SABESP(US:SBS)2025-11-12 11:14Financial Performance - Revenue from sales and services for the quarter reached R$9,413,305, compared to R$14,986,700 in the same quarter last year, reflecting a decrease of 37.3%[11] - Net income from continuing operations was R$2,158,565, down from R$6,111,883 year-over-year, a decline of 64.7%[11] - Basic earnings per share for the quarter were R$3.16, down from R$8.94 in the same quarter last year, a decrease of 64.7%[11] - The company reported a gross profit of R$2,991,172, down from R$11,005,126 year-over-year, a decline of 72.8%[11] - Total comprehensive income for the period is R$2,053,983, down from R$6,111,883 in the same quarter of the previous year[12] - Net income for Q3 2025 was R$2.159 billion, a decrease of 64.7% compared to R$6.111 billion in Q3 2024[39] - The net revenue for Q3 2025 was R$9.425 billion, down 37.2% from R$14.997 billion in the same quarter last year[39] - The margin for net income decreased to 23% in Q3 2025 from 41% in Q3 2024[39] Assets and Liabilities - Total assets increased to R$95,982,957, up from R$80,978,272 year-over-year, representing a growth of 18.5%[8] - Total liabilities rose to R$95,982,957, an increase of 18.5% from R$80,978,272 in the previous year[10] - Current liabilities increased to R$14,434,328, compared to R$11,968,321 in the previous year, marking a rise of 20.6%[10] - Long-term assets increased to R$32,054,871 from R$24,927,066, reflecting a growth of 28.2%[8] - Total equity increased to R$42,710,275, up from R$36,928,054, representing a growth of 15.1%[10] - Total liabilities increased to R$53,277,182 in Q3 2025, up from R$38,225,976 in Q3 2024, which is a rise of 39.4%[56] - Total equity grew to R$42,710,275 in Q3 2025, compared to R$37,908,972 in Q3 2024, representing an increase of 12.5%[56] Cash Flow and Investments - Cash and cash equivalents stood at R$4,966,996.7, significantly up from R$1,681,204, indicating a growth of 195.5%[8] - Cash generated from operations year-to-date is R$10,326,542, an increase of 27.2% from R$8,117,827 in the previous year[13] - Net cash from operating activities increased to R$7,454,364 from R$4,740,155 year-over-year[22] - Cash generated from operations rose to R$10,443,765 compared to R$8,115,218 in the previous year[22] - Total investments in Q3 2025 reached R$4.0 billion, the highest amount recorded in a single quarter, focusing on infrastructure and universalization targets[29][37] - In the first nine months of 2025, Sabesp invested R$10.4 billion, delivering potable water to over 616,264 new units, exceeding the annual target[30] Operational Metrics - The company connected 73,846 new sewage units and provided sewage treatment for nearly 948,965 units, achieving 92% of the annual goal[30] - Operating expenses (OPEX) decreased by 15% year-over-year to R$2,270 million in 3Q25, with significant reductions in general expenses and personnel costs[46] - The company reported an EBITDA of R$3,069 million in 3Q25, with a margin of 33%, up from 51% in the previous year[48] - Total billed volume increased by 2.5% driven by improved measurement through meter replacements and new connections[45] Financial Risk Management - The company has been managing foreign exchange risk through hedging transactions since 2024 to mitigate potential losses from exchange rate fluctuations[76] - Interest rate risk management is conducted through derivative financial instruments, with total borrowings and financing subject to different inflation adjustment indices amounting to R$34,940,121 as of September 30, 2025[79] - The company’s liquidity is primarily reliant on cash from operating activities and borrowings, with total financial liabilities projected at R$64,953,147 as of September 30, 2025[92] - The company has entered into hedging instruments to manage financial risks associated with foreign-currency financing, aiming to mitigate exposure to market fluctuations[95] Debt and Financing - As of September 30, 2025, total financial debt amounts to R$8,911,109, an increase from R$3,366,723 as of December 31, 2024[77] - Total borrowings and financing as of September 30, 2025, amounted to R$34,926,444, an increase from R$25,258,297 as of December 31, 2024, representing a growth of 38.4%[99] - The company has various financing agreements with the Brazilian Development Bank (BNDES) and the Inter-American Development Bank (IDB), with interest rates ranging from TJLP + 1.76% to CDI + 2.70%[200] - SABESP's foreign currency loans include agreements with the International Finance Corporation (IFC) and JICA, with interest rates such as SOFR + 1.20% and 1.8% to 2.5% for Yen loans, maturing between 2029 and 2048[200] Customer and Revenue Management - The company has a diversified customer base, mitigating credit risk exposure from accounts receivable[85] - The average rate for residential customers decreased by 6.2% to R$4.04/m3, while the average rate for commercial customers increased by 3.9% to R$15.12/m3[44] - Revenue from sanitation services for the nine-month period ended September 30, 2025, totaled R$18,366,116, accounting for 99.14% of the consolidated amount[62] Employee and Management Costs - The number of employees decreased by 12% year-over-year, with 9,306 employees at the end of 3Q25[49] - Key management personnel compensation expenses for the period from July to September 2025 totaled R$8,527, compared to R$2,325 in the same period of 2024[6] Capital and Shareholder Information - The company has recognized a capital increase of R$3,400,000, raising the paid-up capital to R$18,400,000[15] - SABESP issued R$2,815,700 in non-convertible debentures on August 1, 2025, with a yield of IPCA + 9.28% p.a., of which R$2,765,700 was acquired by SABESP Luxembourg[7] - SABESP completed a capital increase of R$85,000 on November 3, 2025, through the issuance of 85,000,000 new shares[8]