CEMIG(US:CIG)2023-08-05 03:54Financial Data and Key Metrics Changes - The company reported an adjusted EBITDA of BRL2 billion for the quarter, with an annualized figure close to BRL8 billion, reflecting a growth of almost 7% compared to the previous quarter [4] - Net profit for the quarter was BRL1.2 billion, indicating consistent results and a growth of 6.6% year-over-year [42][23] - The company generated BRL4 billion in operating cash flow over six months, ending with BRL3.8 billion in cash [44] Business Line Data and Key Metrics Changes - The trading segment of Cemig achieved an EBITDA of over BRL600 million in the first half of the year, demonstrating effective market engagement [18] - Investments in distribution for the first half of the year were BRL1.7 billion, nearly double the total investment made in 2018 [15] - The company is constructing 180 megawatts of photovoltaic plants and has plans for 540 megawatts in distributed generation [6] Market Data and Key Metrics Changes - The electricity market for Cemig D saw a 0.7% growth in consumer and transported energy, with a significant 56% increase in distributed generation [45] - The state of Minas Gerais is presenting growth opportunities, with transported energy growing by 3.3% despite a 1.7% drop in overall consumption [45] Company Strategy and Development Direction - The company is focused on a BRL42 billion investment program over the next five years, targeting distribution, transmission, and generation of energy in Minas Gerais [11] - Cemig aims to maintain its leadership in the state of Minas Gerais while expanding its market share in the retail sector as the market opens [19][34] - The company is investing in digital transformation and automation, with a commitment to modernizing its operations [20][35] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's results for the end of the year, citing a robust investment program and positive tariff reviews [23][25] - The Brazilian electric sector faces challenges in centralized generation due to high supply levels, but demand is expected to pick up [7] - The company is committed to maintaining operational efficiency and meeting regulatory limits, with a focus on cash generation [29][54] Other Important Information - Cemig issued BRL2 billion in sustainable bonds, reflecting market confidence and supporting investments in social programs [22] - The company has a strong commitment to ESG initiatives, including a diversity program and significant reductions in CO2 emissions [21][37] - The company is undergoing a divestment process for non-strategic assets, with several assets already sold [48] Q&A Session Summary Question: Can you comment on GASMIG's results and the significant gap compared to regulatory limits? - Management explained that GASMIG's results are influenced by a recent tariff review that integrated off-balance regulatory payments, leading to improved EBITDA and profit [70] Question: How is the negotiation with the government regarding thermal dispatch and exports progressing? - Management indicated that discussions are ongoing, but no definitive timeline is available for the resolution of these negotiations [74] Question: Will the BRL1 billion investment in automation and technology be included in the remuneration base? - Management confirmed that most of the investment is operational expenditure, which will be covered by the tariff review [77] Question: What is the strategy for Eurobond rollover? - The company plans to manage liability in stages, reducing FX exposure and potentially switching to local debt due to current market conditions [84] Question: Update on GASMIG's IPO and divestment in Taesa? - Internal preparations for a potential IPO of GASMIG have been completed, but no decision has been made yet [86]