CEMIG's 2024 Q4 Earnings Call: Navigating Contradictions in Labor Talks, Divestments, and Privatization Prospects

These are the key contradictions discussed in Companhia Energética de Minas Gerais - CEMIG's latest 2024Q4 earnings call, specifically including: Union Negotiations and Labor Agreements, Divestment Strategy and Timeline, and Privatization Process:



Record Financial Performance:
- CEMIG reported the highest EBITDA and net profit in the company's history, reaching BRL11.3 billion and BRL8.3 billion respectively, with a significant growth of 500% and 600% compared to 2018.
- This remarkable performance was attributed to increased investments in strategic areas, successful divestments, and a positive tariff review for transmission, which amounted to BRL1.5 billion.

Investment and Expansion:
- The company's annual CapEx reached an all-time high of BRL5.7 billion, marking a 34.8% annual average growth since 2018.
- This growth was driven by a focus on regulated sectors and strategic divestments, allowing CEMIG to improve its financial sustainability and enhance service quality for clients.

Sustainability and Ratings:
- CEMIG achieved an AAA rating from Fitch Ratings, along with a 15% yield in the electric sector and a 43% increase in preferred shares in 2024.
- This success was supported by a 100% clean energy matrix, inclusion in indices like the DJSI, and issuing renewable energy certificates (RECs), demonstrating a strong commitment to sustainability.

Regulatory and Operational Improvements:
- The distributing company improved its perceived DEC by 2.5 hours, indicating better service quality for clients.
- This progress was facilitated by regionalization efforts, increased efficiency in supply logistics, and the successful implementation of a new DNS, which led to cost improvements and enhanced service delivery.