Companhia Paranaense De Energia · BMFBOVESPA:CPLE3
Companhia Paranaense De Energia — Energy Co of Parana — Q1 2020 Earnings Presentation
73 slides from Companhia Paranaense De Energia's earnings presentation, Sep 14, 2020
Slide 1: Copel 1Q20 Results
iE 4Q19 Results te Conference Call 05.15.2020-2:00p.m. [RES (Brazilian time) Telephone cg (#1 646) 843-6054 Code: Copel Bia iE . wy 4 zt COPEL 1Q20 Results Copel records EBITDA of R$1.2 billion in the first quarter EBITDA adjusted of R$ 1,231.2 million in 120 (+11.5%) Net income of R$ 593.9 million
Slide 2: 2.2 Operating Costs and Expenses
2.2 Operating Costs and Expenses In 1Q20, operating costs and expenses increased by 8.7%, totaling R$3,309.0 million, mainly due to (i) the R$129.7 million increase in “material and supplies for power electricity”, resulting from TPP Araucária’s activation; (ii) the 6.2% increase in the cost of “ele
Slide 3: Operating costs and expenses were also impacted
Operating costs and expenses were also impacted by the amount of R$133.4 million recorded in “provisions and reversals”, a 30.1% increase compared to the R$102.5 million recorded in 1Q19, mainly due to impairments, partially offset by the 24.1% decrease in “natural gas and supplies for gas business”
Slide 4: Charges of the main distribution and transmission grid
The item “charges of the main distribution and transmission grid” increased 5.1%, mainly due to the tariff increase and transmission infrastructure charges made available to new generation projects beginning in 2019, partially offset by the reduction on the System Services Charges - ESS.
Slide 5: PMSO costs
PMSO costs (except estimated losses, provisions and reversals) decreased slightly by 0.2%, mainly due to the non-collection of the Control, Monitoring and Inspection Fee for Exploration Activities and the Use of Water Resources (TCFRH ), reflecting a 10.2% reduction in the “other costs and expenses
Slide 6: Personnel and management
“Personnel and management” fell by 1.9% due to the decrease of 516 employees in the period, mainly as a result of the Incentivized Dismissal Program (PDI), carried out and concluded at the end of 2019, partially offset by the 26.2% increase in the provision for profit-sharing (PLR) due to the improv
Slide 7: Personnel and management table
R$million Siac nd acca _ ee . Var. % (a) (2) (3) (1/3) Personnel and management 279,137 459,587 284,585 (1.9) Profit sharing program (PLR) (35,502) (71,825) (28,142) 26.2 (-) Provision for indemnification for voluntary dismissal’ : (43,517) : : TOTAL 243,635 344,245 256,443 (5.0)
Slide 8: 2.4 EBITDA
2.4 EBITDA In 1Q20, earnings before interest, taxes, depreciation, and amortization reached R$1,153.3 million, 5.6% higher than the R$1,092.1 million recorded in 1Q19. This result is mainly due to (i) the 32.8% growth in “electricity sales to distributors” revenue, due to the increased volume of ele
Slide 9: 2.5 Financial Result
2.5 Financial Result In 1Q20, the financial result was negative by R$94.6 million, compared to negative R$98.2 million in 1Q19. Financial revenues totaled R$215.9 million, up 4.5% from the R$206.6 million recorded in 1Q19, mainly due to the registration of R$ 24.6 million in the fair value of deriva
Slide 10: 2.6 Consolidated Net Income
2.6 Consolidated Net Income In 1Q20, net income was of R$510.9 million, 1.0% higher than the R$506.0 million reported in 1Q19.
Slide 11: Consolidated income statement
Rg'000 Pat Ce 1Q20 4Q19 1Qi9 Var.% (1) (2) (3) (1/3) OPERATING REVENUES 4,153,941 4,412,410 3,896,006 66 Electricity sales to final customers 1,758,660 1,767,778 1,631,025 78 Electricity sales to distributors 876,751 786,634 660,159 328 Use of the main distribution and transmission grid 1,042,782 1,
Slide 12: Consolidated assets
R$'000 = Mar-20 Dec-19 ‘Mar-i9 Var.%6 Var.%6 ay 2) @) (a) (3) CURRENT 7,903,235 | 7,909,196 | 6,800,453, (0.4) 16.2 Cash and cash equivalents 3,014,957 | 2,941,727 | 2,053,970 25 468 Bonds and securities 1,446, 3,12 93,909 (53.5) (985) Collaterals and escrow accounts 140 147 61,363 (48) (99.8) Custo
Slide 13: Loans, financing and debentures maturities
Loans, financing and debentures maturities are presented below:
Slide 14: Copel's consolidated net debt
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 15: Net Debt by Subsidiary
Net Debt by Subsidiary The following table shows the gross debt and net debt of the subsidiaries:
Slide 16: Accounts Payable related to the Concession
Accounts Payable related to the Concession Use of Public Property It refers to the concession charges for the use of public property incurred since the execution of the project’s concession agreement until the end of the concession.
Slide 17: Lawsuits classified as possible losses
The lawsuits classified as possible losses (those that are not provisioned in the balance sheet), as estimated by the Company and its controlled companies at the end of March, 2020 , totaled R$3,574.3 million, 2.6 % higher than amount registered in December 2019 (R$ 3,485.1 million), distributed in
Slide 18: Liabilities
aes Mar-20 Dec19 Mar-19 var var%6 a (2) @) (2) (7) ‘CURRENT 5,167,614 5,345,621 | 6,886,528 (33) (25.0) Payroll, social charges and accruals 353,230 337,048 | 288,907 4a 23 Suppliers 1,533,067 1,685,280 1,529,944 (9.0) 02 Income taxand social contribution payable 105,119 60,132 94,219 748 16 Other t
Slide 19: Manageable costs decreased
Also, manageable costs decreased by 4.8%, due to a decrease of 27.3% in “other costs and expenses operating” line, as a result of the revocation of the law that instituted the Control, Monitoring and Inspection Rate of Exploration Activities and the Use of Resources (TCFRH).
Slide 20: Manageable Costs
Manageable Costs — bred a wo 2 @) Personnel and management 75008 | 118,234 72495 Private pension and healthcare plans 15144 15,983 15,337 Materials 1,932 3511 3,040 ‘Third party services 27572 32,722 23,479 Other operating costs and expenses (22,908), (72,769) (250), TOTAL 99,783, 97,681___13,103
Slide 21: Copel GeT and Copel Distribuição
In the first quarter of 2020, Copel GeT had a net income of R$277.3 million, a reduction of 2.3% over the R$284.0 million recorded in 1Q19. 4.2 Copel Distribuição Copel Distribuição recorded EBITDA of R$422.7 million in 1Q20, an amount 28.2% higher than the R$329.8 million recorded in 1Q19. This res
Slide 22: Copel Distribuição manageable costs
The result is also a consequence of the maintenance of manageable costs, especially (i) the line of “personnel and management”, which fell 6.0%, as a result of the reduction of 387 employees at Copel Distribuição in the period, mainly due to the incentive dismissal program (PDI) carried out at the e
Slide 23: Copel Telecomunicações
Net income was of R$209.3 million in 1Q20, up 19.5% vs. R$175.1 million YoY. 4.3 Copel Telecomunicações Copel Telecom recorded an EBITDA of R$42 million in 1Q20, compared to R$35.9 million recorded in 1Q19, mainly due to the 32.2% decrease in manageable costs (except for provisions and reversals) ma
Slide 24: Copel Telecom personnel and EBITDA
The “personnel and management” line totaled R$15.4 million in 1Q20, a reduction of 7.6% over 1Q19, maily reflecting the reduction of 85 employees in the last 12 months, as a result of internal restructuring with transfer of employees to other subsidiaries and the Incentive Dismissal Plan (PDI), ende
Slide 25: 4.4 Copel Comercialização
4.4 Copel Comercialização (Copel Energia) Copel Energia’s EBITDA reached R$11.9 million in 1Q20, significantly higher than the R$4.4 million in 1Q19, mainly due to the 76.6% growth in “electricity sales to final customers” revenues and 37.1% growth in “electricity sales to distributors” revenues, re
Slide 26: Copel Comercialização key figures
mane 1020 4ais 1019 Var.%6 wy (2) (3) (4/3) ‘Net Operating Revenue (R$ million) s33g| 522,7 368,6 46,2 Operating Costs and Expenses (RS million) (5269)) (4259), (364.2) 44,7 Operating Income (R$ million) 138 87,6 148 (49) Net Income (R$ million) o1 578 96 (5,0) EBITDA (R$ million) 19 96,6 4a 1709 Op
Slide 27: 4.5 Accounting Information
4.5 Accounting Information Accounting information concerning Copel’s interests in other companies on March, 31, 2020, is shown in the following table :
Slide 28: Interests in other companies
$'000 Partnerships - Mar/20 Total Assets eee antcah Net income Parent Company (Consolidated) Companhia Paranaense de Gés - Compagés 822,139 $71,037 147,973 12,709 Elejor - Centrais Elétricas do Rio Jordao S.A 636,260 $1,217 51,088 8,358 UEG Araucéria Ltda 383,633, 262,083 155,747 (53,657) Jointly-co
Slide 29: Investment program
R$ million iidiary (88 Carried Scheduled 1920 2020 Copel Gerago e Transmissao 100.5 865.2 HPP Colider - 80.5 - 258 272 1255 TLIbipor’-Londrina (Contract 060/2001) - 585 Substation Bateias - 65 Mata da Santa Genebra Transmissao” 25.4 39.5 SHP Bela Vista 7A 118.6 SPC Uirapuru - 0s UEG Araucaria : 563
Slide 30: 6.2 Grid Market (TUSD)
6.2 Grid Market (TUSD) Copel Distribuição’s grid market, comprising the captive market, concessionaires and licensees in the state of Paraná, and all free consumers in the Company’s concession area, adjusted by removing consumers connected at 230 kV from the basis of comparison 1 , increed by 0.6% i
Slide 31: Aneel Normative Resolution note on 230kV consumers
According to Aneel’s Normative Resolution no. 722/2016, consumers connected at 230kV voltage level must be part of the Basic Grid. The migration of these customers does not imply a reduction in revenue for the remuneration of the Distributor.
Slide 32: 6.4 Total Energy Sold
6.4 Total Energy Sold Total energy sold by Copel in all markets, comprising sales by Copel Distribuição, Copel Geração e Transmissão, Wind Farms and Copel Comercialização totaled 13,377 GWh in the first quarter of 2020, an increase of 7.7% compared with the same period last year. The following table
Slide 33: Number of Customers / Agreements and Energy Sold
Number of Customers / Agreements Energy Sold (6Wh) Mar-20__Mar-19 Var.% 1920 1019 Var.% Copel DIS Captive Market 4,737,968 4,655,362 18 5,180 5,245 (1.2) Concessionaries and Licensees 2 3. 33 19 64 (70.3) CCE (Assigments MCSD EN) 244 184 33 172 167 30 CCE (MVE) 2 - - 109 - - CCEE (MCP) - - - 82 381
Slide 34: Energy Flow - Copel Dis
Energy Flow - Cope! Dis 1q20 1019 Var. % aipa 1367_|__1375 (0) CCEAR— Group Companies 39 38 26 CCEAR—Other 2904 | 3961 (51) —assigments = Mecnanism tor Compensation OF SUrpIUSeS anc i 195 : B CEE (MCP) n : - Angra 2ar 243 (os) ccGF 1sas_| 1590 @a) Proinfa 107 aun fer Elejor SA : 293 - ‘Available Pow
Slide 35: Energy Flow - Copel GeT
Energy Flow - Copel GeT 1020 1019 Var.% ‘Own Generation (net of losses) 2,167 4591 (628) Dona Francisca 35 35 - Copel Comercializacio o ° | MRE Receipt 2,160 20 | _ 10,7000 Total Available Power 4362 4646 (6.1) Bilateral Agreements 675 765 (118) Bilateral Agreements - Copel Comercializagao 1,783 ery
Slide 36: Energy Flow – Copel Comercialização
Energy Flow – Copel Comercialização
Slide 37: Energy Flow - Copel Com
Energy Flow - Copel Com 1020 1019 Var. % Copel Get 4,778 aais| 595 Other 1,086 767) 416 cee (MCP) a2 32) 313 ‘otal Available Power 2,906 1914518 Free Customers 1,110 616) 80.2 Bilateral Agreements 1,787 3239) 442 Bilateral Agreements - Copel Get : 59| (100.0) cee (MCP) 9 E @ “include Copel GeTand Wi
Slide 38: Own Generation and Total Available Power
‘Own Generation 2,475 20.3% Haipu: Dona Francisca: CCE (MCP): ‘Angra: car: CCCEAR: Energy Purchase Agreements in the Regulated Market. CER: Reserve Energy Agreements. MRE: Energy Reallocation Mechanism. CEE (MCP): Electric Power Trade Chamber (Short-term market). “Total Available Power Wh Captive Ma
Slide 39: Power Purchase Average Tariff – Copel Distribuição
Power Purchase Average Tariff – Copel Distribuição
Slide 40: Sales to Final Customers Average Tariff
Sales to Final Customers Average Tariff Copel Distribuição
Slide 41: Average tariff by consumer class
s/w a Warde bei van o way Tdustial wise 48878 (75) Residential ‘Sousa s04ae (ea) Commercial srs s7aan 177 Rural aeo21 465.00 373 Other Beano 36009 30 eta supply average arf (AS/MAWh) 5367053432 mn "oes not consider triage, Ps/Pazepand nt TOE
Slide 42: Shareholders
Shareholders ‘Common % Preferred "A" % Preferred % TOTAL % State of Parand 85,028 : : : : 85,029 310 BNDESPAR 38,299 : : 27,282 213 65,581 240 Hletrobras 4531 : : : : 4531 06 Free Floating 19836 Ed 235 100,965 787120878) 442 83 19,728 7 235 A717 60.4 97,282 355 NYSE 109 on : : 23,320 18.2 23,428 86
Slide 43: Shareholder breakdown charts
Common 59% 00% 14% 01% 26% 44% 01% = State of Parand = BNDESPAR Eletrobras = Free Floating Other Total Preferred 21% = BNDESPAR «= Free Floating Other 73.6% wm State of Parand = BNDESPAR » Eletrobras = Free Floating Other
Slide 44: Share performance
From January to March 2020, 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 68.9 % of the Company’s capital. At the end of March 2020, the market value
Slide 45: 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:
Slide 46: Dividend and interest payments history
Type of arming Fiscal Year_—Approved on Paldon-—««THowwamdsof RS _fS por Share_ Tal ton wip 146833252507 1.61546 toc’ 2011 08/11/11 09/15/11 225,814 0.78803 0.86706 0.86706 oc 2011 04/26/12 05/29/12 195,277 0.68030 1.65801, 0.74840 Tosa 2012 268558 osas27 25207 1.02889 toc’ 2012 12/19/12 01/15/13 13
Slide 47: TPP Figueira concession extension
On March 24, 2017 Copel GeT filed a notice of intention with Aneel to extend the concession agreement of the TPP Figueira, noting, however, that it will only sign the necessary agreements and/or amendments after
Slide 48: Wind farms installed capacity
lnstalled Assured Power Generation Bxpiration of Str parte capacity (MW) (Average MW) ——(GWh) ie” Authorlzation Séo Bento Energla, Invest. e Part. S.A. 940 463 494 217 ‘GE Boa Vista SA. 140 63 55 237.44 08.27.2086 (GE Otho O'Agua SA. 2nd LFA 300 153 178 23023 05.31.2086 (GE'Sio Bento do Norte S.A (0
Slide 49: Interest in Wind Farms
Interest in Wind Farms Copel has 49% interest in the Voltalia São Miguel do Gostoso I Participações S.A. wind complex, in the State of Rio Grande do Norte. The energy output of the enterprise was sold in the Fourth Reserve Energy Auction under twenty-year contracts, with supply beginning in July, 20
Slide 50: Under Construction
Under Construction Bela Vista SHP In August 2018 Copel was granted the right to build Bela Vista SHP with 29 MW of installed capacity. With an estimated investment of R$ 200.0 million, the project, which has 29.4 MW of installed capacity and assured
Slide 51: 8.2 Transmission
8.2 Transmission Assets in Operation The chart below shows the transmission concession agreements and the design of the substations clusters and the transmission lines in operation:
Slide 52: Assets under Construction
Assets under Construction Copel GeT is substantially increasing its share of the transmission segment through its own investment and partnerships in special purpose companies - SPCs. The projects sum up a total of 1,027 km of transmission lines and one substation and will generate an APR of R$160,0
Slide 53: Lot E
Lot E The commercial operation of part of the projects that compose Lot E of Transmission Auction No. 005/2015 began ahead of schedule. Fully sold to Copel GeT, Lot E is comprised of 230 km of transmission lines and 3 substations, totaling 900 MVA of power and expected ARP of R$116.9 million. On Jun
Slide 54: Fernão Dias substation commissioning
At this point, activities are concentrated on commissioning the 440kV sector of the Fernão Dias substation, which is expected to start commercial operation in the first half of 2020.
Slide 55: Compact Distribution Lines
Compact Distribution Lines Copel Distribuição has continued to implement compact distribution lines in urban areas with a high concentration of trees in the vicinity of the distribution grids. This technology avoids the cutting down or trimming of trees and improves the quality of power supply by re
Slide 56: 8.4 Telecommunications
8.4 Telecommunications Copel Telecomunicações has an optical backbone/backhaul made up of a high capacity intermunicipal transmission network and the access network. The access network can be multi-point (GPON) or point-to-point (conventional), thus connecting customers to Copel Telecom’s data trans
Slide 57: Slide 57
Slide 58: 8.6 New Projects
8.6 New Projects Project Portfolio Copel holds interests in different power generation projects. When these projects go into commercial operation, they will add 273.5MW of installed capacity to the Company's portfolio (in proportional to the Company’s stake in the enterprises).
Slide 59: Chopim river studies
Copel, in partnership with other companies, is also developing studies in the lower reaches of the Chopim river that may enable other hydroelectric projects.
Slide 60: 9. Other Information
9. Other Information 9.1 Human Resources Copel’s workforce closed 1Q20 at 7,065 employees distributed. The table below shows employee number trends in the Company and its subsidiaries in the last four years:
Slide 61: Headcount
Headcount 2016 2017 2018 2020 Geraco e Transmissdo 1,680 1,734 1,660 1,603 Distribuicéo 6,022 5,746 5,364 4,939 Telecomunicacdes 660 649 478 383 Holding 69 78 75 100 Comercializagao 30 38 34 40 Renovaveis 70 - E S TOTAL 8531 8,245 7,611 7,065
Slide 62: Generation, transmission and telecom overview
Generation Copel GeT In operation Hydroeletric * Quota System Thermal Wind power Under construction Hydroeletric Wind Farms tn operation Under construction Partnership In operation Hydroeletic Thermal Wind farms Copel Telecom Optical cables backbone/backhaul (km) Cities served in Parana State Number
Slide 63: Consolidated Cash Flow
RS'000 Conslidated Cash Flow 1030 309 {ash flows from operational activities ‘Net income forthe period s10.16 | 505,962 ‘Adjustments to reconcile net income for the period with cash generated from operating activities s91893 792,640 Depreciation and Amortization 25518 | 222,72 Unrealized monetary an
Slide 64: Copel GeT income statement
ies ne 1019 4qi9 1019 Var.% (a) (2) (3) (1/3) OPERATING REVENUES 1,141,075 1,100,235 | 1,001,559 13.9 Electricity sales to final customers 142,984 179,337 166,066 (13.9) Electricity sales to distributors 801,286 653,715 605,400 32.4 Use of the main transmission grid 156,239 189,509 152,912 22 Constr
Slide 65: Copel Distribuição income statement
aging diss 1920 4qig 1019 Var.% eo) 2) @) (1/3) OPERATING REVENUES 2,628,359 2,815,883 | 2,556,600 28 Electricity sales to final customers 1,410,401 1,442,614 1,349,302 45 Electricity sales to distributors 49,784 93,941 49,607 0.4 Use of the main distribution grid 961,337 | 1,029,282 948,900 13 Cons
Slide 66: Copel Telecom income statement
cues names 1020 4qis 1019 Var.% (1) (2) (3) (1/3) NET OPERATING REVENUES 97,461 102,099 115,352 (15.5) Revenues from telecommunications 96,720 101,367 113,757 (15.0) Other operating revenues 7a. 732 1,596 (53.6) OPERATING COSTS AND EXPENSES (92,717) (155,335) (101,550) (8.7) Personnel and management
Slide 67: Copel Comercialização income statement
‘garbled 1020 4qi9 1Q19 Var.% ren) re) (3) (1/3) OPERATING REVENUES 538,841. 522,727 368,598 46.2 Electricity sales to final customers 206,046 146,698 116,664 76.6 Electricity sales to distributors 328,888 270,047 239,930 371 Other operating revenues 3,907 105,982 12,004 - OPERATING COSTS AND EXPENS
Slide 68: Assets by subsidiary
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Slide 69: Assets by subsidiary (continued)
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Slide 70: Liabilities by subsidiary
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Slide 71: Liabilities by subsidiary (continued)
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Slide 72: Income Statement 1Q20 by subsidiary
Rs'000 Income Statement 1020 = pisttigio Telecom Campagas Eon. , Camera WindFarms 5, Marui Holdg Eliminations Cnslnted [NET OPERATING INCOME 2628359 STAG) —«1a7a73| 54088 | «155,707 538,941 95,505 2878 =] (4o1,790)) 4,153,981 Electricity sales to final customers 1410401 < : : 206,086 : : : (77) 1758
Slide 73: Signature and forward-looking statements
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 September 11, 2020 COMPANHIA PARANAENSE DE ENERGIA – COPEL By: / S / Daniel Pimentel Slaviero Danie