AXIA Energia (AXIA6) Q4 2024 earnings summary

Executive summary

• Achieved significant transformation post-privatization, including operational and cultural changes, workforce renewal, cost reduction, and advanced liability management, highlighted by the incorporation of Furnas and simplification of the corporate structure.

• Focused on customer-centric energy trading, innovation, and ESG initiatives, including decarbonization, human rights policy, and progress toward net zero 2030, with major asset sales such as the last coal-fired plant.

• Record dividend payout of R$4 billion, the largest in company history, representing 41% of 2024 net income, reflecting improved financial performance and shareholder focus.

• Investment capacity restored, with R$7.7 billion invested in modernization and expansion, including major projects like Coxilha Negra wind farm and transmission infrastructure.

• Raised R$32 billion in funding, including the first post-privatization bond issue and international financing, ending the year with high liquidity.

Financial highlights

• Net operating revenue rose 8.1% year-over-year to R$40.2 billion, with generation revenue up 5.6% to R$28.1 billion and transmission revenue up 10.7% to R$19.3 billion.

• Consolidated EBITDA surged 51.2% to R$26.2 billion; net income jumped 136.2% to R$10.4 billion; recurring EBITDA reached BRL 5.1 billion.

• Gross debt reached R$75.6 billion, with average debt term extended and cost reduced; net debt stood at R$37.7 billion, with a net debt/adjusted EBITDA ratio of 1.5x.

• Divestments totaled R$15 billion, with R$5.7 billion in acquisitions, optimizing the equity portfolio.

• Operating activities generated R$18.4 billion in cash in 2024; free cash flow totaled R$11.0 billion.

Outlook and guidance

• Focus remains on financial flexibility, prudent capital allocation, and maximizing shareholder value, with investment in reinforcement and improvement expected to grow.

• Improved hydrological scenario expected in 2025, with higher average prices for 2026 due to repricing of risks.

• Growth agenda includes expansion in hydro, green hydrogen, storage, and transmission, with high potential for new projects over the next five years.

• Conservative approach to leverage and capital allocation due to increased market volatility and shrinking reservoirs.

• Largest-ever dividend distribution of R$4 billion approved, representing 41% of 2024 net income.