AXIA Energia (AXIA6) Q3 2024 earnings summary

Executive summary

• Achieved significant operational efficiency and full cost management freedom for the first time in 60 years, following regulatory agreements, and completed the merger with Furnas, consolidating assets and expanding operational scale.

• Net income reached R$7.2 billion in 3Q24, with strong operational and financial performance driven by regulatory remeasurements and the Tucuruí GSF renegotiation.

• Sale of CTEEP shares generated R$2.15 billion, supporting capital allocation and portfolio optimization.

• Solid cash position, with R$28.4 billion as of 3Q24, sufficient to cover four years of debt repayments.

• Launched Consensual Dismissal Program and approved a new Collective Bargaining Agreement by 64.8% of employees.

Financial highlights

• Gross revenue rose 22.9% YoY to R$12.96 billion; net operating revenue reached R$11.04 billion, up 26.9% YoY.

• Net income was R$7.2 billion in 3Q24, with adjusted net income at R$7.6 billion, up 588% YoY, mainly due to regulatory remeasurement and one-time items.

• Raised over R$22.1 billion in 2024, ending the quarter with R$28.4 billion in cash, providing coverage for multiple years of debt maturities.

• Gross debt at R$69.9 billion with an average term of 59.4 months; net debt/adjusted regulatory EBITDA improved to 1.7x.

• Free cash flow reached R$6.1 billion in 3Q24.

Outlook and guidance

• Committed to reducing PMSO below R$7 billion in 2024, below R$6 billion in 2025, and targeting R$5.5 billion in 2026.

• Ongoing investments in asset modernization and expansion, with 245 transmission projects expected to add R$1.8 billion in RAP by 2029.

• Two wind projects (Coxilha Negra and Casa Nova B) to add 330 MW by year-end 2024.

• Anticipates continued price volatility in the energy market, with a focus on leveraging opportunities and managing risks.