Companhia Paranaense De Energia · BMFBOVESPA:CPLE3
Companhia Paranaense De Energia — Energy Co of Parana — Q3 2018 Earnings Presentation
72 slides from Companhia Paranaense De Energia's earnings presentation, Nov 13, 2018
Slide 1: CPLE3 | R$20.11
CPLE3 | R$20.11 CPLE6 | R$21.41 ELP | US$ 5.27 XCOP | € 4.54 Market value | R$5.7 bi * Quotes 09.30.2018
Slide 2: Net operating revenue and operating costs and expenses
In the year to date (September 2018), the net operating revenue increased by 11.4%, mainly due to the 18.9% improvement in “electricity sales to final customers” revenue, resulting from the increased number of free clients at Copel Comercialização and the tariff adjustments of Copel Distribuição in
Slide 3: Decrease in PMSO and personnel costs
* A mounts This increase was partially offset by a 9.4% decrease in PMSO, except for estimated losses, provisions and reversals, reflecting the 41.6% fall in “other operating costs and expenses”, resulted of the work done to recovery at Copel Distribuição’ invoices and lower financial compensation f
Slide 4: Personnel costs excluding PDI provision
Disregarding the effect of the provision for indemnification related to Incentivized Resignation Plan - PDI (reversal of R$1.5 million in 3Q18 and provision of R$11.8 million in 3Q17), costs with personnel increased by 2.3%, below the 4.5% inflation of the last 12 months.
Slide 5: Noteworthy changes in natural gas costs
* A mounts The following changes are also noteworthy: (i) 65.9% increase in “natural gas and supplies for the gas business”, resulting from the of exchange variation and an increase of 18.8% in the consumption of natural gas. subject to rounding.
Slide 6: Nine-month operating costs and expenses
* A mounts In the first nine months of 2018, operating costs and expenses totaled R$9,556.6 million (up 14.2%). The main reasons for this increase are (a) the 13.8% increase in costs with “electricity purchased for resale”, mainly due to: (i) the increase of avarege PLD (R$330.75 in 9M18 versus R$29
Slide 7: 2.4 EBITDA
* A mounts 2.4 EBITDA In 3Q18, earnings before interest, taxes, depreciation and amortization reached R$785.6 million, 23.1% higher than the R$637.9 million recorded in 3Q17. This increase is mainly due to (i) the result of the equity earnings of R$61.2 million in 3Q18 (over a negative result of R$2
Slide 8: 2.5 Financial Result
* A mounts 2.5 Financial Result In 3Q18, the financial income totaled R$184.6 million, down 25.5% when compared to the R$247.8 million recorded in 3Q17, mainly due to the adoption, in 3Q17, of the Special Program of Tax Regularization (PERT - Programa Especial de Regularização Tributária), which gen
Slide 9: 2.6 Consolidated Net Income
* A mounts 2.6 Consolidated Net Income In 3Q18, Copel recorded net income of R$361.0 million, 13.4% amount lower than the R$416.7 million registered in the same period of 2017. The 9M18, net income increased by 6.9%, closing the period by R$1,053.2 million. subject to rounding.
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Slide 12: Loans, financing and debentures maturities
Loans, financing and debentures maturities are presented below:
Slide 13: Consolidated net debt and net debt/EBITDA
Copel’s consolidated net debt (loans, financing and debentures less cash and cash equivalents) and the net debt/EBITDA ratio are shown in the following chart:
Slide 14: Net Debt by Subsidiary
Net Debt by Subsidiary The following table shows the gross debt and net debt of the subsidiaries:
Slide 15: Lawsuits classified as possible losses
* A mounts The lawsuits classified as possible losses, as estimated by the Company and its controlled companies at the end 3Q18, totaled R$3,262.3 million, 4.4% higher than in December 2017 (R$3,123.5 million), distributed in lawsuits of the following natures: civil (R$1,184.0 million), fiscal (R$93
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Slide 17: Copel GeT adjusted EBITDA growth
* A mounts Adjusted EBITDA growth is mainly due to the effects of the tariff revision applied, as from June 2017, to the transmission companies that Copel GeT holds, which had a negative impact on the equity earnings in 3Q17, in view of the positive effect of the June 2018 tariff adjustment. In addi
Slide 18: Copel GeT nine-month results and Copel Distribuição
* A mounts In the first nine months of 2018, Copel GeT recorded operating revenues of R$2,617.9 million, an increase of 1.3% compared to the same period of the previous year, while operating costs and expenses increased by 19,1%, totaling R$1,614.5 million in the period. Net income amounted to R$651
Slide 19: Personnel costs excluding PDI provision
Excluding the effect of the provision for PDI-related indemnification (reversal of R$1.0 million in 3Q18 and provision of R$7.2 million in 3Q17), personnel costs increased 5.5% over 3Q17, mainly due to the higher provision for profit sharing and results;
Slide 20: Copel Distribuição 9M18 EBITDA
In 9M18, Copel Distribuição recorded an EBITDA of R$623.7 million, a 34.9% increase over 9M17. This performance was mainly impacted by the 13.9% growth in revenues with electricity sales to final customers, mainly due to the tariff adjustment as of June 2017 and June 2018, which adjusted the electri
Slide 21: 4.3 Copel Telecomunicações
* A mounts 4.3 Copel Telecomunicações Copel Telecom reported an EBITDA of R$43.9 million in 3Q18, 5.8% higher than the R$41.5 million reported in 3Q17. This result reflects the 14.1% growth in the telecommunications revenue due to the expansion of the clients base, partially offset by the 4.2% incre
Slide 22: Copel Telecom personnel and administrative costs
Disregarding the effect of the provision for indemnification related to the PDI, personnel and administrative costs declined by 23.3% compared to 3Q17 and basically reflect the wage policy applied from October 2017 and the reduction of workforce due to internal restructuring, with the transfer of 13
Slide 23: Copel Telecom EBITDA up to September 2018
* A mounts Up to September 2018, Copel Telecom's EBITDA reached R$114.6 million, 4.3% higher compared to the same period in 2017. While net income fell 18.9%, totaling R$22.6 million. subject to rounding.
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Slide 25: 6. Power Market and Tariffs
6. Power Market and Tariffs 6.1 Captive Market – Copel Distribuição Copel Distribuição’s captive market energy sales totaled 4,723 GWh in the 3Q18, remaining stable in relation to 3Q17, with a reduction of 0.1% in the comparison of the periods. The following table shows captive market trends by cons
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Slide 27: Free market consumption and electricity sales
The result was mainly due to the 5.6% increase in the total consumption of the free market in 3Q18, particularly in the industrial customers in the (i) pulp and paper, (ii) food and (iii) manufacture of motor vehicles, trailers and semi-trailers. 6.3 Electricity Sales Electricity sales to final cust
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Slide 29: Note on CCEE re-balances
* A mounts subject to rounding. 1 This item presents a balance different from what was published in the Notice to the Market 20/18, as a result of CCEE's re-balances, which impacted Copel Distribuição's MCP line in 2018.
Slide 30: Energy Flow – Copel Distribuição
nergy Flow - Copel Die "Betsy sist concessions is withown a iat ofa tan SODaWh/ year Rectsciy sie tothe sqetirnncor fCcitrougys Raguiates Bieter Cortact-COR Sazigerente MCSD BN-Contractal asignrentstoothercstincors trough he Mechanar for Compensation afSurluses and Deficits (MESO)
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Slide 32: Energy Flow – Copel Comercialização
Energy Flow – Copel Comercialização
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Slide 35: Power Purchase Average Tariff – Copel Distribuição
Power Purchase Average Tariff – Copel Distribuição
Slide 36: Sales to Final Customers Average Tariff Copel Distribuição
Sales to Final Customers Average Tariff Copel Distribuição
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Slide 38: Shareholders
Shareholders Preferred = 32213,
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Slide 40: Share trading and performance January–September 2018
* A mounts From January to September 2018, Copel’s common shares (ON - CPLE3) and class B preferred shares (PNB - CPLE6) were traded in 100% of the trading sessions of the B3 S.A. - Brasil, Bolsa, Balcão (B3). The free float accounted for 45.0% of the Company’s capital. At the end of September 2018,
Slide 41: 7.3 Dividends and Interest on Own Capital
7.3 Dividends and Interest on Own Capital The table below presents the payments of dividends and interest on own capital as of 2011:
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Slide 43: TPP Figueira concession extension and quota plants
* A mounts On March 24, 2017 Copel GeT filed an agreement with Aneel with its intention to extend the granting of the TPP Figueira, noting, however, that it will sign the necessary contracts and/or additives only after knowing and accepting the contractual terms and the rules that will govern any pr
Slide 44: Interest in Generation Projects
* A mounts Interest in Generation Projects Copel holds interests in seven power generation projects at the operational stage, with a total installed capacity of 884.7 MW, 599.0 MW referred to Copel´s stake, as shown below: subject to rounding.
Slide 45: Interest in Wind Farms
Interest in Wind Farms Copel has 49% interest in the Voltalia São Miguel do Gostoso I Participações S.A. wind farm complex, in the State of Rio Grande do Norte. Whose energy was sold in the Fourth Reserve Energy Auction by under twenty-year contracts, with supply beginning in July, 2015, according t
Slide 46: São Miguel do Gostoso I Wind Complex
* A mounts On June 17, 2017, the four wind farms comprising the São Miguel do Gostoso I Wind Complex were connected to the National Interconnected System (SIN). The Complex was able to start its operations in June 2015, when the construction of the complex was completed. Since then, the complex has
Slide 47: Colíder Hydroelectric Power Plant
* A mounts Colíder Hydroelectric Power Plant On July 30, 2010, under Aneel New Energy Auction no. 003/2010, Copel GeT was awarded the concession to explore the Colíder HPP for a term of 35 years, from January 17, 2011, the signing date of MME - Colíder HPP Concession Agreement no. 001/11. The projec
Slide 48: Cutia wind farm complexes under construction
* A mounts The largest Copel wind farm called Cutia is under construction, and is divided into two large complexes: • Cutia Complex: composed of seven wind farms (Guajiru, Jangada, Potiguar, Cutia, Maria Helena, Esperança do Nordeste and Paraíso do Ventos do Nordeste) with 180.6 MW of total installe
Slide 49: Share swap with Eletrosul in transmission projects
* A mounts On August 30, 2018, Copel GeT concluded a Swap Contract of Shares with Eletrosul in the jointly-controlled developments of Costa Oeste Transmissora de Energia SA (51% Copel GeT and 49% Eletrosul), Marumbi Transmissora de Energia SA (80% Copel GeT and 20% Eletrosul) and Transmissora Sul Br
Slide 50: 8.3 Distribution
* A mounts 8.3 Distribution Concession agreement In December 2015, the Company signed the fifth amendment to the Public Electricity Distribution Concession Agreement no. 46/1999 of Copel Distribuição S.A., extending the concession term to July 7, 2045. The concession agreement imposes economic and f
Slide 51: Operating Data
Operating Data In the distribution business, Copel serves more than 4.6 million energy customers in 1,113 locations, belonging to 394 municipalities in State of Paraná and one in the State of Santa Catarina. Copel Distribuição operates and maintains the installations in the 13.8 kV, 34.5 kV, 69 kV a
Slide 52: Compact-Design Distribution Lines
* A mounts Compact-Design Distribution Lines Copel Distribuição has continued to implement compact-design distribution lines in urban areas with a high concentration of trees surrounding the distribution grids. This technology reduces the number of trees cut down or trimmed, and improves the quality
Slide 53: 8.4 Telecommunications
8.4 Telecommunications Copel Telecomunicações has an optical backbone, a high capacity intermunicipal transmission network, and the access, a customer service network. The access network can be multi-point (GPON) or point-to-point (conventional), thus connecting the customer to the network's transmi
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Slide 55: 8.6 New Projects
<0 <0} 8.6 New Projects Project Portfolio Copel holds interests in different power generation projects. When these projects go into commercial operation, they will add 346.9 MW of installed capacity to the Company's portfolio.
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Slide 57: Gas Exploration and Production (Paraná Gás)
Gas Exploration and Production (Paraná Gás Exploração e Produção S.A) On November 28, 2013, in the 12th round of Bids of the National Petroleum Agency (ANP), the consortium formed by Copel (30%), Bayar Participações (30%), Tucumann Engenharia (10%) and Petra Energia (30%) (the latter acting as opera
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Slide 59: Customers and employees
* A mounts At the end of September, Copel Distribuição had 4,612,383 customers, representing a consumer-to-employee ratio of 815. Compagas, Elejor and UEG Araucária, companies in which Copel holds a majority interest, had 161, 07 and 17 employees, respectively. subject to rounding.
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Slide 72: Signature and forward-looking statements
A mounts s ubject to rounding. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Date November 9, 2018 COMPANHIA PARANAENSE DE ENERGIA – COPEL By: / S / J