Companhia Energetica De Minas Gerais Sa · BMFBOVESPA:CMIG3
Companhia Energetica De Minas Gerais Sa — Q1 2021 Earnings Presentation
22 slides from Companhia Energetica De Minas Gerais Sa's earnings presentation, May 17, 2021
Slide 1: 1Q21 Results
1Q21 RESULTS OUR POWER, YOUR STRENGTH
Slide 2: Disclaimer
2 Disclaimer Certain statements and estimates in this material may represent expectations about future events or results, which are subject to risks and uncertainties that may be known or unknown. There is no guarantee that the events or results will take place as referred to in these expectations.
Slide 3: Highlights
3 Highlights Ebitda R$ 1,845 million up 133.2% from 1Q20 Ebitda Adjusted Ebitda: up 22.9% from 1Q20 Net profit R$ 422 million vs. R$ 68 million in 1Q20 Net profit Adjusted net profit: up 36.5% YoY Quality DEC outage indicator of Cemig D continues to improve: indicator Average consumer outage: 9.55 h
Slide 4: Cemig D: Best-ever DECi outage indicator
4 Cemig D: Best-ever DECi outage indicator 11.32 11.03 7.76 7.39 7.30 10.73 6.67 6.56 10.44 10.08 11.18 10.42 10.56 5.44 5.13 4.89 4.86 4.98* 9.57 9.55* 2017 2018 2019 2020 1Q21 2017 2018 2019 2020 1Q21 Annual limit DECi Annual limit FECi • Averages for 12 months (moving window, April 2020 – March 2
Slide 5: Cemig D – Energy losses
5 Cemig D – Energy losses Losses in distribution 6,371 6,622 6,545 6,606 18.00% 16.00% 6,005 12.49% 12.73% 12.56% 12.53% 14.00% 5,005 12.00% 11.51% 11.43% 11.38% 4,005 11.22% 10.00% 3,005 8.00% 6.00% 2,005 4.00% 1,005 2.00% 5 0.00% 2018 2019 2020 1Q21* Perdas Totais Total losses, (GWh) GWh %Total Pe
Slide 6: CEMIG D: Combating default
6 CEMIG D: Combating default Receivables Collection Index (‘ARFA’) – (Collection/Billing) % - 12-month moving average In March 2021 Cemig adopted enhanced criteria for accounting default provisions, seeking more accuracy for the Residential and Commercial user categories 97.37 96.67 96.78 Actions fo
Slide 7: PDVP 2021 – Voluntary severance program
7 PDVP 2021 – Voluntary severance program In May 2021 the Board approved a new voluntary severance program: Available to employees of Cemig, Cemig D or Cemig GT joining between May 4 and 31, 2021, with a few exceptions. Payment of full formal severance payments, in the “On Request” mode – plus a
Slide 8: GSF agreement increases concession contract periods
8 GSF agreement increases concession contract periods Estimates of extensions of our concession periods Valuation Offtake guarantee Estimated concession Estimated time Item (IPCA+9.63%) Dec. MWaverage extension (months) remaining (months) 20: R$’000 Cemig 1,674 1,146,469 Emborcação 500 427,801 23 76
Slide 9: Disinvestment: Cemig's stake in Taesa
9 Disinvestment: Cemig’s stake in Taesa Plan for transaction by special auction under B3 rules ISA Brasil FREE FLOAT Shares owned by Cemig 21.68% 14.88% 63.44% ON (common) PN (Preferred) Total shares Market value shares shares Qty. 218,370,005 5,646,184 224,016,189 2.961 MM % 36.97% 1.28% 21.68% on
Slide 10: Análise dos Resultados 1Q21
Análise 1Q21dos Resultados RESULTS
Slide 11: Main factors in the 1Q21 results
11 Main factors in the 1Q21 results Equity method gain in subsidiaries up 45.1% YoY Cemig H • R$ 119 million in 1Q21 vs. R$ 82mn in 1Q20 Positive effect in Taesa; reversal of impairment in Guanhães Volume of electricity distributed up 3.3% YoY: • Captive market: 1.7% lower Cemig D • Transport for cl
Slide 12: Mark-to-market effects on Eurobond and hedge instruments
12 Mark-to-market effects on Eurobond and hedge instruments Depreciation of BRL ( to R$ 5.697/US$ at end of March ): significant effect on 1Q profit Item 2020 1Q21 Change Hedge transactions contracted to protect against Hedge: Swap (interest) 1,389 1,175 –214 foreign currency variation risk Hedge: C
Slide 13: 1Q21 consolidated Ebitda and Net profit
13 1Q21 consolidated Ebitda and Net profit Ebitda Net profit +133.2% +22.9% +36.5% 1,845 1,658 804 1,349 589 791 422 -68 1Q20 1Q21 1Q20 1Q21 1Q20 1Q21 1Q20 1Q21 IFRS IFRS adjusted adjusted IFRS IFRS adjusted adjusted Ebitda Net profit 1Q20 1Q21 1Q20 1Q21 IFRS 791 1,845 (68) 422 Adjustments to fair v
Slide 14: Cemig GT: 1Q21 Ebitda and net profit
14 Cemig GT: 1Q21 Ebitda and net profit Ebitda growth supported by performance of the trading business Ebitda Net profit +12.4% +8.4% 688 746 274 308 1Q20 1Q21 -15 1Q20 1Q21 IFRS IFRS -311 adjusted adjusted 1Q20 1Q21 IFRS IFRS Ebitda Net profit 1Q20 1Q21 1Q20 1Q21 IFRS 688 746 –15 –311 FX exposure –
Slide 15: Market of Cemig D, 1Q21 – GWh
15 Market of Cemig D, 1Q21 – GWh Strong resumption of industrial consumers in 1Q21 Billed market + Transport • Consumption by clients migrating from captive to Free market in 1Q21: 181 GWh +3.3% • Energy carried for clients would have grown 11,207 11,577 7.9% YoY, vs. 9.7% 973 969 Other -0.4% • Cons
Slide 16: Cemig D: 1Q21 Ebitda and net profit
16 Cemig D: 1Q21 Ebitda and net profit Growth in energy market, and revised provisions, contributed to strong profit in 1Q Ebitda Net profit +50.5% +34.5% +72.6% +99.0% 745 666 392 340 495 495 197 197 1Q20 1Q21 1Q20 1Q21 1Q20 1Q21 adjusted adjusted IFRS IFRS adjusted adjusted 1Q20 1Q21 IFRS IFRS Ebi
Slide 17: 1Q21: Consolidated operational costs and expenses
17 1Q21: Consolidated operational costs and expenses Operational expenses below regulatory benchmark +14.3% 5,736 5,018 PMSO costs: 1Q21 vs. 1Q20 883 PMSO 815 22 +8.3% 43 1 Purchase of energy 4,853 2 883 and other 4,204 4 4 costs 815 1Q20 Personnel Profit shares Materials Outsourced Post-retirement
Slide 18: Cemig D: 1Q21 Regulatory Opex and Ebitda
18 Cemig D: 1Q21 Regulatory Opex and Ebitda R$ mn 157 72 3 37 18 10 Opex Opex within 765 712 regulatory target Regulatory PMSO Post-retirement Voluntary Fines and Provisions Doubtful debtors Actual R$53 MM severance offsetting allowance program 53 58 13 R$124 MM Ebitda 745 Ebitda: Realized / Regulat
Slide 19: Debt profile – consolidated
19 Debt profile – consolidated Effective strategy reduced costs and leverage Maturities timetable – Average tenor: 3.8 years Main indexors Net debt ( = Debt – Cash and securities): R$ 8.5 bn Total net debt ( = Net debt – Hedge): R$ 5.7 bn 13% US dollar 9,134 IPCA inflation index 6,181 27% CDI 60% Ot
Slide 20: Consolidated cash flow
20 Consolidated cash flow Robust cash position – sustains our program for investments and amortization of debt 366 943 178 1,373 1,366 16 5,805 6,181 Cash + Cash generated Reimbursement Payment of FINANCING Disposal of INVESTMENT Cash + Securities 2020 to consumers of Loans ACTIVITIES stockholding A
Slide 21: Management's priorities
Management’s priorities Opex within regulatory limit Achieved Strengthening of Cemig D’s Investment Program Achieved DEC within regulatory limit Achieved Optimization of capital allocation Partially achieved Definitive solution for Renova Partially achieved Renewal of concessions In progres
Slide 22: Investor Relations
Investor Relations Tel: +55 31 3506-5024 ri@cemig.com.br http:/ri.cemig.com.br
Companhia Energética de Minas Gerais — Q1 2021 Earnings Presentation on 6ix