Companhia Energética de Minas Gerais - CEMIG (CMIG4) Q2 2024 earnings summary

Executive summary

• Consolidated net profit reached R$1.69 billion in 2Q24, up 35.7% year-over-year, with adjusted net profit at R$1.13 billion, down 6.6% year-over-year.

• Consolidated EBITDA rose 26.2% to R$2.37 billion; adjusted EBITDA was R$1.92 billion, up 2.0% year-over-year.

• Delivered consistent financial results, with performance sometimes 5% above or below market consensus, reflecting robust operations over recent years.

• Achieved strong cash generation and maintained a leading position in dividend payments, including extraordinary dividends.

• Major non-recurring items included a R$584 million reversal of tax provisions and a R$410 million reversal of amounts repayable to consumers.

Financial highlights

• Net profit for 2Q24 was R$1.69 billion, up 35.7% year-over-year; adjusted net profit was R$1.13 billion, down 6.6%.

• EBITDA reached R$2.37 billion (+26.2% YoY); adjusted EBITDA was R$1.92 billion (+2.0% YoY).

• Operational cash generation in 2Q24 reached R$1.9 billion; 1H24 cash generation was BRL 3.5 billion.

• Net revenue grew 7.0% to R$9.44 billion; operational expenses rose 1.8% to R$7.44 billion.

• Net cash at the end of H1 2024 was BRL 3 billion.

Outlook and guidance

• Planned investments of R$35.6 billion for 2024-2028, with R$6.2 billion targeted for 2024; R$2.45 billion already invested in 1H24.

• Execution of the largest investment program in company history, focusing on modernization and reliability.

• Tariff adjustment effective May 2024 increased average tariffs by 7.32% for consumers.

• Transmission RAP for 2024-2025 cycle increased by 18.8% to R$1.36 billion.

• Debt profile is expected to increase to 2.5x EBITDA by 2027, with plans to optimize average debt maturity.