SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934
For the month of November, 2021
Commission File Number 1-34129
CENTRAIS ELÉTRICAS BRASILEIRAS S.A. - ELETROBRÁS
(Exact name of registrant as specified in its charter)
BRAZILIAN ELECTRIC POWER COMPANY
(Translation of Registrant's name into English)
Rua da Quitanda, 196 – 24th floor,
Centro, CEP 20091-005,
Rio de Janeiro, RJ, Brazil
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F ___X___ Form 40-F _______
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes _______ No___X____
Marketletter 3Q21 |
INTRODUCTION
Rio de Janeiro, November 16, 2021
A Eletrobras (Centrais Elétricas Brasileiras S.A.)
[B3: ELET3 and ELET6 – NYSE: EBR e EBR-B – LATIBEX: XELTO and XELTB]
Eletrobras, the largest company in the electric energy sector in Latin America, active in the generation, transmission and commercialization segment, controlling 5 operating subsidiaries and a holding company – Eletropar –, a research center – Cepel, holding 50% of the share capital of Itaipu Binacional and, on September 30, 2021, with direct and indirect interest in 81 Special Purpose Entities, announces, on this date, its results for the period referring to the second quarter of 2021.
3rd QUARTER OF 2021
Eletrobras presented, in the third quarter of 2021 (3Q21), a net profit of R$ 965 million, lower than the profit of R$2,814 million obtained in the third quarter of 2020 (3Q20). The result of 3Q21 was positively impacted by the strong operating performance of Eletrobras, especially in the transmission segment, mainly as a result of the accounting of contracts renewed by Law 12,783/2021, as a result of the reprofiling of the financial component of RBSE, in the amount of R$ 4,859 million. The result was also positively affected by the Hydrological Risk Renegotiation, in the amount of R$4,266 million, resulting from Aneel resolutions 2,932 and 2,919/21/21, which ratified the extension of the terms of grants for several Eletrobras hydroelectric plants. Another positive highlight of the quarter is the reversal of impairments of R$454 million, mainly influenced by the reduction in discount rates, with emphasis on the reversal of R$265 million in the Santa Cruz and Batalha plants in Furnas.
The positive effects of 3Q21 were negatively impacted by certain adjustments in the booking of provisions for contingencies of R$9,434 million. Based on the development of case law related to the ECE lawsuits, the Company reviewed its provision estimates for ECE lawsuits, resulting in an increase of approximately R$ 8,926 million in 3Q21. This amount contemplates, amongst others, (i) R$ 5,253 million related to the reclassification, from remote to probable, of the risk of losing disputes in which parties disputed the initial term of the statutory period applicable to the collection of reflexive compensatory interests, and (ii) R$ 2,180 million resulting from altering the moment in which, in compliance with final judgements that went against the Company’s position, and with unfavorable calculations approved by courts, the Company would supplement the provision for disputed amounts. Considering other constituted provisions and the reversal of ECE lawsuits, the final result was a total provision of R$ 9,059 million for the third quarter of 2021.
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 3 |
Marketletter 3Q21 |
Net Operating Revenue went from R$ 6,626 million in 3Q20 to R$ 9,957 million in 3Q21, a 50% growth, influenced by the effect on transmission revenue from the periodic tariff review, and, in generation, by the better performance in bilateral and higher settlement revenue with the CCEE. Ebtida IFRS, in the amount of R$ 5,369 million in 3Q20, increased to an amount of R$ 5,596 million in 3Q21. Recurring Net Operating Revenue grew by 45%, from R$6,891 million in 3Q20 to R$9,977 million in 3Q21. Recurring EBITDA increased by 70%, from R$ 3,290 million in 3Q20 to R$ 5,598 million in 3Q21. The recurring growth demonstrates the improvement in the Company's operating performance.
OTHER 3Q21 HIGHLIGHTS
Cash of R$20.4 billion, Net Debt of R$19.1 billion and LTM Recurring EBITDA of R$19.6 billion, forming a Net Debt/ LTM Recurring EBITDA indicator of 0.9x. | |
CCC provision in the amount of R$ 340 million referring to the adjustment of current credits assumed by the Holding in the process of privatization of energy distributors, due to the conclusion of the inspection process by Aneel. | |
Negative net exchange variation in the amount of R$ 629 million in 3Q21 against a negative net exchange variation of R$ 221 million in 3Q20. | |
Increase of R$ 657 million in contingency at subsidiary Chesf referring to risk reclassification and update of litigation, with emphasis on R$ 233 million related to the lawsuit of fact K . | |
Credits from refundable fixed assets in progress by Energisa Acre added to the previous approvals of Equatorial Alagoas and Equatorial Piauí, in the amount of R$ 150 million referring to the recognition of fixed assets in progress, under the conditions of revenue as per Note 34 of 3Q21 financial actions. | |
R$ 622 million in revenue at the holding company referring to the increase of 14 months (May 2016 to June 2017) in the period covered by the recognition of energy economic inefficiency credits of credits granted by Amazonas Energia and Boa Vista, pursuant to Law No. 14,182 /20. |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 4 |
Marketletter 3Q21 |
TABLE 01: MAIN INDICATORS (R$ MILLION) |
2021 | 2020 | % | 3Q21 | 3Q20 | % | |
143.0 | 152.2 | -6,1% | Energy Sold - Generation GWh (1) | 46.3 | 52.1 | -11,1% |
31,054 | 24,086 | 29% | Gross Revenue | 11,663 | 8,208 | 42% |
31,300 | 24,332 | 29% | Recurring Gross Revenue (2) | 11,684 | 8,473 | 38% |
26,124 | 19,567 | 34% | Net operating revenue | 9,957 | 6,626 | 50% |
26,371 | 19,813 | 33% | Recurring Net Operating Revenue (3) | 9,977 | 6,891 | 45% |
12,730 | 10,824 | 18% | EBITDA | 5,596 | 5,369 | 4% |
15,643 | 9,188 | 70% | Recurring EBITDA (4) | 5,598 | 3,290 | 70% |
49% | 55% | - 6.59 | Ebitda Margin | 56% | 81% | - 24.83 |
59% | 46% | 12.95 | Recurring Ebitda Margin | 56% | 48% | 8.36 |
48,152 | 49,481 | -3% | Gross debt without third party RGR | 48,152 | 49,481 | -3% |
19,106 | 21,047 | -9% | Recurring Net Debt | 19,106 | 21,047 | -9% |
0,9 | 1,9 | -97% | Recurring Net Debt / Recurring LTM EBITDA | 0,9 | 1,9 | -97% |
5,104 | 4,511 | 13% | Net Profit | 965 | 2,814 | -66% |
2,527 | 1,389 | 82% | Investments | 1,024 | 681 | 50% |
12,160 | 12,552 | -3% | Employees | 12,160 | 12,552 | -3% |
(1) Does not consider the energy allocated to quotas of plants renewed by Law 12,783/2013;
(2), (3) and (4) Adjustments detailed in the consolidated analysis presented below.
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 5 |
Marketletter 3Q21 |
1 ANALYSIS OF THE
CONSOLIDATED RESULT(R$ MILLION)
TABLE 02: CONSOLIDATED RESULTS |
2021 | 2020 | Financial Statements | 3Q21 | 3Q20 |
18,132 | 16,065 | Generation Revenue | 6,570 | 5,268 |
12,370 | 7,570 | Transmission Revenue | 4,894 | 2,769 |
551 | 451 | Others Revenue | 199 | 171 |
31,054 | 24,086 | Gross Revenue | 11,663 | 8,208 |
-4,929 | -4,520 | Deductions from Revenue | -1,707 | -1,582 |
26,124 | 19,567 | Net Operating Revenue | 9,957 | 6,626 |
-3,046 | -5,021 | Resale energy, grid, fuel and construction | 517 | -1,831 |
-6,317 | -5,843 | Personnel, Material, Services and Others | -2,099 | -2,022 |
-1,408 | -1,399 | Depreciation and amortization | -503 | -468 |
-11,369 | -3,008 | Operating Provisions | -9,330 | -2,002 |
3,985 | 4,296 | -1,458 | 304 | |
1,706 | 875 | Shareholding | 920 | 369 |
4,859 | 4,228 | Regulatory remeasurements - Transmission Contracts | 4,859 | 4,228 |
772 | 25 | Others Revenues and Expenses | 772 | 0 |
11,321 | 9,425 | 5,093 | 4,902 | |
-1,122 | -2,097 | Financial Result | -1,059 | -622 |
10,200 | 7,328 | Income before tax | 4,033 | 4,279 |
-5,096 | -2,817 | Income tax and social contribution | -3,069 | -1,465 |
5,104 | 4,511 | NET INCOME FOR THE PERIOD | 965 | 2,814 |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 6 |
Marketletter 3Q21 |
TABLE 03: RECURRING CONSOLIDATED RESULT |
2021 | 2020 | Recurring Financial Statement * | 3Q21 | 3Q20 |
18,371 | 16,311 | Generation Revenue Recurring | 6,591 | 5,533 |
12,370 | 7,570 | Transmission Revenue Recurring | 4,894 | 2,769 |
559 | 451 | Others Revenue Recurring | 199 | 171 |
31,300 | 24,332 | Gross Revenue Recurring | 11,684 | 8,473 |
-4,929 | -4,520 | Deductions from Revenue Recurrent | -1,707 | -1,582 |
26,371 | 19,813 | Net Operating Revenue Recurring | 9,977 | 6,891 |
-6,881 | -4,998 | Operational costs Recurring | -3,357 | -1,827 |
-5,842 | -5,625 | Personnel, Material, Services and Others Recurring | -1,954 | -1,948 |
-1,408 | -1,399 | Depreciation and amortization Recurring | -464 | -468 |
289 | -877 | Operating Provisions Recurring | 12 | -195 |
12,529 | 6,913 | 4,215 | 2,453 | |
1,706 | 875 | Shareholdings Recurring | 920 | 369 |
14,235 | 7,789 | 5,134 | 2,823 | |
-605 | -1,800 | Financial Result Recurring | -898 | -543 |
13,630 | 5,989 | Income before tax Recurring | 4,237 | 2,279 |
-2,471 | -1,469 | Income tax and social contribution Recurring | -582 | -117 |
11,158 | 4,520 | Net Income for the year Recurring | 3,655 | 2,163 |
* Non-recurring adjustments mentioned in the Highlights.
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 7 |
Marketletter 3Q21 |
1.1 MAIN VARIATIONS OF FINANCIAL STATEMENTS
Highlights in the Analysis 3Q20 X 3Q21
OPERATING INCOME
TABLE 04: GENERATION REVENUE |
Operating Revenue - Generation | 3Q21 | 3Q20 | % | 2021 | 2020 | % |
Generation Revenue | ||||||
Energy supply to distribution companies | 3,982 | 3,381 | 18% | 10,799 | 10,555 | 2% |
Supply | 884 | 639 | 38% | 2,412 | 1,970 | 22% |
CCEE | 523 | 248 | 111% | 1,631 | 726 | 125% |
Operation and Maintenance Revenue | 1,084 | 1,048 | 3% | 3,136 | 2,911 | 8% |
Construction Revenue | 14 | 4 | 287% | 39 | 23 | 70% |
Itaipu Transfer | 84 | -51 | -264% | 115 | -120 | -196% |
Generation Revenue | 6,570 | 5,268 | 25% | 18,132 | 16,065 | 13% |
Non-recurring events | ||||||
(-) Disruption of Angra I and II Retroactive and Inflexibility | 34 | 269 | -87% | 277 | 269 | |
(-) Construction Generation | -14 | -4 | 287% | -39 | -23 | 70% |
Recurring Generation Revenue | 6,591 | 5,533 | 19% | 18,371 | 16,311 | 13% |
VARIATION ANALYSIS 3Q20X3Q21
ENERGY SUPPLY TO DISTRIBUTION COMPANIES
• | At Eletronorte (+R$ 284 million): (i) 30% increase in ACL revenue, R$ 176 million, from the Tucurui and Samuel HPPs (R$ 589 million in 3Q20 X R$ 765 million in 3Q21), as a result of an 83% increase in the sale price (R$107/MWh in 3Q20 XR$196/MWh in 3Q21), which offset the 36% reduction in the amount of energy sold (2,490 MWmed in 3Q20 X 1,765 MWmed in 3Q21); (ii) reduction in sales revenue in the ACR, by UHE Tucurui, down 91% (R$ 25 million in 3Q20 vs. R$ 2 million in 3Q21), caused by the end of products from the 18th Auction, which were sold at R$175/ MWh, and beginning of the 23rd auction's billing at a price of R$167.31/MWh, which reduced energy sold by 91%, 66MWmed in 3Q20 X 6MWmed in 3Q21; (iii) In relation to AMAZONAS GT, incorporated by ELETRONORTE, in Jul/21, there was an increase of 13% in revenue, due to: (a) an average increase of 14% in Contractual Prices linked to the IGPM, which, in terms of energy, had a positive variation of 2% in total; and (b) an increase in TPPs in the Interior caused by the annual price readjustment through the IPCA index. |
• | In Furnas (+R$226 million): (i) increase of 320 GWh negotiated in ACL Supply, due to business opportunity and 9% increase in the average price of energy traded, represented an increase of R$96 million; (ii) Price readjustment of ACR contracts by the IPCA, generating an increase of R$ 10 million; (ii) higher dispatch from the Santa Cruz Plant, of 321,756 MWh, due to the water crisis, generating an increase of R$118 million. |
• | At Eletronuclear (+R$107 million): (i) revenue from the supply of Angra 1 and 2 plants in the amount of R$789.3 million; and (b) reimbursement for the calculation of positive energy deviation in the amount of +R$ 32.3 million, while in 2020, there was revenue from the supply of Angra 1 and 2 plants in the amount of R$ 931.6 million, however provision for negative energy deviation in the amount of -R$216.5 million for the period from January to September 2020.; (ii) 38% increase in the net energy supply of the nuclear power plants of Angra 1 and 2, of which 2,470,070 MWh in 3Q20, and 3,417,790 MWh in 3Q21, due to the extension of the stoppages at Angra 1 and 2 occurred in the 3Q20. |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 8 |
Marketletter 3Q21 |
• | At CGT Eletrosul (+R$ 82 million): (i) the R$ 31.5 million increase in ACR revenue, impacted by the 6.4% price readjustment, which added R$ 14.8 million in revenue, which effect was mitigated by a reduction of 2 MWm reducing revenue by R$1.4 million in 3Q21; (ii) increase of R$51 million in ACL revenue, due to the +30% variation in the average sale price, representing an increase of R$41 million and an increase of 19 average MW in energy sold, resulting in an increase of R$10 million in 3Q21; (iii) reduction in revenue of R$26.5 million due to the increase in compensation for unavailability of UTE Candiota III, and (iv) provision for inflexibility of UTE Candiota III in the amount of R$45.7 million in 3Q20 and no occurrence in 3Q21. |
• | At Chesf (+R$5 million): (i) increase of R$14.6 million (20 average MW) due to new contracts with no basis for comparison in 3Q20; (ii) reduction of R$8.9 million related to the classification of revenue from CER's in the Pindaí Complex as revenue in the CCEE; and (iii) start of commercial operation of EOL Casa Nova A. |
SUPPLY FOR END CONSUMERS
• | At Eletronorte (+R$173 million): (i) variation in Albras' sales of R$162 million due to the update of the base price and the variations in the parameters: for Aluminum, Dollar and sector charges, being: (a) the update by IGP-M of 32% of the base price, from R$134.77/MWh to R$177.92/MWh, generated an increase of R$76 million; (b) 50% increase in average aluminum prices (US$1,677 in 3Q20 X US$2,517 in 3Q21), which resulted in an increase of R$111 million; (c) the 3% drop in the average exchange rate for the dollar (R$5.38/US$ in 3Q20 vs. R$5.23/US$ in 3Q21), which resulted in a decrease of R$4 million; (d) the increase in the limit of charges to be reimbursed by 32% and the 49% increase in charges paid by Albras, generated a drop in revenue of R$20 million. (ii) variation of R$ 11 million due to the seasonality of other sales contracts at UHE Tucuruí. |
• | At Chesf (+R$ 30 million): (i) an increase of 42 average MW in the consumption of industrial customers, achieved by Law 13182/2015, influenced by the gradual resumption of activities by an industrial customer. |
• | In Furnas (+R$ 15 million): (i) readjustment in unit prices of supply contracts, linked to the Itumbiara HPP (Law 13,182/15) of approximately. 4.5%; (ii) variation in ICMS. |
CCEE
• | At Eletronorte (+R$68 million): (i) 435% increase in the average PLD in the period (R$92/MWh in 3Q20 X R$490/MWh in 3Q21); and (ii) a 23% drop in energy sold in bilateral contracts, 4,200MWmed in 3Q20 versus 3,404 in 3Q21. |
• | At the holding (+R$296 million): sale of approximately R$296 million in the CCEE spot market as imported energy from Uruguay, corresponding to 274.1 GWh of energy, without occurrence in 3Q20. |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 9 |
Marketletter 3Q21 |
Partially offset by:
• | In Furnas (-R$60 million): (i) decrease in the GSF of approximately 15% (66% in the period in 2020 and 51% in 2021), resulting in a lower amount of available energy and consequent lower positive exposure, although there was an increase of the PLD (2020: R$ 91.68 / 2021: R$ 581.71). |
• | At Chesf (-R$26 million): (i) increase in the contracted amount by 112 average MW in supply/supply. On the other hand, there was (ii) a reduction in the average GSF from 65.97% (3Q20) to 51.38% (3Q21). |
OPERATION AND MAINTENANCE REVENUE - PLANTS RENEWED BY LAW 12.783/2013
• | In subsidiary Chesf (+R$28 million): (i) annual RAG readjustment of approximately 6.5%, pursuant to Ratifying Resolution 2902/2021 (2021-2022 cycle); On the other hand, there was (ii) a 34.15% reduction in CFURH in 3Q21 compared to 3Q20 (around R$15 million). |
• | In Furnas (+R$7 million (i) annual Annual Generation Revneue (RAG) readjustment of around 3%, around R$10 million, pursuant to Aneel Resolution No. 2902/2021; (ii) entry of the Jaguari plant in Jan/21, operated temporarily by Furnas, representing an increase in revenue of R$ 3 million, without comparison in 2020; (iii) lower CFURH and, consequently, lower PIS/COFINS by around R$ 6 million. |
• | Eletronorte: (i) 15% readjustment, which took place in July 2021, of the RAG of UHE Coaracy Nunes. |
CONSTRUCTION REVENUE
• | Higher level of investment made in 3Q21, but with no effect on results, as it has an equivalent amount in construction expenses. |
ITAIPU TRANSFER
• | At the Holding (+R$ 135 million): (i) Tariff variation on which the monetary restatement is applied, calculated based on the American Commercial Price and Industrial goods price indices, levied on Itaipu's financial asset, which offset the levied exchange variation on said asset, recognized by interministerial ordinance 04/2018 of the MME and Ministry of Finance that determines the revenue of Itaipu. |
ANALYSIS OF VARIATION 2021X2020
• | Revenue from the Generation segment grew by 13% in the 9 months of 2021 (9M21) compared to the same period of the previous year. This growth was mainly influenced by higher revenue at the CCEE, caused by the increase in the PLD and the import of energy from Uruguay by the holding, for sale, by order of the ONS, due to the low volume of reservoirs in Brazil, and by the growth in revenue of Operation and Maintenance Revenue, caused by the annual readjustment of the RAG. |
TABLE 05: TRANSMISSION REVENUE |
Operating Transmission Revenue | 3Q21 | 3Q20 | % | 2021 | 2020 | % |
Transmission Revenue | 4,894 | 2,769 | 77% | 12,370 | 7,570 | 63% |
O&M Revenue - Renewed Lines | 1,522 | 1,395 | 9% | 3,483 | 2,813 | 24% |
O&M Revenue - Regime Exploration | 97 | 46 | 111% | 814 | 550 | 48% |
Construction Revenue | 742 | 203 | 266% | 1,064 | 468 | 128% |
Contractual Revenue - Transmission | 2,533 | 1,126 | 125% | 7,009 | 3,740 | 87% |
Recurring Transmission Operating Revenue | 4,894 | 2,769 | 77% | 12,370 | 7,570 | 63% |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 10 |
Marketletter 3Q21 |
ANALYSIS OF VARIATION 3Q20X3Q21
O&M REVENUE - RENEWED LINES LAW 12.783/13
• | In subsidiary Chesf (-R$143 million): (i) increase in the portion of RAP treated as a contractual asset, as with the increase in the RAP associated with CTT 061/2001, there was a proportional increase in the rectifying account of the RAP billed. As the item is a product of the difference between the billed revenue account and the account where the reversal is carried out (revenues treated as contractual assets), there is a reducing effect on the group in reference. On the other side there were 17% increase in the amortization of the contractual asset balance of contract 061/2001. |
• | In the subsidiary Eletronorte (-R$ 43 million): (i) decrease of R$39 million in allowable revenue, mainly impacted by the lower Adjustment and Advancement Portion. In addition, there was (ii) a reduction in revenue due to the increase of R$4 million in the portion allocated to the amortization of assets as a result of the remeasurement caused by the publication of REH nº. 2,959/21. |
• | In the subsidiary Furnas (-R$34 million): (i) redistribution between the pricing of construction and the pricing of operation and maintenance, in the amount of approximately R$ 44 million, due to the re-estimates of the evolution of the execution of the transmission projects in progress and the authorizations by ANEEL, carried out in the period, of RAPs for transmission projects completed. |
• | In the subsidiary CGT Eletrosul (-R$14 million): (i) lower prepayment apportionment by R$10.6 million; (ii) an increase of R$5.7 million referring to the readjustment of authorized reinforcements and improvements, pursuant to REH 2,895/2021, which established the RAP for the 2021/2022 cycle; and (iii) a reduction of approximately 53% in the O&M RAP or approximately R$27.6 million in 3Q21. Excluding the recovery amount of R$20.1 million through the adjustment portion, this results in a reduction of R$7.5 million in total. |
O&M REVENUE - EXPLORATION REGIME
• | In the subsidiary Eletronorte (+R$17 million), mainly due to: (i) an increase of R$22.6 million in billed revenue, mainly impacted by the readjustment/revision of the cycle (higher PV and lower PA); (ii) Readjustment of 6 contracts tendered by the IPCA of the 8.09% cycle, and readjustment of 2 contracts for tariff review: CC 009/2010 and CC 004/2021 with positive readjustment of 17.88% and 16.89% respectively . The others contracts had a correction slightly higher than the inflation of the cycle by new installments of RAP for authorized reinforcements without prior establishment of revenue. On the other hand, there was (ii) a R$6.1 million decrease in O&M Revenue, as a result of the difference between "Billed Revenue" and "Amortization". Amortization had a monthly increase of around R$ 2 million. |
• | In the subsidiary Chesf (+R$11 million): (i) 18% readjustment of the 21/22 cycle (already discounting the inflationary effects between the periods), according to REH Aneel 2,895/21; (ii) the effects of the tariff review of concession contracts 006/2009, 007/2005, 017/2009 and 018/2009; and (iii) the recognition of RAP's of reinforcements without previously established revenue arising from the entry into commercial operation of projects and improvements included by Aneel for the 2021/2022 cycle. |
• | At CGT Eletrosul (+R$6 million): (i) readjustment of the RAP for the 2021/2022 cycle, with emphasis on contract 010/2005, which was corrected by the accumulated IGPM of 37.04%, generating an increase of R$16.1 millions; (ii) reduction of R$6.5 million due to the apportionment of anticipation (-R$4.7 million) and the Calculation Adjustment Portion (-R$1.8 million); and (iii) a decrease in revenue due to the end of the similar concession related to Conversora de Uruguaiana / MME Ordinance No. 624/2014 (-R$ 1.7 million). |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 11 |
Marketletter 3Q21 |
• | In Furnas (+R$4 million): (i) change of tariff cycles, which brought readjustments in the Transmitters' RAPs of around 9%. |
CONSTRUCTION REVENUE – TRANSMISSION
• | Furnas (+R$503 million): (i) reestimates of the execution of ongoing transmission projects and ANEEL authorizations, carried out in the period, of RAPs for completed transmission projects, of approximately R$500 million. |
• | Chesf (+R$179 million): (i) directly related to the expenses incurred (appropriated and allocated) in the transmission investment events in progress, with emphasis on the achievements in the renewed contract, which amount exceeds by more than 80% of investments for the quarter. |
• | CGTEletrosul (R$ 55 million): (i) re-estimates of the execution of transmission projects in progress. |
Partially offset by:
• | Eletronorte (-R$ 35 million): (i) adjustment of the contractual asset of contract 058/2001 (-R$ 22.6 million) in 3Q21, mainly due to the re-estimates of the execution of the transmission projects in progress. |
CONTRACT REVENUE - TRANSMISSION
• | Chesf (+R$834 million): (i) increase in the IPCA variation accumulated in 3Q21 (2.38%) compared to 2020 (0.86%); (ii) increase in the balance of contractual assets related to RAP-RBSE in 3Q21, mainly due to reprofiling, complementary consideration of KE in RAPs related to RBSE and completion of the inspection of the valuation report of the Regulatory Remuneration Basis - BRR of the Contract No. 061/2001. However, it is worth noting that in 3Q20, there was a reclassification between the values of the transmission revenue items, in the amount of R$ 477 million, to adjust the accounting classification occurred in 2Q20, given that this amount refers to the regulatory remeasurement and if you can find it on a separate line from the transmission revenue. |
• | Furnas (+R$367 million), Eletronorte (+R$41 million) and CGT Eletrosul (+R$65 million): (i) increase in the accumulated IPCA variation in 3Q21 (2.38%) compared to 2020 (0 .86%); (ii) increase in the balance of contractual assets related to RAP-RBSE in 3Q21, mainly due to the reprofiling and additional consideration of KE in RAPs related to RBSE. |
VARIATION ANALYSIS 2021x2020
• | Variation in transmission revenue of around R$4.8 billion in the year, mainly due to: (i) increase in inflation rates (IPCA) in 2021; (ii) increase in the balance of contractual assets related to RBSE, (calculation basis of revenue from updating contractual assets), with emphasis on: a) effects of reprofiling the financial component of RBSE, which impact the basis of contractual assets; b) Complementary recognition of the cost of equity (Ke) given that, in 2020, ANEEL only ratified the correction by the IPCA of the RBSE amounts not paid between 2017 and 2020, arising from the ABRACE injunction. In cycle 2021/2022, ANEEL recognized, in addition to correction by the IPCA, the remuneration of this amount by Ke e; c) Completion of the inspection of the appraisal report of the Regulatory Remuneration Basis – BRR of Chesf's Contract No. 061/2001. With this, the definitive values of the Periodic Review of the 2018/2023 cycle of the Allowed Annual Revenue - RAP were approved, through the publication of Ratifying Resolution No. 2935/2021. Additionally, in 2020, due to uncertainties regarding the inspection results, the Company estimated the flow of receivables only until the 2024/2025 cycle, and (iii) re-estimates of the execution of ongoing transmission projects and ANEEL authorizations, with featured in Furnas. |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 12 |
Marketletter 3Q21 |
TABLE 06: OTHER OPERATING REVENUE |
Operating Income | 3Q21 | 3Q20 | % | 2021 | 2020 | % | |||||
Others Revenues | 199 | 171 | 16% | 551 | 451 | 22% | |||||
Non-recurring events | |||||||||||
Retroactive reversal procedure | 0 | 0 | 100% | 8 | 0 | 100% | |||||
Other recurring income | 199 | 171 | 16% | 559 | 451 | 24% | |||||
OTHERS REVENUES
VARIATION ANALYSIS 3Q20X3Q21
• | At Eletronorte (+R$30 million): (i) increase of R$11.3 million in CDE; (b) R$10 million in Proinfa; (c) R$4.6 million in Leases and Leases; (d) R$2.5 million in multimedia communication services. |
• | Chesf (+ R$ 8 million): (i) R$ 7.5 million increase in rental revenue. |
• | CGT Eletrosul (+ R$ 7 million): (i) higher revenue from telecom services and operation and maintenance of R$ 2.5 million, given that in 3Q20 there was a delay in the regularization/update of registration data for the new CGT company Eletrosul; (ii) an increase in revenue from Engineering and Studies Services of R$3.7 million, due to the provision of extraordinary services that took place this year; and (iii) an increase in sales of ash from UTE Candiota III by R$0.9 million, given that the UTE was under maintenance in 3Q20. |
OPERATIONAL COSTS AND EXPENSES
TABLE 07: OPERATIONAL COSTS AND EXPENSES |
Operational costs | 3Q21 | 3Q20 | % | 2021 | 2020 | % |
Energy purchased for resale | 2,360 | -564 | -519% | 1,354 | -1,570 | -186% |
Charges on use of the electricity grid | -857 | -510 | 68% | -1,800 | -1,350 | 33% |
Fuel for production electric power | -627 | -528 | 19% | -1,830 | -1,524 | 20% |
Construction | -359 | -229 | 57% | -769 | -576 | 33% |
Personnel, Material, Services and Others | -2,099 | -2,022 | 4% | -6,317 | -5,843 | 8% |
Depreciation and amortization | -503 | -468 | 8% | -1,408 | -1,399 | 1% |
Operating Provisions | -9,330 | -2,002 | 366% | -11,369 | -3,008 | 278% |
Total Operating Costs and Expenses | -11,414 | -6,322 | 80,5% | -22,139 | -15,271 | 45% |
Non-recurring events | ||||||
(-) Non-recurring PMSO events | 144 | 74 | 95% | 475 | 218 | 118% |
(-) Non-recurring provisions | 9,342 | 1,807 | 417% | 11,658 | 2,131 | 447% |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 13 |
Marketletter 3Q21 |
(-) Generation Construction | 14 | 4 | 287% | 39 | 23 | 70% |
(-) Transfer of coal from Material/Interest and Monetary Variation on debentures fixed in September/21 | 0 | 0 | - | 13 | 0 | - |
(-) Hydrological risk renegotiation, resulting from resolution nº 2.932/21 which ratified the term of extension of the concession of the hydroelectric plants- accounted for as a reducer of the energy purchased for resale account. | -4,266 | 0 | - | -4,266 | 0 | - |
Record of GSF expense for adherence to the hydrological risk renegotiation (with a counterpart reversal of the provision amount of the same amount) | 378 | 378 | ||||
Total Recurring Operating Costs and Expenses | -5,802 | -4,438 | 31% | -13,842 | -12,900 | 7% |
VARIATION ANALYSIS 3Q20X3Q21
ENERGY PURCHASED FOR RESALE
• | At Eletronorte (+R$2,953 million): (i) Renegotiation of the hydrological risk, in the amount of R$3,029 million, recorded as recovery of non-recurring expenses, arising from Aneel Resolution No. 2,932 of 09/14/2021, which ratified the term for extending the concession of the hydroelectric power plants UHE Curuá-Una: 2,313 days, UHE Samuel 1,042 days, and UHE Tucuruí: 518 days; partially offset by (ii) the 435% increase in PLD, R$92/MWh in 3Q20 X R$490/MWh in 3Q21; and (iv) worsens the GSF by 22% (66% in 3Q20 vs. 51% in 3Q21). |
• | In the subsidiary Furnas (+R$335 million): (i) Renegotiation of the hydrological risk, in the amount of R$ 864 million, recorded as recovery of non-recurring expenses, arising from Aneel Resolution No. 2,932 of 09/14/2021, resulting from the extension of the plants HPP Furnas (in 33 days), HPP Luis Carlos Barreto (in 34 days), HPP Porto Colombia (in 34 days), HPP Corumbá I (in 34 days), HPP Marimbondo (in 37 days) and HPP Funil (in 37 days), offset by: (ii) price readjustments of contracts in force of approximately R$53 million in the period; (iii) 31% increase in the IGPM in the period; and (iv) energy purchases in order to avoid negative exposure in the MCP, taking advantage of the discount existing in short-term bilateral operations, as well as the tax benefit against settlement at the CCEE), of approximately R$527 million in 3Q21. |
• | At the Holding (+R$262 million): higher imports (+285.4 GWh) of energy from Uruguay, due to the demand for energy volume by the ONS due to the country's hydrological situation. |
• | At CGT Eletrosul (+R$84 million): (i) increase of 5.2% in the average acquisition price, increasing the cost by R$8.9 million; partially offset by (ii) a reduction of 28 MWm in the quantity purchased (from 373 MWm in 3Q20 to 345 MWm in 3Q21), causing a decrease of R$13.4 million in cost; (iii) positive variation of energy purchased in the MCP and tax and financial effects of the PIS/COFINS discount in the order of R$2.1 million, and (iv) Hydrological risk renegotiation in the amount of R$81.6 million, recorded as recovery of non-recurring expenses, arising from Aneel Resolution No. 2,932 of 09/14/2021, 2,919/2021, which extended the term of the Governador Jayme Canet Júnior (Old Mauá) plants by 1789 days; HPP Passo São João in 1740 days; HPP São Domingos in 610 days; SHP Barra do Rio Chapéu in 1461 days; and PCH João Borges in 1,362 days. |
Partially offset by:
• | At Chesf (-R$165 million): (i) Renegotiation of the hydrological risk, in the amount of R$291 million, recorded as recovery of non-recurring expenses, arising from Aneel Resolution No. 2,932 of 09/14/2021, which approved the term extension of the granting of hydroelectric plants: HPP Boa Esperança (in 122 days), HPP Complexo Paulo Afonso (in 120 days), HPP Curemas (in 446 days), HPP Funil (in 44 days), HPP Luiz Gonzaga (126 days) , UHE Sobradinho (2,555 days) and Xingò (126 days); (ii) the effect of changes in purchase contracts entered into between the compared periods, which impacted the quarter by R$78 million; partially offset by the write-off, in July/2021, of the accumulated amounts, since July/2015 (R$ 378 million), due to Chesf having given up on a court injunction that protected it against the effects of the GSF under the CCEE, affecting the result for the quarter and without a basis for comparison in the same period in 2020. Such procedural waiver allowed the renegotiation of the hydrological risk dealt with in item (i) above. |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 14 |
Marketletter 3Q21 |
FUEL FOR ELECTRICITY PRODUCTION
• | In Furnas (+R$138 million): (i) updates to the contractual parameters related to the price of fuel, in particular Gas Natural Herny Hub; and (ii) higher thermal generation in Santa Cruz, with 321,756 MWh in 3Q21, against 1,202 MWh in 3Q20. |
• | At Eletronuclear (+R$21 million): (i) an increase in the consumption of fissile uranium equivalent (Kg Ueqv) by 37%, of which 325.630 Kg Ueqv in 3Q21 and 237.060 Kg Ueqv in 3Q20; (ii) Angra 2 was stopped in 2020 (2P16 scheduled stoppage in the period from 06/22/2020 to 08/17/2020, impacting 48 days within the analyzed quarter); (iii) 22 days of scheduled shutdown of the Angra 2 plant in 3Q21. |
Partially offset by:
• | At Eletronorte (-R$61 million): (i) the R$50 million increase in fuel costs, being: (a) the R$100 million increase due to the 10.15% annual readjustment in the Natural Gas Price, which are indexed to the IGPM and IPCA, and the increase average of 11.45% in power generation, highlighting the Aparecida and Mauá 3 TPPs, which had an energy increase of 28% and 21%, respectively, which contributed to an average increase of 16% in the Contract's natural gas consumption, as these plants began operating in 3Q21 on a more continuous basis and at full load, following an order from the ONS due to the water crisis that is causing the reduction in the reservoirs of the SIN HPP ; (ii) reduction of R$64.6 million in ancillary expenses with Ship or Pay and Take or Pay, due to the increase in natural gas consumption; (iii) an increase of R$20 million related to the reversal of ICMS on sales of energy produced by UTE Mauá 03, due to the plant's self-consumption of natural gas. The reversal occurs because the sale is outside the state of AM and exempt from ICMS. (iv) reduction of R$6.2 million related to the rental of a generator set recorded in 3Q20 and reclassified in 3Q21. Offset by (ii) an increase of R$110 million in the recovery of expenses, due to: (a) the 10.15% annual readjustment of the Natural Gas Price, which is indexed to the IGPM and IPCA; and (b) the increase in the consumption of natural gas at the Aparecida and Mauá 3 UTEs, equivalent to 33% and 24%, respectively (since these plants are the only beneficiaries of the CCC Reimbursement of the consumed natural gas). |
CHARGES ON USE OF THE ELECTRICITY GRID
• | At Eletronorte (+R$21 million): (i) annual increase with charges for the use of the electricity transmission network, which is readjusted considering the variation of the IPCA index. Overall, the EUST had an average increase of 11.5%, while the EUSD was around 17.5%. The main Aneel Resolutions that ratified the readjustments are: a) ReH 2.958/2021, ReH 2.748/2020 and ReH 2.586/2019 for the Tucuruí and Samuel plants and the Mauá 3 UTE; and b) ReH 2,920/2021, ReH 2750/2020 and ReH 2,566/2019 for the Curuá-Una plant. |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 15 |
Marketletter 3Q21 |
• | At Chesf (+R$ 4 million (i) readjustment of approximately 2.8% of TUST, determined by ANEEL Ratifying Resolution 2896/2021 (2021-2022 cycle). |
CONSTRUCTION
• | At Chesf (+R$103 million), mainly due to: (i) having a direct relationship with the expenses incurred (appropriated and allocated) in the transmission investment events in progress. |
• | In Furnas (+R$ 6 million): (i) increase of R$ 10 million in generation construction; (ii) reduction of R$ 2 million in transmission, referring to contract 062/01 ; (iii) reduction of R$ 1.3 million in other contracts. |
VARIATION ANALYSIS 2021x2020
• | The sum of the costs of Energy purchased for resale, Charges on the use of the electricity network, Fuel for the production of electricity and construction, in 9M21, decreased by 46%, mainly impacted by the renegotiation of the hydrological risk, in the amount of R$ 4,266 million, recorded as recovery of expenses arising from Resolution No. 2,932 of 09/14/2021 which ratified the period for extending the granting of some hydroelectric plants. This reduction in expenses was partially offset by: (i) higher fuel costs, higher dispatch from the Santa Cruz plant and increased consumption at UTE Mauá 03 ; (ii) Increase in network usage charges, mainly caused by the readjustment of about TUST and incorporation of the Pindaí Complex as of April/2021 by Chesf. |
TABLE 08: PERSONNEL, MATERIAL, SERVICES AND OTHER |
Personnel, Material, Services and Others | 3Q21 | 3Q20 | % | 2021 | 2020 | % |
Personnel | -1,178 | -1,049 | 12% | -3,635 | -3,204 | 13% |
Material | -67 | -62 | 9% | -200 | -216 | -7% |
Services | -513 | -519 | -1% | -1,365 | -1,418 | -4% |
Others | -341 | -392 | -13% | -1,117 | -1,005 | 11% |
PMSO total | -2,099 | -2,022 | 3,8% | -6,317 | -5,843 | 8,1% |
Non-Recurring Items | ||||||
Incentive Plans (PAE, PDC) | -2 | -15 | -84% | -7 | -23 | -69% |
Eletronorte resignation | 1 | 0 | - | 79 | 0 | - |
Foundations contributions reversal - CVM 600 adjustment | -8 | 0 | - | -22 | 0 | - |
Indemnities (Labor Claims) – Furnas | 21 | 0 | - | 69 | 0 | - |
Retroactive Entries, Reclassifications and Historic Hour Bank 25% | 53 | 12 | 339% | 1 | 0 | - |
Furnas Outsourced | 0 | 68 | -100% | 0 | 95 | -100% |
Loss with CCC corresponding to the inspection of Boa Vista | 58 | 0 | - | 58 | 0 | - |
Income tax not collected from conviction paid in 2015 | 0 | 0 | - | 42 | 0 | - |
IR on Debt Donation Charges - Transfer from AmGT | 0 | 0 | - | 40 | 0 | - |
Cour costs and fees | 3 | 0 | - | 48 | 0 | - |
Labor Costs | 0 | 0 | - | 13 | 0 | - |
Indemnities - Loss and Damage | 0 | 0 | - | 38 | 0 | - |
Worthless SPE FOTE | 13 | - | 20 | 0 | - | |
Write-off of Energisa assets in 1Q21 (Assets of Distributed Distributors) | 0 | 0 | - | 29 | 0 | - |
Generator group rental (emergency service to Amapá) | 6 | 0 | - | 57 | 0 | - |
Others | 0 | 9 | 12 | 146 | ||
PMSO Recurrent | -1,954 | -1,948 | 0% | -5,842 | -5,625 | 4% |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 16 |
Marketletter 3Q21 |
Others: transfer of coal to fue accountl, Pis/COFINS UTE Candiota III credit, Debenture issue commissions in 1Q21, sale and reimbursement of T assets to Energisa, accounting for previous years, Camargo Correa lawsuit (Furnas), agreement installments Frunas/Inepar, losses and damages – Nova Engevix, Cien.
VARIATION ANALYSIS 3Q20X3Q21
PERSONEL
• | Increase of R$129 million due to: (i) around R$ 40 million in salary adjustment, due to the application of 2.4%, as provided for in the Collective Bargaining Agreement as of Dec/20; (ii) R$27 million in vacations; (iii) R$10 million additional for length of service; (iv) R$16 million for the 13th salary; (v) R$30 million in expenses with FGTS or supplementary pension; (vi) impact of 6.76% provision for ACT 2021, retroactive to May 2021, bringing an increase of R$141 million in the quarter, R$53 million of which referring to the months of May to June and non-recurring in 3Q21. |
• | At Chesf (-R$27 million): increase in the actuarial liability of the CD and BD benefit plans, R$31 million, due to the adequacy of the base in 2020 and the impact of the IGPM, offset by (ii) : reversal of the provision for PLR in R$62 million, due to the payment of the PLR in September 2021; |
• | At Eletronuclear (+R$ 54 million), there was an increase in overtime in the workforce due to the partial replacement of outsourced labor in stoppage activities, beginning of the Dry Storage Unit (UAS) operation, a structure built for " unburden” the storage of nuclear fuel inserted in the pools of each A1/A2 reactor, and extension of shutdown periods due to complications. |
• | These amounts were partially offset by a higher allocation of labor for investment in the amount of R$32 million, especially for Chesf, which increased by R$26.1 million in the period. |
Material
• | At Eletronorte (-R$ 11 million): (i) reduction in operational maintenance materials - direct acquisition, of R$ 10.5 million, impacted by the accounting reclassification of material that would be used for R&D project and which started to be treated as internal cost in the asset. |
• | In Furnas (+R$9 million): (i) increase of R$7 million in Miscellaneous Materials, due to the resumption of maintenance; and (ii) an increase in the Fuel and Lubricants account, in the amount of R$1.3 million, referring to the car fleet. |
• | At Eletronuclear (+R$5 million): (i) revaluation of inventory materials in the amount of R$2.9 million; (ii) higher cost of materials with preventive shutdowns of R$2.2 million. On the other hand, there was: (iii) a reduction in the usual cost of materials, in the amount of R$2.6 million and (iv) a lower adjustment of ICMS on inventory, positively impacting 3Q20 by R$2.6 million |
• | At CGT Eletrosul (+R$5 million): (i) in 3Q21 the Average Generation of TPP Candiota III was 267.35 MWaverage and the expenditure on virgin lime was R$18.8 million, thus the variation only in relation to Cal was R$8.3 million higher than in 3Q20. (ii) Given the non-consumption of materials and production inputs due to the shutdown of the plant, in 3Q21 PIS/COFINS credits were 4.7 million higher than in 3Q20. |
SERVICES
• | At Eletronuclear (+R$43 million): (i) an increase of R$37.2 million with the cost of the stoppage in 3Q21 (2P17 stoppage) compared to the 2P26 stoppage due to the increase in the scope of work. |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 17 |
Marketletter 3Q21 |
• | At CGT Eletrosul (+R$13 million): (i) R$6.3 million increase in operational maintenance services, with emphasis on: (a) R$5.4 million increase in expenses with consulting and audits for contracting technical expertise for arbitration proceedings; (b) resumption of operational maintenance activities that were contingent in 3Q20 due to the COVID-19 pandemic; (ii) an increase of R$1.4 million in IT Services in building conservation due to the return of employees to the office. |
Partially offset by:
• | In Furnas (-R$37 million): (i) reduction of hired labor, R$64.5 million, given that in 2020 there was payment of contract termination. On the other hand, there was an increase in: (ii) Accredited Dental Hospital Medical care by R$9.8 million; (iii) Infrastructure Sharing in R$ 8 million referring to reimbursement of CSC Global Coordination Costs from October/2019 to March/2020; and (iv) Contractors in R$2.5 million. |
• | At Eletronorte (-R$ 15 million): (i) Reduction in the following expenses: (a) Maintenance of operating assets, of R$ 4.2 million, due to a punctual plant maintenance service in 2020, with no counterpart in 2021; (b) Maintenance of the Right of Way and Access Roads, of R$3.9 million, due to the sale of the transmission part of AmGT and the seasonality of the transmission line vegetation clearing service; (c) Medical, hospital and dental care, of R$3.6 million, since the account is no longer being used in 2021; (d) Electricity consumption of R$2.8 million due to the pandemic; (e) Contracted administrative labor, of R$2.2 million; (f) Rental of sundry vehicles, in the amount of R$2 million; (g) Studies and projects, of R$1.6 million. (ii) On the other hand, there was an increase in expenses with: (a) driver services, of R$5.6 million, due to the resumption of activities that were suspended in 2020 due to the pandemic. |
OTHERS
• | Holding (+R$93 million): (i) CCC loss corresponding to the inspection of Boa Vista - R$57 million; (ii) lower expenses with court costs (except labor) R$16 million (iii) increase of R$3.2 million with rentals. |
• | At CGT Eletrosul (+R$46 million (i) lower Recovery of expenses, which amounted to R$44 million in 3Q20 against R$9 million in 3Q21. In 2021, the recovery mainly refers to disallowances of invoices from suppliers referring to services of 2016 in the amount of R$ 5 million. (ii) reversal in 3Q21 of an advantageous purchase that had been recorded in 2Q21, referring to the acquisition process of SPE Fronteira Oeste Transmisora de Energia, of R$ 7.5 million, in addition to an additional record of loss related to the same process in the amount of R$5.7 million, totaling a negative effect of R$13.2 million in 3Q21, given that the analysis of the business combination was provisionally recorded in 2Q21, as permitted by CPC 15 and as mentioned in this Annex II of 2Q21. |
• | At Eletronorte (+R$31 million): (i) reclassification of recovery of expenses (reduction account) related to PIS and COFINS credit activations, which generated an increase of R$16.7 million. In 2020, PIS and COFINS credit activations were recorded in the group of other operating expenses (R$16.7 million), in 2021 they were transferred to the expense recovery group - subsidy received (R$73.9 million) . (ii) In addition, there was an increase in the following expenses: (a) rental of generator groups, of R$5.7 million, as the expense was recorded in the fuel group in 3Q20, and was reclassified to the group of other expenses operating in 2021. In general, the variation in expenses with rental of generator groups between the periods was negative by R$1.2 million; (b) facilities, equipment and inventory insurance, in the amount of R$4.5 million; (c) operation and maintenance cost of R$3.9 million. |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 18 |
Marketletter 3Q21 |
Partially offset by:
• | At Chesf (-R$21 million): (i) reduction in expenses with indemnities, losses and damages of R$37.3 million related to the recording of losses with customers; On the other hand, there was: (ii) an increase in insurance expenses of R$8.1 related to the appropriation of insurance expenses; and (iii) reduction in expense recoveries of R$7.9 million, due to the lower amount recovered from "INSS cooperative" reimbursed to the Company in 3Q20. |
VARIATION ANALYSIS 2021x2020
• | Personnel, material, services and other costs and expenses presented, in 9M21, a variation of 7.1% compared to the same period of the previous year, mainly reflecting: (i) non-recurring expenses of approximately R$79 million due to dismissal of 285 employees between January and March 2021. Salary readjustment, from 12.01.2020, of 2.4% and more 6.76%, from 11.01.2021, as provided for in the Collective Labor Agreement, in addition to other events, such as an increase in the cost of interest due to the actuarial liability of Chesf's benefit plans, bringing a total impact on the personnel account of R$431 million, plus an annual fee of 1%. There was also an increase in other costs and expenses arising from the rental of generator groups, in the amount of R$47.5 million, for emergency assistance to Amapá and the write-off of the energisa asset in the amount of R$33 million. Increase of R$157 million in the “other expenses” account of the holding, mainly impacted by the loss with CCC corresponding to the inspection of Boa Vista (R$57 million); (ii) Income tax not collected from sentence paid in 2015 (R$ 42 million). |
DEPRECIATION AND AMORTIZATION
TABLE 09: OPERATING PROVISIONS |
Depreciation and Amortization | 3Q21 | 3Q20 | % | 2021 | 2020 | % |
Depreciation and Amortization | -503 | -468 | 8% | -1,408 | -1,399 | 0,6% |
Non-recurring events | ||||||
Extraordinary depreciation relating to the updating of energized assets in March/2019, accounted for in August/2021. | 39 | 0 | - | 0 | 0 | 100% |
Recurring Depreciation and Amortization | -464 | -468 | -1% | -1,408 | -1,399 | 1% |
TABLE 10: OPERATING PROVISIONS |
Operating Provisions | 3Q21 | 3Q20 | % | 2021 | 2020 | % |
Operational provisions / reversals | -9,330 | -2,002 | 366% | -11,369 | -3,008 | 278% |
Operational provisions / reversals | ||||||
Contingencies | -375 | -642 | -42% | -1,372 | -532 | 158% |
Provisions and Reversals Compulsory Loan | -9,059 | -377 | 2304% | -10,094 | -409 | 2369% |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 19 |
Marketletter 3Q21 |
Provisão/Reversão PCLD RGR de Terceiros/ Estimativa de perda de crédito prospectiva (CPC 48)/ Reversão PCLD CIEN/ RPCs Chesf | 0 | -179 | -100% | 118 | -201 | -159% |
Onerous Contracts | -23 | -172 | -87% | -23 | -172 | -87% |
(Provision)/Reversal for investment losses | -3 | 9 | -133% | -111 | -112 | 0% |
RAP Adjustment Portion | 0 | 0 | - | 0 | -224 | -100% |
Impairment of long-term assets | 454 | 43 | 965% | 454 | 63 | 623% |
Provision for Implementation of Shares - Compulsory Loan | -47 | -353 | -87% | -93 | -353 | -74% |
ANEEL Provision - CCC | -288 | -27 | 963% | -528 | -18 | 2822% |
Candiota III Plant - Inflexibility | 0 | -107 | -100% | 0 | -173 | -100% |
Usina Candiota III - Fuel | -2 | 0 | - | -9 | 0 | - |
Non-recurring provisions / reversals | -9,342 | -1,807 | 417% | -11,658 | -2,131 | 447% |
Recurring Provisions/Reversals | ||||||
Guarantees | 5 | 3 | 51% | 24 | 1 | 2362% |
PCLD (excluded PCLD Prospective credit loss estimate for privatized distributors (CPC 48)) and RPCs Chesf | 44 | -94 | -147% | 319 | -632 | -151% |
GAG Improvement | 1 | -57 | -103% | -51 | -166 | -70% |
Others | -38 | -47 | -20% | -4 | -80 | -95% |
Recurring provisions / reversals | 12 | -195 | -106% | 289 | -877 | -133% |
The positive values in the table above mean provision reversal.
ANALYSIS OF VARIATION 3Q20X3Q21
The variation is mainly explained by:
Provision for Contingencies of R$9,434 million in 3Q21: (a) At the Holding, based on the development of case law related to the ECE lawsuits, the Company reviewed its provision estimates for ECE lawsuits, resulting in an increase of approximately R$ 8,926 million in 3Q21. This amount contemplates, amongst others, (i) R$ 5,253 million related to the reclassification, from remote to probable, of the risk of losing disputes in which parties disputed the initial term of the statutory period applicable to the collection of reflexive compensatory interests, and (ii) R$ 2,180 million resulting from altering the moment in which, in compliance with final judgements that went against the Company’s position, and with unfavorable calculations approved by courts, the Company would supplement the provision for disputed amounts. Considering other constituted provisions and the reversal of ECE lawsuits, the final result was a total provision of R$ 9,059 million for the third quarter of 2021; (b) At Chesf, R$354 million in provisions for contingencies, with an emphasis on the constitution of R$657 million, mainly due to the reclassification of risk and updating of legal proceedings (with emphasis on the factor k process, with a provision of R$233 million ), which was partially offset by the reversal of the provision for a GSF lawsuit of R$369 million; |
• | At the holding company, provision of R$340 million referring to current CCC credits that were registered in the current assets of the privatized distributors Boa Vista, Ceron and Eletroacre in Jun/17 and which were transfered by the said distribution companies to Eletrobras, but ended up being carried out by the same distributors before the effective transfer of credits to Eletrobras, and therefore, these credits were provisioned by Eletrobras, as the revenue will not be made by the CCC/CDE, but by the privatized distribution companies, who must sign a contract with Eletrobras for the return of said amounts. There is also a current credit owed by Amazonas Energia of approximately R$442 million, but the contract has already been signed and accounted for as a financing receivable from the aforementioned distributor. Credits with other distributors will be accounted for when the respective signed contracts are finalized and signed. |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 20 |
Marketletter 3Q21 |
Partially compensated:
• | By the subsidiary Eletronorte, with the reversal of a provision, in the amount of R$ 53 million, related to the right to compensation resulting from the inspection and monthly reprocessing of the CCC, in the period from July 2009 to June 2016, paid to Eletronorte in a lower amount in the amount of R$ 116 million, updated by the IPCA of August/2021; and reversal of civil contingencies in the amount of R$101.4 million referring to a court settlement in the El Paso Rio Negro Energia Ltda process. |
• | Reversal of impairment of long-term assets, in the net amount of R$454 million, highlighting the reversal of 265 million referring to the UTE Santa Cruz and HPP Batalha, reversal of R$99 million of Samuel impairment, offset by the provision of R $276 million related to the recognition of impairment of UTE Candiota III, mainly due to the revision in the expectation of recomposition of the physical guarantee of this plant. |
FIXED ASSETS + INTANGIBLE ASSETS - GENERATION | CONTROLLED | (-) CONSTITUTION | (+) REVERSAL | Operating Provisions | Result |
Casa Nova A | Chesf | 0 | 35 | 210 | 35 |
Casa Nova II | Chesf | 0 | 49 | 0 | 49 |
Casa Nova III | Chesf | 0 | 26 | 0 | 26 |
Pindaí I | Chesf | 0 | 100 | 0 | 100 |
UHE Batalha | Furnas | 0 | 144 | 265 | 144 |
UTE Santa Cruz | Furnas | 0 | 120 | 0 | 120 |
FASE A,B, NUTEPA, SÃO JERONIMO | CGT Eletrosul | 0 | 15 | -120 | 15 |
CANDIOTA III-FASE C | CGT Eletrosul | -276 | 0 | 0 | -276 |
UGC PCH João Borges | CGT Eletrosul | 0 | 42 | 0 | 42 |
UGC PCH Rio Chapéu | CGT Eletrosul | 0 | 33 | 0 | 33 |
UGC UHE Passo São João | CGT Eletrosul | 0 | 35 | 0 | 35 |
UGC Eólica Coxilha Seca | CGT Eletrosul | 0 | 26 | 0 | 26 |
UGC Eólica Galpões | CGT Eletrosul | 0 | 4 | 0 | 4 |
UGC Eólica Capão do Inglês | CGT Eletrosul | 0 | 1 | 0 | 1 |
UTE Presidente Médice (Fase A e B) | CGT Eletrosul | -0,3 | 0,0 | 0,0 | -0,3 |
UHE Samuel | Eletronorte | 0 | 99 | 99 | 99 |
3Q21 effects (Reversal) | -277 | 731 | 454 | 454 |
• | Onerous contracts: Reversal of R$23 million, the main changes being: (i) reversal of R$88 million from the Onerous Agreement of Coaracy Nunes, ; (ii) constitution of R$94 million due to the result of UHE Funil, reversal of a onerous contract of R$ 33 million, referring to the Jirau commercialization contract. |
ANALYSIS OF VARIATION 2021X2020
• | Operating provisions presented, in 9M21, a 300% growth compared to the same period of the previous year, mainly reflecting: (i) At the Holding, R$10,174 million of provisions for contingencies, highlighting R$10,094 million of provision for lawsuits of compulsory loan; (ii) ANEEL – CCC provision, in the amount of R$528 million, related to CCC credits assigned by the companies CERON and Boa Vista to Eletrobras; partially offset by (iii) Impairment Reversal of R$454 million. |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 21 |
Marketletter 3Q21 |
REGULATORY REMEDIES - TRANSMISSION CONTRACTS
TABLE 11: Regulatory remeasurements - Transmission Contracts |
Regulatory remeasurements - Transmission Contracts | 3Q21 | 3Q20 | % | 2021 | 2020 | % |
Non-Recurring Events | ||||||
Regulatory remeasurements - Transmission Contracts | 4,859 | 4,228 | 15% | 4,859 | 4,228 | 15% |
• | In the third quarter of 2021, the contractual transmission assets increased significantly, due to the remeasurement of the concession assets referring to RBSE, in particular by the reprofiling of the financial component of RBSE, approved by ANEEL in April 2021. The decision caused a reduction in the payment curve of amounts related to the periodic review of RAPs associated with transmission facilities for cycles 2021/2022 and 2022/2023 and an increase in the flow of payments in cycles after 2023, extending such installments until cycle 2027/2028 , preserving, however, the remuneration for the cost of equity (Ke) for RBSE. For more details, see note 14 to the 3Q21 financial statements. |
SHAREHOLDINGS
TABLE 12: SHAREHOLDINGS |
Shareholdings | 3Q21 | 3Q20 | % | 2021 | 2020 | % |
Shareholdings | 920 | 369 | 149% | 1,706 | 875 | 95% |
ANALYSIS OF VARIATION 3Q20X3Q21
SHAREHOLDINGS
• | The main highlights were: (i) improvement in the equity result of SPE Norte Energia (+R$105 million), due to the extension of the concession period, as a result of the GSF agreement pursuant to Law 14.052/2020; (ii) improvement in the result of SPE Chapecoense (+R$58 million), due to the reduction in energy purchases and (iii) improvement in the result of equivalence at CTEEP (+R$80 million); (iv) Negative amount of R$464 million in 3Q20 referring to Manaus Energia. |
ANALYSIS OF VARIATION 2021X2020
• | In 9M21, equity interests showed a 78% variation compared to the same period of the previous year, mainly reflecting: (i) positive variation in the equity in the earnings of affiliates (+R$269 million), with emphasis on CTEEP; (ii) comparative improvement in the result of IE Madeira (+R$180 million), due to the increase in contractual revenue, mainly due to the effect of the application of the IPCA correction; |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 22 |
Marketletter 3Q21 |
FINANCIAL RESULT
TABLE 13: FINANCIAL INCOME AND EXPENSES |
Financial Result | 3Q21 | 3Q20 | % | 2021 | 2020 | % |
Financial Income | ||||||
Interest, commission and fee income | 158 | 238 | -34% | 489 | 721 | -32% |
Income from financial investments | 206 | 137 | 51% | 396 | 963 | -59% |
Additional moratorium on electricity | 74 | 95 | -23% | 206 | 211 | -3% |
Active monetary updates | -172 | -197 | -13% | 58 | -1 | -9110% |
Exchange rate variations | -629 | -221 | 185% | -270 | -1,020 | -74% |
Net Derivative gains | 247 | 164 | 51% | 685 | 56 | 1114% |
Financial expenses | ||||||
Debt charges | -722 | -587 | 23% | -1,897 | -2,250 | -16% |
Leasing charges | -112 | -91 | 23% | -340 | -277 | 23% |
Charges on shareholder resources | 12 | 66 | -82% | -27 | -78 | -65% |
Other net financial income and expenses | -120 | -226 | -47% | -421 | -422 | 0% |
Financial Result | -1,059 | -622 | 70% | -1,122 | -2,097 | -46% |
Non-recurring adjustments | ||||||
(-) Revenue from loans owed by privatized distributors | -82 | -76 | 9% | -236 | -296 | -20% |
(-) Bonus Award + FIDC Commission 1Q20 | 0 | 0 | - | 91 | 298 | -69% |
(-) Chesf: update of lawsuits due to Benner's go live | -231 | 0 | - | -231 | 0 | - |
(-) Regularization of credits in the tax process / Fine and Notices of Violation | 0 | 0 | - | 81 | 0 | - |
(-) Monetary update of the 14-month increase in economic and energy inefficiency | -151 | 0 | - | -151 | 0 | - |
(-) Financial expense corresponding to the exchange of the Selic rate for the IPCA according to CNPE Resolution No. 15/2021 | 432 | 0 | - | 432 | 0 | - |
(-) RPCs Chesf / Addition of late payment and monetary variation | 0 | 0 | - | 118 | 0 | - |
(-) Monetary adjustment compulsory loan | 194 | 155 | 26% | 413 | 295 | 40% |
Recurring Financial Result | -898 | -543 | 65% | -605 | -1,800 | -66% |
FINANCIAL RESULT
ANALYSIS OF VARIATION 3Q20X3Q21
In 3Q21, the financial result showed a strong negative variation, having presented a negative result of R$622 million in 3Q20 and R$1,059 million in 3Q21. The main variations were in the accounts of:
• | The net exchange variation went from a net negative variation of R$221 million in 3Q20 to R$629 million in 3Q21, mainly due to the variation of the dollar in the respective periods. |
• | Expenses with debt charges increased by 23%, from an expense of R$587 million in 3Q20 to an expense of R$722 million in 3Q21, mainly impacted by the increase in the CDI rate, which went from 1.9% p.a.a. to 6.15% p.a. in the period and inflation measured by the IPCA, which went from 3.14% p.a. (accumulated in the last 12 months) to 10.78% pa, which resulted in a greater readjustment of the outstanding balance and, consequently, more expenses with interest, in addition to the increase of approximately R$72 million generated by the charges generated by the new issue of Debentures that took place in May 2021. |
• | Passive monetary variation of R$767 million in 3Q21, mainly due to the financial expense of R$432 million recorded, due to the effect of the application of the IPCA (replacing the SELIC) on Amazonas Energia's “inefficiency” credits and Boa Vista. Eletrobras changed the method of correction of “inefficiency” credits in 3Q21, starting to use the IPCA, as it was the correction method used in CNPE Resolution No. 15/2021, which defined the grant amount to be paid by Eletrobras for new generation concessions in the company's capitalization process. |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 23 |
Marketletter 3Q21 |
Partially offset by:
• | Derivatives gains and losses increased from a net revenue of R$164 million in 3Q20 to a net revenue of R$247 million in 3Q21, especially for the subsidiary Eletronorte, due to the pricing of assets, as provided for in the energy sales contract signed with Albras, which is mainly linked to the LME (Aluminum) and US dollar quotation. |
• | Accounting of financial income of R$ 286 million, of which: (i) R$ 151 million referring to the monetary adjustment over the accounting of the extension of 14-month (May 2016 to June 2017) in the coverage period of the inefficiency credits " economic and energetic , due to the publication of Law No. 14.182/2021, applicable to credits originating from companies Amazonas Energia (R$ 620 million) and Roraima Energia (R$ 1.7 million), totaling the amount of R$ 622 million Such amounts were approved by ANEEL through Official Letter No. 367/2021-SFF/ANEEL, of 10/08/2021; (ii) R$135 million of which R$106 million refer to the update (IPCA) of the inspection result applicable to original credits from the companies Ceron, Eletroacre and Roraima Energia and R$30 million referring to the restatement (SELIC) of economic and energy inefficiency credits up to April 2016 granted by Amazonas and Roraima Energia; |
ANALYSIS OF VARIATION 2021X2020
• | The Financial Result presented, in 9M21, a variation of 46% in relation to the same period of the previous year, mainly reflecting: (i) Gains and losses with Derivatives (+R$628 million), with emphasis on the subsidiary Eletronorte, due to the asset pricing as provided for in the energy sale agreement entered into with Albras, which is mainly linked to the LME (Aluminum) and US dollar quotation; (ii) net exchange variation, which went from a net expense of R$1,020 million in 9M20 to a net expense of R$270 million in 9M21, reflecting the dollar variation in the respective periods; partially offset by (iii) a decrease in income from financial investments (-R$ 566 million) mainly due to the reduction in the rate of the indexes that remunerate the investments. |
OTHER OPERATING REVENUE AND EXPENSES
Outras Receitas e Despesas | 3T21 | 3T20 | % | 2021 | 2020 | % |
Outras Receitas e Despesas | 772 | 0 | - | 772 | 25 | 2982% |
Eventos não recorrentes | ||||||
(-) Ajuste não recorrentes | -772 | 0 | - | 772 | 25 | 2982% |
Outras Receitas e Despesas Recorrente | 0 | 0 | - | 0 | 0 | - |
• | Addition of 14 months (May 2016 to June 2017) in the period of coverage of economic and energy inefficiency credits, due to the publication of Law No. 14.182/2021, applicable to credits originating from Amazonas Energia companies (R$ 620 million ) and Roraima Energia (R$1.7 million), totaling R$622 million.These amounts were approved by ANEEL through Official Letter 367/2021-SFF/ANEEL, of 10/08/2021. |
• | The amount of R$ 150 million, which is due to the tariff recognition associated with the AIC (fixed assets in progress) approved by ANEEL, through the extraordinary tariff review process, and which must be paid by the distributors Energisa Acre (R$ 43, 5 million), Equatorial Alagoas (R$ 61 million) and Piauí (R$ 45 million) to Eletrobras, according to the following conditions described in explanatory note 34 to the Financial Statements. |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 24 |
Marketletter 3Q21 |
INCOME TAX
Income tax and social contribution | 3Q21 | 3Q20 | % | 2021 | 2020 | % |
Current income tax and social contribution | 9 | -921 | -101% | -1,427 | -2,172 | -34% |
Deferred income tax and social contribution | -3,078 | -545 | 465% | -3,669 | -645 | 469% |
Total income tax and social contribution | -3,069 | -1,465 | 109% | -5,096 | -2,817 | 81% |
Non-Recurring Events | ||||||
(-) Non-recurring Eletrosul Adjustment / Chesf PCLD Estimate / Hydrological Risk Renegotiation | 2,487 | 1,348 | 84% | 2,625 | 1,348 | 95% |
Recurring income tax and social contribution | -582 | -117 | 397% | -2,471 | -1,469 | 68% |
1.2 EBITDA Consolidated
TABLE 12: EBITDA DETAIL |
EBITDA | 2021 | 2020 | % | 3Q21 | 3Q20 | % |
Resulto of the period | 5.104 | 4.511 | 13% | 965 | 2.814 | -66% |
+ Income Tax and Social Contribution Provision | 5.096 | 2.817 | 81% | 3.069 | 1.465 | 109% |
+ Financial Result | 1.122 | 2.097 | -46% | 1.059 | 622 | 70% |
+ Depreciation and Amortization | 1.408 | 1.399 | 1% | 503 | 468 | 8% |
= EBITDA | 12.730 | 10.824 | 18% | 5.596 | 5.369 | 4% |
Non recurring adjustments | ||||||
Other revenues and expenses | -772 | -25 | 2982% | -772 | 0 | - |
Reversal of Energy Revenue between Brazil and Uruguay | 8 | 0 | - | 0 | 0 | - |
Interruption of Angra I and II Retroactive and Candiota Inflexibility | 277 | 269 | 3% | 34 | 269 | -87% |
Regulatory remeasurements - Transmission Contracts | -4,859 | -4,228 | 15% | -4,859 | -4,228 | 15% |
Renegotiation of the hydrological risk, arising from resolution No. 2.932021 which ratified the term for extending the concession of the hydroelectric plants. | -4,266 | 0 | - | -4,266 | 0 | - |
Record of GSF expense for adherence to hydrological risk renegotiation | 378 | 0 | - | 378 | 0 | - |
Transfer of coal from Material/Interest and Monetary Variation on debentures fixed in September/21 | 13 | 0 | - | 0 | 0 | - |
Incentive Plans (PAE, PDC) | -7 | -23 | -69% | -2 | -15 | -84% |
Dismissal Eletronorte | 79 | 0 | - | 1 | 0 | - |
Reversal of contributions to foundations - CVM 600 adjustment | -22 | 0 | - | -8 | 0 | - |
Indemnities (Labor Claims) - Furnas | 69 | 0 | - | 21 | 0 | - |
Retroactive ACT Releases and Historical Hour Bank 25% | 1 | 0 | - | 53 | 12 | 339% |
Transfer of coal to Fuel account | -13 | 0 | - | 0 | 0 | - |
PIS/COFINS credit – prior periods of TPP Candiota III | -4 | 0 | - | 0 | 0 | - |
Furnas Outsourced | 0 | 95 | -100% | 0 | 68 | -100% |
Loss with CCC corresponding to the inspection of Boa Vista | 58 | 0 | - | 58 | 0 | - |
Income tax not collected from conviction paid in 2015 | 42 | 0 | - | 0 | 0 | - |
IR arising from Transfer of Amz GT | 40 | 0 | - | 0 | 0 | - |
Court costs and fess – Parent Compant and Furnas | 48 | 0 | - | 3 | 0 | - |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 25 |
Marketletter 3Q21 |
Labor Costs | 13 | 0 | - | 0 | 0 | - |
Indemnities - Loss and Damage | 38 | 0 | - | 0 | 0 | - |
Debenture issue commissions in 1Q21 | -8 | 0 | - | 0 | 0 | - |
Worthless SPE FOTE | 20 | 0 | - | 13 | 0 | - |
Write-off of Energisa assets in 1Q21 (Assets of Distributed Distributors) | 29 | 0 | - | 0 | 0 | - |
Generator group rental (Amapá emergency service) | 57 | 0 | - | 6 | 0 | - |
Sale of Transmission Assets to Energisa | -3 | 0 | - | 0 | 0 | - |
Reimbursement of Transmission Assets to Energisa | 2 | 0 | - | 0 | 0 | - |
Accounting issues if previous years | -7 | 0 | - | 0 | 0 | - |
Camargo Correa claim – Furnas | 0 | 98 | -100% | 0 | 0 | - |
Installments of the agreement between Furnas and Inepar | 0 | 38 | -100% | 0 | 9 | -100% |
Indemnities, losses and damages - Nova Engevix, CIEN and Furnas Outsourced | 45 | 10 | 351% | 0 | 0 | - |
Contingencies | 1,372 | 532 | 158% | 375 | 642 | -42% |
Compulsory Loan | 10,094 | 409 | 2369% | 9,059 | 377 | 2304% |
PCLD Credit Loss Estimate (CPC 48) / PCLD Reversal CIEN / RPCs Chesf | -118 | 201 | -159% | 0 | 179 | -100% |
Onerous Contracts | 23 | 172 | -87% | 23 | 172 | -87% |
(Provision)/Reversal for investment losses | 111 | 112 | 0% | 3 | -9 | -133% |
RAP Adjustment Portion | 0 | 224 | -100% | 0 | 0 | - |
Impairment of long-term assets | -454 | -63 | 623% | -454 | -43 | 965% |
Provision for Implementation of Shares - Compulsory Loan | 93 | 353 | -74% | 47 | 353 | -87% |
Outsourced Indemnity Incentive Provision | 0 | 0 | - | 0 | 0 | - |
Provision ANEEL - CCC | 528 | 18 | 2822% | 288 | 27 | 963% |
TPP Candiota III - Inflexibility | 0 | 173 | -100% | 0 | 107 | -100% |
TPP Candiota III - Coal | 9 | 0 | - | 2 | 0 | - |
= Recurring EBITDA | 15,643 | 9,188 | 70,3% | 5,598 | 3,290 | 70% |
Note: As of 2019, the Company started to consider, in its recurring EBITDA, the RBSE revenue from concessions extended under Law 12,783/2013, in order to maintain a protocol similar to the debenture covenants issued in 2019. Considering the privatization of the distributors was completed in April 2019, and these operations are no longer part of its core business, the company treated as non-recurring the relevant effects of financial income, expenses, PL reversals and prospective allowance for loan losses ( CPC 48) of loans contracted with them before or as a result of the privatization process, although revenues and eventual provisions arising from contracted loans may continue to affect the company's accounting result until its complete exhaustion. However, they were treated as recurring PCLDs of outstanding effective debt of distributors as well as debts related to energy supply.
Recurring Cash Generation with Adjustment of Regulatory Transmission RAP |
3Q21 | 3Q20 | |
1. EBITDA Recurrent | 5,581 | 3,290 |
2. (-) Total Corporate Revenue from Transmission | 4,894 | 2,769 |
O&M Revenue | 1,522 | 1,447 |
Construction Revenue | 97 | 46 |
Finance - Return on Investment - RBSE | 742 | 150 |
Contractual Revenue Transmission | 2,533 | 1,126 |
Periodic Tariff Revenue | 0 | 0 |
3. (+) Total Payment of Allowed Annual Revenue | 4,015 | 3,305 |
Revenue of RAP and indemnities | 2,494 | 1,857 |
O & M Revenue | 1,522 | 1,447 |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 26 |
Marketletter 3Q21 |
4 = 1 - 2 + 3 : Approximate Cash Generation | 4,702 | 3,826 |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 27 |
Marketletter 3Q21 |
1.3 Consolidated Results by Continued Operations segment:
TABLE 14: FINANCIAL STATEMENT BY SEGMENT – R$ THOUSAND |
2021 | |||||
Finacial Statement by Segment | Administration | Generation | Transmission | Eliminations | Total |
Net Operating Revenue | 189 | 15,245 | 11,047 | -357 | 26,124 |
Operating Costs | -458 | -5,028 | -2,044 | 345 | -7,184 |
Operating Expenses | -12,998 | -1,465 | -504 | 12 | -14,955 |
Operating Income Before Financial Result | -13,268 | 8,753 | 13,358 | 0 | 8,844 |
Financial Result | -1,122 | ||||
Result of Equity Interests | 1,706 | ||||
Other income and expenses | 772 | ||||
Income tax and social contribution | -5,096 | ||||
Net income (loss) for the period | 5,104 |
2020 | |||||
Finacial Statement by Segment | Administration | Generation | Transmission | Eliminations | Total |
Net Operating Revenue | 169 | 13,452 | 6,730 | -784 | 19,567 |
Operating Costs | -22 | -7,369 | -2,569 | 777 | -9,183 |
Operating Expenses | -4,255 | -1,166 | -556 | -113 | -6,088 |
Regulatory remeasurements - Transmission Contracts | 0 | 0 | 4,228 | 0 | 4,228 |
Operating Income Before Financial Result | -4,107 | 4,917 | 7,834 | -119 | 8,524 |
Financial Result | -2,097 | ||||
Result of Equity Interests | 875 | ||||
Other income and expenses | 25 | ||||
Income tax and social contribution | -2,817 | ||||
Net income (loss) for the period | 4,511 |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 28 |
Marketletter 3Q21 |
1.3.1. INDEBTEDNESS AND RECEIVABLES
TABLE 15: GROSS DEBT AND NET DEBT |
09/30/2021 | |
Gross Debt - R$ million | 48,152 |
(-) (Cash and cash equivalents + marketable securities) | 20,432 |
(-) Financing Receivable | 7,672 |
(-) Net balance of Itaipu Financial Assets1 | 941 |
Net debt | 19,106 |
1 See Explanatory Note 15b to the Financial Statements.
TABLE 16: Debt Maturity Schedule and Debentures of the Holding and Subsidiaries included: |
* For further information, see note 20 to ITR 3Q21.
Gross Consolidated Debt Total – R$ billion |
Parent Company Gross Debt – R$ billion |
2021 | 2022 | 2023 | 2024 | 2025 | 2026 | After 2026 | Total (R$ billion) | |
Amortization and Debentures | 5.6 | 4.0 | 2.3 | 4.2 | 3.2 | 2.5 | 6.8 | 28.6 |
| Table 17: Foreign Exchange Exposure |
Liabilities * | US$ | % | ||||
thousand | ||||||
Asset | US$ thousand | % | Bônus 2021 - Eletrobras | 641,092 | 30% | |
Itaipu Loans Receivables | 298,920 | 63% | Bônus 2025 - Eletrobras | 498,530 | 23% | |
Itaipu Financial Asset | 173,014 | 37% | Bônus 2030 - Eletrobras | 740,401 | 34% | |
TOTAL | 471,933 | 100% | Others | 267,346 | 12% | |
TOTAL | 2,147,369 | 100% |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 29 |
Marketletter 3Q21 |
2021 | 2022 | 2023 | 2024 | 2025 | 2026 | After 2026 | TOTAL | |
Asset (US$ million) | 197.91 | 229.19 | 43.34 | 1.49 | 0.00 | 0.00 | 0.00 | 471.93 |
Liabilities (US$ million) | 669.46 | 45.79 | 46.26 | 19.70 | 518.23 | 19.70 | 828.23 | 2.147.37 |
Foreign Exchange Exposure | -471.56 | 183.40 | -2.92 | -18.20 | -518.23 | -19.70 | -828.23 | -1,675.44 |
Due to the atypical scenario and potentially unpredictable characteristics, it is not possible to accurately predict the scenarios that could materialize in the coming months in the company's operations.
* In the balance of Bonuses 2030 and 2025, there is an accounting effect on the deferral of expenses with repurchase of the 2021 bonus due to the operation carried out in February.
Ratings
TABLE 18: Ratings |
Agency | National Classification / Perspective | Last Report |
Moody’s BCA | “Ba3”: / Estável | 09/16/2020 |
Moody’s Senior Unsecured Debt | “Ba2”: / Estável | 09/16/2020 |
Fitch - Issuer Default Ratings (Foreign Currency) | “BB-”: / Negativa | 06/02/2021 |
Fitch - Issuer Default Ratings (Local Currency) | “BB-”: / Negativa | 06/02/2021 |
S&P LT Local Currency – Escala Nacional Brasil | brAAA/Estável | 03/12/2021 |
S&P Issuer Credit Rating – Escala Global | BB-/Estável | 03/12/2021 |
*CreditWatch
Financing and loans granted (receivables)
TABLE 19: Receivables |
Average Rate | CONSOLIDATED | ||||||
09/30/2021 | 12/31/2020 | 09/30/2021 | 12/31/2020 | ||||
Itaipu | 6.47 | 6.93 | 1,625,944 | 4,200,471 | |||
CEAL | 3.79 | 3.45 | 1,293,613 | 1,505,961 | |||
Eletropaulo | 3.50 | 3.75 | 673,567 | 1,008,052 | |||
Amazonas D | 5.98 | 5.78 | 4,005,534 | 3,998,324 | |||
CEPISA | 4.49 | 2.50 | 496,894 | 571,127 | |||
Boa Vista | 3.58 | 2.22 | 143,916 | 147,764 | |||
Outras | - | - | 197,512 | 248,201 | |||
(-) PECLD | - | - | (764,903) | (755,002) | |||
Total | 7,672,078 | 10,924,899 |
The graphs and table below exclude charges, allowance for loan losses and financial assets of Itaipu.
*For more information, see explanatory note 9 of ITR 3Q21.
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 30 |
Marketletter 3Q21 |
Total Consolidated Loans and Financing Receivables – R$ billion |
Does not include: receivable from Itaipu's financial assets of R$941 million and PCLD of R$765 million and current charges.
Loans and financing receivable Parent company - R$ billion |
Projection Receivables | 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | after 2026 | TOTAL |
Parent Company | 1.4 | 2.7 | 2.1 | 1.4 | 0.9 | 0.7 | 3.8 | 13.1 |
Does not include charges and allowance for loan losses.
Loans and Financing receivable Parent Company - R$ billion |
Receivables Projection | 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | After 2026 | TOTAL |
Parent Company | 1.4 | 2.7 | 2.1 | 1.4 | 0.9 | 0.7 | 3.8 | 13.1 |
Does not include charges and PCLD.
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 31 |
Marketletter 3Q21 |
Table 20: CCC credits assigned by Privatized Distributors
In the process of privatizing the distributors, credits contained in the right of reimbursement account recorded in the assets of the distributors in June/17 and which were being analyzed and inspected by Aneel, in processes closed in September 2021, were assigned to Eletrobras. activated in the Company's Financial Statements, of 09/30/2021, in two accounts, namely Right to Reimbursement and Financing receivable, according to Explanatory Notes 15 and 11 of 3Q21, and detailed below:
REIMBURSEMENT RIGHT
Registered Net Assets – R$ thousand |
R$ thousand | Amazonas | Ceron | Eletroacre | Boa Vista | Total |
NT Aneel + Claims under analysis Aneel + "inefficiency" | 2,366,317 |
3,008,691
|
116,173
| 120,023 |
5,611,205
|
Current Rights | |||||
Total (a) | 2,366,317 | 3,008,691 | 116,173 | 210,249 | 5,611,205 |
* The balance of R$ 2,366 million from Amazonas is composed of an obligation to return to the CCC in the amount of R$ 504.5 million referring to the final result of the inspection of the first and second periods carried out by Aneel, and a credit receivable from National Treasury of economic and energy “inefficiency” of R$ 2.87 billion. The economic and energy “inefficiency” credit was being updated by Selic until 2Q21, being changed in 3Q21, starting to be updated by the IPCA. The amount to be returned to the CCC must be deducted from the credit receivable from the CCC in relation to the amounts transferred from the other distributors.
** The credits referring to the current rights of Ceron, Eletroacre and Boa Vista were provisioned in this 3Q21, as the amount to be returned by the distributors to Eletrobras for having realized this current credit before the credit transfer date is still under negotiation to Eletrobras. When a return agreement is signed with these distributors, Eletrobras will reverse the provision.
Conversion into Loans |
R$ thousand | Amazonas | Ceron | Eletroacre | Boa Vista | Total |
Conversion into Loans (b) | 442,366 | 442,366 |
Note: The R$ 442.4 million credit in the table above was also a CCC credit, given by Amazonas to Eletrobras, however, as it is not part of the aforementioned inspection period, and as it is a current credit, it has already been paid by CCC to Amazonas Distribuidora, and could not have been assigned to Eletrobras, so it was converted into debt of the distributor with Eletrobras.
Total Credits Granted (Note 9 + Note 13) |
R$ mil | Amazonas | Ceron | Eletroacre | Boa Vista | Total |
Credit assigned Net (1) | 2.808.683
| 3.008.691
| 116.173
| 210.249
| 6.053.571
|
(1) | Credits updated until 06/30/2021, by IPCA. |
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Marketletter 3Q21 |
The National Electric Energy Agency - Aneel recognized, by decision of its collegiate board, on March 10, 2020, (i) the right to receive credits from the Ceron Fuel Consumption Account, in the amount of R$ 1,904.0 million (at July 2019 prices), referring to the inspection of benefits due in the period from July 30, 2009 to June 30, 2016, considered as the first period of the inspection process ("First Inspection Period"), credits assigned to Eletrobras at the time of privatization of said distributor; and (ii) the right to receive credits from the Fuel Consumption Account – CCC to the Electricity Company of Acre (“Eletroacre”), in the amount of R$ 191.6 million (at July 2019 prices), referring to the inspection of benefits due from July 30, 2009 to June 30, 2016, credits which were also assigned to Eletrobras on the occasion of the privatization of the aforementioned distributor.
Aneel's Board of Directors also approved, on March 10, 2020, the obligation to return R$ 2,061.4 million (at March 2019 prices), referring to the CCC inspection and monthly reprocessing process paid to Amazonas Distribuidora de Energia SA (“Amazonas Energia”), from July 2016 to April 2017, referring to the Second Inspection Period. With this decision, Amazonas Energia had completed its entire inspection process, as Aneel's Board of Directors had already deliberated, on March 19, 2019, the result of the First Inspection Period of CCC reimbursements to Amazonas Energia, with the company entitled to receive a credit in the order of R$1,591.7 million (at September 2018 prices), to be offset against the credits to be returned.
The net balance of credits granted by Amazonas Energia, positive in R$ 2.81 billion, refers, in addition to the contract signed with the distributor, with the payment of the amount of R$ 442.4 million in current credits, upon revenue of disallowances of the CCC arising from the economic and energy efficiency criteria, a right recognized by Law 13,299/2016, and later by Law 14,182/2021, in the historical amount of R$ 1,978.1 million, which will be deducted from the grant amount to be paid by the Eletrobras for new generation concessions. The new law increased by 14 months the term of coverage of "inefficiency", going from Apr/16 (Law 13,299/2016) to until Jun/17. This increase in coverage, updated by the IPCA for Sep/21, brought a gain of R$ 771 million for Amazonas' “inefficiency” credits. However, the exchange of Selic for IPCA to update these credits had a negative effect of R$ 423 million. Eletrobras changed the way of correction of “inefficiency” credits in 3Q21, starting to use the IPCA, as it was the form of correction used in CNPE Resolution No. 15/2021, which defined the grant amount to be paid by Eletrobras for the new generation concessions in the company's capitalization process.
On June 15, 2021, Aneel approved the result of the inspection and monthly reprocessing of the benefits reimbursed by CCC to Boa Vista Energia, setting the amount to be reimbursed by CCC to the distributor at R$ 103.9 million, February 2020 position , and establishing that the payment to Eletrobras, holder of the credits, should await the final result (first and second periods) of the inspections carried out at Amazonas Energia, Ceron, Eletroacre and Boa Vista Energia.
In a meeting held on September 28, 2021, Aneel's board deliberated on the CCC inspection processes, which are still pending analysis, according to the inspection period of Ceron, Eletroacre and Boa Vista. The amounts approved by Aneel's board were in line with the amounts presented in the latest technical notes issued by SFF-SFG-SRG/ANEEL. The amount of R$ 806.6 million (position Apr/21) was approved as a result of Ceron's second inspection period, as well as the negative amount of R$ 97.5 million (position Apr/21) to be returned to the CCC as a result of Eletroacre's second inspection period, and the negative amount of R$29.7 million (Apr/21) position for Boa Vista's second inspection period.
Thus, all eight inspection processes (first and second periods of Amazonas, Eletroacre, Ceron and Boa Vista) were closed and the payment conditions to Eletrobras of the net final value of the eight inspection processes were defined. Aneel defined the final amount on the CCC inspection reimbursed to Amazonas Energia, Ceron, Eletroacre and Boa Vista Energia in the amount of R$ 2,670.5 million, updated by the IPCA of Aug/2021, which shall be reimbursed by the CCC to Eletrobras, as holder of the assumed credits of these distributors. This amount will be received in 60 months, in equal installments, duly updated by the IPCA, with the beginning of monthly payments being considered in the Annual Budget of the CDE 2022.
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Marketletter 3Q21 |
In 3Q21, Eletrobras recorded the amount of R$ 6,053.6 million in credits assumed by distributors in their privatization processes. The amount of R$ 2,705.2 million as the final result of the CCC inspection processes carried out by Aneel and which will be paid by the Fund to Eletrobras, the amount of R$ 2,906.0 million in “inefficiency” credits assumed by Amazonas and Boa Vista, which will be used to deduct the grant amount to be paid by Eletrobras for new generation concessions in the company's capitalization process, and R$ 442.4 million recorded in the loans and financing account referring to the current credit return contract signed with Amazonas Energia, which is still in the grace period for payment of the principal. It is important to highlight that Eletrobras made a provision in the amount of R$ 340.1 million in 3Q21 referring to current credits of Ceron, Eletroacre and Boa Vista Energia (credits made before the transfer of the right to Eletrobras, and therefore, must be returned to Eletrobras) since contracts have not yet been signed with these three distributors for the refund of the amount. Currently, Eletrobras has been discussing with the three companies the amount to be paid to Eletrobras. After defining the amounts and payment conditions, the contracts will be signed and Eletrobras will revert part or all of this R$340.1 million provision made.
Thus, as a summary of the changes in credits assumed by distributors in 3Q21, a breakdown can be made into 5 items: i) Increase of R$ 622.0 million in “inefficiency” credits with the additional 14 months of coverage provided by Law 14.182/2021, including only the principal amount, still uncorrected; ii) financial income in the amount of R$286.3 million, with the update by the IPCA of the additional 14 months of “inefficiency” credits, and the update by the IPCA of the result of the CCC inspection of Ceron, Eletroacre and Boa Vista; iii) financial expense in the amount of R$446.6 million arising from the exchange of the correction of the Amazonas and Boa Vista de Selic “inefficiency” credits to the IPCA, and the correction of the net result of the inspection by Amazonas (first and second periods); iv) R$340.1 million in the provision for current credits, given that contracts have not yet been signed with Ceron, Eletroacre and Boa Vista to refund the amounts paid by the distributors themselves before the assignment of credits to Eletrobras; v) losses of R$ 57.6 million resulting from the incorporation of the result of the second inspection period on Boa Vista's CCC credits.
RBSE REPROFILING
In April 2021, ANEEL approved the reprofiling of the financial component of RBSE, of the subsidiaries Furnas, Eletronorte, CGT Eletrosul and Chesf. The decision provides for a reduction in the payment curve of amounts related to the periodic review of RAPs associated with transmission facilities for cycles 2021/2022 and 2022/2023 and an increase in the flow of payments in cycles after 2023, extending such installments until the 2027/2028 cycle, preserving, however, the remuneration by the WACC.
In September 2021, the reprofiling of the financial component of the Existing System Basic Network - RBSE was accounted for. ANEEL's decision caused a reduction in the payment curve of amounts related to the periodic review of RAPs associated with transmission facilities for cycles 2021/2022 and 2022/2023 and an increase in the flow of payments in cycles after 2023, extending such installments until the 2027/2028 cycle, preserving, however, the remuneration for the cost of equity (Ke). For more details, see note 14 of the 3Q21 financial statements.
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Marketletter 3Q21 |
In 3Q21, the contractual transmission assets increased significantly, mainly due to the remeasurement of the concession assets referring to RBSE, as follows:
1. Reprofiling of the RBSE financial component, approved by ANEEL in April 2021. The decision caused a reduction in the payment curve of the amounts related to the periodic review of the RAPs associated with transmission facilities for cycles 2021/2022 and 2022/2023 and an increase the flow of payments in cycles after 2023, extending such installments until the 2027/2028 cycle, preserving, however, the remuneration for the cost of equity (Ke) for RBSE;
2. Complementary recognition of the cost of equity (Ke). In 2020, ANEEL ratified only the correction by the IPCA of the RBSE amounts not paid between 2017 and 2020, resulting from the ABRACE injunction. In cycle 2021/2022, in response to a request from the Transmitters, ANEEL recognized, in addition to the correction by the IPCA, the remuneration of this amount by the Ke.
3. Completion of inspection of the appraisal report of the Regulatory Remuneration Basis – BRR of Chesf's Contract No. 061/2001. With this, the definitive values of the Periodic Review of the 2018/2023 cycle of the Allowed Annual Revenue - RAP were approved, through the publication of Ratifying Resolution No. 2935/2021.
Table 21: Reprofiling RBSE – R$ million
REPROFILED Financial Component | Cycle 2021-2022 | 2022-2023 | 2023-2024 | 2024-2025 | 2025-2026 | 2026-2027 | 2027-2028 |
CHESF | 639 | 886 | 1,648 | 1,648 | 1,648 | 1,648 | 1,648 |
ELETRONORTE | 278 | 393 | 769 | 769 | 769 | 769 | 769 |
ELETROSUL | 161 | 215 | 360 | 360 | 360 | 360 | 360 |
FURNAS | 806 | 1,199 | 2,635 | 2,635 | 2,635 | 2,635 | 2,635 |
Total | 1,884 | 2,693 | 5,411 | 5,411 | 5,411 | 5,411 | 5,411 |
Economic Component | Cycle 2021-2022 | 2022-2023 | 2023-2024 | 2024-2025 | 2025-2026 | 2026-2027 | 2027-2028 |
CHESF | 1,091 | 1,091 | 654 | 654 | 654 | 654 | 654 |
ELETRONORTE | 562 | 562 | 242 | 242 | 242 | 242 | 242 |
ELETROSUL | 187 | 187 | 69 | 69 | 69 | 69 | 69 |
FURNAS | 1,785 | 1,785 | 1,136 | 1,136 | 1,136 | 1,136 | 1,136 |
Total | 3,625 | 3,625 | 2,102 | 2,102 | 2,102 | 2,102 | 2,102 |
Total RBSE after REPROFILING | Cycle 2021-2022 | 2022-2023 | 2023-2024 | 2024-2025 | 2025-2026 | 2026-2027 | 2027-2028 |
CHESF | 1,730 | 1,976 | 2,302 | 2,302 | 2,302 | 2,302 | 2,302 |
ELETRONORTE | 841 | 955 | 1,011 | 1,011 | 1,011 | 1,011 | 1,011 |
ELETROSUL | 348 | 402 | 430 | 430 | 430 | 430 | 430 |
FURNAS | 2,590 | 2,984 | 3,771 | 3,771 | 3,771 | 3,771 | 3,771 |
Total | 5,509 | 6,318 | 7,513 | 7,513 | 7,513 | 7,513 | 7,513 |
The amounts above include TFSEE charges (Electric Energy Services Inspection Fee) and resources for R&D and Energy Efficiency, and do not include PIS and Cofins. Furthermore, the data refer to the tariff cycle and not the calendar year.
The values approved in the reprofiling were updated by the IPCA.
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 35 |
Marketletter 3Q21 |
1.4. Investment |
Table 22: INVESTMENTS BY SEGMENT - R$ million
Investment (Corporate + Partnerships) | Realized 1Q21 | Realized 2Q21 | Realized 3Q21 | Budget 3Q21 | % 3Q21 | Realized 9M21 | Budget 9M21 | % 9M21 |
Generation | 314 | 529 | 572 | 1.218 | 47% | 1.415 | 2.882 | 49% |
Corporate Expansion | 145 | 329 | 431 | 851 | 51% | 904 | 1.919 | 47% |
Maintenance | 130 | 152 | 139 | 287 | 48% | 421 | 722 | 58% |
SPEs - Contributions | 39 | 17 | 2 | 79 | 3% | 58 | 237 | 25% |
SPEs - Acquisitions | 0 | 31 | 0 | 1 | 0% | 31 | 4 | 829% |
Transmission | 142 | 360 | 378 | 525 | 72% | 881 | 1.729 | 51% |
Corporate Expansion | 16 | 38 | 34 | 11 | 316% | 87 | 91 | 96% |
Reinforcements and Improvements | 96 | 213 | 300 | 413 | 72% | 608 | 1.077 | 56% |
Maintenance | 30 | 27 | 44 | 99 | 45% | 101 | 222 | 46% |
SPEs | 1 | 83 | 0 | 1 | 0% | 84 | 340 | 25% |
Others* | 65 | 91 | 75 | 118 | 63% | 231 | 521 | 44% |
Total | 522 | 981 | 1,024 | 1,861 | 55% | 2,527 | 5,132 | 49% |
Others: Research, Infrastructure, Environmental Quality
* For more details on the investments, by subsidiary or by project, see annex 3 to this Report to Investors, to be released in November 2021.
IN 3Q21, R$ 1,024 MILLION WERE INVESTED OF THE R$ 1,861 MILLION BUDGET FOR THE QUARTER.
In generation, the total investment was R$572 million, R$431 million of which related to the expansion of corporate projects, with emphasis on: Angra 3 R$375 million, Angra 1 and 2 R$70 million. In generation SPEs, the realization was only R$ 2 million at Brasil Ventos. In generation maintenance, R$139 million were realized, with an emphasis on R$21 million at Furnas and R$26 million at Chesf.
In transmission, the total investment was R$ 378 million, of which R$ 34 million in expansion and exclusive of Chesf referring to ( LT São Luiz II/São Luiz III; / - LT Paraíso-Açu C3; / - LT Pau Ferro /Santa Rita C1; /- TL Mossoro/Açu C2; /- TL Banabuiu/Russas 230K C2). In reinforcements and improvements, R$300 million was invested, with emphasis on: Chesf R$178 million, CGT R$49 million, Furnas R$38 million and R$36 million for Eletronorte. There was no performance in transmission SPE in 3Q21
As for non-realization of investments, there was a frustration of R$ 837 million, of which -R$ 647 million in generation, with emphasis on the non-realization of -R$ 333 million in Angra 3 due to delay in the bidding process for resumption of works and release of AFAC, frustration of -R$ 86 million in maintenance of Angra 1 and 2 due to the impacts of the pandemic. In SPE, there was a frustration of R$ 26 million in Teles Pires due to the postponement of contributions and -R$ 34 million in Brasil Ventos due to planned contributions to subsidiaries and not made.
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Marketletter 3Q21 |
In transmission, investments were not made in the amount of R$ 147 million, highlighting: -R$ 20 million due to delays in environmental licensing, -R$ 17 million due to impacts from COVID-19 and -R$ 12 million due to problems with tenders . The budget for transmission SPES was only R$1 million.
1.5. COMMERCIALIZATION
1.5.1. ENERGY SOLD IN 3Q21 – GENERATORS - TWH
In terms of the evolution of the energy market, Eletrobras Companies, in 3Q21, sold 46.3 TWh of energy, against 52.1 TWh traded in the same period of the previous year, which represents a decrease of 11%. These volumes include the energy sold from the plants under the quota regime, renewed by Law 12.783 / 2013, as well as by the plants under the exploration regime (ACL and ACR).
Sales: includes projects under Law 13,182 / 15
Average ACR Prices in the chart do not include Itaipu and O&M. Include Eletronuclear.
1.5.2. ENERGETIC BALANCE
TABLE 23: ENERGETIC BALANCE |
Energetic Balance (MWmed) | 2021 | 2022 | 2023 | 2024 | 2025 | |
Ballast | 9,288 | 9,313 | 9,277 | 9,257 | 8,563 | |
Own resources | 8,119 | 8,183 | 8,183 | 8,183 | 7.707 | |
Energy Purchase | 1,168 | 1,130 | 1,094 | 1,074 | 855 | |
Sales | 7,190 | 6,344 | 5,843 | 4,711 | 3,123 | |
ACL - Bilateral Contracts + MCP realized | 5,101 | 4,188 | 3,691 | 2,559 | 1.377 | |
ACR - Except quotas | 2,090 | 2,156 | 2,152 | 2,152 | 1.746 | |
Average Selling Price R$/MWh | 228.96 | 224.83 | 218.12 | 227.88 | 228.91 | |
Average Purchase Price R$/MWh | 283.32 | 247.60 | 254.38 | 256.79 | 247.58 | |
Average Selling Price R$/MWh (1) | 186.18 | 184.03 | 171.50 | 169.63 | 178.85 | |
Average Purchase Price R$/MWh (1) | 263.85 | 228.16 | 235.24 | 235.99 | 235.99 | |
Balance (Ballast - Sales) | 2,097 | 2,969 | 3,434 | 4,546 | 5,440 | |
Uncontracted Energy * | 23% | 32% | 37% | 49% | 64% |
* The uncontracted portion includes energy reserved for the company's hedge, strategically defined according to the GSF estimate for the period.
Contracts entered into until 09/30/2021.
The consequences of Law 14.182/2021, the decotization process of plants under the Physical Guarantee Quotas regime and the creation of the new state-owned company are not being considered in the balance sheet.
* A parcela descontratada inclui energia reservada para hedge da companhia, definido estrategicamente conforme estimativa de GSF para o período.
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 37 |
Marketletter 3Q21 |
The installments of Physical Guarantee Quotas and Nuclear Energy Quotas are not included in the balance.
1) | The extension of the concession period for the Mascarenhas de Moraes and Tucuruí HPPs was considered, as established in ANEEL Ratifying Resolution No. 2.932, of September 14, 2021. |
2) | The prices of the Amazonas GT contracts (incorporated by Eletronorte), including the PIEs contracts, arising from the Amazonas Distribuidora unbundling process, are not considered in the energy purchase and sale prices, it is worth noting that, in this case, the energy purchase and sale operations do not reflect economic impact ("pass-through"). |
Physical Guarantee and Nuclear Energy Quotas (MWmed) | 2021 | 2022 | 2023 | 2024 | 2025 |
Physical Guarantee Quotas for Hydroelectric Power Plants (3) | 7,464 | 7,464 | 7,451 | 7,451 | 7,451 |
Nuclear Energy Quotas | 1,573 | 1,573 | 1,573 | 1,573 | 1,573 |
3) | The concession under provisional administration of the Jaguari HPP was considered, remaining until 2022. It only considers existing CCGF, different from previous publications, which considered the end of the contracts of UHE Mascarenhas de Moraes, in Jan/2024, and of UHE Tucuruí, in Aug/2024, and from these dates, these plants were considered under the Quota regime of Physical Guarantee. |
With the consequences of Law 14.182/2021 and the decotization process of the plants under the Physical Guarantee Quotas regime, the following scenario is presented considering its implementation:
| |||||
Scenario Law 14.182/2021 (MWmed) | 2021 | 2022 | 2023 | 2024 | 2025 |
Physical Guarantee Quotas for Hydroelectric Power Plants (3) (4) | 7,464 | 7,464 | 5,961 | 4,470 | 2,980 |
Decotization (5) | 0 | 0 | 1,332 | 2,663 | 3,995 |
New Grants (6) | 0 | 0 | 5,728 | 5,728 | 5,728 |
4) | Decotization taking place gradually over a period of 5 years from 2023. |
5) | Upon decotization, the plants currently under the quota regime will have a new concession under the Independent Energy Producer - PIE regime, occurring gradually over a period of 5 years from 2023. The Physical Guarantee values were defined in Ordinance GM/MME No. 544/21. |
6) | New concession grants are considered as of 2023 for the Sobradinho, Itumbiara, Tucuruí, Curuá-Una and Mascarenhas de Moraes plants, whose Physical Guarantee values were defined in Ordinance GM/MME No. 544/21. Regardless of what is observed in item (1). |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 38 |
Marketletter 3Q21 |
II.
Result Analysis of
Parent Company
In 3Q21, Eletrobras Holding posted net income of R$924 million, a reduction of 66% compared to the net income of R$2,751 million in 3Q20. The result for 3Q21 was decisively influenced by: (i) Equity Interest, of R$ 10,756 million, mainly influenced by the results of the controlled companies as a result of the GSF agreement pursuant to Law 14,052/20 which extended the deadline for granting of several hydroelectric plants and the effect of the RBSE reprofiling; (ii) registration of Other Revenues in R$ 772 million, which refer, first, to the recognition of R$ 622 million due to the increase of 14 months (May 2016 to June 2017) in the period covered by Law No. 14.182/2021 , which regulates the CCC reimbursement credit related to economic and energy "inefficiency" that Eletrobras may compensate for the added value to be paid in the case of decotization of hydroelectric plants and the granting of new 30-year concessions, within the scope of the privatization of Eletrobras and, second, the reimbursement of R$ 150 million from the AIC (fixed assets in progress) to be paid by the privatized distributors to Eletrobras. This was partially offset by: (iii) negative effect on provisions for legal contingencies, with emphasis provisions related to compulsory loan lawsuits in the amount of R$9,059 million; and (iv) constitution, in 3Q21, of R$ 340 million in ANEEL CCC Provision due to the adjustment of current credits granted to Parent Company by the privatized distribution ocmpanies. In addition to the (iv) negative impact of the Financial Result in the amount of R$927 million in 3Q21, mainly due to the negative effect of the exchange rate fluctuation in the period (R$503 million) and the negative result of net monetary restatements (R$473 million ).
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 39 |
Marketletter 3Q21 |
EVOLUTION OF RESULT - R$ MILLION |
Note: The analysis of the results of each subsidiary can be found in Appendix II of the Investor Report.
2.1 Shareholdings in the Parent Company
In 3Q21, the Equity Interest result positively impacted the Company's result by R$10,756 million, mainly due to the Equity Income from investments in subsidiaries, while the result in 3Q20 was R$4,178 million (the amount in 3Q20 was restated due to the remeasurement of transmission assets – see Note 4.4 to the Financial Statements). Highlight for the improvement in the results of Chesf (+R$3,323 million), Eletronorte (+R$2,816 million), Furnas (+R$557 million) and partially offset by the lower result of CGT Eletrosul (-R$217 million).
2.2 Operating Provisions of Parent Company
In 3Q21, Operating Provisions had a negative impact on the Parent Company's results by R$9,552 million, compared to a provision of R$921 million in 3Q20. This variation is mainly explained by: (i) negative effect on provisions for legal contingencies, with emphasis on the compulsory loan lawsuits in the amount of R$9,059 million, compared to a provision of R$379 million in 3Q20; and (ii) constitution, in 3Q21, of R$340 million in ANEEL CCC Provision due to the adjustment of current credits granted to the Holding by the privatized distributors, as mentioned in the consolidated analysis.
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 40 |
Marketletter 3Q21 |
Table 24: Operating Provisions (R$ million) |
Operating Provisions | ||
3Q21 | 3Q20 (Restated) | |
Guarantees | - 5 | - 3 |
Contingencies | 9,139 | 412 |
PCLD - Financing and Loans | 10 | 99 |
Overdraft liabilities in subsidiaries | - | - |
Investment Losses | 15 | 18 |
Provision for Implantation of Shares - Compulsory Loan | 47 | 353 |
ANEEL Provision - CCC | 340 | 27 |
Others | 5 | 15 |
TOTAL | 9,552 | 921 |
2.3 Parent Company Financial Result
In 3Q21, the Financial Result negatively impacted the Parent Company's result by R$927 million, as well as in 3Q20, with a negative result of R$311 million. The result was mainly influenced by: (i) exchange rate fluctuations in the period, given the devaluation of the dollar against the real and the situation of exchange rate exposure. The result of net exchange variation went from a negative amount of R$107 million in 3Q20 to a negative result of R$503 million in 3Q21; and (ii) the increase in net monetary restatements, which went from a negative amount of R$243 million in 3Q20 to a negative amount of R$473 million in 3Q21, mainly due to the financial expense and monetary restatement considering the effect of the application of the IPCA (in replacement of SELIC) on CCC credits and obligations in the amount of R$ 446 million, due to what was established in CNPE Resolution 15/2021.
Table 26: Financial Result (R$ million) |
FINANCIAL RESULT | 3Q21 | 3Q20 | ||
Financial income | ||||
Interest, commission and fee income | 227 | 332 | ||
Income from financial investments | 118 | 89 | ||
Additional moratorium on electricity | 11 | 0 | ||
Monetary updates | - 473 | - 243 | ||
Exchange variations | - 503 | - 107 | ||
Interest income on dividends | 209 | 137 | ||
Other financial income | 32 | 28 | ||
Financial expenses | ||||
Debt charges | - 392 | - 283 | ||
Leasing charges | -1 | -1 | ||
Charges on shareholder resources | -1 | 0 | ||
Other financial expenses | -155 | -262 | ||
- 927 | - 311 |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 41 |
Marketletter 3Q21 |
III.
General Information
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 42 |
Marketletter 3Q21 |
SHARE CAPITAL
Eletrobras' capital stock, on September 30, 2021, totaled R$ 39,057 billion, represented by 1,568,930,910 shares, of which 1,288,842,596 are common shares and 280,088,314 are preferred shares.
TABLE 27: CAPITAL STRUCTURE |
Eletrobras’s Social Capital | ||||
Shareholding position on 09/30/2021 | % Capital | |||
Shareholders | Quantity | Value(R$) | % | Total |
Common | 1,288,842,596 | 32,084,698,524.23 | 100.00% | 82.15% |
Government | 667,888,884 | 16,626,555,917.17 | 51.82% | 42.57% |
BNDESPAR | 141,757,951 | 3,528,950,032.66 | 11.00% | 9.04% |
BNDES | 74,545,264 | 1,855,744,316.08 | 5.78% | 4.75% |
Citibank | 46,264,144 | 1,151,708,608.43 | 3.59% | 2.95% |
Iberclear - Latibex | 333,835 | 8,310,553.49 | 0.03% | 0.02% |
FIA Dinâmica e Banclass | 65,536,875 | 1,631,487,726.37 | 5.08% | 4.18% |
FND | 45,621,589 | 1,135,712,719.15 | 3.54% | 2.91% |
FGHAB | 1,000,000 | 24,894,194.70 | 0.08% | 0.06% |
Banco do Nordeste | 1,420,900 | 35,372,161.25 | 0.11% | 0.09% |
Others | 244,473,154 | 6,085,962,294.93 | 18.97% | 15.58% |
PREF. A | 146,920 | 3,657,455.09 | 100.00% | 0.01% |
Victor Adler | 52,200 | 1,299,476.96 | 35.53% | 0.00% |
Shareholders to be identified | 42,451 | 1,056,783.46 | 28.89% | 0.00% |
Others | 52,269 | 1,301,194.66 | 35.58% | 0.00% |
PREF. B | 279,941,394 | 6,968,915,567.21 | 100.00% | 17.84% |
Citibank | 5,052,187 | 125,770,126.85 | 1.80% | 0.32% |
Iberclear - Latibex | 134,253 | 3,342,120.32 | 0.05% | 0.01% |
BNDESPAR | 18,691,102 | 465,299,932.37 | 6.68% | 1.19% |
BNDES | 18,262,671 | 454,634,487.64 | 6.52% | 1.16% |
3G Radar Backgrounds | 28,538,776 | 710,449,846.28 | 10.19% | 1.82% |
Shareholders to be identified | 2,023,774 | 50,380,223.99 | 0.72% | 0.13% |
Government | 494 | 12,297.73 | 0.00% | 0.00% |
Others | 207,238,137 | 5,159,026,532.02 | 74.03% | 13.21% |
Total | 1,568,930,910 | 39,057,271,546.52 | - | 100.00% |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 43 |
Marketletter 3Q21 |
Shares Analysis
Shares
Table 28: B3, ELET3 and ELET6 |
Price and Volume | (R$) ELET3 (Common) | (R$) ELET6 (Preferred) | (pts.) IBOV (index) | (pts.) IEE (index) |
Closing Price on 09/30/2021 | 38.51 | 38.72 | 110,979 | 78,296 |
Maximum in the quarter | 44.20 | 43.61 | 128,407 | 81,892 |
Average in the quarter | 39.92 | 40.01 | 120,076 | 79,698 |
Minimum in the quarter | 34.29 | 34.95 | 108,844 | 76,567 |
Variation in 3Q21 | -10.8% | -10.5% | -12.5% | -2.7% |
Change in the last 12 months | 36.6% | 34.2% | 17.3% | 14.2% |
Average Daily Traded Volume 3Q21 (R$ million) | 160.2 | 79.6 | - | - |
Book Value per Share (R$) | 48.52 | 48.52 | - | - |
Price / Profit (P/E) (1) | 65.40 | 65.76 | - | - |
Price / Shareholders' Equity (P/B) (2) | 0.79 | 0.80 | - | - |
(1) | Closing price of preferred and common shares at the end of the period / Net income per share. For the calculation, the accumulated net profit of the last 12 months was considered; |
(2) | Closing price of preferred and common shares at the end of the period / Book Value per share at the end of the period. |
Evolution of Shares Traded at B3 |
Source: AE Broadcast
Index number 09/30/2020 = 100 and ex-dividend values.
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 44 |
Marketletter 3Q21 |
ADR Programs
TABLE 29: NYSE, EBRN AND EBRB |
Price and Volume | (US$) NYSE EBRN | (US$) NYSE EBRB |
Closing Price on 09/30/2021 | 7.10 | 7.22 |
Maximum in the quarter | 8.68 | 9.16 |
Average in the quarter | 7.67 | 7.70 |
Minimum in the quarter | 6.55 | 6.65 |
Variation in 3Q21 | -17.9% | -17.4% |
Change in the last 12 months | 38.1% | 42.4% |
Average Daily Trading Volume 3Q21 (US$ thousand) | 5,864 | 56 |
Evolution of Shares Traded in ADR |
Source: AE Broadcast
Index number 09/30/2020 = 100 and ex-dividend values.
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 45 |
Marketletter 3Q21 |
Latibex - MADRID MARKET
Tabela 30: LATIBEX, XELTO E XELTB |
Price and Volume | (€) LATIBEX XELTO | (€) LATIBEX XELTB |
Closing Price on 09/30/2021 | 6.15 | 6.10 |
Maximum in the quarter | 7.15 | 7.55 |
Average in the quarter | 6.33 | 6.88 |
Minimum in the quarter | 5.60 | 5.60 |
Variation in 3Q21 | -20.6% | -19.2% |
Change in the last 12 months | 32.5% | 18.4% |
Average Daily Traded Volume 3Q21 (thousands of Euros) | 13.9 | 0.6 |
Evolution of Foreign Currencies |
Index number 09/30/2020 = 100.
Source: Banco Central
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 46 |
Marketletter 3Q21 |
Nº of Employees
PARENT COMPANY
TABLE 31: EMPLOYEES FOR WORKING TIME |
Working time in the company (years) | 3Q21 |
Up until 5 | 21 |
6 to 10 | 56 |
11 to15 | 365 |
16 to 20 | 149 |
21 to 25 | 19 |
More than 25 | 59 |
Total | 669 |
TABLE 32: EMPLOYEES BY FEDERATION STATE |
Federation State | 3Q21 |
Rio de Janeiro | 652 |
São Paulo | 1 |
Brasília | 15 |
Expatriate | 1 |
Total | 669 |
TURNOVER INDEX (Holding)
TABLE 33: TURNOVER HOLDING |
3Q21 |
1.74% |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 47 |
Marketletter 3Q21 |
Balance Sheet
(R$ thousand) |
Ativo | Parent Company | Consolidated | ||
09.30.21 | 12.31.20 | 09.30.21 | 12.31.20 | |
CURRENT | ||||
Cash and cash equivalents | 1,705,126 | 21,630 | 1,881,127 | 286,607 |
Restricted cash | 3,893,807 | 3,412,292 | 3,893,807 | 3,573,362 |
Marketable securities | 8,460,398 | 7,740,051 | 18,551,266 | 14,039,358 |
Customers | 345,257 | 481,109 | 4,401,187 | 5,971,657 |
Asset contractual transmission | 0 | 0 | 7,097,383 | 10,364,908 |
Loans and financing | 3,550,100 | 5,937,323 | 2,429,175 | 4,748,661 |
Remuneration of equity interests | 1,046,917 | 4,720,491 | 270,292 | 675,510 |
Taxes to recover | 347,824 | 519,200 | 475,653 | 833,960 |
Income tax and social contribution | 816,736 | 829,569 | 1,615,861 | 1,292,750 |
Reimbursement rights | 0 | 0 | 3,267 | 4,684 |
Warehouse | 281 | 305 | 587,676 | 509,991 |
Nuclear fuel stock | 0 | 0 | 428,340 | 428,340 |
Derivative financial instruments | 0 | 0 | 673,264 | 317,443 |
Hydrological risk | 0 | 0 | 0 | 0 |
Others | 2,436,134 | 1,683,297 | 2,511,564 | 1,855,175 |
22,602,580 | 25,345,267 | 44,819,862 | 44,902,406 | |
Asset held for sale | 289,331 | 289,331 | 389,210 | 289,331 |
22,891,911 | 25,634,598 | 45,209,072 | 45,191,737 | |
NON CURRENT | ||||
LONG-TERM REALIZABLE | ||||
Reimbursement rights | 5,611,205 | 5,583,447 | 5,729,850 | 5,583,447 |
Loans and financing | 8,990,249 | 11,197,073 | 5,242,903 | 6,176,238 |
Customers | 0 | 0 | 1,459,622 | 1,061,899 |
Marketable Securities | 338,780 | 322,884 | 339,144 | 323,236 |
Nuclear fuel stock | 0 | 0 | 1,381,643 | 1,264,780 |
Taxes to recover | 3,365 | 2,781 | 485,075 | 430,045 |
Current Income Tax and Social Contribution | 0 | 0 | 1,513,141 | 2,068,894 |
Escrow deposits | 6,402,167 | 4,676,895 | 8,452,197 | 6,752,865 |
Transmission contractual asset | 0 | 0 | 49,902,960 | 41,023,616 |
Financial assets - Concessions and Itaipu | 1,021,388 | 1,103,034 | 3,152,989 | 3,199,751 |
Derivative financial instruments | 0 | 0 | 628,828 | 310,100 |
Advances for future capital increase | 2,259,232 | 1,223,108 | 0 | 1,541 |
Decommissioning Fund | 1,958,863 | 1,753,827 | 1,958,863 | 1,753,827 |
Others | 918,965 | 1,153,411 | 1,258,823 | 1,286,546 |
27,504,214 | 27,016,460 | 81,506,038 | 71,236,785 | |
INVESTMENT | 92,006,003 | 77,538,694 | 28,493,143 | 29,089,522 |
Fixed assets net | 238,298 | 244,673 | 32,971,786 | 32,662,912 |
INTANGIBLE | 56,930 | 42,974 | 5,075,042 | 785,493 |
TOTAL NON-CURRENT ASSETS | 119,805,445 | 104,842,801 | 148,046,009 | 133,774,712 |
TOTAL ASSETS | 142,697,356 | 130,477,399 | 193,255,081 | 178,966,449 |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 48 |
Marketletter 3Q21 |
(R$ thousand) |
Liabilities and Equity | Parent Company | Consolidated | ||
09.30.21 | 31.12.20 | 09.30.21 | 31.12.20 | |
CURRENT | ||||
Loans and financing and Debentures | 9,009,755 | 7,984,194 | 11,875,718 | 11,410,751 |
Compulsory loan | 80,354 | 57,201 | 80,354 | 57,201 |
Suppliers | 618,886 | 705,908 | 3,511,594 | 3,904,051 |
Advances from customers | 1,047,382 | 1,060,770 | 1,136,891 | 1,134,845 |
Taxes payable | 229,012 | 335,432 | 889,144 | 1,194,042 |
Income tax and social contribution | 0 | 0 | 47,468 | 319,435 |
Onerous contracts | 0 | 0 | 0 | 40,196 |
Remuneration to shareholders | 40,429 | 1,530,718 | 44,701 | 1,547,158 |
Financial liabilities - Concessions and Itaipu | 2,134,388 | 647,214 | 2,134,388 | 647,214 |
Estimated liabilities | 182,921 | 167,344 | 1,573,622 | 1,454,148 |
Reimbursement Obligations | 1,493,047 | 1,373,656 | 1,766,802 | 1,618,508 |
Post-employment benefits | 0 | 0 | 218,395 | 192,209 |
Provisions for contingencies | 2,167,235 | 1,332,779 | 2,167,235 | 1,722,562 |
Regulatory charges | 0 | 0 | 551,309 | 586,845 |
Lease | 7,671 | 7,595 | 213,311 | 217,321 |
Others | 126,328 | 111,998 | 389,166 | 353,580 |
17,137,408 | 15,314,809 | 26,600,098 | 26,400,066 | |
NON-CURRENT | ||||
Loans and financing and Debentures | 19,639,808 | 20,014,081 | 36,276,082 | 35,591,282 |
Suppliers | 0 | 0 | 16,555 | 16,556 |
Advances from customers | 0 | 0 | 208,204 | 290,870 |
Compulsory loan | 1,109,335 | 989,908 | 1,109,335 | 989,908 |
Obligation for asset retirement | 0 | 0 | 3,209,663 | 3,040,011 |
Provisions for contingencies | 24,413,167 | 16,526,961 | 31,479,756 | 24,108,078 |
Post-employment benefits | 1,120,996 | 1,131,997 | 6,970,556 | 6,824,632 |
Provision for unsecured liabilities | 0 | 0 | 3,848 | 4,191 |
Onerous contracts | 0 | 0 | 478,099 | 414,705 |
Reimbursement Obligations | 0 | 0 | 92,359 | 22,259 |
Lease | 42,532 | 48,333 | 733,378 | 835,873 |
Concessions payable - Use of public goods | 0 | 0 | 73,531 | 65,954 |
Advances for future capital increase | 75,929 | 74,060 | 75,929 | 74,060 |
Derivative financial instruments | 0 | 0 | 0 | 10,014 |
Sector Charges | 0 | 0 | 642,938 | 744,442 |
Taxes payable | 0 | 0 | 299,712 | 182,179 |
Income tax and social contribution | 600,540 | 650,523 | 6,762,310 | 3,705,055 |
Others | 2,429,131 | 2,248,420 | 1,789,591 | 1,895,020 |
TOTAL NON-CURRENT LIABILITIES | 49,431,438 | 41,684,283 | 90,221,846 | 78,815,089 |
EQUITY | ||||
Share capital | 39,057,271 | 39,057,271 | 39,057,271 | 39,057,271 |
Capital reserves | 13,867,170 | 13,867,170 | 13,867,170 | 13,867,170 |
Profit reserves | 26,616,165 | 28,908,054 | 26,616,165 | 28,908,054 |
Advances for future capital increase | 0 | 0 | 0 | 0 |
Other comprehensive income accumulated | -8,424,696 | -8,354,188 | -8,424,696 | -8,354,188 |
Non controlling shareholdins | 0 | 0 | 304,627 | 272,987 |
Accumulated profits | 5,012,600 | 0 | 5,012,600 | 0 |
TOTAL SHAREHOLDERS' EQUITY | 76,128,510 | 73,478,307 | 76,433,137 | 73,751,294 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 142,697,356 | 130,477,399 | 193,255,081 | 178,966,449 |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 49 |
Marketletter 3Q21 |
Income Statement
(R$ thousand) |
Parent Company | Consolidated | ||||
09.30.21 | 09.30.20 | 09.30.21 | 09.30.20 | ||
NET OPERATING REVENUE | 472,345 | -15,113 | 26,124,306 | 19,566,810 | |
Operating costs | |||||
Personnel, Material and Services | 0 | 0 | -2,635,804 | -2,439,544 | |
Energy purchased for resale | -418,856 | -4,577 | 1,353,914 | -1,570,469 | |
Charges upon use of electric network | 0 | 0 | -1,800,388 | -1,349,987 | |
Fuel for electricity production | 0 | 0 | -1,830,066 | -1,524,080 | |
Construction | 0 | 0 | -769,016 | -576,480 | |
Depreciation | 0 | 0 | -1,224,303 | -1,233,154 | |
Amortization | 0 | 0 | -56,183 | -44,919 | |
Operating Provisions /Reversals net | 0 | 0 | -9,472 | -367,304 | |
Others Costs | 0 | 0 | -213,004 | -76,640 | |
GROSS RESULT | 53,489 | -19,690 | 18,939,984 | 10,384,233 | |
Operating expenses | |||||
Personnel, Supllies and Services | -400,505 | -415,045 | -2,563,827 | -2,398,040 | |
Depreciation | -8,995 | -9,703 | -105,691 | -97,662 | |
Amortization | -8 | -8 | -22,176 | -23,674 | |
Donations and contributions | -65,830 | -75,769 | -115,176 | -137,790 | |
Operating Provisions /Reversals net | -10,864,969 | -1,111,520 | -11,359,302 | -2,640,507 | |
Others | -288,703 | -144,672 | -788,997 | -790,777 | |
-11,629,010 | -1,756,717 | -14,955,169 | -6,088,450 | ||
Regulatory remeasurements - Transmission Contracts | 0 | 0 | 4,858,744 | 4,228,337 | |
OPERATING INCOME BEFORE FINANCIAL RESULT | -11,575,521 | -1,776,407 | 8,843,559 | 8,524,120 | |
Resultado Financeiro | |||||
Financial result | |||||
Financial income | 697,197 | 1,115,374 | 488,565 | 720,892 | |
Income from interest, commissions and fees | 206,419 | 753,582 | 396,286 | 962,700 | |
Income from financial investments | 22,887 | 1,385 | 205,745 | 211,112 | |
Moratorium on electricity | 988,977 | 363,216 | 1,340,085 | 543,676 | |
Active monetary updates | 1,352,771 | 5,158,498 | 1,288,240 | 4,912,083 | |
Active exchange rate variations | 209,321 | 137,404 | 16,761 | 5,992 | |
Gains on derivatives | 0 | 0 | 684,564 | 56,396 | |
Other financial income | 128,193 | 138,521 | 353,709 | 214,268 | |
Financial expenses | |||||
Debt charges | -1,045,776 | -1,338,305 | -1,896,829 | -2,249,797 | |
Leasing charges | -3,709 | -4,238 | -339,591 | -276,974 | |
Charges on shareholders' funds | -1,869 | -23,467 | -27,348 | -78,012 | |
Passive monetary updates | -1,089,568 | -483,789 | -1,282,171 | -544,319 | |
Passive exchange variations | -1,568,699 | -5,502,398 | -1,558,126 | -5,932,490 | |
Derivative losses | 0 | 0 | 0 | 0 | |
Other financial expenses | -486,621 | -936,638 | -791,656 | -642,283 | |
-590,477 | -620,855 | -1,121,766 | -2,096,756 | ||
INCOME BEFORE EQUITY | -12,165,998 | -2,397,262 | 7,721,793 | 6,427,364 | |
RESULTS OF EQUITY | 16,438,024 | 6,856,931 | 1,706,178 | 875,494 | |
OUTRAS RECEITAS E DESPESAS | 771,758 | 0 | 771,758 | 25,042 | |
OTHER REVENUE AND EXPENDITURE | 5,043,784 | 4,459,669 | 10,199,729 | 7,327,900 | |
Current Income Tax and Social Contribution | 0 | 0 | -1,427,201 | -2,171,772 | |
Deferred Income Tax and Social Contribution | 0 | 0 | -3,668,904 | -645,120 | |
NET INCOME FOR THE PERIOD | 5,043,784 | 4,459,669 | 5,103,624 | 4,511,008 | |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 50 |
Marketletter 3Q21 |
Cash Flow Statement
(R$ thousand) |
Parent Company | Consolidated | ||||
09.30.21 | 09.30.20 | 09.30.21 | 09.30.20 | ||
Operating Activities | |||||
Income before income tax and social contribution | 5.043.784 | 4.459.669 | 10.199.729 | 7.327.900 | |
Adjustments to reconcile income to cash provided by operations:: | |||||
Depreciation and amortization | 9.003 | 9.711 | 1.408.353 | 1.399.409 | |
Net foreign exchange rate variations | 316.519 | 464.473 | 211.972 | 1.021.050 | |
Financial charges | 144.836 | 113.232 | 1.758.442 | 1.877.899 | |
Equivalence equity results | -16.438.024 | -6.856.931 | -1.706.178 | -875.494 | |
Other Income and Expenses | -771.758 | 0 | -771.758 | -25.042 | |
Contract revenue - Transmission | 0 | 0 | -7.008.578 | -3.739.843 | |
Construction Revenue | 0 | 0 | -1.103.056 | -437.739 | |
Regulatory remeasurements - Transmission Contracts | 0 | 0 | -4.858.744 | -4.228.337 | |
Operating provisions (reversals) | 10.864.969 | 1.111.520 | 11.368.774 | 3.007.811 | |
Participation of non-controlling shareholders | 0 | 0 | -90.643 | -61.300 | |
GSF reimbursement | 0 | 0 | -4.265.889 | 0 | |
Financial instruments - derivatives | 0 | 0 | -684.564 | -56.396 | |
Others | -167.777 | 458.297 | 703.487 | -521.022 | |
-6.042.232 | -4.699.698 | -5.038.382 | -2.639.004 | ||
(Increases) / decreases in operating assets | |||||
Customers | 1 | 1 | 1.036.896 | -557.013 | |
Marketable securities | -720.347 | -18.698 | -4.511.920 | -1.407.663 | |
Reimbursement rights | 51.040 | -95.311 | -66.188 | -18.340 | |
Warehouse | 24 | -65 | -77.685 | -41.850 | |
Nuclear fuel stock | 0 | 0 | -116.863 | -170.433 | |
Financial assets - Itaipu | 1.568.820 | 514.997 | 1.568.820 | 514.997 | |
Assets held for sale | 0 | 294.249 | -99.879 | 324.009 | |
Hydrological risk | 0 | 0 | 520.785 | 34.062 | |
Credits with subsidiaries - CCD | 0 | 0 | 0 | 0 | |
Others | 110.536 | 128.797 | 62.226 | -306.729 | |
1.010.074 | 823.970 | -1.683.808 | -1.628.960 | ||
Increase / (decrease) in operating liabilities | |||||
Suppliers | -254.687 | -58.257 | -560.123 | -568.307 | |
Advances | 0 | 0 | -67.232 | -53.459 | |
Lease | -5.725 | 4.237 | 274.473 | 253.179 | |
Estimated liabilities | 15.577 | 26.875 | -16.027 | 122.333 | |
Indemnification obligations | 0 | 0 | 99.003 | 0 | |
Sectorial charges | 0 | 0 | -137.040 | 69.231 | |
Liabilities associated with assets held for sale | 0 | 0 | 0 | 0 | |
Accounts payable with subsidiaries | 0 | 0 | 0 | 0 | |
Others | -733.239 | 342.622 | -715.465 | 131.494 | |
-978.074 | 315.477 | -1.122.411 | -45.529 | ||
Payment of financial charges | -848.801 | -631.163 | -1.549.307 | -1.798.451 | |
Revenue of RAP and indemnities | 0 | 0 | 7.510.113 | 6.519.416 | |
Revenue of financial charges | 643.814 | 840.415 | 424.945 | 523.603 | |
Payment of income tax and social contribution | -155.989 | -188.159 | -1.920.400 | -2.376.481 | |
Revenue of remuneration for investments in equity interests | 5.528.150 | 3.578.347 | 1.523.912 | 454.423 | |
Supplementary pension payment | -11.002 | -9.443 | -241.683 | -204.965 | |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 51 |
Marketletter 3Q21 |
Payment of legal contingencies | -1.886.445 | -2.871.787 | -4.148.606 | -2.942.684 |
Bonds and related deposits | -1.574.390 | -728.671 | -1.512.755 | -765.390 |
Net cash provided by (used in) operating activities | 728.889 | 888.957 | 2.441.347 | 2.423.878 |
Financing Activities | ||||
Loans and financing obtained and debentures obtained | 2.700.000 | 5.193.319 | 4.736.770 | 8.191.275 |
Payment of loans and financing and debentures - principal | -2.860.468 | -8.099.149 | -4.270.102 | -9.974.976 |
Payment of remuneration to shareholders | -2.922.438 | -2.579.579 | -2.840.202 | -2.590.936 |
Revenue of advance for future capital increase | 0 | 0 | 0 | 0 |
Payment of finance leases | 0 | -9.899 | -380.978 | -409.831 |
Others | 0 | 0 | 266 | -14.236 |
Net cash provided by (used in) financing activities | -3.082.906 | -5.495.308 | -2.754.246 | -4.798.704 |
Investing activities | ||||
Lending and financing | 0 | 0 | 0 | 0 |
Loans and financing receivables | 5.076.238 | 4.966.163 | 3.615.731 | 3.131.802 |
Acquisition of fixed assets | -2.621 | 0 | -1.375.560 | -842.815 |
Acquisition of intangible assets | -13.964 | -14.190 | -133.994 | -50.331 |
Acquisition / capital investment in equity | -9 | 0 | -117.921 | -45.569 |
Advance concession for future capital increase | -1.022.319 | -652.339 | 0 | -6.000 |
Investment sale in shareholdings | 188 | 309.287 | 188 | 311.587 |
Net cash flow in the acquisition of investees | 0 | 0 | 0 | 0 |
Others | 0 | 0 | -81.025 | -151.858 |
Net cash provided by (used in) investing activities from continuing operations | 4.037.513 | 4.608.921 | 1.907.419 | 2.346.816 |
Increase (decrease) in cash and cash equivalents | 1.683.496 | 2.570 | 1.594.520 | -28.010 |
Cash and cash equivalents at the beginning of the year for continued operations | 21.630 | 18.202 | 286.607 | 335.307 |
Cash and cash equivalents at year-end of continuing operations | 1.705.126 | 20.772 | 1.881.127 | 307.297 |
1.683.496 | 2.570 | 1.594.520 | -28.010 |
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 52 |
Marketletter 3Q21 |
IV.
NEW SUSTAINABILITY CHANNEL
MARKETLETTER 3Q2021 Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding. | 53 |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: November 17, 2021
CENTRAIS ELÉTRICAS BRASILEIRAS S.A. - ELETROBRÁS | ||
By: | /S/ Elvira Baracuhy Cavalcanti Presta | |
Elvira Baracuhy Cavalcanti Presta CFO and Investor Relations Officer |
FORWARD-LOOKING STATEMENTS
This press release may contain forward-looking statements. These statements are statements that are not historical facts, and are based on management's current view and estimates offuture economic circumstances, industry conditions, company performance and financial results. The words "anticipates", "believes", "estimates", "expects", "plans" and similar expressions, as they relate to the company, are intended to identify forward-looking statements. Statements regarding the declaration or payment of dividends, the implementation of principal operating and financing strategies and capital expenditure plans, the direction of future operations and the factors or trends affecting financial condition, liquidity or results of operations are examples of forward-looking statements. Such statements reflect the current views of management and are subject to a number of risks and uncertainties. There is no guarantee that the expected events, trends or results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations.