Neoenergia (NEOE3) Q3 2025 earnings summary

Executive summary

• Achieved strong operational and financial performance in Q3 2025, with cash EBITDA up 13% to R$2.8 billion and net income up 10% to R$924 million, alongside significant industry recognition and leadership in distribution concessions serving over 40 million people.

• Net operating revenue rose 10% year-over-year in Q3 2025 to R$12,972 million, driven by customer base expansion and positive tariff adjustments.

• Major milestones in transmission projects were completed, with most lots nearing completion and full operation expected by January 2026.

• Regulatory achievements included the early extension of the Pernambuco concession to 2060 and ongoing negotiations for other key concessions.

• Asset rotation and investment in distribution companies remain strategic priorities, with a focus on operational excellence and organic growth.

Financial highlights

• Injected energy in concession areas grew 2.3% year-over-year, with 342,000 new clients added in Q3 2025.

• Operating expenses increased 5.6% year-over-year in Q3 2025, in line with or below inflation.

• Cash EBITDA reached R$2.8 billion, up 13% year-over-year; net income was R$924 million, up 10% from Q3 2023.

• Gross margin rose 10% to R$4,556 million in Q3 2025.

• Capex totaled R$2.6 billion in the quarter and R$7.6 billion year-to-date, with most allocated to networks.

Outlook and guidance

• Investment cycle in transmission concluding by end of 2025, shifting focus to distribution investments in 2026.

• Deleveraging process to begin in 2026, with potential for dividend policy review in late 2026 as debt declines and cash flow increases.

• No participation planned in upcoming transmission auction, maintaining disciplined capital allocation.

• Upcoming concession amendments for Coelba, Cosern, and Elektro are expected.

• Tariff adjustments for Neoenergia Elektro (+1.3% Parcel B) and Neoenergia Brasília (+8.3% Parcel B) were implemented in 2H25.