Companhia Energética de Minas Gerais - CEMIG (CMIG4) Q3 2024 earnings summary

Executive summary

• Achieved record AAA credit rating from Fitch, reflecting strong financial performance, robust cash generation, and disciplined capital allocation over the past five years.

• Net profit reached R$3.28 billion in 3Q24, up 165.2% year-over-year, driven by the sale of Aliança Energia and positive effects from the transmission tariff review.

• Consolidated EBITDA rose 146.5% to R$4.96 billion, with best-ever quarterly results fueled by asset sales and regulatory gains.

• Announced significant governance change: controlling shareholder submitted a bill to turn the company into a corporation.

• Leadership transition: Andrea Almeida appointed as new CFO and IR Officer, replacing Leonardo Magalhães.

Financial highlights

• Net revenue increased 7.7% year-over-year to R$10.15 billion in 3Q24.

• Net profit surged to R$3.28 billion from R$1.24 billion in 3Q23, mainly due to one-off gains from asset sales and tariff review.

• Cash and securities increased to R$6.75 billion by 9M24, supported by strong cash from operations and divestments.

• 11th sustainable debenture issuance raised R$2.5 billion, extending average debt maturity by one year.

• Paid dividends and interest on equity in two installments during the year, totaling R$1.89 billion in 3Q24.

Outlook and guidance

• Investment plan for 2024 set at R$6.2 billion, with over 65% realized by Q3 and over 90% expected by year-end.

• Planned investments of R$35.6 billion for 2024-2028, focusing on modernization, reliability, and renewable expansion.

• Forecasts leverage to rise to 2–2.5x by 2027 due to high investment and dividend payouts, then decline post-2028 tariff review.

• Ongoing focus on reducing energy losses, improving service quality, and digital transformation.

• Dividend payout policy remains at 50% of IFRS results, with expectations for continued attractive dividends.