for within equity. Otherwise, other contingent consideration is remeasured at fair value at each reporting date and subsequent changes in the fair value of the contingent consideration are recognized in profit or loss.
If the Company makes a purchase of an investment and part of the amount is in installments, the accounts payable is recorded in the item Obligations from acquisition of, as mentioned in Note 7.
33
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
3.15.Non-controlling interests
The interest attributable to non-controlling shareholders was calculated based on the percentage of 49%, 30% and 20% on the total shareholders’ equity of each investee, as shown in the table below.
Set out below is summarized financial information for NCI that are material to the Group for September 30, 2023:
Summarized statement of financial positionAmbipar Response Espírito Santo S.A.Ambipar Response Dracares Apoio Marítimo e Portuario S/A.Ambipar Flyone Serviço Aereo Especializado, Comércio e ServiçoRG Response S.A.Ambipar Response Tank Cleaning S/AJM Serviços Integrados S.A.Ambipar Response Marine S/AAmbipar Response Industrial Services S/AEmergência Participações S.A.Total
September 30, 2023September 30, 2023September 30, 2023September 30, 2023September 30, 2023September 30, 2023September 30, 2023September 30, 2023September 30, 2023September 30, 2023
Current assets89,837 16,576 37,329 5,678 72,201 38,745 6,132 11,129 1,400,282 1,677,909 
Current liabilities(83,100)(20,152)(22,593)(1,876)(19,873)(10,406)(1,959)(7,559)(938,376)(1,105,894)
Current net assets6,737 (3,576)14,736 3,802 52,328 28,339 4,173 3,570 461,906 572,015 
Non-current assets175,760 70,447 114,424 5,544 73,115 22,043 4,329 3,714 2,319,013 2,788,389 
Non-current liabilities(86,506)(15,890)(30,301)(1,846)(13,125)(26,448)(385)— (2,042,190)(2,216,691)
Non-current net assets89,254 54,557 84,123 3,698 59,990 (4,405)3,944 3,714 276,823 571,698 
          
Net assets95,991 50,981 98,859 7,500 112,318 23,934 8,117 7,284 738,729 1,143,713 
Net assets controlling95,991 50,981 98,859 7,500 112,318 23,934 8,117 7,284 738,729 1,143,713 
Net assets nom-controlling16,719 — — — — — — — 102,850 119,569 
 
Accumulated NCI81,734 
Others adjustment from non-controlling23,493 5,604 25,497 1,105 18,567 5,716 1,623 3,569 3,321 88,495 
Accumulated NCI adjusted170,229 
Revenue122,696 58,548 68,395 11,113 87,440 55,234 8,981 34,758 380,143 827,308 
Cost of services rendered(91,272)(41,848)(44,021)(7,913)(42,803)(27,567)(6,022)(27,588)(315,838)(604,872)
Gross profit31,424 16,700 24,374 3,200 44,637 27,667 2,959 7,170 64,305 222,436 
Selling, general and administrative expenses— — — — — — — — — — 
Other expense87 1,789 8,731 230 17,212 38 85 5 (2,882)25,295 
Operating expenses87 1,789 8,731 230 17,212 38 85 5 (2,882)25,295 
Operating profit31,511 18,489 33,105 3,430 61,849 27,705 3,044 7,175 61,423 247,731 
          
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AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)
Summarized statement of financial positionAmbipar Response Espírito Santo S.A.Ambipar Response Dracares Apoio Marítimo e Portuario S/A.Ambipar Flyone Serviço Aereo Especializado, Comércio e ServiçoRG Response S.A.Ambipar Response Tank Cleaning S/AJM Serviços Integrados S.A.Ambipar Response Marine S/AAmbipar Response Industrial Services S/AEmergência Participações S.A.Total
September 30, 2023September 30, 2023September 30, 2023September 30, 2023September 30, 2023September 30, 2023September 30, 2023September 30, 2023September 30, 2023September 30, 2023
Finance costs(10,429)(1,019)(4,778)(157)(295)(3,800)(60)(114)(33,276)(53,928)
Finance income1,440 307 435 26 2,583 114 140 84 940 6,069 
Net finance costs(8,989)(712)(4,343)(131)2,288 (3,686)80 (30)(32,336)(47,859)
Profit before tax22,522 17,777 28,762 3,299 64,137 24,019 3,124 7,145 29,087 199,872 
Income tax and social contribution(8,337)(6,422)(4,841)(803)(10,251)(4,965)(345)(3,603)(7,913)(47,480)
Profit for the year14,185 11,355 23,921 2,496 53,886 19,054 2,779 3,542 21,174 152,392 
Profit for the year controlling7,515 5,791 12,200 1,391 35,058 13,338 2,223 1,806 7,886 87,209 
Profit for the year non-controlling6,670 5,564 11,721 1,105 18,828 5,716 556 1,736 13,288 65,183 
Interest attributable to non-controlling shareholders30.00 %49.00 %49.00 %49.00 %49.00 %30.00 %20.00 %49.00 %100.00 %
(*)     The information on Ambipar Response ES S.A. in this table is consolidated and have their subsidiaries shown in the table at note 1.2.
35
AMBIPAR EMERGENCY RESPONSE
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
For the periods ending September 30, 2023, and 2022
(Values expressed in thousands of Brazilian Reais)

3.16.Segment reporting
For reviewing the operational performance of the Group and allocating resources purposes, the Chief Operating Decision Maker ("CODM") of the Group, which is comprised of the Chief Executive Officer of the Group, reviews the Consolidated results as a geographical area disaggregated by domestic market and foreign market as a whole market. The CODM considers the whole Group a single operating and reportable segment, when monitoring operations, making decisions on fund allocation, and evaluating performance. The CODM reviews relevant financial data on a Consolidated basis for all subsidiaries and business lines.
The Group’s net revenue, profit or loss, and assets and liabilities for this one reportable segment can be determined by reference to the Unaudited Condensed Consolidated Interim Financial Statements.
For more information regarding the Group's non-current assets and net revenue by geographic area, refer to note 8.