CPFL Energia S A : 2Q19 Conference Call Presentation
08/14/2019 | 10:37am EDT
This presentation may contain statements that represent expectations about future events or results according to Brazilian and international securities regulators. These statements are based on certain assumptions and analyses made by the Company pursuant to its experience and the economic environment, market conditions and expected future events, many of which are beyond the Company's control. Important factors that could lead to significant differences between actual results and expectations about future events or results include the Company's business strategy, Brazilian and international economic conditions, technology, financial strategy, developments in the utilities industry, hydrological conditions, financial market conditions, uncertainty regarding the results of future operations, plans, objectives, expectations and intentions, among others. Considering these factors, the Company's actual results may differ materially from those indicated or implied in forward-looking statements about future events or results.
The information and opinions contained herein should not be construed as a recommendation to potential investors and no investment decision should be based on the truthfulness, timeliness or completeness of such information or opinions. None of the advisors to the company or parties related to them or their representatives shall be liable for any losses that may result from the use or contents of this presentation.
This material includes forward-looking statements subject to risks and uncertainties, which are based on current expectations and projections about future events and trends that may affect the Company's business.
These statements may include projections of economic growth, demand, energy supply, as well as information about its competitive position, the regulatory environment, potential growth opportunities and other matters. Many factors could adversely affect the estimates and assumptions on which these statements are based.
Increase of0.9% in load in the concession area
EBITDA ofR$ 1,505 million, growth of9.9%
Net Income ofR$ 574 million, growth of27.4%
Net Debt ofR$ 11.0 billion and leverage of1.93x Net Debt/EBITDA1
Investments of R$ 521 million, growth of 23.5%
RGE-RGESul's tariff adjustments, inJun-19:(i) increase of7.14% of RGE's parcel B, and (ii) increase of9.10% of RGE Sul's parcel B
CPFL Energia'sRe-IPO,inJun-19:R$ 3.7 billion @R$ 27.50/share;
total offering: 134.3 MM shares; since the offering - price: +22.3%2
and ADTV: R$ 109.5 MM(from Jun 13 to Aug 13)
Financial covenants criteria; 2) From R$ 27.50/share to R$ 33.62/share on Aug 13.
2Q19 Energy Sales
Load1in the concession area | GWh
Sales(2)in the concession area | GWh
Sales by consumption segment | GWh
Breakdown in the concession area|2Q19
Main impacts by segment | %
Migr. National Grid
Residential Industrial Commercial Others
1) Load net of losses; 2) If excluding the consumption of two large consumers that migrate to the National Grid, the sales within the concession area in 2Q19 would have the following variation: -0.1%.
Macroeconomic scenario still not favorable and weather also affecting negatively the market performance
Rainfall in RGE1(mm)
1) Source: Somar; 2) Source: IBGE.
Industrial production - Brazil2(% YoY)
Retail sales2(% YoY)
ADA | R$ MM
Collection actions | Power Cuts
Benchmarking - 2Q18 X 2Q19 (% ADA/Billed Revenue)1
Actions in progress - 2019
Increase of power cuts in the 2Q19 and expectation of keeping the same level until the end of the year (meter and circuit braker)
Intensification of other collection actions: 2.9 million negativity in 2Q19 (641k higher than 1Q19)
New payment options (debit and credit) for the negotiation of overdue accounts
2Q18 x 2Q19
1) Source: Earnings Release.
2Q18 2Q19 2Q18 2Q19
Maximum Storable Energy| National Interconnected System (SIN)
2019:due to rainfall in the last October and November, the SIN storage began 10% higher than 2018
Jan-Feb2019:typical storage recovery of this period was not observed
As of March:near-normal rainfall in the SE/CW and above in the South allowed a significant storage recovery
Solving transmission lines problems(Madeira)and the commissioning of new lines (Belo Monte)also contributed to the storage recovery
Expectations for PLD
May June July
2019 PLDexpected avg:R$ 185/MWh
GSF:-15.7%(Jul-Sep are the more critical months, when GSF reaches -45% considering the seasonal MRE assured energy)
In the coming years, the expansion of renewable sources and hydroelectricity is much lower than the demand growth:expect a smaller impact of GSF