AXIA Energia (AXIA6) Q2 2025 earnings summary

Executive summary

• Post-privatization initiatives led to shareholder structure simplification, cost and liability reductions, and a compulsory loan inventory drop to R$11.97 billion, with a transition to growth and stabilization.

• R$4 billion in dividends were proposed/approved, reflecting improved financial health, risk mitigation, and value creation.

• Major events included the acquisition of Eletronet, sale of thermoelectric assets, asset swap with Copel, and completion of key projects like Ponchilla Negra wind farm and Manaus-Boa Vista connection.

• Investments surged 116% vs. 1Q25, with acceleration in reinforcements and improvements, and completion of the first post-privatization transmission auction win.

• Reported a consolidated net loss of R$1,325 million for Q2 2025, mainly due to a R$3,433 million regulatory provision and asset sale losses, despite higher revenues.

Financial highlights

• Adjusted gross revenue grew 19% year-over-year to R$12,191 million in 2Q25; net operating revenue (IFRS) rose 22.8% YoY to R$10,308 million.

• Adjusted net income reached R$1,469 million, up 43.3% YoY, benefiting from deferred income tax and effective tax rate adjustments.

• Generation margins increased 21% sequentially and 16% year-over-year, offsetting a drop in transmission revenue.

• PMSO costs reduced to R$1,403 million, with efficiency gains despite new hires.

• Free cash flow reached R$2.5 billion in 2Q25; net debt stood at R$40.13 billion, with net debt/adjusted LTM EBITDA improved to 1.5x.

Outlook and guidance

• Dividend payment of R$4 billion approved/proposed, with projected leverage within target range and a five-year outlook to 2030.

• Constructive outlook for energy prices in 2026 and 2027, with some volatility expected and conservative pricing for uncontracted energy post-2027.

• 249 large-scale transmission projects underway, with R$1.8 billion in additional RAP expected between 2025-2030 and total CAPEX of R$13.3 billion.