Form 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Report Of Foreign Private Issuer
Pursuant To Rule 13a-16 Or 15d-16 Of
The Securities Exchange Act Of 1934

For the month of May, 2006

Commission File Number: 001-14950

ULTRAPAR HOLDINGS INC.
(Translation of Registrant’s Name into English) 
 
Avenida Brigadeiro Luis Antonio, 1343, 9º Andar
São Paulo, SP, Brazil 01317-910
(Address of Principal Executive Offices)

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   X     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   X  

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   X  

Indicate by check mark whether by furnishing the information contained in this Form, the Registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:

         Yes           No   X  

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): N/A





ULTRAPAR HOLDINGS INC.

TABLE OF CONTENTS

ITEM    
1.   Interim financial statements for the quarter ended March 31, 2006  
2.   Minutes of a meeting of the Board of Directors, May 10, 2006  

- 2 -





Item 1
 
(Convenience Translation into English from
the Original Previously Issued in Portuguese)
 
 
 
Ultrapar Participações S.A.
 
 
Interim Financial Statements for the Quarter
ended March 31, 2006 and Independent
Accountants’ Review Report
 
 
 
Deloitte Touche Tohmatsu Auditores Independentes





(Convenience Translation into English from the Original Previously Issued in Portuguese)

INDEPENDENT ACCOUNTANTS’ REVIEW REPORT

To the Shareholders and Management of
Ultrapar Participações S.A.
São Paulo - SP

1.      We have performed a special review of the accompanying interim financial statements of Ultrapar Participações S.A. and subsidiaries as of and for the three-month period ended March 31, 2006, prepared in accordance with Brazilian accounting practices and under the responsibility of the Company’s management, consisting of the balance sheets (Company and consolidated), the related statements of income and the performance report.
 
2.      We conducted our review in accordance with specific standards established by the Brazilian Institute of Independent Auditors (IBRACON), together with the Federal Accounting Council, which consisted principally of: (a) inquiries of and discussions with persons responsible for the accounting, financial and operating areas as to the criteria adopted in preparing the interim financial statements, and (b) review of the information and subsequent events that had or might have had material effects on the financial position and results of operations of the Company and its subsidiaries.
 
3.      Based on our special review, we are not aware of any material modifications that should be made to the financial statements referred to in paragraph 1 for them to be in conformity with Brazilian accounting practices and standards established by the Brazilian Securities Commission (CVM), specifically applicable to the preparation of mandatory interim financial statements.
 
4.      Additionally, we have reviewed the consolidated statement of cash flows, included in Note 23 to the interim financial statements, for the periods ended March 31, 2006 and 2005, which is presented for purposes of additional analysis and is not a required part of the basic interim financial statements. Such statement has been subjected to the review procedures described in paragraph 2 and, based on our review, we are not aware of any material modifications that should be made to this statement for it to be fairly stated, in all material respects, in relation to the interim financial statements taken as a whole.
 
5.      We had previously audited the Company and consolidated balance sheets as of December 31, 2005 and reviewed the Company and consolidated statements of income for the three- month period ended March 31, 2005, presented for comparative purposes, and issued unqualified audited and special review reports thereon, dated January 31, 2006 and April 29, 2005, respectively.
 




Deloitte Touche Tohmatsu

6.      The accompanying interim financial statements have been translated into English for the convenience of readers outside Brazil.


São Paulo, April 28, 2006    
     
     
DELOITTE TOUCHE TOHMATSU   Altair Tadeu Rossato
Auditores Independentes   Engagement partner

2





(Convenience Translation into English from the Original Previously Issued in Portuguese)
                         
ULTRAPAR PARTICIPAÇÕES S.A. AND SUBSIDIARIES
 
BALANCE SHEETS AS OF MARCH 31, 2006 AND DECEMBER 31, 2005
(In thousands of Brazilian reais - R$)
    Company   Consolidated
ASSETS   03/31/06   12/31/05   03/31/06   12/31/05
CURRENT ASSETS                        
Cash and banks   131     90     26,470     32,714  
Temporary cash investments   373,326     359,626     1,058,660     1,218,210  
Trade accounts receivable   -     -     335,002     343,328  
Inventories   -     -     208,403     191,749  
Recoverable taxes   11,928     8,984     59,117     62,931  
Deferred income and social contribution taxes   92     87     22,552     21,969  
Dividends receivable   -     73,302     -     -  
Other   943     422     9,006     8,608  
Prepaid expenses   536     536     9,873     8,793  
Total current assets   386,956     443,047     1,729,083     1,888,302  
LONG-TERM ASSETS                        
Cash investments   -     -     382,124     372,692  
Related companies   14,409     14,409     4,955     3,706  
Deferred income and social contribution taxes   2,915     2,849     61,348     60,991  
Recoverable taxes   11,832     11,734     46,882     46,777  
Escrow deposits   -     -     16,802     16,384  
Trade accounts receivable   -     -     20,986     19,244  
Prepaid expenses   -     -     13,799     13,144  
Other   821     757     387     571  
Total long-term assets   29,977     29,749     547,283     533,509  
PERMANENT ASSETS                        
Investments:                        
 Subsidiary and affiliated companies   2,215,915     2,153,873     4,242     4,182  
 Other   186     186     28,117     28,117  
Property, plant and equipment   -     -     1,070,187     1,072,729  
Deferred charges   -     -     102,533     98,286  
Total permanent assets   2,216,101     2,154,059     1,205,079     1,203,314  
TOTAL ASSETS   2,633,034     2,626,855     3,481,445     3,625,125  

    Company   Consolidated
LIABILITIES AND STOCKHOLDERS' EQUITY   03/31/06   12/31/05   03/31/06   12/31/05
CURRENT LIABILITIES                        
Loans and financing   -     -     129,661     135,855  
Debentures   4,173     17,853     4,173     17,853  
Trade accounts payable   273     280     94,440     90,938  
Payroll and related charges   41     41     56,286     66,066  
Taxes payable   10     7     13,726     11,332  
Dividends payable   13,715     100,108     17,337     103,854  
Income and social contribution taxes   -     -     837     638  
Deferred income and social contribution taxes   -     -     230     249  
Other   2     4     3,784     13,395  
Total current liabilities   18,214     118,293     320,474     440,180  
LONG-TERM LIABILITIES                        
Loans and financing   -     -     905,911     978,608  
Debentures   300,000     300,000     300,000     300,000  
Related companies   447,252     404,230     4,984     5,049  
Deferred income and social contribution taxes   -     -     24,499     24,120  
Other taxes   8,881     8,689     39,003     54,622  
Other   -     -     2,441     2,747  
Total long-term liabilities   756,133     712,919     1,276,838     1,365,146  
MINORITY INTEREST   -     -     30,764     29,634  
STOCKHOLDERS' EQUITY                        
Capital   946,034     946,034     946,034     946,034  
Capital reserve   2,046     2,046     381     329  
Revaluation reserve   14,600     14,955     14,600     14,955  
Profit reserves   837,502     837,502     837,502     837,502  
Treasury shares   (4,894 )   (4,894 )   (8,544 )   (8,655 )
Retained earnings   63,399     -     63,396     -  
Total stockholders' equity   1,858,687     1,795,643     1,853,369     1,790,165  
Total minority interest and stockholders' equity   1,858,687     1,795,643     1,884,133     1,819,799  
TOTAL LIABILITIES AND STOCKHOLDERS                        
EQUITY   2,633,034     2,626,855     3,481,445     3,625,125  

The accompanying notes are integral part of these financial statements.

3





(Convenience Translation into English from the Original Previously Issued in Portuguese)
                         
ULTRAPAR PARTICIPAÇÕES S.A. AND SUBSIDIARIES
                         
STATEMENTS OF INCOME
FOR THE QUARTERS ENDED MARCH 31, 2006 AND 2005
(In thousands of Brazilian reais - R$, except for earnings per share)
                         
    Company   Consolidated
    03/31/06   03/31/05   03/31/06   03/31/05
GROSS SALES AND SERVICES   -     -     1,198,980     1,257,323  
Deductions   -     -     (101,239 )   (120,326 )
NET SALES AND SERVICES   -     -     1,097,741     1,136,997  
Cost of sales and services   -     -     (898,709 )   (878,217 )
GROSS PROFIT   -     -     199,032     258,780  
EQUITY IN SUBSIDIARIES AND AFFILIATED COMPANIES   62,095     100,844     59     (71 )
OPERATING (EXPENSES) INCOME   (1 )   (172 )   (139,835 )   (136,110 )
Selling   -     -     (45,983 )   (43,707 )
General and administrative   (1 )   (172 )   (62,559 )   (60,972 )
Management compensation   -     -     (1,244 )   (1,224 )
Depreciation and amortization   -     -     (30,578 )   (31,363 )
Other operating income, net   -     -     529     1,156  
INCOME FROM OPERATIONS BEFORE FINANCIAL ITEMS   62,094     100,672     59,256     122,599  
Financial income (expenses), net   1,510     19     12,414     (8,826 )
Financial income   14,674     439     33,674     21,147  
Financial expenses   (13,164 )   (420 )   (32,260 )   (23,893 )
CPMF/IOF/other financial expenses   -     -     11,000     (6,080 )
INCOME FROM OPERATIONS   63,604     100,691     71,670     113,773  
Nonoperating (expenses) income, net   -     -     (2,091 )   (1,809 )
INCOME BEFORE TAXES ON INCOME AND   -     -              
 MINORITY INTEREST   63,604     100,691     69,579     111,964  
INCOME AND SOCIAL CONTRIBUTION TAXES   -     59     (11,653 )   (10,494 )
Current   (578 )   (90 )   (28,430 )   (35,797 )
Benefit of tax holidays - ADENE   -     -     11,369     20,901  
Deferred   71     149     5,408     4,402  
INCOME BEFORE MINORITY INTEREST   63,097     100,750     57,926     101,470  
Minority interest   -     -     (1,138 )   (720 )
NET INCOME   63,097     100,750     56,788     100,750  
EARNINGS PER SHARE - R$   0.77767     0.00126     0.69991     0.00126  
                         
                         
The accompanying notes are integral part of these financial statements.

4





(Convenience Translation into English from the Original Previously Issued in Portuguese)

ULTRAPAR PARTICIPAÇÕES S.A.

IDENTIFICATION


01.01 - CAPITAL COMPOSITION
Number of shares
(Thousands) 		Current quarter
3/31/2006 		Prior quarter
12/31/2005 		Same quarter in prior year
3/31/2005
Paid-up Capital
1 - Common 49,430 49,430 49,429,897
2 - Preferred 31,895 31,895 30,715,062
3 - Total 81,325 81,325 80,144,959
Treasury Stock
4 - Common 7 7 6,616
5 - Preferred 182 182 211,097
6 - Total 189 189 217,713

01.02 - DIVIDENDS APPROVED AND/OR PAID DURING AND AFTER THE QUARTER
 1 - ITEM 2 - EVENT 3 - APPROVAL 4 - REVENUE 5 - BEGINNING OF PAYMENT  7 - TYPE OF SHARE 8 - AMOUNT PER SHARE
01 Board of Director’s Meeting 02/15/2006 Dividend 03/07/2006  Common 1.232498
02 Board of Director’s Meeting 02/15/2006 Dividend 03/07/2006  Preferred 1.232498

01.03 - SUBSCRIBED CAPITAL AND ALTERATIONS IN THE CURRENT YEAR
1 - ITEM 2 - DATE OF ALTERATION 3 - AMOUNT OF THE CAPITAL
(IN THOUSANDS OF REAIS) 		4 - AMOUNT OF THE ALTERATION
(IN THOUSANDS OF REAIS)		 5 - NATURE OF ALTERATION 7 - NUMBER OF SHARES ISSUED
(THOUSAND) 		8 - SHARE PRICE ON ISSUE DATE
(IN REAIS)
               

5





(Convenience Translation into English from the Original Previously Issued in Portuguese)

ULTRAPAR PARTICIPAÇÕES S.A. AND SUBSIDIARIES

NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE QUARTER ENDED MARCH 31, 2006
(In thousands of Brazilian reais - R$, unless otherwise stated)


1.      OPERATIONS
 
  Ultrapar Participações S.A. (the “Company”) invests in commercial and industrial activities, including subscription or purchase of shares of other companies with similar activities.
 
  Through its subsidiaries, the Company is engaged in the distribution of liquefied petroleum gas - LPG (Ultragaz), production and sale of chemicals (Oxiteno) and logistic services for chemicals and fuels (Ultracargo).
 
2.      PRESENTATION OF INTERIM FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING PRACTICES
 
  The accounting practices adopted to record transactions and prepare the interim financial statements - ITR are those established by Brazilian accounting practices and the Brazilian Securities Commission (CVM).
 
  a)      Results of operations
 
    Determined on the accrual basis of accounting. Revenues from sales and respective costs are recognized when the products are delivered to the customers or services are performed, and the transfer of risks, rights and obligations associated with the ownership of products takes place.
 
  b)      Current and long-term assets
 
    Temporary cash and long-term investments are stated at cost, plus accrued income (on a “pro rata temporis” basis), which approximate to the market value. Temporary cash investments include the results from hedge transactions, as described in Notes 4 and 19, that management intends to hold to maturity.
 
    The allowance for doubtful accounts is based on estimated losses and is considered by management to be sufficient to cover potential losses on accounts receivable.
 
    Inventories are stated at the lower of average cost of acquisition or production, market or net realizable value.
 
    Other assets are stated at the lower of cost or probable realizable values, including, when applicable, accrued income and monetary variations or net of allowances for potential losses.
 

6





Ultrapar Participações S.A. and Subsidiaries

c)      Permanent assets
 
 
  		• Investments
     
        Significant investments in subsidiaries and affiliated companies are recorded under the equity method, as shown in Note 10.
     
        Other investments are stated at acquisition cost, less an allowance for losses, should the loss not be considered temporary.
     
     
  		• Property, plant and equipment
     
        Stated at cost of acquisition, process or construction, and include revaluation write- ups, recorded in prior years, based on appraisal reports issued by independent appraisers, in accordance with item 68, letter b), of CVM Resolution No. 183/95.
     
        Depreciation is calculated on a straight-line basis at the annual rates described in Note 11, based on the economic useful lives of the assets.
     
     
  		• Deferred charges
     
        Deferred charges comprise costs incurred in the installation of equipment at customers’ facilities, projects to modernize systems, and goodwill on acquisition of subsidiaries, as mentioned in Note 12.
     
    d)      Current and long-term liabilities
     
      Stated at known or estimated amounts including, when applicable, accrued charges, and monetary and exchange variations incurred during the period.
     
    e)      Income and social contribution taxes
     
      Income and social contribution taxes, current and deferred (according to CVM Resolution No. 273/98) are measured on the basis of effective rates and include the benefit of tax holidays.
     
    f)      Basis for translation of the financial statements of foreign subsidiaries
     
      The financial statements of foreign subsidiaries are translated into Brazilian reais at the exchange rate in effect as of the date of the interim financial statements - ITR . The criteria for preparation of the financial statements have been adapted to conform to Brazilian accounting practices.
     
    g)      Statements of Cash flows
     
      The Company is presenting the statements of cash flows as supplementary information, prepared in accordance with Accounting Standard and Procedure (NPC) No. 20 issued by IBRACON (Brazilian Institute of Independent Auditors).
     

    7





    Ultrapar Participações S.A. and Subsidiaries

    3.      CONSOLIDATION PRINCIPLES
     
      The consolidated financial statements have been prepared in accordance with the basic consolidation principles established by Brazilian corporate law and the Brazilian Securities Commission (CVM), and include the following direct and indirect subsidiaries:
     
        Ownership interest - %
       
        3/31/2006   12/31/2005
        Direct   Indirect   Direct   Indirect
       
    		 
    		 
    		 
                     
    Ultragaz Participações Ltda.   100   -   100   -
       Companhia Ultragaz S.A.   -   99   -   99
           SPGás Distribuidora de Gás Ltda.   -   99   -   99
       Bahiana Distribuidora de Gás Ltda.   -   100   -   100
       Utingás Armazenadora S.A.   -   56   -   56
       LPG International Inc.   -   100   -   100
    Ultracargo - Operações Logísticas e                
       Participações Ltda.   100   -   100   -
       Melamina Ultra S.A. Indústria Química   -   99   -   99
       Transultra - Armazenamento e Transporte                
           Especializado Ltda.   -   100   -   100
       Terminal Químico de Aratu S.A. - Tequimar   -   99   -   99
    Oxiteno S.A. - Indústria e Comércio   100   -   100   -
       Oxiteno Nordeste S.A. - Indústria e Comércio   -   99   -   99
       Oleoquímica Indústria e Comércio de Produtos                
           Químicos Ltda.   -   100   -   100
       Barrington S.L.   -   100   -   100
         Canamex Químicos S.A. de C.V.   -   100   -   100
         Oxiteno International Co.   -   100   -   100
               Oxiteno Overseas Co.   -   100   -   100
    Imaven Imóveis e Agropecuária Ltda.   100   -   100   -

    Upon consolidation, intercompany investments, accounts, transactions and profits were eliminated. Minority interest in subsidiaries is presented separately in the financial statements.

    8





    Ultrapar Participações S.A. and Subsidiaries

    4.      TEMPORARY CASH AND LONG-TERM INVESTMENTS
     
      These investments, contracted with leading banks, are substantially composed of: (i) public securities and private securities issued by leading banks, notes issued by the Austrian Government, and fixed-income funds, all linked to the interbank deposit rate (CDI); (ii) abroad, in certificates of deposit issued by leading banks; and (iii) currency hedges. They are stated at cost plus accrued income on a “pro rata temporis” basis.
     
        Company   Consolidated
        3/31/2006   12/31/2005   03/31/2006     12/31/2005  
    		 
    		 
    Austrian notes, indexed in                    
         Brazilian reais   -   -   356,055     344,603  
    Securities and fixed-income funds   373,326   359,626   457,354     571,817  
    Foreign investments (a)   -   -   674,836     722,565  
    Net expenses on hedge                    
     transactions (b)   -   -   (47,461 )   (48,083 )
    		 
    		 
    Total   373,326   359,626   1,440,784     1,590,902  
    		 
    		 
    Current portion   373,326   359,626   1,058,660     1,218,210  
    Long-term portion   -   -   382,124     372,692  
    		 
    		 

    (a)      Investments made by the indirect subsidiaries Oxiteno Overseas Co., Oxiteno International Co. and Canamex Químicos S.A. de C.V. in fixed-income funds, certificates of deposit, Brazilian corporate securities, and low risk investment grade corporate securities.
     
    (b)      Accumulated gain or loss on hedge positions (see Note 19).
     

    5. TRADE ACCOUNTS RECEIVABLE (CONSOLIDATED)            
                 
        3/31/2006     12/31/2005  
       
    		 
                 
    Domestic customers   359,358     367,499  
    Foreign customers   76,263     60,943  
    (-) Advances on export contracts   (52,767 )   (38,971 )
    (-) Allowance for doubtful accounts   (26,866 )   (26,899 )
       
    		 
        355,988     362,572  
       
    		 
    Current portion   335,002     343,328  
    Long-term portion   20,986     19,244  
       
    		 
                 
                 
    The changes in the allowance for doubtful accounts are shown below:            
    Balance as of December 31, 2005         26,899  
    Addition recorded in selling expenses         1,832  
    Utilization         (1,865 )
             
    Balance as of March 31, 2006         26,866  
             

    9





    Ultrapar Participações S.A. and Subsidiaries
                                 
    6. INVENTORIES (CONSOLIDATED)
        3/31/2006   12/31/2005
            Provision             Provision      
        Cost   for losses     Net   Cost   for losses     Net
       
    		 
    		 
    		 
    		 
    		 
    Finished products   102,617   (2,230 )   100,387   103,316   (1,750 )   101,566
    Work in process   408   -     408   1,109   -     1,109
    Raw materials   46,563   (88 )   46,475   43,294   (89 )   43,205
    Liquefied petroleum gas (LPG)   22,618   -     22,618   23,113   -     23,113
    Supplies and cylinders for resale   17,350   (604 )   16,769   18,213   (924 )   17,289
    Advances to suppliers - mainly LPG   21,769   -     21,769   5,467   -     5,467
       
    		 
    		 
    		 
    		 
    		 
        211,325   (2,922 )   208,403   194,512   (2,763 )   191,749
       
    		 
    		 
    		 
    		 
    		 
                                 
                                 
    The changes in the provision for losses on inventories are shown below:
                                 
                                 
    Balance as of December 31, 2005                           2,763
    Addition                           159
                               
    Balance as of March 31, 2006                           2,922
                               

    7.      RECOVERABLE TAXES
     
      Represented substantially by credit balances of ICMS (state VAT), IPI (federal VAT), PIS and COFINS (taxes on revenue), and income and social contribution taxes.
     
        Company   Consolidated  
        3/31/2006   12/31/2005   3/31/2006     12/31/2005  
       
    		 
    		 
    		 
                         
    Income and social contribution taxes   23,697   20,655   60,000     68,022  
    ICMS   -   -   75,563     70,908  
    Provision for losses - ICMS (*)   -   -   (40,268 )   (35,959 )
    PIS and COFINS   22   22   4,489     3,018  
    IPI   -   -   164     146  
    VAT of subsidiary Canamex                    
     Químicos S.A. de C.V.   -   -   5,714     3,505  
    Other   41   41   337     68  
       
    		 
    		 
    		 
    Total   23,760   20,718   105,999     109,708  
       
    		 
    		 
    		 
    Current portion   11,928   8,984   59,117     62,931  
    Long-term portion   11,832   11,734   46,882     46,777  
       
    		 
    		 
    		 

    (*)      The provision refers to credit balances that the subsidiaries estimate they will be unable to offset in the future.
     

    The changes in the provision for losses on ICMS are shown below:      
           
    Balance as of December 31, 2005   35,959  
    Addition   4,989  
    Reversal   (680 )
       
    Balance as of March 31, 2006   40,268  
       

    10





    Ultrapar Participações S.A. and Subsidiaries

    8. RELATED COMPANIES

        Company   Consolidated
       
    		 
        Loans   Loans   Trade accounts
       
    		 
    		 
        Assets   Liabilities   Assets   Liabilities   Receivable   Payable
       
    		 
    		 
    		 
    		 
    		 
    Ultracargo - Operações Logísticas e                        
     Participações Ltda.   -   391,126   -   -   -   -
    Transultra - Armazenamento e Transporte                        
     Especializado Ltda.   164   -   -   -   -   -
    Oxiteno S.A. - Indústria e Comércio   1,355   -   -   -   -   -
    Oxiteno Nordeste S.A. - Indústria e                        
     Comércio   -   33,000   -   -   -   -
    Ultragaz Participações Ltda.   9,951   -   -   -   -   -
    Companhia Ultragaz S.A.   2,939   -   -   -   -   -
    Imaven Imóveis e Agropecuária Ltda.   -   22,658   -   -   -   -
    Melamina Ultra S.A. Indústria Química   -   468   -   -   -   -
    Química da Bahia Indústria e Comércio                        
     S.A.   -   -   -   3,856   -   -
    Serma Associação dos Usuários de                        
     Equipamentos de Processamentos de                        
     Dados e Serviços Correlatos   -   -   4,839   -   -   -
    Petroquímica União S.A.   -   -   -   -   -   5,066
    Oxicap Indústria de Gases Ltda.   -   -   -   -   -   753
    Liquigás Distribuidora S.A.   -   -   -   -   127   -
    Petróleo Brasileiro S.A. - Petrobras   -   -   -   -   16,219   -
    Copagaz Distribuidora de Gás Ltda.   -   -   -   -   80   -
    Braskem S.A.   -   -   -   -   -   23,918
    SHV Gás Brasil Ltda.   -   -   -   -   43   -
    Plenogás - Distribuidora de Gás S.A.   -   -   -   871   -   -
    Other   -   -   116   257   39   -
       
    		 
    		 
    		 
    		 
    		 
    Total as of March 31, 2006   14,409   447,252   4,955   4,984   16,508   29,737
       
    		 
    		 
    		 
    		 
    		 
    Total as of December 31, 2005   14,409   404,230   3,706   5,049   2,335   26,764
       
    		 
    		 
    		 
    		 
    		 


        Consolidated
         Transactions   Financial
    income
    (expenses)
    		 
        Sales   Purchases  
       
    		 
    		 
    Química da Bahia Indústria e Comércio S.A.   -   -   (85 )
    Petroquímica União S.A.   -   30,561   -  
    Oxicap Indústria de Gases Ltda.   -   1,955   -  
    Liquigás Distribuidora S.A.   764   -   -  
    Petróleo Brasileiro S.A. - Petrobras   9   461,508   -  
    Copagaz Distribuidora de Gás Ltda.   264   -   -  
    Braskem S.A.   10,541   149,613   -  
    Other   258   -   -  
       
    		 
    		 
    Total as of March 31, 2006   11,836   643,637   (85 )
       
    		 
    		 
    Total as of March 31, 2005   26,384   676,088   (128 )
       
    		 
    		 

    11





    Ultrapar Participações S.A. and Subsidiaries

      The loan balance with Química da Bahia Indústria e Comércio S.A. is adjusted based on the Brazilian long-term interest rate (TJLP). Other loans are not subject to financial charges. Purchase and sale transactions refer substantially to purchases of raw materials, other materials and transportation and storage services, carried out at market prices and conditions.
     
      The loan agreement with Ultracargo - Operações Logísticas e Participações Ltda. results substantially from the sale of shares issued by Oxiteno S.A. - Indústria e Comércio to the Company, so as to avoid cross shareholding resulting from a corporate restructuring conducted in 2002.
     
    9.      INCOME AND SOCIAL CONTRIBUTION TAXES
     
      a)      Deferred income and social contribution taxes
     
        The Company and its subsidiaries recognize tax assets and liabilities, which do not expire, arising from tax loss carryforwards, temporary add-backs, revaluation of property, plant and equipment, and other procedures. The tax credits are based on continuing profitability from operations. Deferred income and social contribution taxes are presented in the following principal categories:
     
        Company   Consolidated
        3/31/2006   12/31/2005   3/31/2006   12/31/2005
       
    		 
    		 
    		 
    Assets:                
       Deferred income and social                
           contribution taxes on:                
           Provision for loss of assets   -   -   24,172   22,783
           Provision for contingencies   2,915   2,849   11,921   17,131
           Other provisions   92   87   17,555   18,765
           Income and social contribution                
               tax loss carryforwards   -   -   30,252   24,281
       
    		 
    		 
    		 
    Total   3,007   2,936   83,900   82,960
       
    		 
    		 
    		 
    Current portion   92   87   22,552   21,969
    Long-term portion   2,915   2,849   61,348   60,991
       
    		 
    		 
    		 
    Liabilities:                
       Deferred income and social                
           contribution taxes on:                
           Revaluation of property, plant                
               and equipment   -   -   1,146   1,245
           Income earned abroad   -   -   23,583   23,124
       
    		 
    		 
    		 
    Total   -   -   24,729   24,369
       
    		 
    		 
    		 
    Current portion   -   -   230   249
    Long-term portion   -   -   24,499   24,120
       
    		 
    		 
    		 

    12





    Ultrapar Participações S.A. and Subsidiaries

    The estimated recovery of deferred income and social contribution assets is shown below:

        Company   Consolidated
       
    		 
    To Through 2006   92   22,552
    2007   -   16,395
    2008   2,915   24,616
    2009   -   20,337
       
    		 
        3,007   83,900
       
    		 

    b)      Conciliation of income and social contribution taxes in the statements of income Income and social contribution taxes are reconciled to statutory tax rates as follows:
     
        Company   Consolidated
       
    		 
        3/31/2006   3/31/2005   3/31/2006   3/31/2005
       
    		 
    		 
    		 
    Income before taxes, equity in                        
     subsidiaries and affiliated companies                        
     and minority interest   1,509     (153 )   69,520     112,035  
    Statutory tax rates - %   34     34     34     34  
       
    		 
    		 
    		 
    Income and social contribution taxes at                        
     statutory rates   (513 )   52     (23,637 )   (38,092 )
       
    		 
    		 
    		 
    Adjustments to the effective tax rate:                        
     Operating provisions and                        
         nondeductible expenses/nontaxable                        
         income   6     7     48     5,367  
     Adjustments to estimated income   -     -     443     429  
     Workers’ meal program (PAT)   -     -     250     127  
     Other   -     -     (126 )   774  
       
    		 
    		 
    		 
    Income and social contribution taxes                        
     before benefit of tax holidays   (507 )   59     (23,022 )   (31,395 )
       
    		 
    		 
    		 
    Benefit of tax holidays - ADENE   -     -     11,369     20,901  
    Income and social contribution taxes                        
     in the statements of income   (507 )   59     (11,653 )   (10,494 )
    Current   (578 )   (90 )   (28,430 )   (35,797 )
    Deferred   71     149     5,408     4,402  
    Benefit of tax holidays - ADENE   -     -     11,369     20,901  

    The benefit of tax holidays of subsidiaries in the amount of R$11,369 in 2006 (R$20,901 in 2005), derived substantially from operations in regions entitled to incentive, are classified as income and social contribution taxes in the statements of income.

    13





    Ultrapar Participações S.A. and Subsidiaries


    c) Tax exemption

    The following indirect subsidiaries have partial or full exemption from income tax in connection with a government program for the development of the Northeast Region of Brazil:

            Exemption   Expiration
    Subsidiary   Plants   - %   date
    		 
    		 
    		 
    Oxiteno Nordeste S.A. - Indústria e            
       Comércio   Camaçari plant   100        2006
    Bahiana Distribuidora de Gás Ltda.   Mataripe unit   75        2013
        Suape unit   100        2007
        Ilhéus unit   25        2008
        Aracaju unit   25        2008
        Caucaia unit   75        2012
    Terminal Químico de Aratu S.A. -            
       Tequimar   Aratu Terminal   75        2012
        Suape Terminal        
         (storage of acetic        
         acid and butadiene        
         byproducts) (*)   100        2005

     (*) In December 2005, this base’s exemption expired and a request was filed with ADENE (Northeast Development Agency), the agency in charge of managing this incentive program, seeking a 75% income tax reduction until 2015, still pending approval by ADENE. Should the request not be approved, the company will file a new request, for a income tax reduction of 25% until 2008 and 12.5% from 2009 until 2013, to which it is entitled as it is located in an incentive area and considered a priority economic activity for the region’s development. As the request has not yet been approved, there is no reduction considered in the income tax calculation relating to such unit in 2006.
     
    10.      INVESTMENTS
     
      a)      Subsidiaries of the Company
        Investments   Equity in subsidiaries
    and affiliated companies
       
    		 
        3/31/2006   12/31/2005   3/31/2006     3/31/2005
       
    		 
    		 
    		 
    Ultragaz Participações Ltda.   301,915   280,733   21,235     3,731
    Ultracargo - Operações                  
       Logísticas e Participações Ltda.   597,132   597,239   (106 )   2,383
    Imaven Imóveis e Agropecuária Ltda.   47,253   46,072   1,180     1,203
    Oxiteno S.A. - Indústria e Comércio   1,269,615   1,229,829   39,786     93,527
       
    		 
    		 
    		 
        2,215,915   2,153,873   62,095     100,844
       
    		 
    		 
    		 

    14




    Ultrapar Participações S.A. and Subsidiaries
                       
    b) Affiliated companies (consolidated)                  
                       
        Investments   Equity in subsidiaries
    and affiliated companies
       
    		 
        3/31/2006   12/31/2005   3/31/2006   3/31/2005  
       
    		 
    		 
    		 
    Química da Bahia Indústria                  
        e Comércio S.A.   2,807   2,764   43   -  
    Oxicap Indústria de Gases Ltda.   1,435   1,418   16   (71 )
       
    		 
    		 
    		 
        4,242   4,182   59   (71 )
       
    		 
    		 
    		 

    The investment of subsidiary Oxiteno S.A. - Indústria e Comércio in the affiliated company Oxicap Indústria de Gases Ltda. and the investment of subsidiary Oxiteno Nordeste S.A. -Indústria e Comércio in the affiliated company Química da Bahia Indústria e Comércio S.A. are carried under the equity method based on the affiliates’ financial statements as of February 28, 2006 and as of March 31, 2006, respectively.

    11. PROPERTY, PLANT AND EQUIPMENT (CONSOLIDATED)

                                 
                                 
            3/31/2006   12/31/2005
    Annual
        depreciation   Revalued   Accumulated     Provision     Net book   Net book
        rates - %   cost   depreciation     for losses     value   value
       
    		 
    		 
    		 
    		 
    		 
    Land   -   48,044   -     -     48,044   48,147
    Buildings   4 to 5   432,104   (155,766 )   -     276,338   279,691
    Machinery and equipment   5 to 10   867,932   (426,424 )   (412 )   441,096   450,413
    Gas tanks and cylinders                            
        10   268,764   (148,441 )   -     120,323   127,295
    Vehicles   20 to 30   167,806   (123,276 )   -     44,530   48,127
    Furniture and fixtures   10   22,417   (8,931 )   -     13,486   13,661
    Construction in progress   -   45,947   -     -     45,947   29,254
    Imports in transit   -   285   -     -     285   763
    Intangibles   2.5 to 20   106,966   (46,204 )   (631 )   60,131   59,134
    Other   20 to 30   50,101   (30,094 )   -     20,007   16,244
       
    		 
    		 
    		 
    		 
    		 
            2,010,366   (939,136 )   (1,043 )   1,070,187   1,072,729
       
    		 
    		 
    		 
    		 
    		 

    The subsidiaries recorded, in previous years, revaluation of property, plant and equipment items. The revaluation balances are shown below:

        3/31/2006   12/31/2005
                    Net    
              Accumulated     book   Net book
        Revaluation     depreciation     value   value
       
    		   
    		 
    		 
    Land   15,571     -     15,571   15,571
    Buildings   46,696     (35,168 )   11,528   11,933
    Machinery and equipment   31,740     (30,457 )   1,283   1,362
    Vehicles   1,087     (1,087 )   -   -
    Gas tanks and cylinders   48,911     (48,911 )   -   -
       
    		   
    		 
    		 
        144,005     (115,623 )   28,382   28,866
       
    		   
    		 
    		 

    15





    Ultrapar Participações S.A. and Subsidiaries

    The depreciation of theses revaluations in the amount of R$484 was recorded in the statements of income. The amount of deferred taxes on revaluations totals R$8,313, of which R$1,146 is recorded as long-term liabilities, as shown in Note 9.a), and R$7,167 is accrued in the same period in which certain subsidiaries realize the revaluation reserve, since these revaluations occurred prior to the issuance of CVM Resolution No. 183/95.

    Construction in progress refers substantially to improvements of subsidiaries’ plants.

    Buildings include R$61,076 (R$61,514 in 2005) of leasehold improvements that are being amortized on a straight-line basis at 4% per year.

    Intangibles include software in the amount of R$24,394 (R$24,368 in 2005), technology in the amount of R$13,735 (R$11,053 in 2005), goodwill in the amount of R$6,588 (R$7,114 in 2005) and commercial property rights, mainly those described below:

    • On July 11, 2002, the subsidiary Terminal Químico de Aratu S.A. - Tequimar won a bid for use of the site where the Aratu Terminal is located for another 20 years, renewable for the same period. The price paid by Tequimar amounted to R$12,000 and is being amortized from August 2002 to July 2042.

    • Further, the subsidiary Terminal Químico de Aratu S.A. - Tequimar has a lease agreement for an area adjacent to the Port of Santos for 20 years, effective December 2002 and renewable for another 20 years, for building and operating a terminal for receiving, tankage, handling and distribution of bulk liquids. The price paid by Tequimar was R$3,803 and is being amortized from August 2005 until December 2022.

    Other refers to computer equipment in the amount of R$13,802 (R$14,963 in 2005) and advances to suppliers in the amount of R$6,204 (R$1,724 in 2005).

    There were no changes in the valuation allowance for property, plant and equipment during the period presented.

    12.      DEFERRED CHARGES (CONSOLIDATED)
     
      Represented substantially by costs incurred in the implementation of systems modernization projects in the amount of R$9,218 (R$8,654 in 2005), amortized over five to ten years, and for costs associated with the installation of Ultrasystem equipment at customers’ facilities in the amount of R$62,249 (R$60,300 in 2005), amortized over the terms of the LPG supply contracts with these customers. Deferred charges also include the goodwill from acquisitions and expenses on studies and projects.
     

    16





    Ultrapar Participações S.A. and Subsidiaries

    13. LOANS, FINANCING AND DEBENTURES (CONSOLIDATED)

    a) Composition

    Description   03/31/2006     12/31/2005     Index / Currency   Annual interest
    rate 2006 - %         		  Maturity and
    amortization
    		 
    		 
    		 
    		 
    		 
    Foreign currency:                        
     Syndicated loan   132,172     140,639     US$   5.05   Semiannually until 2008
     Notes (b)   554,037     586,471     US$   7.25   Semiannually until 2015
     Working capital loan   2,758     443     MX$ + TIIE (i)   1.0   Monthly until 2006
     Foreign financing   26,089     28,542     US$ + LIBOR   2.0   Semiannually until 2009
     Inventories and property, plant                        
         and equipment financing   9,158     10,957     MX$ + TIIE (i)   From 1.5 to 2.0   Semiannually until 2010
     Advances on foreign exchange                        
         contracts   4,840     9,771     US$   From 4.50 to 5.20   Maximum of 60 days
     National Bank for Economic                        
         and Social Development                        
         (BNDES)   19,073           UMBNDES (ii)   From 8.26 to   Monthly until 2010
              22,330         10.01    
     National Bank for Economic                        
         and Social Development                        
         (BNDES)   1,945           US$   From 9.41 to   Monthly until 2011
              261         10.46    
     Export prepayments, net of                        
         linked operations   23,246     44,852     US$   From 4.22 to 6.85   Semiannually until 2008
       
    		 
    		           
    Subtotal   773,318     844,266              
       
    		 
    		           
    Local currency:                        
     National Bank for Economic                        
         and Social Development                        
         (BNDES)   169,585     173,055     TJLP (iii)   From 1.5 to 4.85   Monthly until 2011
     National Bank for Economic                        
         and Social Development                        
         (BNDES)   8,912     11,244     IGP-M (iv)   6.5   Semiannually until 2008
     Government Agency for                        
           Machinery and Equipment                        
           Financing (FINAME)   47,773     47,676     TJLP (iii)   From 1.8 to 4.85   Monthly until 2011
     Research and project financing                        
           (FINEP)   35,662     38,059     TJLP (iii)   (2.0)   Monthly until 2009
     Debentures (c)   304,173     317,853     CDI   102.5   Semiannually until 2008
     Other   322     163              
       
    		 
    		           
    Subtotal   566,427     588,050              
       
    		 
    		           
    Total loans, financing and                        
     debentures   1,339,745     1,432,316              
       
    		 
    		           
    Current liabilities   (133,834 )   (153,708 )            
       
    		 
    		           
    Long-term liabilities   1,205,911     1,278,608              
       
    		 
    		           

    (i) MX$ = Mexican peso; TIIE = Mexican break-even interbank interest rate.
    (ii) UMBNDES = BNDES monetary unit. This is a “basket” of currencies representing the composition of the BNDES debt in foreign currency, 88%, of which is linked to the U.S. dollar.
    (iii) TJLP = fixed by the CMN (National Monetary Council); TJLP is the basic cost of BNDES financing.
    (iv) IGP-M = General Market Price Index, a measure of Brazilian inflation calculated by the Getúlio Vargas Foundation.

    The long-term amounts have the following composition by year of maturity:

        3/31/2006   12/31/2005
       
    		 
    From 1 to 2 years   390,684   93,958
    From 2 to 3 years   200,238   515,458
    From 3 to 4 years   64,825   74,954
    From 4 to 5 years   7,064   9,064
    More than 5 years   543,100   585,174
       
    		 
        1,205,911   1,278,608
       
    		 

    17





    Ultrapar Participações S.A. and Subsidiaries

    b)      Notes in the foreign market
     
      In June 1997, the subsidiary Companhia Ultragaz S.A. issued US$60 million in notes, maturing in 2005. In June 2005, maturity was extended to June 2020, with put/call options in June 2008.
     
      In January 2004, the subsidiary LPG International Inc. issued US$60 million in notes to acquire the notes of Companhia Ultragaz S.A. In June 2005, the subsidiary LPG International Inc., which held all notes issued by Companhia Ultragaz S.A., sold them to the subsidiary Oxiteno Overseas Corporation, which financed their acquisition through a syndicated loan in the amount of US$60 million maturing in June 2008, with annual interest rate of 5.05%. The loan was guaranteed by the Company and Oxiteno S.A. - Indústria e Comércio, which, among others, assumed the commitment of maintaining the financial index determined by the ratio between net debt and consolidated EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) lesser than or equal to 3.5, and the ratio between consolidated EBITDA and consolidated net financial expenses greater than or equal to 1.5. The subsidiary LPG International Inc. used the proceeds from the sale of notes of Companhia Ultragaz S.A. to redeem notes issued by it.
     
      In December 2005, the subsidiary LPG International Inc. issued notes in the amount of US$250 million, maturing in December 2015, with annual interest rate of 7.25% paid semiannually, with the first payment scheduled for June 2006. The issue price was 98.75% of the notes’ face value, which represented a total yield for investors of 7.429% per year upon issuance. The notes were guaranteed by the Company and by Oxiteno S.A. - Indústria e Comércio.
     
      As a result of the issuance of notes and the syndicated loan, the Company and its subsidiaries mentioned above are subject to covenants that limit, among other things, their ability to incur indebtedness and establish liens on assets, engage in mergers and acquisitions, conduct transactions with securities issued by it, and conduct transactions with affiliated companies. The restrictions imposed on the Company and its subsidiaries have not limited their ability to conduct their business to date and not restricted the performance of its strategy.
     
    c)      Debentures
     
      On February 2, 2005, the Extraordinary Stockholders’ Meeting approved the issuance by the Company and the public distribution in a single series of 30,000 nonconvertible debentures with nominal unit value of R$10,000.00 (ten thousand Brazilian reais), totaling R$300,000.
     
      On March 30, 2005, the Company’s Board of Directors, as delegated by the Extraordinary Stockholders’ Meeting, approved the interest rate determined through a bookbuilding process on the same date.
     
      On April 6, 2005, the Brazilian Securities Commission (CVM) registered the operation, and funds of R$304,854, net of commission, were received on April 8, 2005.
     

    18





    Ultrapar Participações S.A. and Subsidiaries

    Characteristics of the debentures are:

    Nominal unit value: R$10,000.00
    Final maturity: March 1, 2008
    Nominal value payment: Lump sum at final maturity
    Yield: 102.5% of CDI
    Yield payment: Semiannually, beginning March 1, 2005
    Repricing: None

      The debentures are subject to commitments that restrict, among other things, certain operations of merger or spin-off, as well as the disposal of operating assets that would result in a reduction of more than 25% of consolidated net sales, and also included the obligation to maintain a consolidated net debt to EBITDA ratio less than or equal to 3.5. Thus far, none of these commitments have restricted the ability of the Company and its subsidiaries to conduct business.
     
    d)      Collateral
     
      A portion of the financing is collateralized by liens on property, plant and equipment, shares, promissory notes and guarantees provided by the Company and its subsidiaries, as shown below:
     
        3/31/2006   12/31/2005
       
    		 
    Amount of financing secured by:        
       Property, plant and equipment   52,001   53,734
       Shares of affiliated companies and minority        
           stockholders’ guarantees   8,912   11,244
       
    		 
        60,913   64,978
       
    		 

    Other loans are collateralized by guarantees issued by the Company and by the future flow of exports. The Company is responsible for sureties and guarantees offered on behalf of its subsidiaries, amounting to R$954,399 (R$1,017,858 in 2005).

    Certain subsidiaries have issued guarantees to financial institutions related to amounts owed to those institutions by some of their customers (vendor financing). In the event any subsidiary is required to make a payment under the guarantees, the subsidiary may recover such amounts paid directly from its customers through commercial collection. Maximum future payments related to these guarantees amount to R$22,555 (R$33,208 in 2005), with terms of up to 210 days. As of March 31, 2006, the Company and its subsidiaries have not incurred any loss nor recorded any liability related to these guarantees.

    Certain subsidiaries have conducted operations denominated “supplier finance” with its suppliers. In the operation, the banks advance to suppliers the proceeds from sales made to the subsidiaries, through acceptance by the subsidiaries with the banks. Those operations have an average term of nine days and are recorded as bank loans, since the suppliers received the funds from the banks, using the subsidiaries’ credit. The amount as of March 31, 2006 totalized R$322. Financial income related to this operation for the quarter amounted to R$6 and is recorded in financial income.

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    Ultrapar Participações S.A. and Subsidiaries

    14.      STOCKHOLDERS’ EQUITY
     
      a)      Capital
     
        The Company is a listed corporation with shares traded on the São Paulo and New York Stock Exchanges. Subscribed and paid-up capital is represented by 81,325,409 shares without par value, comprised of 49,429,897 common and 31,895,512 preferred shares.
     
        As of March 31, 2006, 11,318,826 preferred shares were outstanding abroad, in the form of American Depositary Receipts - ADRs.
     
        Preferred shares are not convertible into common shares, do not entail voting rights, and have priority in capital redemption, without premium, in the event of liquidation of the Company.
     
        At the beginning of 2000, the Company granted, through a stockholders agreement, tag- -along rights, which assure to minority stockholders identical conditions to those negotiated by the controlling shareholders in case of disposal of shareholding control of the Company. The tag-along rights guarantee 100% of the offer amount for all types of shares of the Company. On May 18, 2004, the Company included the tag-along rights in its bylaws.
     
        The Company is authorized to increase its capital, regardless of amendment to the bylaws, through a resolution of the Board of Directors, until it reaches R$1,500,000 (one billion and five hundred million reais), by means of issuance of common or preferred shares, without keeping the existing ratio, observed the limit of 2/3 of preferred shares to the total shares issued.
     
      b)      Treasury shares
     
        The Company acquired its own shares at market price, without capital reduction, for holding in treasury and subsequent disposal or cancellation, in accordance with the provisions of Brazilian Securities Commission (CVM) Instructions No. 10, of February 14, 1980, and No. 268, of November 13, 1997.
     
        As of March 31, 2006, the Company’s financial statements record 182,697 preferred shares and 6,617 common shares in treasury, which were acquired at the average cost of R$26.09 and R$19.30 per share, respectively. The consolidated financial statements record 377,847 preferred shares and 6,617 common shares in treasury, which were acquired at the average cost of R$24.35 and R$19.30 per share, respectively.
     
        The market price of preferred shares issued by the Company as of March 31, 2006 on the São Paulo Stock Exchange (BOVESPA) was R$38.00.
     
      c)      Capital reserve
     
        The capital reserve in the amount of R$2,046 reflects the goodwill on the disposal of shares to be held in treasury in the Company’s subsidiaries, at the average price of R$33.21 per share. Executives of these subsidiaries were given the usufruct of such shares, as described in Note 21.
     

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    Ultrapar Participações S.A. and Subsidiaries

    d)      Revaluation reserve
     
      This reserve reflects the revaluation write-up of assets of subsidiaries and is realized based upon depreciation, write-off or disposal of revalued assets, including the related tax effects.
     
      In some cases, taxes on the revaluation reserve of certain subsidiaries are recognized only upon the realization of this reserve, since the revaluations occurred prior to the publication of CVM Resolution No. 183/95. Taxes on these reserves are R$7,167 (R$7,288 in 2005).
     
    e)      Retention of profits reserve
     
      This reserve is supported by the investment program, in conformity with article 196 of Brazilian corporate law, and includes both a portion of net income and the realization of the revaluation reserve.
     
    f)      Realizable profits reserve
     
      This reserve is established in conformity with article 197 of Brazilian corporate law, based on the equity in subsidiaries and affiliated companies. Realization of the reserve usually occurs upon receipt of dividends, disposal and write-off of investments.
     
    g)      Conciliation of stockholders’ equity - Company and consolidated
        3/31/2006     12/31/2005  
       
    		 
    Stockholders’ equity - Company   1,858,687     1,795,643  
    Treasury shares held by subsidiaries, net of realization   (3,651 )   (3,761 )
    Capital reserve arising from sale of treasury shares to            
       subsidiaries, net of realization   (1,667 )   (1,717 )
       
    		 
    Stockholders’ equity - consolidated   1,853,369     1,790,165  
       
    		 

    h)      Reconciliation of net income - Company and consolidated
     
      The reconciliation of net income, Company and consolidated, shows the effect of the reversal of the allowance for scheduled factory maintenance shutdown of some subsidiaries, net of income and social contribution taxes, recorded in retained earnings, in accordance with CVM Resolution No. 489/05 and Technical Interpretation No.º 01/2006 by IBRACON, as follows:
     
        3/31/2006     12/31/2005
       
    		 
    Net income - Company   63,097     100,750
    Reversal of allowance for factory maintenance shutdown by          
       the subsidiary Oxiteno S.A. Indústria e Comércio   (796 )   -
    Reversal of allowance for factory maintenance shutdown by          
       the subsidiary Oxiteno Nordeste S.A. Indústria e Comércio   (5,513 )   -
       
    		 
    Net income - consolidated   56,788     100,750
       
    		 

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    Ultrapar Participações S.A. and Subsidiaries

    15.      NONOPERATING EXPENSES, NET (CONSOLIDATED)
     
      Refers principally to the result on the disposal of permanent assets, especially cylinders.
     
    16.      CONCILIATION OF EBITDA (CONSOLIDATED)
     
      EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is calculated by the Company as shown below:

        3/31/2006   3/31/2005
        Ultragaz     Oxiteno     Ultracargo   Other     Consolidated     Consolidated
    Operating income from                                
       operations   33,158     35,558     711   2,243     71,670     113,773
    (-) Equity in subsidiaries and                                
       affiliated companies   -     (728 )   -   669     (59 )   71
    (+/-) Financial income                                
       (expense)   (6,120 )   (5,765 )   970   (1,499 )   (12,414 )   8,826
    (+) Depreciation and                                
       amortization   28,226     11,409     7,618   179     47,432     45,491
    EBITDA   55,264     40,474     9,299   1,592     106,629     168,161

    17.      SEGMENT INFORMATION
     
      The Company has three reportable segments: gas, chemicals and logistics. The gas segment distributes LPG to retail, commercial and industrial consumers mainly in the South, Southeast and Northeast Regions of Brazil. The chemicals segment primarily produces ethylene oxide, ethylene glycols, ethanolamines and etherglycols. Operations in the logistics segment include storage and transportation, mainly in the Southeast and Northeast Regions of Brazil. Reportable segments are strategic business units that offer different products and services. Intersegment sales are transacted at prices approximating those that the selling entity is able to obtain with third parties.

    The principal financial information about each of the Company’s reportable segments is as follows:

        3/31/2006   3/31/2005
        Ultragaz   Oxiteno   Ultracargo   Other   Consolidated   Consolidated
    Net sales, net of related-party                        
     transactions   694,033   357,457   46,230   21   1,097,741   1,136,997
    Income from operations before                        
     financial income (expenses) and                        
     equity in subsidiaries and                        
     affiliated companies   27,038   29,065   1,681   1,413   59,197   122,670
    EBITDA   55,264   40,474   9,299   1,592   106,629   168,161
    Total assets, net of related parties   847,587   1,935,530   284,427   413,901   3,481,445   2,528,982

    22




    Ultrapar Participações S.A. and Subsidiaries

    18. FINANCIAL INCOME AND EXPENSES, NET (CONSOLIDATED)

        3/31/2006     3/31/2005  
       
    		 
    Financial income:            
      Interest on temporary cash investments and            
         long-term cash investment   43,371     19,199  
       Interest on trade accounts receivable   1,605     1,377  
       Monetary and exchange variations income   (11,882 )   (52 )
       Other income   580     623  
       
    		 
        33,674     21,147  
       
    		 
    Financial expenses:            
       Interest on loans and financing   (20,324 )   (10,196 )
       Interest on debentures   (12,807 )   -  
       Bank charges   (2,806 )   (4,165 )
       Monetary and exchange variations expenses   14,350     (778 )
       Financial results from currency hedge transactions   (9,039 )   (8,016 )
       CPMF/IOF/other financial expenses (*)   11,000     (6,080 )
       Other expenses   (1,634 )   (738 )
       
    		 
        (21,260 )   (29,973 )
       
    		 
    Financial results   12,414     (8,826 )
       
    		 

    (*) Including R$15,886 referring to the reversal of the provision for PIS and COFINS contingencies mentioned in Note 20 a).
       
    19.      RISKS AND FINANCIAL INSTRUMENTS (CONSOLIDATED)
     
      The main risk factors to which the Company and its subsidiaries are exposed reflect strategic/operating and economic/financial aspects. Strategic/operating risks (such as behavior of demand, competition, technological innovation, and significant structural changes in industry, among others) are addressed by the Company’s management model. Economic/financial risks mainly reflect customer default, macroeconomic variables such as exchange and interest rates, as well as the characteristics of the financial instruments used by the Company. These risks are managed through control policies, specific strategies and the determination of limits, as follows:
     
     
  		• Customer default - These risks are managed by specific policies for accepting customers and analyzing credit, and are mitigated by diversification of sales. As of March 31, 2006, the subsidiaries Oxiteno S.A. - Indústria e Comércio and Oxiteno Nordeste S.A. - Indústria e Comércio maintained R$866 (R$848 in 2005) and the subsidiaries of Ultragaz Participações Ltda. maintained R$24,828 (R$25,191 in 2005) as an allowance for doubtful accounts.
     
     
  		• Interest rates - The Company and its subsidiaries adopt conservative policies to obtain and invest funds and to minimize the cost of capital. Temporary cash investments of the Company and its subsidiaries are comprised substantially of transactions linked to the interbank deposit rate (CDI), as described in Note 4. A portion of the financial assets is intended for foreign currency hedges, as mentioned below. Borrowings are originate from the BNDES, and foreign currency financing, as mentioned in Note 13.
     

    23





    Ultrapar Participações S.A. and Subsidiaries

     
  		• Exchange rate - The Company’s subsidiaries use hedge (mainly US$ to CDI) instruments available in the financial market to cover assets and liabilities in foreign currency, so as to reduce the exchange variation effects on their results. Such hedges have amounts, periods and indexes equivalent to the assets and liabilities in foreign currency to which they are linked. Shown below are the assets and liabilities in foreign currency, translated into Brazilian reais at March 31, 2006 and December 31, 2005:

        3/31/2006     12/31/2005
       
    		 
    Assets:          
       Investments abroad and hedges   94,617     126,236
       Foreign cash and cash equivalents   2,380     3,129
       Foreign temporary cash and long-term cash investments   674,836     722,565
       Receivables from foreign customers, net of advances on          
           exchange contracts   23,447     21,949
       
    		 
        795,280     873,879
       
    		 
    Liabilities:          
       Foreign currency financing   773,318     844,266
       Import payables   24,479     16,054
       
    		 
        797,797     860,320
       
    		 
    Net (liability) asset position   (2,517 )   13,559
       
    		 

      The exchange rate variation related to cash and banks, investments, temporary cash investments, and long-term cash investments of foreign subsidiaries was recorded as financial expense in the consolidated statement of income for 2006, in the amount of R$11,545 (financial income of R$1,900 in 2005).

    • Market value of financial instruments

    Market value of financial instruments as of March 31, 2006 and December 31, 2005 are as follows:

        3/31/2006   12/31/2005
        Book   Market   Book   Market
        value   value   value   value
       
    		 
    		 
    		 
    Financial assets:                
     Cash and banks   26,470   26,470   32,714   32,714
     Temporary cash investments   1,058,660   1,055,744   1,218,210   1,215,638
     Long-term cash investments   382,124   382,124   372,692   372,692
       
    		 
    		 
    		 
        1,467,254   1,464,338   1,623,616   1,621,044
       
    		 
    		 
    		 
    Financial liabilities:                
     Current and long-term loans and                
         financing   1,035,572   1,029,726   1,114,463   1,113,665
     Current and long-term debentures   304,173   304,322   317,853   318,495
       
    		 
    		 
    		 
        1,339,745   1,334,048   1,432,316   1,432,160
       
    		 
    		 
    		 
    Investment-                
     Investment in affiliated company   18,694   23,518   18,694   23,703
       
    		 
    		 
    		 

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    Ultrapar Participações S.A. and Subsidiaries

        The market value of financial instruments was obtained through the commonly used marking to market methodology, which consists of carrying the balances of the instruments until the maturity at the respective contracted rates, discounting them to present value at market rates as of March 31, 2006 and December 31, 2005. The market value of investment in affiliated company is based on the share price trading on the São Paulo Stock Exchange - BOVESPA.
       
    20.      CONTINGENCIES AND COMMITMENTS (CONSOLIDATED)
     
      a)      Labor, civil and tax lawsuits
     
        The Petrochemical Industry Labor Union, of which the employees of Oxiteno Nordeste S.A. - Indústria e Comércio are members, filed an action against the subsidiary in 1990, demanding compliance with the adjustments established in a collective labor agreement, in lieu of the salary policies effectively followed. At the same time, the employers’ association proposed a collective bargaining for the interpretation and clarification of the fourth clause of the agreement. Based on the opinion of its legal counsel, who analyzed the last decision of the Federal Supreme Court (STF) on the collective bargaining, as well as the status of the individual lawsuit of the subsidiary, management believes that a reserve is not necessary as of March 31, 2006.
     
        The subsidiaries Companhia Ultragaz S.A. and SPGás Distribuidora de Gás Ltda. are parties to an administrative proceeding at the SDE (Economic Law Department), linked to CADE (Administrative Council for Economic Defense), under the allegation of anticompetitive practice in the municipalities of a region of the State of Minas Gerais in 2001. In September 2005, the SDE issued a technical notice recommending to CADE a ruling against the companies involved in this proceeding. In their defense, the subsidiaries’ arguments, among others, are that: (i) under the terms of the notice issued by the Company’s chief executive officer on July 4, 2000, the subsidiaries’ employees were forbidden to discuss with third parties matters related to prices; and (ii) no consistent evidence was attached to the proceeding’s records, and the SDE acknowledges its failure in the attempt to prove the practice. In view of the arguments presented, the fact that the technical notice has no binding effect on CADE’s decision, and their legal counsel’s opinion, the subsidiaries did not record a provision for this issue. Should CADE’s decision be unfavorable, the subsidiaries can still discuss the issue at the judicial level.
     
        The subsidiary Companhia Ultragaz S.A. is a defendant in lawsuits relating to damages caused by an explosion in 1996 in a shopping mall in the city of Osasco, State of São Paulo. Such lawsuits involve: (i) individual suits filed by victims of the explosion claiming damages from Ultragaz for the loss of economic benefit and for pain and suffering; (ii) lawsuit for reimbursement of expenses by the administration company of the shopping mall and its insurance company; and (iii) class action suit seeking indemnification for property damage and pain and suffering for all the victims injured and deceased. The subsidiary believes that it has presented evidence that defective gas pipes in the shopping mall caused the accident and that Ultramar’s on-site LPG storage facilities did not contribute to the explosion. Of the 54 lawsuits judged thus far, a
     

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    Ultrapar Participações S.A. and Subsidiaries

    favorable judgment was obtained for 53, with 1 unfavorable decision, which is still subject to appeal, and whose amount, should the decision be upheld, is R$17. The subsidiary has insurance for this contingency, and the uninsured contingent amount is R$39,633. The Company has not recorded any provision for this amount, since it believes the probability of loss is remote.

    The Company and its subsidiaries obtained injunctions to pay PIS and COFINS (taxes on revenues) without the changes introduced by Law No. 9718/98 in its original version. The ongoing questioning refers to the levy of these taxes on sources other than revenues. The unpaid amounts were recorded in the financial statements of the Company and its subsidiaries, totaling R$21,370 (R$36,966 in 2005). Recently the Federal Supreme Court (STF) has decided the matter favorable to the taxpayer. Although it is a precedent, the effect of this decision does not automatically apply to all companies, since they must await judgment of their own lawsuits. On 3/29/2006 a final and unappealable decision was rendered on the lawsuit of the subsidiary Companhia Ultragaz S.A. Based on this decision the subsidiary reversed the existing provision in the amount of R$15,886, net of attorney’s fees, as financial income in the statement of income for the quarter. In addition to the accrued amount, the Company has other subsidiaries that have been unsuccessful in obtaining an injunction and, accordingly, have been paying the taxes. Thus, should there be final favorable outcomes for the subsidiaries in all lawsuits, the Company estimates that the total effect on income before income and social contribution taxes should reach R$42,027, net of attorney’s fees.

    The subsidiary Oxiteno S.A. - Indústria e Comércio and its subsidiary Oxiteno Nordeste S.A. - Indústria e Comércio accrued R$14,824 (R$14,532 in 2005) for ICMS tax assessments being judged at lower-level and appeal-level administrative courts. The subsidiaries are currently awaiting a decision on the appeals.

    The subsidiary Utingás Armazenadora S.A. has been challenging in court ISS (Service Tax) tax assessments issued by the municipal government of Santo André. Legal counsel of the subsidiary classifies the risk as low, since a significant portion of the lower-court decisions was favorable to the subsidiary. The thesis defended by the subsidiary is supported by the opinion of a renowned tax specialist. The unprovisioned updated amount of the contingency as of March 31, 2006 is R$31,292 (R$29,995 in 2005).

    On October 7, 2005, the subsidiaries of Ultragaz Participações Ltda. filed for and obtained an injunction to support the offset of PIS and COFINS credits against other federal taxes administered by the Federal Revenue Service (SRF), notably income and social contribution taxes. According to the injunction obtained, the subsidiaries have been making escrow deposits for these debits and recognizing the corresponding liability for this purpose.

    The Company and its subsidiaries have other ongoing administrative and judicial proceedings; legal counsel classified the risks on these proceedings as possible and/or remote and, therefore, no reserves for potential losses on these proceedings have been recorded.

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    Ultrapar Participações S.A. and Subsidiaries
                                   
    Escrow deposits and provisions are summarized below:
        Balance on           Reversal/           Balance on  
    Provisions   12/31/2005     Additions     utilization     Update     03/31/2006  
    		 
    		 
    		 
    		 
    		 
    Income and social                              
       contribution taxes   9,272     483     (314 )   323     9,764  
    Labor claims   -     -     -     -     -  
    PIS and COFINS on other                              
       revenues   36,966     -     (16,465 )   869     21,370  
    ICMS   14,532     -     -     292     14,824  
    (-) Escrow deposits   (6,148 )   (555 )   -     (252 )   (6,955 )
       
    		 
    		 
    		 
    		 
        54,622     (72 )   (16,779 )   1,232     39,003  
       
    		 
    		 
    		 
    		 

    b)      Contracts
     
      The subsidiary Terminal Químico de Aratu S.A. - Tequimar has contracts with CODEBA - Companhia Docas do Estado da Bahia and Complexo Industrial Portuário Governador Eraldo Gueiros in connection with their port facilities in Aratu and Suape, respectively. Such contracts establish minimum cargo movement of 1,000,000 tons per year for Aratu, effective through 2022, and 250,000 tons per year for Suape, effective through 2027. If annual movement is less than the minimum required, the subsidiary is required to pay the difference between the actual movement and the minimum contractual movement, using the port rates in effect at the date established for payment.
     
      As of March 31, 2006, such rates were R$3.67 and R$3.44 per ton for Aratu and Suape, respectively. The subsidiary has met the minimum cargo movement limits since inception of the contracts.
       
      The subsidiary Oxiteno Nordeste S.A. - Indústria e Comércio has a supply contract with Braskem S.A., effective through 2012, which establishes a minimum consumption level of ethylene per year. The minimum purchase commitment and the actual demand for the period ended March 31, 2006 and 2005, expressed in tons of ethylene, are summarized below. Should the minimum purchase commitment not be met, the subsidiary would be liable for a fine of 40% of the current ethylene price for the quantity not purchased.
       
        Minimum purchase   Actual demand
        commitment   (real)1st quarter
       
    		 
            2006   2005
           
    		 
    In tons    137,900   44,995   49,863
       
    		 
    		 

    c)      Insurance coverage for subsidiaries
     
      The Company has appropriate insurance policies to cover various risks, including loss and damage from fire, lightning, explosion of any nature, windstorm, plane crash and electrical damage, among others, protecting the units and other branches of all subsidiaries, with coverage amounting to US$240 million.
     

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    Ultrapar Participações S.A. and Subsidiaries

        For the units of Oxiteno S.A. - Indústria e Comércio, Oxiteno Nordeste S.A. - Indústria e Comércio and Canamex Químicos S.A. de C.V., there is also loss of income insurance against losses from potential accidents related to their assets, with coverage amounting to US$128 million.
         
        A civil liability insurance program covers all Group companies, with coverage of US$150 million, for losses and damage from accidents caused to third parties, related to the commercial/industrial operations and/or distribution and sale of products and services.
         
       

    Group life insurance, personal accident insurance, health insurance, and domestic and international transportation insurance are also contracted.

       
    21.      STOCK COMPENSATION PLAN (CONSOLIDATED)
     
      The Extraordinary Stockholders’ Meeting held on November 26, 2003 approved a compensation plan for management of the Company and its subsidiaries, which provides for: (i) the initial grant of usufruct of shares issued by the Company and held in treasury by the subsidiaries in which the beneficiaries are employed; and (ii) the transfer of the beneficial ownership of the shares after ten years from the initial grant, provided that the professional relationship between the beneficiary and the Company and its subsidiaries is not interrupted. The total amount granted to executives until March 31, 2006, including taxes, was R$8,940 (R$8,940 in 2005). This amount is being amortized over a period of ten years and the amortization related to the quarter ended March 31, 2006, in the amount of R$223 (R$191 in 2005), was recorded as an operating expense.
     
    22.      EMPLOYEE BENEFITS AND PRIVATE PENSION PLAN (CONSOLIDATED)
     
      The Company and its subsidiaries offer benefits to their employees, such as life insurance, health care and pension plan. In addition, loans for the acquisition of vehicles and personal computers are available to employees of certain subsidiaries. These benefits are recorded on the accrual basis and terminate at the end of the employment relationship.
     
      In August 2001, the Company and its subsidiaries began to provide a defined contribution pension plan to their employees. This plan is managed by Ultraprev - Associação de Previdência Complementar. Under the terms of the plan, the basic contribution of each participating employee is defined annually by the participant between 0% and 11% of his/her salary. The sponsoring companies provide a matching contribution in an identical amount as the basic contribution. As participants retire, they may opt to receive monthly: (i) a percentage varying between 0.5% and 1.0% of the fund accumulated in their name in Ultraprev; or (ii) a fixed-monthly amount that will deplete the fund accumulated in the participant’s name in a period of 5 to 25 years. Accordingly, neither the Company nor its subsidiaries assume responsibility for guaranteeing the levels of amounts or periods of receipt of the retirement benefit. In 2006, the Company and its subsidiaries contributed R$800 (R$1,192 in 2005) to Ultraprev, which was charged to income for the period. The total number of participating employees as of March 31, 2006 was 5,906, with no participants retired to date. Additionally, Ultraprev has 1 active participant and 31 former employees receiving defined benefits according to the policies of a previous plan.
     

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    Ultrapar Participações S.A. and Subsidiaries

    23.      SUPPLEMENTARY INFORMATION OF THE STATEMENTS OF CASH FLOWS - INDIRECT METHOD (CONSOLIDATED)

    Prepared in accordance with Accounting Standard and Procedure (NPC) No. 20 issued by IBRACON (Brazilian Institute of Independent Auditors).

        3/31/2006     3/31/2005  
       
    		 
    Cash flows from operating activities:            
    Net income   56,788     100,750  
    Adjustments to reconcile net income to cash provide by            
     operating activities:            
         Equity in subsidiaries and affiliated companies   (59 )   71  
         Depreciation and amortization   47,432     45,491  
         PIS and COFINS credits on depreciation   557     279  
         Interest, foreign exchange and indexation   (33,081 )   3,299  
         Deferred income and social contribution taxes   (580 )   (4,402 )
         Minority interest   1,138     720  
         Proceeds from disposals of permanent assets   2,091     1,383  
         Allowance for probable losses on permanent assets   -     481  
         Reversal of allowance for factory shutdown, net of taxes   6,309     -  
         Other   101     32  
                 
    (Increase) decrease in current assets:            
     Trade accounts receivable   8,326     3,836  
     Inventories   (16,654 )   (39,891 )
     Recoverable taxes   3,814     (4,027 )
     Other   (398 )   5,325  
     Prepaid expenses   (1,080 )   (1,431 )
                 
    Increase (decrease) in current liabilities:            
     Trade accounts payable   3,502     (23,839 )
     Payroll and related charges   (9,780 )   (30,955 )
     Taxes payable   2,394     2,270  
     Income and social contribution taxes   199     (39 )
     Other   (9,611 )   673  
                 
    (Increase) decrease in long-term assets:            
     Recoverable taxes   (105 )   206  
     Escrow deposits   (418 )   (1,140 )
     Trade accounts receivable   (1,742 )   (2,134 )
     Other   184     102  
     Prepaid expenses   (655 )   -  
                 
    Increase (decrease) in long-term liabilities:            
     Other taxes   (15,619 )   4,983  
     Other   (306 )   125  
       
    		 
    Net cash provided by operating activities   42,747     62,168  
       
    		 

    29





    Ultrapar Participações S.A. and Subsidiaries            
        3/31/2006     3/31/2005  
       
    		 
    Cash flows from investing activities:            
      Cash investments in long-term, net of redemption   -     (300,775 )
      Additions to property, plant and equipment   (40,893 )   (40,112 )
      Additions to deferred charges   (15,677 )   (11,543 )
      Proceeds from sales of permanent assets   2,166     740  
      Acquisition of minority interest   (4 )   -  
    Net cash used in investing activities   (54,408 )   (351,690 )
       
    		 
    Cash flows from financing activities:            
      Loans, financing and debentures:            
           Issuances   83,331     81,228  
            Amortization   (149,631 )   (125,884 )
      Dividends paid   (86,518 )   (71,764 )
      Related companies   (1,315 )   202  
       
    		 
    Net cash used in financing activities   (154,133 )   (116,218 )
       
    		 
    Net decrease in cash and banks and temporary cash investments   (165,794 )   (405,740 )
       
    		 
    Cash and banks and temporary cash investments at the beginning            
      of the period   1,250,924     558,379  
    Cash and banks and temporary cash investments at the end of the            
      period   1,085,130     152,639  
    Supplemental disclosure of cash flow information:            
      Interest paid on loans and financing   33,784     5,436  
      Income and social contribution taxes paid in the period   1,662     8,017  

    30





    ULTRAPAR PARTICIPAÇÕES S.A. AND SUBSIDIARIES
     
    OTHER INFORMATION CONSIDERED MATERIAL BY THE COMPANY
     

    Shares directly or indirectly owned by the controlling shareholders, members of the Board of Directors, Executive Officers and members of the Fiscal Council as of March 31, 2006

        Common   Preferred   Total
    Controlling Shareholders   33,748,059   885,979   34,634,038
    Board of Directors¹   406,825   78,971   485,796
    Officers²   -   139,950   139,950
    Fiscal Council   -   1,071   1,071

    Note: ¹Shares owned by members of the Board of Directors which were not included in Controlling Shareholders' position
              ²Shares owned by Officers which were not included in Controlling Shareholders' and Board of Directors' positions

    Shares directly or indirectly owned by the controlling shareholders, members of the Board of Directors, Executive Officers and members of the Fiscal Council

        Mar-31-06   Mar-31-05³
     
        Common   Preferred   Total   Common   Preferred   Total
    Controlling Shareholders   33,748,059   885,979   34,634,038   33,748,075   7,240,641   40,988,716
    Board of Directors¹   406,825   78,971   485,796   406,824   197,198   604,021
    Officers²   -   139,950   139,950   -   129,950   129,950
    Fiscal Council   -   1,071   1,071   -   1,071   1,071

    Note: ¹Shares which were not included in Controlling Shareholders' position
              ²Shares which were not included in Controlling Shareholders' and Board of Directors' positions
              ³Quantities in 2005 are retroactively adjusted for the reverse stock split carried by Ultrapar in August 2005, in the proportion of 1000:1 shares.

    Total free float and its percentage of total shares as of March 31, 2006

        Common     Preferred     Total  
    Total Shares   49,429,897     31,895,512     81,325,409  
     ( - ) Shares held in treasury   6,617     182,697     189,314  
     ( - ) Shares owned by Controlling Shareholders   33,748,059     885,979     34,634,038  
    Free-float   15,675,221     30,826,836     46,502,057  
    % Free-float / Total Shares   31.71 %   96.65 %   57.18 %

    31





    Ultrapar Participações S.A. and Subsidiaries

    The Company’s shareholders that holds more than 5% of voting or non-voting capital, up to the individual level, and breakdown of their shareholdings as of March 31, 2006

    ULTRAPAR PARTICIPAÇÕES S.A   Common   %     Preferred   %     Total   %  
    Ultra S.A. Participações   32,646,696   66.04 %   12   0.00 %   32,646,708   40.14 %
    Parth Investments Company¹   9,311,730   18.84 %   1,396,759   4.38 %   10,708,489   13.17 %
    Monteiro Aranha S.A.²   5,212,637   10.55 %   1,011,888   3.17 %   6,224,525   7.65 %
    Shares held in treasury   6,617   0.01 %   182,697   0.57 %   189,314   0.23 %
    Dodge & Cox, Inc.³   0   0.00 %   6,819,785   21.38 %   6,819,785   8.39 %
    Others   2,252,217   4.56 %   22,484,371   70.50 %   24,736,588   30.42 %
    TOTAL   49,429,897   100.00 %   31,895,512   100.00 %   81,325,409   100.00 %

    ¹Company headquartered outside of Brazil

    ²Public listed company

    ³Company headquartered outside of Brazil, position according to last available data as at January 2006

    ULTRA S.A. PARTICIPAÇÕES   Common   %     Preferred   %     Total   %  
    Paulo Guilherme Aguiar Cunha   11,974,109   18.95 %   0   0.00 %   11,974,109   13.52 %
    Ana Maria Villela Igel   3,663,669   5.80 %   3,186,410   12.57 %   6,850,079   7.74 %
    Christy Participações Ltda.   6,425,199   10.17 %   4,990,444   19.69 %   11,415,643   12.89 %
    Rogério Igel   7,953,538   12.58 %   3,917,200   15.46 %   11,870,738   13.41 %
    Joyce Igel de Castro Andrade   8,401,501   13.29 %   4,365,161   17.22 %   12,766,662   14.42 %
    Márcia Igel Joppert   8,401,501   13.29 %   4,365,161   17.22 %   12,766,662   14.42 %
    Fábio Igel   7,437,724   11.77 %   4,070,447   16.06 %   11,508,171   13.00 %
    Lucio de Castro Andrade Filho   3,775,470   5.97 %   -   0.00 %   3,775,470   4.26 %
    Others   5,169,337   8.18 %   448,063   1.78 %   5,617,400   6.34 %
    TOTAL   63,202,048   100.00 %   25,342,886   100.00 %   88,544,934   100.00 %

    CHRISTY PARTICIPAÇÕES LTDA.   Capital Stock   %  
    Maria da Conceição Coutinho Beltrão   3,066   34.90 %
    Hélio Marcos Coutinho Beltrão   1,906   21.70 %
    Cristiana Coutinho Beltrão   1,906   21.70 %
    Maria Coutinho Beltrão   1,906   21.70 %
    TOTAL   8,784   100.00 %

    32





    ULTRAPAR PARTICIPAÇÕES S.A. AND SUBSIDIARIES
     
    INVESTMENTS IN SUBSIDIARIES AND/OR AFFILIATES

    1 - Item   2 - Company name   3 - Corporate
    taxpayer number
    (CNPJ)         		  4 - Classification   5 - % of
    ownership
    interest in
    investee         		  6 - % of
    investor’s
    stockholders
    equity         		  7 - Type of company   8 - Number of
    shares held in
    the current quarter
    (in thousands)         		  9 - Number of
    shares held in
    the prior quarter
    (in thousands)
       01   Ultracargo - Operações Logísticas e   34.266.973/0001-99   Closely-held subsidiary   100.00   32.13   Commercial, industrial and other   2,461   2,461
         Participações Ltda.                            
       02   Ultragaz Participações Ltda.   57.651.960/0001-39   Closely-held subsidiary   100.00   16.24   Commercial, industrial and other   4,336   4,336
       03   Imaven Imóveis e Agropecuária Ltda.   61.604.112/0001-46   Closely-held subsidiary   100.00   2.54   Commercial, industrial and other   27,734   27,734
       04   Oxiteno S.A. - Indústria e Comércio   62.545.686/0001-53   Closely-held subsidiary   100.00   68.31   Commercial, industrial and other   35,102   35,102
       05   Oxiteno Nordeste S.A. - Indústria e   14.109.664/0001-06   Investee of subsidiary/affiliated company   99.24   52,83   Commercial, industrial and other   5,242   5,242
         Comércio                            
       06   Terminal Químico de Aratu S.A. -   14.688.220/0001-64   Investee of subsidiary/affiliated company   99.43   6.16   Commercial, industrial and other   12,539   12,539
         Tequimar                            
       07   Transultra - Armazenamento e Transporte   60.959.889/0001-60   Investee of subsidiary/affiliated company   100.00   3.79   Commercial, industrial and other   34,999   34,999
         Especializado Ltda.                            
       08   Companhia Ultragaz S.A.   61.602.199/0001-12   Investee of subsidiary/affiliated company   98.54   22.56   Commercial, industrial and other   799,775   799,767
       09   SPGás Distribuidora de Gás Ltda.   65.828.550/0001-49   Investee of subsidiary/affiliated company   100.00   4.72   Commercial, industrial and other   1,314   1,314
       10   Bahiana Distribuidora de Gás Ltda.   46.395.687/0001-02   Investee of subsidiary/affiliated company   100.00   5.88   Commercial, industrial and other   24   24
       11   Utingás Armazenadora S.A.   61.916.920/0001-49   Investee of subsidiary/affiliated company   55.99   1.41   Commercial, industrial and other   2,751   2,751
       12   Canamex Químicos S.A. de C.V.       Investee of subsidiary/affiliated company   100.00   1.44   Commercial, industrial and other   122,048   122,048

    Note: This information is an integral part of the interim financial statements as required by the CVM.

    33





    ULTRAPAR PARTICIPAÇÕES S.A. AND SUBSIDIARIES

    CHARACTERISTICS OF DEBENTURES    
         
    1- ITEM   01
    2- ORDER NUMBER   SINGLE
    3- REGISTRATION NUMBER IN THE CVM   CVM/SRE/DEB/2005/015
    4- REGISTRATION DATE   4/06/2005
    5-SERIES ISSUED   UN
    6- ISSUE TYPE   SINGLE
    7- ISSUE NATURE   PUBLIC
    8- ISSUE DATE   3/01/2005
    8- MATURITY DATE   3/01/2008
    10- DEBENTURE TYPE   NO PREFERENCE
    11-YIELD   102.5% of the CDI
    12-PREMIUM/DISCOUNT   0
    13- PAR VALUE (REAIS)   10,000.00
    14- ISSUED AMOUNT (IN THOUSANDS OF REAIS)   304,173
    15- ISSUED SECURITIES (UNIT)   30,000
    16- OUTSTANDING SECURITIES (UNIT)   30,000
    17- SECURITIES HELD IN TREASURY (UNIT)   0
    18- REDEEMED SECURITIES (UNIT)   0
    19- CONVERTED SECURITIES (UNIT)   0
    20- UNPLACED SECURITIES (UNIT)   0
    21- LAST RESET DATE    
    22- NEXT EVENT DATE   9/01/2006

    34






    ULTRAPAR PARTICIPAÇÕES S.A.

    MD&A - ANALYSIS OF CONSOLIDATED EARNINGS
    First Quarter 2006

    (1) Key Indicators - Consolidated:

    (R$ million)                   Change     Change  
        1Q 06     1Q 05   4Q 05     1Q06 vs. 1Q05     1Q06 vs. 4Q05  
    Net sales and services   1,097.7     1,137.0     1,125.5     (3%)   (2%)
    Cost of sales and services   (898.7 )   (878.2 )   (944.5 )   2%    (5%)
    Gross Profit   199.0     258.8     181.0     (23%)   10% 
    Selling, general and administrative                              
    expenses   (140.4 )   (137.3 )   (141.8 )   2%    (1%)
    Other operating income (expense), net   0.6     1.2     (1.4 )   (50%)   143% 
    Income from operations before                              
    financial items   59.2     122.7     37.8     (52%)   57% 
    Financial income (expense), net   12.4     (8.8 )   0.9     241%    1,278% 
    Equity in subsidiaries and affiliated                              
    companies   -     (0.1 )   0.2     -       -    
    Nonoperating expense, net   (2.1 )   (1.8 )   1.5     17%    (240%)
    Income before taxes and social   69.5     112.0     40.4     (38%)   72%
    contribution                              
    Income and social contribution taxes   (23.0 )   (31.4 )   (7.4 )   (27%)   211% 
    Benefit of tax holidays   11.4     20.9     9.1     (45%)   25% 
    Minority interest   (1.1 )   (0.7 )   (0.4 )   57%    175% 
    Net income   56.8     100.8     41.7     (44%)   36% 
    EBITDA   106.6     168.2     86.5     (37%)   23% 
    Volume - LPG sales   355.2     355,3     377.4     (0%)   (6%)
    Volume - Chemicals sales   128.8     119.9     120.6     7%    7% 

    35





    Ultrapar Participações S.A. and Subsidiaries

    (2) Performance Analysis:

    Net Sales and Services - Ultrapar's net consolidated sales and services in 1Q06 amounted to R$ 1,097.7 million, down 3% compared to the same quarter in 2005 and down 2% in relation to 4Q05.

    Ultragaz: In 1Q06, Brazil's LPG market expanded by 1.3% compared to the same period in 2005. In this same period, Ultragaz's sales volume totaled 355.2 thousand tons, flat compared to 1Q05. The level sales performance in relation to the market already reflects a number of initiatives taken as part of Ultragaz’s distribution structure review. Compared to 4Q05, sales volume at Ultragaz saw a retraction of 6%, as a result of seasonal effects between the two periods. Both the bottled and bulk segments remained flat in relation to 1Q05. In the large bulk segment, the reverse seen in falling sales volume reflects the revision of the use of LPG vis à vis the natural gas, driven by the uncertainties regarding natural gas supply from Bolivia. Net sales at Ultragaz amounted to R$ 694.2 million in 1Q06, up 3% compared to 1Q05, as a result of the market repositioning brought about by the company's distribution structure review. Compared to 4Q05, net sales decreased by 4%.

    Oxiteno: Total sales volume at Oxiteno amounted to 128.8 thousand tons in 1Q06, up 7% in relation to 1Q05. In this same period, sales in the domestic market increased by 2.5 thousand tons, or 3%, compared to 1Q05, basically due to increased sales in the paints, varnishes, cosmetics and detergents segments. Export markets saw an increase of 6.4 thousand tons, or 18%, compared to 1Q05, as a consequence of (i) higher sales to China and (ii) a 27% increase in the volume sold by Canamex. Compared to 4Q05, Oxiteno's sales volume increased by 7%, as a result of increased exports. In 4Q05, Oxiteno's exports were impacted by a stoppage to replace the catalysts in the Camaçari plant. Oxiteno’s net sales in 1Q06 amounted to R$ 357.4 million, down 15% compared to 1Q05, basically due to: (i) the 18% stronger Brazilian real, partially offset by an increase of 7% in sales volume and (ii) the drop in the international glycol price in 2005. Compared to 4Q05, despite a stronger Brazilian real, Oxiteno's net sales were up 1%, due to a 7% increase in sales volume.

    Ultracargo: The average storage levels of Ultracargo, measured in cubic meters, increased by 3% in 1Q06, compared to 1Q05, due to the start-up of operations at the Santos Intermodal Terminal - TIS, in mid-2005. Compared to 4Q05, average storage levels saw a retraction of 3%, as a consequence of the temporary non-availability of various tanks at Suape, due to expansion works. Ultracargo reported net services of R$ 58.1 million in 1Q06, up 7% compared to 1Q05, due basically to (i) the additional revenue from TIS and (ii) contractual tariffs readjustments. Compared to 4Q05, net services saw a reduction of 3%, basically due to lower operational volume.

    Cost of Sales: Ultrapar's cost of sales in 1Q06 amounted to R$ 898.7 million, up 2% compared to 1Q05, but down 5% in relation to 4Q05.

    Ultragaz: The cost of sales in the quarter increased by 2% compared to 1Q05, basically due to an increase in freight costs, as a result of fuel price increases during last year, and the rise in personnel costs, as a result of collective wage increase agreement in 2005. Compared to 4Q05, the cost of sales was down 8%, or R$ 48.3 million, due to: (i) a reduction of 6% in sales volume and (ii) the initiatives taken as part of the company's distribution structure review, including the effect of non-recurring costs reported in 4Q05.

    Oxiteno: Oxiteno's cost of sales in 1Q06 amounted to R$ 279.2 million, up 3% compared to 1Q05, due to (i) an increase in sales volume and the rise in the dollar cost of ethylene, partially offset by the appreciation in the Brazilian real, and (ii) an increase in fixed costs, as a result of a reduction in the finished products goods inventory. Compared to 4Q05, the cost of sales increased by 2% as a result of a 7% increase in sales volume and the effect of the 2% appreciation in the Brazilian real.

    Ultracargo: The cost of services provided by Ultracargo in 1Q06 was up by 4%, compared to the same quarter in 2005, principally as a result of (i) the start-up of operations at the Santos Intermodal Terminal, (ii) the increase in fuel costs, and (iii) increased salaries as a result of the annual collective wage agreement. When compared to 4Q05, Ultracargo's cost of services was down by 8%, basically due to lower operational volume.

    Gross Profit: In 1Q06 Ultrapar reported a gross profit of R$199.0 million, a decrease of 23% in relation to 1Q05. Compared to 4Q05, the gross profit increased by 10%.

    Selling, General and Administrative Expenses: In 1Q06, Ultrapar's selling, general and administrative expenses amounted to R$ 140.4 million, up 2% compared to 1Q05, and down 1% compared to 4Q05.

    36





    Ultrapar Participações S.A. and Subsidiaries

    Ultragaz: Selling, general and administrative expenses at Ultragaz amounted to R$ 74.1 million, up 2% compared to 1Q05, principally due to an increase in personnel expenses, in accordance with the annual collective wage agreement. Compared to 4Q05, selling, general and administrative expenses were down by 2%, the result of a 12% drop in selling expenses - in 4Q05 there were non-recurring expenses related to the company's distribution structure review.

    Oxiteno: Oxiteno's selling, general and administrative expenses amounted to R$ 49.1 million in 1Q06, 6% lower than in 1Q05, due to a reduction in the provision for employee profit sharing, partially offset by an increase in freight expenses, in line with the rise in volume sold. Compared to 4Q05, there was a reduction of R$ 0.4 million, or 1%.

    Ultracargo: Selling, general and administrative expenses at Ultracargo amounted to R$ 18.4 million in 1Q06, a 36% increase compared to the same period in 2005, basically due to expansion in the size of the operational workforce, as a result of new operations, and the increase in staff salaries as a result of the annual collective wage agreement. Compared to 4Q05, there was an increase of R$ 0.3 million, or 2%.

    Income from Operations before Financial Items: Ultrapar reported an income from operations before financial items of R$ 59.2 million, 52% lower than the operating income reported in 1Q05. Compared to 4Q05, Ultrapar’s income from operations before financial items increased by 57%.

    Financial Income (Expenses), Net: Ultrapar reported financial income, net, of R$ 12.4 million in 1Q06 compared to net financial expenses of R$ 8.8 million in 1Q05. This improvement in the financial result is explained by (i) the non-recurring positive effect of R$ 15.9 million, the result of winning a court case in regard PIS and COFINS taxes, explained in further detail below and (ii) an increase in the company's net cash position, which amounted to R$ 127.4 million at the end of 1Q06, compared to a net debt of R$ 17.6 million at the end of 1Q05. Through its subsidiaries, Ultrapar had filed lawsuits questioning the levy of PIS and COFINS taxes on sources of income other than revenues. In March 2006 the Federal Supreme Court decided one of the lawsuits favorable to Ultrapar. The amount of R$ 15.9 million booked in the financial income refers only to the amount disputed by Ultragaz. Ultrapar has other subsidiaries which are also disputing this issue, but which have yet to have their cases ruled on. Should these subsidiaries also obtain a favorable final court decision, Ultrapar estimates that the total effect on financial income will be an additional R$ 42 million, net of legal fees.

    Nonoperating Income (Expenses), Net: In 1Q06 Ultrapar reported nonoperating expenses, net, of R$ 2.1 million, an increase of 17% compared to 1Q05, when Ultrapar reported a non-operating expenses, net, of R$ 1.8 million. In both periods, the non-operating expenses were largely due to the scrapping of storage cylinders at Ultragaz. Compared to 4Q05, when Ultrapar reported nonoperating income, net, of R$ 1.5 million, the company saw a decrease of 240%, due to the sale of assets (vehicles and land) in 4Q05.

    Income and Social Contribution: Ultrapar’s 1Q06 income and social contribution taxes expenses amounted to R$ 23.0 million, a decrease of 27% in relation to 1Q05, when Ultrapar’s income and social contribution taxes expenses were R$ 31.4 million, as a result of the decrease in income from operations. Compared to 4Q05, when the company reported R$ 7.4 million, Ultrapar’s income and social contribution taxes expenses were 211% higher, due to the increase in income from operations.

    Benefit of Tax Holidays: Ultrapar is entitle to federal tax benefits for its activities in the Northeast Region of Brazil, due to the federal program for development of the region. Tax benefits cover Oxiteno’s plant in Camaçari, Bahiana Distribuidora de Gás and Tequimar. Ultrapar's operations generated R$ 11.4 million in benefits of tax holidays in 1Q06, compared to R$ 20.9 million generated in 1Q05. The drop in benefits of tax holidays reflects the company’s lower income from operations and the increase in the proportion of income from operations generated by Ultragaz, which enjoys lower benefit of tax holidays.

    Net Income: Ultrapar's consolidated net income in 1Q06 amounted to R$ 56.8 million, down 44% compared to 1Q05, but up 36% compared to 4Q05.

    EBITDA: Ultrapar's consolidated operating cash generation (EBITDA) amounted to R$ 106.6 million in 1Q06, 37% lower than in 1Q05, but 23% higher than in 4Q05.

    Ultragaz: EBITDA at Ultragaz amounted to R$ 55.3 million in 1Q06, 22% and 61% higher than the respective figures reported in 1Q05 and 4Q05, as a result of market repositioning and operational efficiencies driven by the company's distribution structure review.

    37





    Ultrapar Participações S.A. and Subsidiaries

    Oxiteno: Oxiteno ended 1Q06 with EBITDA of R$ 40.5 million, a 64% reduction compared to 1Q05, basically as a result of the appreciation in the Brazilian real on the company's sales, the high oil price level and the drop in international petrochemical commodity prices in 2005. Compared to 4Q05, this reduction amounted to 4%, basically due to the appreciation in the Brazilian real.

    Ultracargo: EBITDA at Ultracargo amounted to R$ 9.3 million, down 7%, or R$ 0.7 million, compared to 1Q05, basically due to the new operations in the ramp up phase. However, compared to 4Q05, EBITDA saw an improvement of 16%.

    EBITDA

    R$ million 1Q06 1Q05 4Q05 Change
    1Q06 X 1Q05         		Change
    1Q06 X 4Q05
    Ultrapar 106.6 168.2 86.5 (37%) 23%
    Ultragaz 55.3 45.4 34.4 22% 61%
    Oxiteno 40.5 111.4 42.2 (64%) (4%)
    Ultracargo 9.3 10.0 8.0 (7%) 16%

    We hereby inform that, in accordance with the requirements of CVM Resolution 381/03, our independent auditors Deloitte Touche Tohmatsu Auditores Independentes have not performed during this first three months of 2006 any service other than the external audit of the financial statements of Ultrapar and affiliated companies and subsidiaries. We also inform that there is no expectation, for the current year, for Deloitte to perform any other service amounting to more than 5% of the auditing cost.

    RU0062*.*

    38



    Item 2
     
    ULTRAPAR PARTICIPAÇÕES S.A.
    Publicly Listed Company
       
       
         CNPJ nº 33.256.439/0001- 39 NIRE 35.300.109.724
       
    MINUTES OF A MEETING OF THE BOARD OF DIRECTORS (03/2006)

    Date, Time and Place:

    May 10, 2006, at 2.30 p.m, at Company Headquarters, located on Av. Brigadeiro Luiz Antônio, Nº 1343 - 9º andar, in the City and State of São Paulo.

    Present:

    Members of the Board of Diretors whose signature appears below, and member of the Fiscal Council (Audit Committee) Flávio Cesar Maia Luz.

    Matters deliberated on :

    1.      To examine and discuss the performance of the Company in the first quarter of this financial year, having approved the respective financial statements.
     
    2.      To authorize the carrying out of an “Exchange Offer” through which the notes issued in the international market in December 2005 by the Company's subsidiary Companhia, LPG International Inc., and guaranteed by the Company and Oxiteno S.A. Indústria e Comércio, for the amount of US$ 250,000,000.00 (two hundred and fifty million US dollars), this issue having been approved by this Board of Directors on December 14, 2005, will be able to be exchanged by their holders for new notes registered with the Securities and Exchange Commission - SEC under the terms of the Registration Rights Agreement, signed on December 20, 2005. The new notes registered will have the same characteristics as the original notes issued.
     




    3.      To approve the carrying out by the Executive Board of all the actions and the signing of all the documents related to the deliberations referred to in item “2” of these minutes.
     
    4.      To nominate, in the manner set out in § 1º, of Article 17 of the Bylaws, as Chairman of the Board of Directors, board member PAULO GUILHERME AGUIAR CUNHA , Brazilian, married, engineer, hold of Identity Card RG Nº 4.554.607/ SSP-SP and CPF Nº 008.255.498-68 and as Vice-President of the Board of Directors, board member LUCIO DE CASTRO ANDRADE FILHO , Brazilian, married, engineer, holder of Identity Card RG Nº 3.045.977/SSP-SP and CPF Nº061.094.708-72, the business address of both the aforementioned being Av. Brigadeiro Luiz Antonio, Nº 1343 – 9º andar, in the City and State São Paulo (CEP 01317-910).
     
    5.      To elect the persons listed below as Executive Officers of the Company, with a mandate to run until the 2007 Annual General Meeting, to examine the documents referred to in Art. 133 of Law Nº 6.404/76, which refer to the current ongoing financial year:
     
      As Chairman:
     
      PAULO GUILHERME AGUIAR CUNHA, already cited above;
     
      As Vice President:
     
      LUCIO DE CASTRO ANDRADE FILHO , already cited above;
     
      As Investor Relations Officer:
     
      FABIO SCHVARTSMAN , Brazilian, married, engineer, hold of Identity Card RG Nº 4.144.579/ SSP-SP and CPF Nº 940.563.318-04;
     
      As Executive Officers:
     




      PEDRO WONGTSCHOWSKI , Brazilian, divorced, chemical engineer, holder of Identity Card RG Nº 3.091.522/ SSP-SP and CPF Nº 385.585.058-53;
     
      PEDRO JORGE FILHO , Brazilian, married, engineer, holder of Identity Card RG Nº 6.031.456/ SSP-SP and CPF Nº 822.913.308-53;
     
      EDUARDO DE TOLEDO , Brazilian, married, engineer, hold of Identity Card RG Nº 4.358.259/ SSP-SP and CPF Nº 103.264.958-51.
     
    6.      To approve the hiring of Deloitte Touche e Tohmatsu to provide external auditing services for the financial year 2006, as well as the estimates provided for the provision of these services.
     

    Observation: (i) The deliberations were approved by all those Board Members present, except for Board Member Renato Ochman, who abstained from voting on items 1 to 5, and voted in favor of the hiring of the continuing auditing services in item 6; (ii) the business address of all the Directors is Av. Brigadeiro Luiz Antonio, Nº 1343 - 9º andar, in the City and State of São Paulo (CEP 01317-910); (iii) the Directors hereby elected, having been previously consulted, declare that, (a) they have no ongoing impediment which prevents them exercising their duties in the posts assigned to them, (b) they do not hold posts in companies which may be considered market competitors of the Company and (c) they have no conflict of interest with the Company, in accordance with Art. 147 of Law Nº 6.404/76.

    There being no further business to discuss, the meeting was closed and the minutes of this meeting hereby set out, read and approved by all the undersigned board members present, as well as by the member of the Fiscal Council present:

    Paulo Guilherme Aguiar Cunha – Chairman; Lucio de Castro Andrade Filho - Vice President; Ana Maria Levy Villela Igel; Paulo Vieira Belotti;





    Renato Ochman – Board Members, Flavio Cesar Maia Luz, Fiscal Council Member.
                I declare that this document is a faithful copy of the minutes, as entered in the Company Registry.

    Paulo Guilherme Aguiar Cunha

    Chairman of the Board




    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.

        ULTRAPAR HOLDINGS INC.
             
    Date: May 12, 2006 By: /s/ Fábio Schvartsman
         
          Name: Fábio Schvartsman
          Title: Chief Financial and Investor Relations Officer

    (Interim financial statements for the quarter ended March 31, 2006 and minutes of meeting of the Board of Directors, May 10, 2006)