Energisa (ENGI3) Q1 2025 earnings summary

Executive summary

• Net income reached R$1,026.7 million in 1Q25, down 9.5% year-over-year, with adjusted recurring EBITDA at R$1,857.8 million, a 15.8% decrease, mainly due to negative rate adjustments and non-recurring effects in the distribution segment.

• Net revenue (excluding construction) rose 4.4% to R$6,921.7 million, driven by higher distribution and commercial activities.

• Power distribution added 33,000 new consumer units, an 11% increase, with energy sales up 1.3% year-over-year.

• Delinquency rates and churn improved, with collection rates at historic highs of 97.01%.

• Maintained robust investment and operational performance in transmission and renewables, despite a challenging economic and regulatory environment.

Financial highlights

• Consolidated EBITDA was R$2,397.0 million, down 5.2% year-over-year; adjusted recurring EBITDA was R$1,857.8 million, down 15.8% year-over-year.

• Net income was R$1,026.7 million, down 9.5% year-over-year; recurring consolidated net income was R$390.7 million, 48% below Q1 2024.

• Net debt stood at R$26,218.9 million, with a net debt/EBITDA (covenants) ratio of 3.2x.

• Investments totaled R$1,327.7 million in 1Q25, stable year-over-year.

• Extraordinary tariff adjustment in Rondônia contributed R$177 million to EBITDA and R$185 million to net income.

Outlook and guidance

• Management reaffirmed 2026 guidance for up to R$24 billion in investments and up to 25% EBITDA contribution from non-distribution businesses.

• ES Gás and Espírito Santo business plans target up to R$1 billion in investments by 2030, focused on infrastructure and energy democratization.

• Expectation of continued cost control with PMSO growth below inflation and regulatory limit adjustments for non-technical losses up to 1% by 2026.

• Concession renewal processes expected to conclude by end of August, with TCU oversight.

• ESG targets are on track, with early completion of thermal plant decommissioning and renewable capacity expansion.