Eletrobras(US:EBR)2020-11-13 04:01Financial Data and Key Metrics Changes - The energy market is recovering, with daily load operating 26% above 2019 levels, and monthly ticket prices are 4% higher than in 2019 [5][6] - The company reported a slight increase in leverage due to a dividend payment of BRL2.5 billion, impacting net debt [9][47] - EBITDA dropped by 29% year-over-year, with a recurrent drop of 18%, reaching BRL3 billion [31][46] Business Line Data and Key Metrics Changes - Generation revenue decreased from BRL7.3 billion to BRL5.6 billion in the first nine months of 2020, primarily due to lost high-value contracts [23][33] - The company generated 23% of its installed capacity, amounting to almost 50,000 gigawatt-hours [21] - The unregulated market's participation increased from 26% to 36%, while the regulated market's share decreased from 37% to 49% [22] Market Data and Key Metrics Changes - The average price in the unregulated market dropped significantly, with prices per megawatt reported at BRL80 to BRL90, compared to BRL200 to BRL215 in the previous year [36] - The company faced extraordinary events affecting generation, including prolonged stoppages at Angra 1 and 2, leading to provisions of BRL217 million [11][12] Company Strategy and Development Direction - The company is focusing on improving its capital allocation and addressing liabilities, particularly regarding compulsory loans [68] - There is an ongoing effort to simplify the structure of its Special Purpose Entities (SPEs), aiming to reduce from 131 to 49 by December 2021 [50] - The company is optimistic about future rainfall patterns, which are expected to improve energy prices and generation capacity [64] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the recovery of the energy market and the company's ability to regain market share despite challenges posed by the pandemic [5][64] - The management acknowledged the impact of the pandemic on contracts but noted a normalization in demand since June [74] - There is a commitment to improving governance and financial discipline to navigate the current challenges [58] Other Important Information - The company reported a significant reduction in operational costs, with personnel costs dropping from BRL9.8 billion to BRL5.8 billion [39] - The company has implemented measures to address COVID-19, including extensive testing and safety protocols [55] Q&A Session Summary Question: Impact of the blackout in Amapa on privatization - Management indicated that the blackout has complicated the privatization process, but they remain committed to moving forward with investments and regulatory improvements [60][61] Question: Hydrology and its impact on prices - Management noted that while there are concerns about rainfall, they remain optimistic about the upcoming weather patterns and their potential positive impact on energy prices [64] Question: Provisions and compulsory loans - Management highlighted that addressing compulsory loans is a priority, with ongoing efforts to mitigate bad debt and improve capital allocation [68][70] Question: Future dividend payments - Management clarified that there are no plans for dividend payments above the minimum expected, emphasizing a robust cash flow [72][73]