Companhia De Saneamento Basico Do Estado De Sao Paulo Sabesp · BMFBOVESPA:SBSP3
Companhia De Saneamento Basico Do Estado De Sao Paulo Sabesp — Companhia de Saneamento Básico do Estado de São Paulo - SABESP — Q1 2020 Earnings Presentation
25 slides from Companhia De Saneamento Basico Do Estado De Sao Paulo Sabesp's earnings presentation, May 19, 2020
Slide 1: 1Q20 Results
1Q20 Results Economic-Financial Office and Investor Relations Office
Slide 2: Disclaimer
DISCLAIMER This presentation may contain forward-looking statements referring to SABESP’s business outlook, operating and financial results estimates, and growth prospects. These are only forecasts, and as such, they are exclusively based on SABESP’s management expectation in relation to the future
Slide 3: Agenda
AGENDA 1 COMPANY OVERVIEW 2 OUR OPERATIONS 3 OUR FINANCIAL PERFORMANCE 4 SPMR – WATER SITUATION
Slide 4: One of the largest water and sewage providers in the world
...ONE OF THE LARGEST WATER AND SEWAGE PROVIDERS IN THE WORLD COMPANY OVERVIEW MAIN OPERATIONAL INDICATORS(1) Sabesp is one of the largest water and sewage service Water Sewage providers in the world based on the number of Connections (million)(2) 10.0 8.4 Customers* Coverage (%) (3) 98 91 Natur
Slide 5: With strong corporate governance
...WITH STRONG CORPORATE GOVERNANCE We are a mixed capital company, majority-owned by the State of São Paulo, with significant private ownership State Law 11,454/2003 requires the State of São Paulo to own at least 50% + 1 of Sabesp voting shares Law nº 13,303/16 – Government-Controlled Compan
Slide 6: Agenda
AGENDA 1 THE COMPANY 2 OUR OPERATIONS 3 OUR FINANCIAL PERFORMANCE 4 SPMR – WATER SITUATION
Slide 7: Diversified consumer base
DIVERSIFIED CONSUMER BASE WATER BILLED VOLUME BY TYPE OF CUSTOMER SEWAGE BILLED VOLUME BY TYPE OF CUSTOMER Commercial 10% Residential 85% Residential 85% Commercial 8% Industrial 2% Industrial 2% Public 2% Public 2% Whosale 1% Whosale 3% WATER REVENUES BY TYPE OF CUSTOMER* SEWAGE REVENUES BY TYPE OF
Slide 8: Broad coverage of municipalities
BROAD COVERAGE OF MUNICIPALITIES CONTRACTUAL BASE Nº Municipalities % of Revenue 2020 2019 2018 2020 2019 2018 Renewed / Secured 328* 324 307 92.0 92.2 84.8 Metropolitan Region Without Contract 11 11 25 2.4 2.3 58.8 Expired Contracts / Under Negotiation 9 10 10 0.9 0.7 0.7 To be expired (2020 - 2025
Slide 9: Regulatory framework
REGULATORY FRAMEWORK State Law State Government of São Paulo – Controlling Shareholder 11,454 /2003 State law requires the State of São Paulo to own at least 50% + 1 voting shares at all times Sanitation Regulatory Framework Obligation to install the service regulation → Municipal, State level o
Slide 10: Tariff review
TARIFF REVIEW METHODOLOGY OF TARIFF REVIEW (PRICE CAP) Required Revenue = + Taxes RABt – RAB0 OPEX CAPEX + + W A Initial Asset Base C Personnel Water Income Tax Average Billed Tariff (P0) Volume Energy Sewage Revenue (-) Depreciation C Materials Others Taxes (+) WK Variation Others (+) Capex Output
Slide 11: Tariff readjustments and revisions
TARIFF READJUSTMENTS AND REVISIONS READJUSTMENTS AND REVISIONS INDEXES SCHEDULE OF STAGES FOR 3RD OTR IPCA Index – Between the readjustement/revision periods 2020 Stage 1 - Presentation of historical data by Sabesp May 14 Stage 2 – Publication of the 3rd OTR methodology proposal Stage 3 - Publ
Slide 12: Water and sewage operations
WATER AND SEWAGE OPERATIONS WATER CONNECTION EVOLUTION (million) WATER COVERAGE (Connection in 000’s) Add 932 thousand new connections by 2024 SEWAGE CONNECTION EVOLUTION (million) SEWAGE COVERAGE (´000s) Add 1.2 million new connections by 2024 Coverage: from 91% in 2019 to 95% in 2024 Treat
Slide 13: Capex and financing
CAPEX AND FINANCING CAPEX PLAN OF R$ 20.2 BILLION FROM 2020 TO 2024 Financial Values (in R$ million) FINANCING MAIN PROGRAMS Metropolitan Water Program Tietê Project Program for Water Loss Reduction Clean Stream Program Clean Wave Program New Pinheiros River Project 13
Slide 14: Agenda
AGENDA 1 COMPANY OVERVIEW 2 OUR OPERATIONS 3 OUR FINANCIAL PERFORMANCE 4 SPMR – WATER SITUATION
Slide 15: Long term and low cost funding
LONG TERM AND LOW COST FUNDING TOTAL DEBT BREAKDOWN DEBT BY INDEXOR Foreign Currency – 55% Local Currency – 45% DEBT AMORTIZATION PROFILE (R$ million) 15
Slide 16: Consistent performances
CONSISTENT PERFORMANCES NET REVENUE (R$ million) NET INCOME (R$ million) ADJUSTED EBITDA* (R$ million) DIVIDEND / PAY OUT 2014 2015 2016 2017 2018 2019 Dividend (R$) 0.4 0.2 1.2 1.0 1.2 1.4 Pay Out (%) 27.9 27.9 27.9 27.9 27.9 27.9 Outstanding Shares* 683.5 683.5 683.5 683.5 683.5 683.5 * Millions A
Slide 17: Historical leverage
HISTORICAL LEVERAGE (R$ million) ADJUSTED TOTAL DEBT VS. ADJUSTED EBITDA* ADJUSTED EBITDA* VS. FINANCIAL EXPENSES** NET DEBT VS. ADJUSTED EBITDA* RATINGS National Global Agencies Scale Scale Standard & Poors brAAA BB- Fitch Rating AA (bra) BB Moody's Latam Aa2.br Ba2 * Adjusted EBITDA – LTM / ** Fin
Slide 18: Covenant – Adjusted net debt vs. EBITDA
COVENANT – ADJUSTED NET DEBT vs. EBITDA 18
Slide 19: Covenant – Adjusted total debt vs. EBITDA
COVENANT – ADJUSTED TOTAL DEBT vs. EBITDA 19
Slide 20: Financial highlights (R$ million)
FINANCIAL HIGHLIGHTS (R$ million) 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 1Q20 Net Revenues 7,809 8,580 9,231 9,927 10,738 11,316 11,213 11,712 14,098 14,608 16,085 17,984 4,042 Adjusted EBITDA 2,865 2,727 3,222 3,371 3,605 4,007 2,919 3,974 4,572 5,269 6,541 7,511 1,484 Adjusted
Slide 21: Agenda
AGENDA 1 COMPANY OVERVIEW 2 OUR OPERATIONS 3 OUR FINANCIAL PERFORMANCE 4 SPMR – WATER SITUATION
Slide 22: SPMR – Water situation (05/14/2020)
SPMR – WATER SITUATION (05/14/2020) VOLUME STORAGE (%) WATER INFLOW (m³/s) AVERAGE PRODUCTION (m³/s) PRODUCTION SYSTEMS – AVERAGE PRODUCTION (m³/s) 2014 2015 2016 2017 2018 2019 2020 Cantareira 23.7 14.1 22.0 25.0 23.9 23.9 24.1 Guarapiranga 14.2 14.9 13.9 13.3 13.4 12.7 12.9 Alto Tietê 13.8 12.1 11
Slide 23: Water supply system stronger than before the water crisis of 2014/2015
SPMR – WATER SITUATION WATER SUPPLY SYSTEM STRONGER THAN BEFORE THE WATER CRISIS OF 2014/2015 RESERVOIRS 2013 2020 Var. % Reservoirs (water right) (m³/s) 68.9 80.3 16.5% Maximum storage capacity (hm³) 1,816 1,945 7.1% (without the technical reserve) Transfers between reservoirs (m³/s) 10.2 26.8 162.
Slide 24: Water plan for SPMR – from 2015 to 19
SPMR – WATER SITUATION WATER PLAN FOR SPMR – FROM 2015 TO 2019 (MAIN ACTIONS) FLOW (m³/s) DESCRIPTION AVAILABILITY/ PURPOSE SECURITY INITIATIVES ACCOMPLISHED IN 2015 Reversal increase from Guaratuba River to the Ponte Nova reservoir 0.5 Recover the storage volume and ensure Alto Tietê's water by 0.5
Slide 25: IR Contacts
www.sabesp.com.br IR Contacts Mario Azevedo de Arruda Sampaio Angela Beatriz Airoldi Head of Capital Markets and IR Investor Relations Manager maasampaio@sabesp.com.br abairoldi@sabesp.com.br +55 (11) 3388-8664 +55 (11) 3388-8793