Copel(US:ELP)2019-11-13 19:54Financial Data and Key Metrics Changes - The company reported an EBITDA of over BRL1.2 billion, growing 41% compared to the same period last year [6] - Year-to-date EBITDA reached BRL3.2 billion, surpassing the total for the entire year of 2018 [6] - Operating cash generation for the quarter was BRL1 billion, significantly better than Q3 2018 [6] - Net income for Q3 2019 was approximately BRL395 million, a 3% increase year-over-year, and including nonrecurring effects, it surpassed BRL613 million, a 42% increase [31] - The company's leverage ratio improved to approximately 2.2x EBITDA over net debt, down from over 3 in the previous quarter [6][46] Business Line Data and Key Metrics Changes - Copel Distribution achieved an EBITDA of BRL331 million, an 18% improvement compared to Q3 2018, and for the last 12 months, it reached a record of BRL1.123 billion [7][36] - Copel GeT's EBITDA reached BRL541 million, an 18% increase year-over-year, primarily due to a 26% reduction in purchased energy for resale [28] - The commercialization company, Copel Energia, reported significant results with a mark-to-market gain of BRL99 million for the quarter [12] Market Data and Key Metrics Changes - The energy consumption in the grid market grew by 1.6% in Q3 2019, with an 8.4% increase in industrial free market consumption [29] - There was a 1.8% growth in electric energy supply, with a 3.5% increase in energy sold volume to end users [30] Company Strategy and Development Direction - The company is focusing on a modernization program for its energy distribution grid, with an investment of BRL2.9 billion planned between 2020 and 2025 [16][17] - The company aims to improve operational efficiency and reduce costs through various initiatives, including a Voluntary Redundancy Program targeting approximately 500 employees [13][58] - The company is also preparing for the divestment of Copel Telecom, with plans to hold an auction by the end of Q1 2020 [19][76] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver consistent results and emphasized the importance of execution in their value improvement strategy [24][49] - The company is closely monitoring regulatory changes in the industry that may present opportunities for energy generation and innovation [21] - Management highlighted the importance of maintaining financial discipline and capital allocation to support sustainable growth [46][47] Other Important Information - The company received a certification from B3 for its governance practices, achieving the highest score among state-owned companies [14] - The investment plan for 2020 was approved at BRL2.1 billion, the highest in the company's history before the regulatory review [22] Q&A Session Question: Can you provide more details on the Voluntary Redundancy Program and other cost-cutting measures? - Management indicated that they are considering outsourcing the internal call center and expediting the shared service center process to gain efficiency [54][56] Question: What is the status of the divestment process for Compagas? - Management stated that guidelines for the concession renewal are expected to be published in the first half of 2020, with a divestment plan anticipated by early 2021 [60] Question: Can you comment on the Jandaíra Wind Farm and its synergies with other projects? - Management confirmed that the Jandaíra project benefits from existing knowledge and infrastructure in the region, which will help reduce costs and improve efficiency [61][62]