Centrais Elétricas de Santa Catarina (CLSC4) Q1 2024 earnings summary

Executive summary

• 1Q24 net operating revenue was R$2,600.515m (+1.01% YoY), EBITDA R$457.464m (+7.35%) and net profit R$232.011m (+6.4%).

• Net revenue excluding construction revenue rose 2.7% to R$2,393.3m; billed electricity increased 6.6% to 7,806 GWh.

• Consolidated investment totaled R$285.0m, down 7.0% YoY; distribution demand grew while low rainfall weighed on generation output.

Financial highlights

• Gross operating revenue increased 3.77% to R$4,120.583m; EBIT rose 6.0% to R$373.685m.

• Gross profit was R$525.053m versus R$496.198m; the financial result was a R$49.540m expense, improving from R$52.896m.

• EBITDA margin was 17.59% versus 16.55%, and net margin was 8.92% versus 8.47%.

• Operating costs and expenses were R$2,241.9m (+0.1%); energy costs rose 0.7%, while construction costs fell 14.7%.

• Operating cash flow was R$238.982m; cash and cash equivalents were R$880.437m at quarter-end.

Outlook and guidance

• Smart-meter rollout in Florianópolis is planned across consumer units over three years, with R$116m budgeted for replacements.

• Four distributed solar projects totaling 7.5 MW were under construction, with planned starts from May to June 2024.

• Generation expansion plans include Maruim restoration and projects at Salto, Caveiras, Cedros and Palmeiras, at varying development stages.

• The 2023 tariff adjustment remained in effect through Aug. 21, 2024, with a 2.30% average consumer impact; PIS/COFINS credit refund methodology remained under regulatory discussion.