SABESP (SBSP3) Q2 2025 earnings summary

Executive summary

• Net income for Q2 2025 reached R$2,136 million, up 76.6% year-over-year, with EPS of R$3.12 versus R$1.77 in Q2 2024, driven by tariff adjustments, higher consumption, and new connections.

• Revenue grew 32.8% year-over-year to R$8,965 million, with construction revenue up 142% and sanitation service revenue up 7.4%.

• Over 1.3 million people gained water access and 1.4 million gained sewage treatment in the first year post-privatization.

• Investments totaled R$3.6 billion in Q2 2025, a 178% increase year-over-year, focused on infrastructure and universalization projects.

• Major investments in infrastructure, technology, and customer service enhancements, including digital payment solutions and smart metering.

Financial highlights

• EBITDA reached R$3,890 million, up 29.4% year-over-year, and EBIT was R$3,346 million, up 51%.

• Adjusted net income for Q2 2025 was R$1,956 million, up 64.3% year-over-year.

• Net revenue for the first half of 2025 was R$17,391 million, up 30.7% from H1 2024.

• Operating costs and expenses fell 19% year-over-year, mainly from lower provisions, reduced workforce, and lower municipal fund transfers.

• Personnel expenses fell 10.3% year-over-year, mainly due to an 11% headcount reduction from voluntary dismissal plans.

Outlook and guidance

• Capex is expected to remain at around BRL 3.5 billion per quarter, with a shift in profile as major sewage plant expansions conclude.

• Management reaffirmed commitment to universalization, with accelerated investments and expansion of water and sewage services.

• Efficiency programs and cost-saving initiatives are expected to continue delivering benefits, with further ramp-up in discount removal gains in H2 2025.

• Social tariff impacts will persist in H2 but will be compensated in the tariff cycle effective January 2027.

• Capex backlog of R$35 billion across 542 projects through 2029 supports long-term growth.