Transmissora Aliança de Energia Elétrica (TAEE11) Q2 2024 earnings summary

Executive summary

• Regulatory net income rose 22.9% year-over-year to R$294 million in 2Q24, driven by improved operational costs, financial results, and tax efficiencies from mergers and JCP distribution.

• IFRS net income surged 81.9% year-over-year to R$403.1 million, supported by monetary restatement revenues and merger impacts.

• Board approved R$223.3 million in earnings distribution for 2Q24, with total distributions in 2024 reaching R$986 million and payout representing nearly 76% of regulatory net income for the first half.

• Operational availability of transmission lines remained high at 99.38%–99.4%, with a one-off event at Janaúba impacting the Variable Portion.

• Installation licenses for Tangará and Ananaí projects obtained, though Ananaí faced CAPEX delays due to environmental licensing.

Financial highlights

• Regulatory net revenues in 2Q24 were R$579.7 million, down 7.2% year-over-year, mainly due to negative IGP-M adjustment and RAP drop at ATE III.

• Regulatory EBITDA reached R$485.2 million, down 7.8% year-over-year, with a margin of 83.7%.

• IFRS net revenues in 2Q24 were R$911.1 million, up 33.5% year-over-year, driven by higher investments and monetary restatement revenues.

• IFRS EBITDA was R$520.0 million, up 31.0% year-over-year, with a margin of 57.1%.

• Dividend yield for the period reached approximately 8.1%.

Outlook and guidance

• New projects and reinforcements (Ananaí, Pitiguari, Saíra phase 2, Tangará) are expected to add R$445 million in RAP as they become operational.

• RAP for the 2024-2025 cycle set at R$4.1 billion, with operational RAP at R$3.65 billion.

• Dividend payout policy for 2024 set at a minimum of 75% of regulatory net income, with plans to increase to at least 90% from 2025 onward, subject to financial conditions.

• ANEEL's Ratifying Resolution 3.348/2024 set RAP adjustments for 2024-2025: -0.34% for IGP-M-indexed and +3.93% for IPCA-indexed concessions.

• Participation in upcoming September bidding process for new concessions, with a promising outlook for growth.