AES Brasil Energia (AESB3) Q3 2024 earnings summary

Executive summary

• Cajuína II wind complex (370 MW) and AGV VII solar plant reached full commercial operation, completing expansion obligations in São Paulo.

• Wind portfolio availability improved by 5 percentage points year-over-year, driven by asset turnaround and operational recovery.

• Disciplined cost management reduced recurring expenses and improved efficiency.

• Net revenue rose 21.3% in 3Q24 year-over-year, but adjusted net income swung to a loss of R$72.1 million from a R$119.3 million profit in 3Q23, mainly due to higher energy costs and financial expenses.

• Business combination with Auren Energia completed, with share exchange ratio of 0.75 and transaction price of R$11.84 per share.

Financial highlights

• Net margin for 3Q24 was R$566 million, down 4% year-over-year; hydro contributed 41%, wind 53%.

• Adjusted EBITDA for 3Q24 was R$378 million, with a year-to-date total of R$1,119 million; both periods saw reductions due to wind curtailment.

• Adjusted net loss of R$72 million in 3Q24 and R$260 million year-to-date, mainly due to lower EBITDA, reduced financial revenue, and higher financial expenses.

• Net revenue: R$1,102.4 million in 3Q24 (+21.3% YoY); R$2,802.9 million in 9M24 (+14.0% YoY).

• Hydroelectric generation fell 32% year-over-year in 3Q24 due to reduced dispatch to preserve reservoir levels.

Outlook and guidance

• All expansion obligations in São Paulo are fulfilled, and new wind and solar assets are fully operational.

• Portfolio is 99% contracted for 2024, 97% for 2025, and 95% for 2026, supporting revenue visibility.

• Contracting levels advanced, with consolidated average sale price above R$180/MWh.

• Debt strategy focuses on extending average maturity and reducing CDI exposure, with new long-term financings replacing bridge loans.