Companhia de Saneamento do Paraná - SANEPAR (SAPR4) Q3 2024 earnings summary

Executive summary

• Net revenue for 3Q24 rose 6.5% year-over-year to BRL 1,709.7 million, driven by tariff adjustments, higher billed volumes, and increased connections.

• Net profit declined 4.9% year-over-year to BRL 377.5 million, mainly due to a 15.1% rise in operating costs and expenses.

• EBITDA for 3Q24 was BRL 758.5 million, margin 44.4%, down from 48.4% in 3Q23.

• Service coverage reached 100% for water and 80.8% for sewage, with 25,000+ new water and 36,500+ new sewage connections.

• Recognized with ANEFAC Transparency Award and Southern Region's Innovation Champions Award.

Financial highlights

• Net revenue for 9M24 increased 10.4% year-over-year to BRL 5,072.0 million.

• Net profit for 9M24 was BRL 1,132.5 million, nearly stable versus 9M23.

• Operating costs and expenses rose 15.1% in 9M24, mainly due to higher personnel and third-party services.

• Cash flow from operations grew 19.1% in the nine-month period, with a strong EBITDA-to-cash conversion rate of 94.7%.

• Financial result improved, with net financial expenses of BRL 48.8 million in 3Q24, a 25% reduction from 3Q23.

Outlook and guidance

• Tariff adjustment of 2.96% approved for 2024, effective from May 17, 2024.

• 3rd Periodic Tariff Review scheduled for completion in May 2025, with regulatory actions underway.

• Legal and labor provisions are expected to normalize as major lawsuits conclude by the end of 2024 and into 2025.

• Ongoing strategic planning may adjust dividend payment periodicity, depending on financial conditions.

• Company focuses on universalization and quality of services, supporting investment programs to meet regulatory targets.