Companhia de Saneamento de Minas Gerais (CSMG3) Q4 2025 earnings summary

Executive summary

• Achieved record investments in 2025 with BRL 2.9 billion in CapEx, up 31.5% year-over-year, focusing on water supply, sewage systems, and universalization, with a BRL 21 billion investment plan for 2026–2030 targeting universalization and water security.

• Net revenue reached BRL 1.88 billion in 4Q25, up 6.9% year-over-year, and BRL 7.36 billion for 2025, up 5.6% from 2024.

• EBITDA for 4Q25 was BRL 731 million, up 14.1% year-over-year (38.5% margin); annual EBITDA was BRL 2.95 billion, up 5.7% (39.8% margin).

• Strategic pillars include privatization execution, regulatory predictability, and operational efficiency, with a strong ESG commitment validated by inclusion in the Carbon Efficient Index and Ibovespa Index.

• Net income increased 23.9% in 4Q25 and 7.5% for the year, driven by operational efficiency and cost control.

Financial highlights

• Net revenue for 4Q25 reached BRL 1.88 billion (+6.9% YoY); annual net revenue was BRL 7.36 billion (+5.6% YoY).

• EBITDA for 4Q25 was BRL 731 million (+14.1% YoY, 38.5% margin); annual EBITDA was BRL 2.95 billion (+5.7%, 39.8% margin).

• Net income: BRL 337 million in 4Q25 (+23.9% YoY); BRL 1.42 billion in 2025 (+7.5% YoY).

• Operating cash generation for 2025 was BRL 2.3 billion, up 12.8% year-over-year.

• Leverage increased to 2.3x Net Debt/EBITDA; net debt at BRL 6.87 billion as of Dec/2025.

Outlook and guidance

• CapEx guidance for 2026–2030 is BRL 21 billion, focusing on sewage universalization, water security, and loss reduction.

• Tariff review completed with an average effect of 6.56% and pre-tax WACC of 13.7%, supporting robust investment needs.

• Efficiency gains and cost reductions are expected from zero-based budgeting, strategic sourcing, and shared services.

• Regular dividend payout ratio maintained at 50% for 2025 and planned for 2026.