Eletrobrás (ELET3) Q2 2025 earnings summary

Executive summary

• Post-privatization initiatives led to shareholder structure simplification, cost and liability reductions, and a compulsory loan inventory drop to R$11.97 billion, with a transition to growth and stabilization.

• R$4 billion in dividends proposed, reflecting improved performance, risk mitigation, and financial discipline.

• Investments surged 116% vs. 1Q25, with key projects like Ponchilla Negra wind farm, Manaus-Boa Vista connection, and the first post-privatization transmission auction win completed.

• Major portfolio moves included the sale of Amazonas thermal plants, acquisition of Eletronet, and increased stake in Transnorte Energia.

• Transitioned from turnaround to growth, focusing on process improvement and client service.

Financial highlights

• Adjusted gross revenue grew 19% year-over-year to R$12,191 million in 2Q25, with net operating revenue (IFRS) up 22.8% YoY to R$10,308 million.

• Adjusted net income reached R$1,469 million, up 43.3% YoY, despite a reported IFRS loss of R$1,325 million due to regulatory remeasurement of transmission contracts.

• Generation margins increased 21% sequentially and 16% YoY, offsetting lower transmission revenue.

• PMSO costs reduced to R$1,403 million, with efficiency gains despite new hires.

• Net debt stood at R$40.13 billion, down R$2.84 billion YoY; net debt/adjusted LTM EBITDA improved to 1.5x from 2.5x.

Outlook and guidance

• Proposal for R$4 billion in dividends, with projected leverage within target range and a five-year outlook to 2030.

• 249 large-scale transmission projects underway, with R$1.8 billion in additional RAP expected between 2025-2030 and total CAPEX of R$13.3 billion.

• Ambition to maintain and grow investments above R$4.5 billion in 2025, with further growth expected in subsequent years.

• Energy trading client base grew 24% YoY, with 781 clients, 688 in the free market.

• Conservative long-term energy price assumptions maintained, with short-term price revisions for 2025 and 2026 reflecting improved market conditions.