Centrais Elétricas de Santa Catarina (CLSC4) Q3 2024 earnings summary

Executive summary

• 3Q24 consolidated revenue including construction revenue rose 4.3% to R$4.00bn; EBITDA increased 25.3% to R$252.8m and net income reached R$76.1m versus R$35.0m.

• 9M24 revenue including construction revenue rose 4.5% to R$12.20bn; EBITDA increased 21.5% to R$1.239bn and net income reached R$585.7m.

• Distribution consumption and generation output grew, supported by higher demand, rainfall and plant availability; debt rose and billing-system issues disrupted collections.

Financial highlights

• Consolidated net operating revenue was R$2.627bn in 3Q24, up 2.9% YoY, and R$7.847bn in 9M24, up 2.1%; excluding construction revenue, 3Q24 revenue was R$2.378bn, up 0.8%.

• Excluding construction revenue, 9M24 consolidated revenue was R$7.201bn, up 3.1% YoY; operating costs and expenses rose 1.4% in 3Q24 and declined 0.4% in 9M24.

• 9M24 EBIT was R$985.2m versus R$787.5m; the financial result was a loss of R$187.4m versus R$169.2m, while financial expenses fell to R$442.7m from R$698.9m.

• 9M24 operating cash flow fell to R$112.3m from R$559.7m; investing outflow was R$654.2m and financing inflow was R$972.6m.

Outlook and guidance

• The 2024 distribution tariff adjustment took effect August 22, with a 3.02% average consumer impact versus 4.50% period IPCA inflation; impacts were 0.75% for high-voltage and 4.19% for low-voltage customers.

• Collection actions were paused while commercial-system issues were addressed; normalization was expected by year-end 2024.

• Capivari solar project completion shifted to January 2025 pending connection-bay installation; Videira solar project was energized in October 2024.

• Planned generation developments include 6 MW of solar projects and hydro expansions or reactivations, subject to regulatory, environmental and construction procedures.