Companhia de Saneamento de Minas Gerais (CSMG3) Q4 2025 earnings summary

Executive summary

• Net revenue reached BRL 1.88 billion in 4Q25 (+6.9% YoY) and BRL 7.42 billion in 2025 (+5.6% YoY), driven by tariff adjustments, higher volumes, and operational efficiency.

• EBITDA was BRL 731 million in 4Q25 (+14.1% YoY, 38.5% margin) and BRL 2.95 billion in 2025 (+5.7% YoY, 39.8% margin).

• Net income rose to BRL 337 million in 4Q25 (+23.9% YoY) and BRL 1.42 billion in 2025 (+7.5% YoY), reflecting resilience and cost control.

• Record CapEx of BRL 2.9 billion in 2025 (+32% YoY), focused on universalization, modernization, and efficiency, with a BRL 21 billion plan for 2026–2030.

• Advanced ESG agenda, improved customer satisfaction (NPS 76.9%), and maintained low delinquency rates (2.91%).

Financial highlights

• 2025 net revenue: BRL 7.42 billion (+5.6% YoY); EBITDA: BRL 2.95 billion (+5.7% YoY, 39.8% margin); net income: BRL 1.42 billion (+7.5% YoY).

• Operating cash generation for 2025 was BRL 2.3 billion, up nearly 13% YoY.

• Dividends (regular and extraordinary) totaled BRL 853 million in 2025, with a 50% payout ratio.

• Leverage at 2.3x Net Debt/EBITDA; net debt at BRL 6.9 billion as of year-end 2025.

• Delinquency rate improved to 2.91%, a record low since 2020.

Outlook and guidance

• CapEx guidance for 2026–2030 is BRL 21 billion, focused on universalization, water security, and loss reduction.

• Tariff review effective January 2026, with a 6.56% average tariff increase and pre-tax WACC of 13.7%.

• Board set a 50% payout policy for dividends in 2026, maintaining predictability.

• Ongoing privatization process, with legal and governance structures in place for transition.