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 August, 2020

 

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 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

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INTRODUCTION

Rio de Janeiro, August 12,2020

A Eletrobras (Centrais Elétricas Brasileiras S.A.)

[B3: ELET3 e 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, controller of 6 operating subsidiaries and a holding company - Eletropar -, a research center - Cepel, holding 50% of the Itaipu Binacional's share capital and direct and indirect participation in 133 Special Purpose Companies, on this date, announces its results for the period.

2nd QUARTER OF 2020

Eletrobras presented, in the second quarter of 2020 (2Q20), a net profit of R$ 4,597 million, lower than the R$ 5,561 million obtained in the same period of 2019. Net Income from Continuing Operations was R$ 4,597 million in 2Q20, higher than the R$ 301 million in 2Q19 (2Q19 profit consists of R$ 301 million in net income from continuing operations and R$ 5,260 million in distribution - discontinued operation).

The profit of R$ 4,597 million in 2Q20 was impacted, mainly, by the effect of the tariff revisions of the transmission concessions extended under the terms of Law 12,783/2013 and the Annual Permitted Revenue (“RAP”) of these concessions for the 2020-2021 tariff cycle was approved. in an ordinary meeting of the Executive Board of the National Electric Energy Agency - ANEEL held on 06/30/2020 over the RBSE amount to be received1. The RAP of the Eletrobras Companies suffered increases resulting from the positive result of the Periodic Tariff Review of 2018 and the recognition of the portion of the remuneration provided for in article 1, third paragraph, of the MME Ordinance 120/2016, which establishes that the capital cost not incorporated since the extensions of the concessions until the tariff process, established in the first paragraph of that article, shall be updated and remunerated at the cost of equity (“Ke”), real, of the transmission segment defined by ANEEL in the Periodic Tariff Review methodologies Existing Concessionaires. The quarter was also marked by a 26% drop in PMSO, which went from R$ 2,268 in 2Q19 to R$ 1,676 million in 2Q20, impacted mainly by the voluntary dismissal programs, but also by the OBZ and the Covid pandemic 19. There was also an impact of the recognition of two negative economic effects, but without financial effect, which were the remeasurement of the fair value of RBSE revenue, with an expense of R$ 1,028 million and the negative exchange variation of R$ 197 million as a result the devaluation of the Real during the Covid pandemic 19. The recurring profit in 2Q20 was R$ 1,452 million, also impacted by the negative economic effects mentioned above, against the result of R$ 2,186 million in 2Q19.

Net Operating Revenue went from R$ 6,601 million in 2Q19 to R$ 11,098 million in 2Q20, an increase of 68%. Ebtida IFRS, in the amount of R$ 1,336 million in 2Q19, increased to R$ 7,787 million in 2Q20. Recurring Net Operating Revenue decreased by 13%, from R$ 6,384 million in 2Q19 to R$ 5,564 million in 2Q20, influenced by the termination of contracts at Furnas and Eletronorte, in the regulated environment, as well as by anticipation of the R$ 218 million adjustment in the Adjustment Portion of the transmission revenue, a measure adopted by Aneel to mitigate the effects of the pandemic in the sector, and by the amortization of RBSE revenue. Recurrent Ebtida decreased 19%, from R$ 2,996 million in 2Q19 to R$ 2,413 million in 2Q20.

 

1 The other impacts of the tariff reviews for transmission concessions extended under the terms of Law 12,783/2013, for the 2020-2021 tariff cycle, as approved at a regular meeting of the Executive Board of the National Electric Energy Agency - ANEEL held on 06/30/2020, they will only be incorporated into the quarter that will end on September 30, 2020.

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

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1st HALFYEAR OF 2020

Eletrobras presented, in the first half of 2020 (1H20), a net profit of R$ 4,904 million, lower than the R$ 6,908 million obtained in the same period of 2019, mainly impacted by the events mentioned above. Recurring profit in 1H20 was R$ 2,436 million, also impacted by the negative economic effects mentioned above, against the result of R$ 3,674 million in 2019. Disregarding the effects of the Adjustment to Fair Value and the exchange variation in the Result, the recurring profit would be R$ 3,747 million, higher than the R$ 1,819 million in 1H19.

Net Operating Revenue went from R$ 13,066 million in 1H19 to R$ 18,053 million in 1H20, an increase of 38%. EBITDA IFRS, in the amount of R$ 4,287 million in 1H19, increased to R$ 10,589 million in 1H20. Recurring Net Operating Revenue fell 3%, from R$ 12,926 million in 2Q19 to R$ 12,512 million in 1H20. Recurrent Ebtida decreased by 7.6%, from R$ 6,080 million in 1H19 to R$ 5,619 million in 1H20.

OTHER 2Q20 HIGHLIGHTS

 

 

 

 

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

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TABLE 01: MAIN INDICATORS (R$ Million)

1H20 1H19 %   2Q20 2Q19 %
67.6 67.5 0.1% Energy Sold - Generation GWh (1) 30,4 32,4 -6.2%
20,991 15,946 32% Gross Revenue 12,518 8,016 56%
15,449 15,806 -2% Recurring Gross Revenue (2) 6,985 7,799 -10%
18,053 13,066 38% Net operating revenue 11,098 6,601 68%
12,512 12,926 -3% Recurring Net Operating Revenue (2) 5,564 6,384 -13%
10,589 4,287 147% EBITDA 7,787 1,336 483%
5,619 6,080 -8% Recurring EBITDA (3) 2,413 2,996 -19%
59% 33% 2585% Ebitda Margin 70% 20% 4992%
45% 47% -213% Recurring Ebitda Margin 43% 47% -357%
49,492 42,281 17% Gross debt without third party RGR 49,492 42,281 17%
19,599 19,975 -2% Recurring Net Debt 19,599 19,975 -2%
1,5 2,1 -56% Recurring Net Debt / Recurring LTM EBITDA 1,5 2,1 -56%
4,904 1,871 162% Net Income from Continuing Operations 4,597 301 1426%
4,904 6,908 -29% Net Profit 4,597 5,561 -17%
709 1,180 -40% Investments 380 666 -43%
12,552 15,529 -19% Employees 12,552 15,529 -19%

(1) It does not consider the energy allocated to quotas, from the plants renewed by Law 12,783/2013 (2) Revenue from Procel Retroactive, GAG Retroactive and Revenue from Generation Construction, RBSE retroactive due to Periodic Tariff Review; (3) Excludes item (2), costs of the Extraordinary Retirement Plan (PAE) and the Consensual Dismissal Plan (PDC), expenses with independent investigation, Extraordinary Consulting at the Holding, expenses related to the Inepar / Furnas agreement, retroactive payment to Enel by TUSD Eletronuclear, Inepar + Camargo Correa + CIEN judicial agreements; FGTS and INSS at Eletronorte - April launch; provisions for contingencies, onerous contracts, Impairment, provision for losses on investments, provision for losses on investments classified as held for sale, provisions for adjustment to market value, provision for water resources inspection fee (TFRH), provision for ANEEL CCC; Rap Adjustment Portion; Provision Inflexibility of Usina Candiota III, PCLD of third party debt with RGR (CCEE pass-through) and PCLD Prospective credit loss estimate (CPC 48), Expiry of Concession and Indemnity for Furnas Third Parties; (4) Excludes item (3) and monetary restatement for the compulsory loan contingency; Eletropaulo process financial income and activation of non-recurring tax credit.

 

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

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I | ANALYSIS OF THE CONSOLIDATED RESULT (R$ MILLION)

TABLE 02: CONSOLIDATED RESULTS

1H20 1H19 Financial Statements 2Q20 2Q19
10,797 10,943 Generation Revenue 4,848 5,321
9,914 4,590 Transmission Revenue 7,519 2,515
280 413 Others Revenue 151 180

20,991

15,946

Gross Revenue

12,518

8,016

-2,938 -2,880 Deductions from Revenue -1,420 -1,415

18,053

13,066

Net Operating Revenue

11,098

6,601

-3,190 -2,864 Operational costs -1,439 -1,575
-3,821 -4,314 Personnel, Material, Services and Others -1,676 -2,268
-932 -873 Depreciation and amortization -463 -445
-1,006 -2,029 Operating Provisions -559 -1,506
9,104 2,986  

6,960

806

528

262

Shareholding

364

102

25

166

Others Revenues and Expenses

0

-17

9,658 3,414  

7,324

891

-2,840 89 Financial Result -1,331 425

6,818

3,504

Income before tax

5,994

1,317

-1,914 -1,632 Income tax and social contribution -1,396 -1,016

4,904

1,871

Net Income for the year

4,597

301

0 5,037 Profit (Loss) Net of Taxes from Discontinued Operation 0 5,260

4,904

6,908

NET INCOME FOR THE PERIOD

4,597

5,561

 

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

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TABLE 03: RECURRING CONSOLIDATED RESULT

1H20 1H19 Recurrent Financial Statement * 2Q20 2Q19
10,778 10,930 Generation Revenue Recurrent 4,837 5,311
4,392 4,590 Transmission Revenue Recurrent 1,997 2,343
280 286

Others Revenue Recurrent

 

 

151 145

15,449

15,806

Gross Revenue Recurrent

6,985

7,799

-2,938 -2,880 Deductions from Revenue Recurrent -1,420 -1,415

12,512

12,926

Net Operating Revenue Recurrent

5,564

6,384

-3,171 -2,851 Operational costs Recurrent -1,428 -1,393
-3,654 -3,981 Personnel, Material, Services and Others Recurrent -1,687 -2,071
-932 -873 Depreciation and amortization Recurrent -463 -445
-596 -276 Operating Provisions Recurrent -400 -25
4,159 4,946   1,586 2,449
528 262 Shareholdings Recurrent 364 102
4,687 5,208  

1,950

2,551

-1,764 99 Financial Result Recurrent -529 502

2,923

5,307

Income before tax Recurrent

1,422

3,053

-487 -1,632 Income tax and social contribution Recurrent 30 -1,016

2,436

3,674

Net Income for the year Recurrent

1,452

2,037

 

* Non-recurring adjustments mentioned in the Highlights.

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

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I.1 MAIN VARIATIONS OF FINANCIAL STATEMENTS

HIGHLIGHTS IN ANALYSIS OF VARIATION 2Q19X2Q20

OPERATING INCOME

TABLE 04: GENERATION REVENUE

Operating Revenue - Generation 2Q20 2Q19 %

Generation Revenue

 
 
 
Energy supply to distribution companies 3,172 3,567 -11%
Supply 659 571 15%
CCEE 125 280 -55%
Operation and Maintenance Revenue 934 844 11%
Construction Revenue 11 10 13%
Itaipu Transfer -52 50 -205%
Generation Revenue 4,848 5,321 -9%
Non-recurring events      
(-)Construction Generation -11 -10 13%

Recurring Generation Revenue

4,837

5,311

-9%

2Q19X2Q20 Variation Analysis

Energy supply

· At subsidiary Furnas (-R$ 411 million): (i) In ACR, the termination of the 2014-2019 Existing Energy Product resulted in a net drop in revenue of approximately R$ 246 million, considering an average contracted quantity in 2Q19 317MWméd; (ii) higher sales in the Supply line, thus reducing the availability of energy for sale ACL Supply, representing a decrease of R$ 153 million; and (iii) seasonality of contracts, price adjustment (on average 4%) of the CCEARs and variation in the variable revenue of the Santa Cruz plant, represented a drop in revenue of R$ 13 million;
· At subsidiary Eletronorte (-R$ 203 million): (i) drop in ACR revenue by 88% due to the termination of products from the 13th Auction - 2014/2019 and the 17th Auction - 2018/2019 and also due to the pandemic and its impacts on the energy market, these being the facts that led to a reduction in both the volume of energy sold by 84% (from 447 MWmed to 73 MWmed) and the average price by 28% (R $ 175.00 / MWh in 2Q20 against R$ 242.28 / MWh in 2Q19). On the other hand, there was: (ii) a 127% increase in ACL sales to traders, 1249 MWmed were sold in 2Q20 and only 551 MWmed in 2Q19, with prices sold being 55% lower, R $ 80.97 / MWh in 2020 and R$ 178.20 / MWh in 2019, resulting in a 3% higher revenue, R$ 221 million in 2Q20 against R$ 214 million in 2Q19, but insufficient to offset the total reduction in supply.
· In the Holding (-R$ 52), impacted by the sale (resale) of energy imported from Uruguay in the amount of R$ 49 million in 2Q19 without correspondence in 2Q20, given the drop in demand and the unnecessary importation of energy by Eletrobras, with a corresponding drop in the expense of energy purchased for resale.
· Partially offset by the increase in the subsidiary Amazonas GT (+ R$ 107 million) mainly due to: (i) price adjustments from R$ 1,497.00 Mw/h to R$ 1,544.00 Mw/h of purchased energy for resale of PIEs and natural gas, costs that are passed on to the power supply contracts to Amazonas D, resulting in an increase of 9% in billing, corresponding to approximately 44 million; (iii) entry of UTE Coari in Jan / 2020, which represents an increase of approximately R$ 25 million; (iv) HPP Balbina represented an increase of approximately R$ 16 million due to seasonality; partially offset (iv) by the reduction of approximately 7 million in UTE Mauá 03 due to seasonality.
· At the subsidiary Eletronuclear (+ R$ 69 million), mainly due to (i) the increase in Fixed Revenue at the Angra 1 and 2 Power Plants according to ANEEL Homologatory Resolution No. 2,661 / 2019 (in the amount of R$ 931.6 million in 2Q20 and R$ 852.3 million in 2Q10, the latter in accordance with ANEEL Approval Resolution No. 2,509 / 2018, and in 2019 there was an estimate of an excess portion of energy recognized in the amount of R$ 10.6 million.

MARKETLETTER 2Q2020

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Supply

· At the subsidiary Furnas (+ R$ 113 million), mainly due to the following reasons: (i) adjustment of about 5% in the price of the current contracts for the Itumbiara Plant auctions, governed by Law 13,182 / 2015, specific to final consumers , resulting in an increase in revenue of R $ 6 million; and (ii) new contracts that started supplying in 2020, positively impacted revenue by R$ 107 million.
· Partially offset by the reduction in the subsidiary Eletronorte (-R$ 24 million), mainly due to the following reason: (i) a reduction in the turnover of the contract with Albras in the amount of R$ 22 million, motivated by a 17% drop in the average price of the LME (US$ 1,855.94 in 2Q19 against US$ 1,540.38 in 2Q20), partially offset by the 38% increase in the exchange rate (R$ 3.92 / US $ in 2Q19 against R$ 5.39 / US$ in 2Q20). These values ​​directly influence the sale price of energy to Albrás due to the fact that the energy sale contract has a variable part that depends on both the LME and the dollar; (ii) a reduction in revenues of R$ 2.7 million from other customers due to the adjustment of the energy seasonal curve and volume of energy sales.

CCEE

· At subsidiary Eletronorte (-R$ 178 million), mainly due to (i) the 17% increase in sales of bilateral contracts, from 1884 MWmed in 2Q19 to 2197 MWmed in 2Q20; (ii) the 31% seasonally reduced Physical Guarantee (from 3617 MWmed 2Q19 x 2485 MWmed 2Q20), (iii) these facts meant that, in 2Q20, the controlled company was exposed in the MCP in 92 MWmed to an average PLD equal to R$ 49.59 / MWh, already in 2Q19 there was a surplus of 1097 MWmed to be settled at the average PLD equal to R$ 56.32, which is why greater revenue occurred in 2Q19.
· At subsidiary Furnas (-R$ 31 million), mainly due to (i) the variation in the energy allocated in 2019 (and the consequent higher settlement at CCEE) and the lower energy allocated in 2020 (and consequently less settlement at CCEE); (ii) In addition, the average PLD decreased by 43% (in 2Q19 it was R$ 131.41, while in 2Q20 it was R$ 75.43); and
· Partially offset by subsidiary Chesf (+ R$ 57 million), mainly due to the following reason: (i) one-time accounting adjustment, in 2Q19, related to the record of delinquency in previous periods (-R$ 72 million), which ended up reducing 2Q19 revenue. Excluding this adjustment, there would have been a decrease of R$ 15 million, explained by an increase of approximately 80 average MW in contracted energy, according to the variation reflected in the supply.

Operation and Maintenance Revenue - Plants Renovated by Law 12.783/2013

· At subsidiary Chesf (+ R$ 60 million): (i) annual increase of approximately 9% in RAG, according to Aneel Homologatory Resolution No. 2,587 / 2019 (2019-2020 cycle); and (ii) the increase in generation in 2020, reflected in the indemnity income from CFURH and taxes of approximately R $ 16 million.
· At subsidiary Furnas (+ R$ 31 million), mainly due to (i) RAG's annual readjustment of approximately 11%, in accordance with Aneel Homologatory Resolution No. 2587/2019, representing an increase in revenue of R$ 26 million in 2020; and (ii) the variation of CFURH and, consequently, of PIS / COFINS, which represented an increase in revenue of R$ 5 million.

Construction Revenue

· Higher level of investment realized in 2Q20, but with no effect on results as it has an equivalent value in construction expenses.

Transfer Itaipu

· Variation of the tariff on which the monetary restatement calculated based on the American price indices Commercial Price and Industrial goods, which had a negative variation of -0.96% in 2Q20 (against + 2.74% in 2Q19) and offset the exchange variation gains on the financial asset of Itaipu recognized by the interministerial decree 04/2018 MME and Ministry of Finance that determines Itaipu's revenue.

MARKETLETTER 2Q2020

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TABLE 05: TRANSMISSION REVENUE

Operating Transmission Revenue 2Q20 2Q19 %

Transmission Revenue

7,519

2,515

199%

O&M Revenue - Renewed Lines 494 1,037 -52%
O&M Revenue - Regime Exploration 343 175 96%
Construction Revenue 139 124 12%
Finance - Return on Investment - RBSE 6,366 970 556%
Contractual Revenue - Transmission 177 209 -15%
Non-recurring events      
Ke RBSE -5,522 -172 3111%

O&M Revenue - Renewed Lines

1,997

2,343

-15%

O&M Revenue - Renewed Lines Law 12.783/13

· At subsidiary Chesf (- R$ 119 million): (i) Anticipation of the adjustment portion of cycle 20-21, in three installments in 2Q20 (3 installments of R$ 21.6 million from April to May/20, totaling R$ 64.85 million), as a measure adopted by Aneel of financial support to distributors, in the face of the Covid-19 pandemic, anticipating what would be done only in 12 installments starting in July 2021, especially regarding the anticipation of the EUST surplus in the cycle 2019/2020,; (ii) The other reduction effects can be attributed to the determination by IFRS15 of the undertakings associated with authoritative resolutions of CC 061/2001 and the projection of the revenue flow in accordance with the approval resolution published in July/2019 (R$ 80 million) . Despite the fall in the corporate balance sheet, (iii) the regulatory RAP grew 4.72% between the periods mentioned, causing an increase of R$ 18 million.
· At Eletronorte (+ R$ 31 million), Reduction of approximately R$ 30.1 million corresponding to the anticipation of the adjustment portion of the 20/21 cycle, as mentioned in Dispatch 1,106 / 2020 / ANEEL, which did not occur in 2Q19 (ii) an increase in the RAP ratified for the 2019/2020 cycle (ReH 2565/19), which contributed to the increase in revenue billed in 2Q20 by R$ 20 million; (iii) an increase of R$ 3.7 million in the PV discount (2Q19: R$ 3.1 million x 2Q20: R$ 6.8 million); (iv) recognition, as of 2Q19, of revenue related to small enterprises, with an impact in 2Q20 in the amount of R$ 1.15 million (Technical Note No. 0374/2019-SCT / ANEEL); (v) a reduction of approximately R$ 14 million related to the increase in the amortization of contractual assets and amortization of RBSE ..
· Furnas (-R$ 30 million): (i) reduction of approximately R$ 66 million, being, on average, R$ 22 million / month, corresponding to the anticipation of the adjustment portion of the 20/21 cycle, according to Dispatch nº . 1,414 / 20 - ANEEL; (ii) This effect was partially offset by the 13% readjustment related to the increase in the 2018/2019 and 2019/2020 cycle.
· Variation of the elimination effect between quarters, in the consolidated, of operations between group companies of approximately R$ 172 million.

O&M Revenue - Exploration Regime

· In the subsidiary Chesf (- R$ 40 million), mainly due to: (i) anticipation of the adjustment installment that would also only be realized in 12 installments as of July 2021, especially related to the anticipation of the EUST surplus in the cycle 2019/2020, and was anticipated and discounted in three installments in 2Q20 (3 installments of R$ 25 million from April to May / 20, totaling R $ 75 million), according to Aneel Order No. 1,106 / 202, due to Aneel's measures ahead the COVID-19 pandemic; offset by (ii) the incorporation of the R$ 15 million ETN (11/01/2019) and TDG contracts in Chesf (5/12/2020) of R$ 3.5 million.

Construction Revenue

· The variation is mainly due to the higher volume of investments compared to the previous year, especially Chesf (+ R$ 100 million), partially offset by the reduction in Furnas (-R$ 50 million) and in CGT Eletrosul (+ R$ 29 million).

MARKETLETTER 2Q2020

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Finance - Return on Investment – RBSE

· The variation is mainly due to: (I) approval of the tariff review of transmission concessions extended under the terms of Law 12,783 / 2013, granted by Aneel in June 30, 2020, which approved the new Permitted Annual Revenue ("RAP") of these concessions for the 2020-2021 tariff cycle and bringing the following changes to RBSE summarized: (a) Retrospective change to wacc for the years 2018 and 2019; (ii) Change in the asset base incorporating the write-offs occurred in the 2013-2018 cycle and the readjustment of the new replacement value of the agreements of assets associated with RBSE; (e) Incorporation of the payment of the controversial installment "Ke" that had been judicial discussion since 2017; (III) Allocating for 3 years the differences between the amount effectively received between 2018 and 2019 and the installments now reviewed via the adjustment portion updated by IPCA. There was a recognition of R$ 5,522 in RBSE Financial Revenue due to the tariff review.

Contractual Revenue – Transmission

· At subsidiary Eletronorte (-R$ 44 million) due to a reclassification in 2Q19 to RBSE revenue in the amount of R$ 63.7 million, which did not occur in 2Q20. As a result, 2Q19 is well below 2Q20, while what was expected was stable revenue.
· In the subsidiary Chesf (-R$ 17 million) mainly due to: (i) higher registration of the remuneration on the financial asset due to the entry of new ventures during the year of 2019, with emphasis on the authorization of the contract 61.

TABLE 06: OTHER OPERATING REVENUE

Operating Income 2Q20 2Q19 %

Others Revenues

151

180 

-16%

Non-recurring events      
Procel retroactive reversal / Sale of SPEs 0 -64 100%

Other recurring income

151

144

4%

Others Revenues

· The variation is mainly due to: (i) non-recurring gain recorded in 2Q19 in the sale of SPE of R $ 35.2 million, inherent to the SPEs Etau and Uirapuru of Eletrosul;

OPERATIONAL COSTS

TABLE 07: OPERATIONAL COSTS

Operational costs 2Q20 2Q19 %
Energy purchased for resale -360 -466 -23%
Charges on use of the electricity grid -394 -576 -32%
Fuel for production electric power -528 -381 39%
Construction -157 -152 3%

Total Operating Costs

-1,439

-1,575

-9%

Non-recurring events

 
 
 
(-) Generation Construction 11 10 13%
(-) Retroactive Nuclear Cusd Fuel CGTEE 0 172 -100%

Total Recurring Operating Costs

-1,428

-1,393

3%

MARKETLETTER 2Q2020

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2Q19X2Q20 Variation Analysis

Energy purchased for resale

· Holding (-R$ 48 million): reduction due to the fact not having occurred, in 2Q20, energy was purchased (for resale) from Uruguay, due to the lack of need to import energy in the Covid pandemic19;
· At the subsidiary Amazonas GT (-R$ 45 million): considering the adjustments2 (+ R$ 17 million) realized in 12Q19, compared to 2Q20, we would have a reduction of approximately 50% (-R$ 27 million), which occurs due to the following factors: (i) R$ 22 million referring to the PIE note from Mar / 2019 released in April 2019 (non-recurring) and later reversed in July / 19, (iii) readjustment in Leasing which represents a reduction in 2Q20 of approximately R$ 5 million.
· At the subsidiary Eletrosul (-R$ 12 million), mainly due to the decrease in the energy purchased from Eletronorte as provided for in a 135MW to 109 MW contract. In total, this reduction represents 7% of the energy purchased by the company, however, the effect is less in the values ​​due to price differences between the contracts and the readjustment of the same; (ii) In addition, in June 2019 there was a provision for a negative result in the CCEE of R$ 3.3 million, which did not occur in 2020.

Charges on use of the electricity grid

· Variation in the elimination effect between quarters, in the consolidated, of operations between group companies of approximately R$ 172 million;
· Readjustment of TUST for the 2019-2020 cycle.

Fuel for electricity production

· At subsidiary Amazonas GT (-R$ 171 million): (a) considering the SAP adjustments (-R$ 64 million) realized in 2Q19, basically due to the entry of the difference in the regulatory and contractual price of natural gas realized in 2Q19 and reclassified from the account of other expenses, in relation to 2Q20, we would have a reduction of 29% (approximately R$ 107 million) in the fuel bill, due to the lower recovery of CCC justified by the following reasons: (ii) exit from rental companies (PIEs), which represents a reduction of approximately R$ 60 million with revenue of system service charges (ESS); (iii) the reduction in gas consumption at the plants, mainly due to the alteration of the UTE Aparecida contract, CCVEE - OC 87.495/13 to CCEAR 34.163/14, according to MME Ordinance No. 855/2018 with a reduction of inflexibility from 150 to 75 MWh, representing a reduction of approximately R$ 62 million; offset by (iv) the entry of UTE Coari which increases the recovery by approximately R$ 17 million.
· At subsidiary Furnas (-R$ 50 million), mainly due to: (i) variation in the dispatch of the Santa Cruz plant, which represented a smaller generation in the period of approximately 243,112 MWh in 2Q20 due to the scenario low PLD.

Construction

· CGT Eletrosul (+ R$ 17 million), mainly due to the following reason: (i) the increase in the volume of transmission projects being built by the company in 2020 and which are linked to Aneel's authoritative resolutions and the improvements realized to the system existing.
· In Furnas (+ R$ 8 million), mainly due to the increase in expenses, after the recognition of revenue, in transmission contracts in the period. The 062/2001 contract registered in 2019 - R$ 28 million in investment against R$ 7 million in 2020.
· Partially offset by subsidiary Eletronorte (-R$ 14 million), mainly due to the following reasons: (i) low investment in 2020; and (ii) investments realized up to June / 20 are already reflected in the balance of contractual assets, or still, they do not have a RAP approved by Aneel and, therefore, cannot be recognized in Assets.
· Chesf (-R$ 11 million), due to investments in the transmission system between the compared dates.

2 Amazonas GT, due to problems in the migration of SAP, a single instance, had its accounts impacted by bookings made in different items that occurred in 1Q19 and 2Q19. In 2Q20, the records are normalized, however, for comparative purposes, and a better explanation of the Company's results, the adjustments are being detailed in each account.

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

12
 

 

OPERATIONAL EXPENSES

TABLE 08: PERSONNEL, MATERIAL, SERVICES AND OTHER

Personnel, Material, Services and Others 2Q20 2Q19 %
Personnel -1,028 -1,204 -15%
Material -52 -71 -27%
Services -432 -588 -27%
Others -165 -406 -59%

PMSO total

-1,676

-2,268

-26.1%

Non-Recurring Items

 
 
 
(-) PDC -4 -3 39%
(-) FGTS and INSS at Eletronorte - April launch -22 0 -
(-) Furnas Outsourced 0 0 -
(-) Research / SAP / ERP implementation consultancies 0 93 -100%
(-) Inepar + Camargo Correa + CIEN 16 107 -85%

PMSO Recurrent

-1,687

-2,071

-18.6%

2Q19X2Q20 Variation Analysis

Personnel

· Reduction in personnel costs due to the cost containment policy established by the Company, with PDC and OBZ (dangerousness and overtime);
· Non-recurring expenses with PDC, with a reversion of R$ 4 million in 2Q19 against R$ 3 million in 2Q20, as there is no plan planned for 2020.
· Actions to combat COVID-19 such as the non-payment of FGTS and INSS by employers, FAP rate and other entities (Sebrae, education salary and INCRA) in May and June / 2020 and reduction of overtime and greater provision for vacations that were anticipated without cash disbursement;
· In the subsidiary Eletronuclear, reduction in the items Dangerousness (R$ 3.0 million), Overtime (R$ 7.5 million), Social Security (R$ 7.4 million), considering the 2P15 stop in 2Q19, without counterpart in 2Q20 and reduction of R$ 7.6 million in the use of the Medical Plan in 2Q20 compared to 2Q19.
· In return for cost reductions, there was: (a) increase of 3.55% granted to employees through ACT as of 10/2019, with retroactive effects to 05/2019, and an additional of about 1% per time service, with an impact of R$ 54 million; b) Lower appropriation in Investments by R $ 26 million in the comparison between 2Q20 and 2Q19 (Chesf and CGT Eletrosul).

Material

· At subsidiary Eletronorte (-R$ 9 million), mainly due to: (i) expenses with HVDC (High Voltage System) in the amount of R$ 1.2 million in 2Q19; (ii) postponement of maintenance that required travel by employees; (iii) reduction of expenses with corporate materials due to teleworking. On the other hand, there was a higher expense in 2Q20 with the construction of the Bridge in Itapuã do Oeste in the amount of R$ 2.6 million.

MARKETLETTER 2Q2020

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13
 
· At the subsidiary Chesf (-R$ 6 million), mainly due to: (i) reduction in expenses with office supplies and work safety (-R$ 0.4 million); (ii) reduction in the difference in the ICMS tax rate (-R$ 3.2 million).

Services

· In the subsidiary Furnas (-R$ 65 million), variation is mainly due to: (i) a reduction of 35.5%, mainly in the FRG Assistance items - Fundação Real Grandeza (R$ 4 million), Travel / Accommodation (R$ 3 million) and Contracted Labor (R $ 58.8 million), due to the departure of 1,044 outsourced workers in 2019 (reduction of 1 contracted in October, 49 contracted in November; and 994 contracted in December) , whose expected annual savings in 2020 is R$ 115.9 million - The savings expected for 2020 are being impacted by the launch of accountability from Dec/19 for days worked and contract terminations. workforce, Furnas contracted services with an annual cost in 2020 of R$ 42 million (some contracts are still in the bidding phase), and an effect of R$ 2.2 million in 2Q20.
· In the subsidiary CGT Eletrosul (-R$ 9 million) reduction mainly due to: (i) Management measures related to the Zero Base Budget (OBZ) according to PNDG 2020-2024 which had a target in 2Q20 to reduce R$ 1, 8 million and exceeded, reaching a reduction of R$ 3.2 million, with emphasis on: (a) decrease in classroom activities, reflecting COVID-19, especially in the travel and commuting items, which decreased by R$ 2.9 million compared to 2Q19; (b) due to COVID, service provision contracts related to building maintenance, cleaning, concierge, reception and drivers were renegotiated, implying a temporary reduction of 23% in these contracts (R$ 800 thousand in 2Q20) and (c) personnel expenses requested from other companies in the group that in 2019 was accounted for as Services (1.4 million). In addition to the above points, there was a change in the accounting for CGTEE food stamps before the incorporation of Eletrosul, which was recorded in Third Party Services. After the merger, this expense started to be recognized as Personnel expenses, which contributed to a reduction of R$ 0.8 million per quarter due to the change in allocation.
· At subsidiary Eletronorte (-R$ 18 million), mainly due to: (i) reduction in expenses with contracted labor: R$ 6.1 million, (ii) Expenses with building services: R$ 4.7 million ; (iii) Mowing of access roads: R$ 1.7 million; (iv) Accommodation and Tickets: R$ 2.6 million; (v) Security and Surveillance: R$ 1.2 million; (vi) Institutional Advertising: R$ 1 million; and (vii) IT expenses: $ 0.5 million. The expected reductions with OBZ in 2Q20 were R$ 2.1 million, this goal was exceeded and there was a reduction of R$ 5.4 million. In addition, a reduction of R$ 8.5 million due to reclassification of expenses with food aid and R$ 4.1 million due to contingency and reduction of expenses with the pandemic.

Others

· At the subsidiary Amazonas GT (–R$ 78 million), mainly due to the following reasons: (i) considering the adjustments to SAP (+ R$ 77.8 million) realized in 2Q19, basically due to the value the difference in the regulatory and contractual price of natural gas realized in 1Q19 and subsequently reclassified to the CCC expense (fuel reducer) in 2Q20, we have a reduction of 5% or, approximately, R$ 340 thousand. Thus, the variation is due to: (ii) the reduction of IOF on foreign exchange contracts of approximately R$ 300 thousand.
· At subsidiary Furnas (-R$ 54 million), mainly due to: (i) a reduction in the indemnities, losses and damages account in the amount of R$ 43 million, as in June 19, the first installment of the Agreement was paid of Inepar in the amount of 60 million, in 2020 only the payments of the remaining installments in the order of R $ 4.3 million / month occurred; In addition, (ii) we highlight the reduction in the items Bank Guarantee, GSF Insurance, Rental Block C (OBZ initiative), which together total R$ 30.4 million; On the other hand, (iii) there was an increase in the Legal Costs - Fine Proc / Adm account in the amount of R $ 24 million, referring to the payment of fine penalties applied through Notice of Notices AI nº 013/2020-SFE-ANEEL, AI nº 014/2020-SFE-ANEEL and AI nº 015 / 2020- SFE-ANEEL, taking advantage of the 25% discount for cash payments as established in paragraph 2 of article 38 of Normative Resolution nº 846/2019, and the amount had already been provisioned since the notification.
· At subsidiary Eletronorte (-R$ 43 million), mainly due to: (i) a reduction of R$ 21.7 million in court costs (reclassification of an account in the amount of R $ 21.3 million in 2Q20); (ii) a reduction of R$ 6.2 million with losses on the sale and deactivation of assets and rights; (iii) reduction of R $ 6.0 million with employees assigned, released and amnestied; (iv) reduction of R$ 5.9 million in UTE Araguaia; (v) a reduction of R$ 4.1 million with indigenous communities; (vi) reduction of R$ 3.2 million in insurance with hydrological risk, ended in Dec / 2019; (vii) a reclassification of R$ 2.8 million in daily service trips, due to the entry into the Single Instance reclassified to Personnel in 2020); (viii) reduction of R$ 2.0 million in rent of properties for commercial purposes resulting from the delivery of a tower in the headquarters building. On the other hand, there was an increase in the following accounts: (ix) an increase of R$ 5.5 million in leasing expenses resulting from IFRS 16; (x) an increase of R$ 3.7 million with operational risk insurance; (xi) an increase of R$ 3.5 million in vehicle rental, the hiring of which began in the beginning of 2020 for fleet rental for operational purposes, replacing old vehicles with high maintenance costs.

MARKETLETTER 2Q2020

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14
 
· At subsidiary Eletronuclear (-R$ 12 million), mainly due to: (i) a reduction, in 2Q20 compared to 2Q19, of R$ 2.0 million in Taxes and Fees; (ii) judicial convictions in the amount of R$ 12.7 million occurred in 2Q19, with no counterpart in 2Q20; offset by (iii) write-offs of judicial provisions in the amount of R$ 3.7 million, occurred in 2Q19, with no counterpart in 2Q20.

 

 

Depreciation and Amortization

Depreciation and Amortization 2Q20 2Q19 %
Depreciation and Amortization -463 -445 4.0%

 

TablE 09: OPERATING PROVISIONS

Operating Provisions 2Q20 2Q19 %
Operational provisions / reversals -559 -1.506 -63%
       

Non-recurring provisions / reversals

 
 
 
Contingencies 60 -329 -118%
PCLD/ Estimated loss of credit prospective privatized distributors (CPC 48) 39 -119 -133%
Onerous Contracts 0 248 -100%
Provision/reversal for investment losses -4 27 -116%
RAP Adjustment Portion -224 0 -
Impairment of long-term assets 20 0 -
Expiry of the concession 0 -387 -100%
ANEEL provision - CCC 16 -921 -102%
Inflexibility Usina Candiota III -65 0 -

Non-recurring provisions / reversals

-159

-1.481

-89%

       

Recurring provisions / reversals

 
 
 
Garanties 5 58 -91%
PCLD (excluding PCLD Prospective estimate of credit loss from privatized distributors (CPC 48) -337 -22 1431%
GAG Improvement -51 -42 21%
Others -17 -19 -13%

Recurring provisions / reversals

-400

-25

1491%

Note: Numbers with positive signs mean reversals of provision.

The variation is mainly explained by:

· Provisions for consumer and retailer allowance for loan losses in the amount of R$ 313 million in 2Q20, compared to a provision of R$ 88 million in 2Q19, with highlights to the records realized by Amazonas GT of R$ 193 million in relation to the distributor's default Amazonas Energia and Chesf R$ 74 million

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

15
 
· Provision for Rap Adjustment Installment in the amount of R$ 224 million, considered as non-recurring, due to the revenue by CGT Eletrosul of higher amounts in RAP in the 2018/2019 and 2019/2020 cycles due to the delay of Periodic Tariff Review - RPT, which it only occurred in July 2020. The amount will be refunded in 36 installments starting in July / 2020.

 

 

 

SHAREHOLDINGS

TABLE 10: SHAREHOLDINGS

Shareholdings 2Q20 2Q19 %

Shareholdings

364

102

257%

· The main highlights were: (i) improvement in the equity result of associates, with an amount of R$ 329 million in 2Q20 compared to R$ 27 million in 2Q19; (ii) an improvement of R$ 111 million in the equity income of SPE IE Madeira; partially offset by (iii) ) negative variation of R$ 172 million of SPE Interligação Elétrica do Madeira; (iv) negative variation in the results of SPE NESA, mainly due to the increase in expenses due to the increase in energy sales costs and the increase in operating costs (-R$ 89 million);

 

FINANCIAL RESULT

TABLE 11: FINANCIAL INCOME AND EXPENSES

Financial Result 2Q20 2Q19 %

Financial Income

1,355

3,503

-61%

Interest, commission and fee income 256 295 -13%
Income from financial investments 268 184 46%
Additional moratorium on electricity 61 101 -40%
Active monetary updates 0 303 -100%
Exchange rate variations 744 201 270%
Fair value adjustment 0 1,944 -100%
Derivative gains 0 0 -
Other Financial Income 26 474 -94%

Financial expenses

-2,686

-3,077

-13%

Debt charges -624 -1,109 -44%
Leasing charges -92 -87 6%
Charges on shareholder resources -97 -125 -22%
Passive monetary updates 147 -275 -153%
Passive exchange variations -941 -204 363%
Fair value adjustment -1,028 -223 362%
Derivative losses 11 -7 -262%
Other financial expenses -61 -1,048 -94%

Financial Result

-1,331

425

-413%

Non-recurring adjustments      
(-) Revenue from loans owed by privatized distributors3 -105 -47 124%
(-) RBSE Retroactive recognition effect 854 0 -
(-) Monetary adjustment (Selic) of the provision for compulsory loans 53 123 -57%

Recurring Financial Result

-529

502

-205%

3 Considering that the privatization of the distributors was completed in April 2019, and these operations are no longer part of Eletrobras core business, the company treated the material effects of financial income, expenses, PL reversals and prospective loan loss provisions as non-recurring. 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 outstanding allowance for loan losses of distributors, as well as debts related to energy supply.

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

16
 

 

Financial Result:

In 2Q20, the financial result decreased, from a positive result of R$ 425 million in 2Q19 to a negative result of R$ 1,331 million in 2Q20. The main variations were in the accounts of:

· Adjustment to fair value of RBSE revenue in the positive net amount of R $ 1,722 million in 2Q19, having presented a financial expense of R $ 1,028 million in 2Q20. The variation of R $ 2,750 million is due to the difference in the discount rate between the measurement at amortized cost (operating result) and the fair value mark in which it considers the taxes and charges on this component, in addition to the current discount rate being a similar rate the regulatory Wacc; (ii) Change in the regulatory wacc that went from 6.64% to 6.96%. In 2019, there was a NTN-B variation from 4.6% in December 2018 to 3.09% in June 2019, generating a gain in 2Q19. It is considered a non-recurring effect of the recalculation of RBSE and the entry of R $ 854 million in this account, due to the impact of the tariff review.
· Exchange Variation: the net result of the active and passive exchange variation accounts went from a negative result of R$ 3 million in 2Q19 to a negative result of R$ 197 million in 2Q20, due to exchange rate fluctuation in the period, influenced by the effects of Covid 19 pandemic. Eletrobras has a consolidated foreign exchange exposure of approximately R$ US$ 721.60 million in 2Q20;
· Revenue from financial investments: the increase in revenue results mainly from the increase in the balance of financial investments in non-market investment funds. The increase is due, in particular, to the capital increase that occurred in Dec/19, in the amount of R$ 3.6 billion and to the funding that occurred in Feb/20.
· Interest, commission and fee income was reduced due to the debt settlement by Ceal, Acre and Cepisa with an impact of R$ 93 million.
· Debt charges: reduction of 43% in expenses due to the reduction of indebtedness and reduction of reference rates and indexes.

 

 

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

17
 

 

 

 

I.2 EBITDA CONSOLIDATED

TABLE 12: EBITDA DETAIL

EBITDA 1H20 1H19 (%) 2Q20 2Q19 (%)
Net Profit (Loss) for the Year 4,904 6,908 -29% 4,597 5,561 -17%
Net Tax Losses from Discontinued Operation 0 5,037 -100% 0 5,260 -100%
Result of the Exercise 4,904 1,871 162% 4,597 301 1426%
+ Provision for Income Tax and Social Contribution 1,914 1,632 17% 1,396 1,016 37%
+ Financial Result 2,840 -89 -3278% 1,331 -425 -413%
+ Amortization and Depreciation 932 873 7% 463 445 4%

= EBITDA

10,589

4,287

147%

7,787

1,336

483%

ADJUSTMENTS NON-RECURRING EVENTS            
RBSE retroactive -5,522 0   -5,522 0  
Other Income and Expenses -25 -166 -85% 0 17 -100%
Retroactive: Procel  /  Gains from the sale of SPEs 0 -127 -100% 0 -35 -100%
PDC -4 167 -102% -4 -3 39%
FGTS and INSS at Eletronorte - April launch 0 0 - -22 0 -
Furnas Outsourced 25 0 - 0 0 -
Research / SAP / ERP implementation consultancies 0 107 -100% 0 93 -100%
Inepar + Camargo Correa + CIEN + / Intercompany Adjustment 146 60 143% 16 107 -85%
Contingencies -78 622 -113% -60 329 -118%
PCLD Credit loss estimate (CPC 48) 107 162 -34% -39 119 -133%
Onerous Contracts 0 -342 -100% 0 -248 -100%
Provision / (reversal) for investment losses 120 -62 -293% 4 -27 -116%
Adjustment portion RAP 224 0 - 224 0 -
Impairment of long-term assets -20 0 - -20 0 -
Expiry of the concession 0 387 -100% 0 387 -100%
ANEEL provision - CCC -9 986 -101% -16 921 -102%
Inflexibility Usina Candiota III 65 0 - 65 0 -

= EBITDA RECURRENT4

5,619

6,080

-8%

2,413

2,996

-19%

 

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 debentures covenants issued in 2019. The Ebitda of Adjusted 2Q19 considers this adjustment of RBSE revenue to compare recurring EBITDA in 2Q20, for comparative purposes, and also the mandatory effects of IFRS 9 and 15 as explained in 4 of our financial statements. In addition, 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 the relevant effects of financial income, expenses, PL reversals and allowances for loan losses as non-recurring. prospective (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 outstanding allowance for loan losses of distributors as well as debts related to energy supply.. These recurring adjustments related to the distributors, adjusted the recurring EBITDA in 2Q20 by R$ 146 million.

 

4 The adjustments realized to the recurring Ebitda refer to non-recurring events or events that are expected to be dealt with under the PDNG 2019-2023. However, there are risks and uncertainties related to the Company's business, such as, but not limited to, general economic, regulatory, political and commercial conditions in Brazil and abroad, changes in interest rates, inflation and the value of the Real, changes in volumes and pattern of use of electricity by the consumer, competitive conditions, payments related to our receivables, changes in the levels of rain and water in the reservoirs used to operate our hydroelectric plants, our financing and capital investment plans, existing and future government regulations , and other risks described in our annual report and other documents filed with the Securities and Exchange Commission and the Securities and Exchange Commission of the United States of America, which may change these estimates and expectations of Management. Thus, the future results of the Companies' operations and initiatives may differ from current expectations and the investor should not rely exclusively on the information contained herein.

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

18
 

 

TABLE 13: 2Q19 EBITDA CONCILIATION:

EBITDA

2Q19

Resubmitted

2Q19

Reported

Net Profit (Loss) for the Year 5,561 5,561
Net Loss of Taxes from Discontinued Operation 5,260 5,260
Result of the Exercise 301 301
+ Provision for Income Tax and Social Contribution 1,016 1,016
+ Financial Result -425 -412
+ Amortization and Depreciation 445 445

= EBITDA

1,336

1,350

ADJUSTMENTS NON-RECURRING EVENTS    
     
Other Income and Expenses 17 0
Retroactive: Procel / Disposal Gains SPEs -35 -64
(-) PDC -3 -3
(-) FGTS and INSS at Eletronorte - April launch 0 172
(-) Investigation / Consulting implementation SAP / ERP 93 118
(-) Inepar + Camargo Correa + CIEN + / Intercompany Adjustment 107 60
Contingencies 329 329
PCLD Prospective estimate of credit loss (CPC 48) 119 119
Onerous Contracts -248 -248
Provision / (reversal) for investment losses -27 -27
Expiry of the concession 387 387
ANEEL provision - CCC 921 921

= RECURRING EBITDA

2,996

3,113

 

RECURRING CASH GENERATION WITH REGULATORY RAP ADJUSTMENT TRANSMISSION

     
  2Q20 2Q19
1. Recurring EBITDA 2,413 2,996
     
2. (-) Total Corporate Income from Transmission 1,997 2,515
O&M revenue 837 1,213
Construction Revenue 139 124
Finance - Return on Investment - RBSE 844 970
Contractual Transmission Revenue 177 209
     
3. (+) Total Revenue of Allowed Annual Revenue 2,761 3,296
Revenue of RAP and indemnities 1,924 2,083
O&M Revenue 837 1,213
     
4 = 1 - 2 + 3: Approximate Cash Generation 3,177 3,777

 

 

 

MARKETLETTER 2Q2020

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19
 

I.3       CONSOLIDATED RESULT BY SEGMENT OF CONTINUED OPERATIONS:

TablE 14: FINANCIAL STATEMENT BY SEGMENT - R$ THOUSAND

06/30/2020

FinacialStatement

by Segment

Administration Generation Transmission Eliminations Total
Net Operating Revenue 83 9,025 9,492 -547 18,053
Operating Costs and Expenses -1,035 -6,415 -2,046 547 -8,949
Operating Income Before Financial Result -952 2,610 7,447 0 9,104
Financial Result -306 -595 -1,938 0 -2,840
Result of Equity Interests 528 0 0 0 528
Other income and expenses 25 0 0 0 25
Income tax and social contribution -5 -1,150 -759 0 -1,914

Net income (loss) for the period

-710

865

4,749

0

4,904

 

06/30/2019

FinacialStatement

by Segment

Administration Generation Transmission Eliminations Total
Net Operating Revenue 68 9,270 4,212 -484 13,066
Operating Costs and Expenses -2,128 -5,950 -2,486 484 -10,080
Operating Income Before Financial Result -2,060 3,320 1,725 0 2,986
Financial Result -518 -806 1,413 0 89
Result of Equity Interests 262 0 0 0 262
Other income and expenses 166 0 0 0 166
Income tax and social contribution -26 -834 -772 0 -1,632

Net income (loss) for the period

-2,175

1,680

2,366

0

1,871

 

MARKETLETTER 2Q2020

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20
 

 

I.3.1. INDEBTEDNESS AND RECEIVABLES

TABLE 15: GROSS DEBT AND NET DEBT

  06/30/2020

Gross Debt - R$ million

50,555

(-) Transfer RGR to CCEE1 1,063

Recurring Gross Debt

49,492

(-) (Cash and cash equivalents + marketable securities) 14,724
(-) Financing Receivable 14,033
(+) RGR to receive RGR transfer to CCEE 1,063
(-) Net balance of Itaipu Financial Assets2 2,198

Net debt

19,599

1 See Notes 9.1 and 19 (third party debts, Eletrobras being a mere manager).

2 See Explanatory Note 15b of the Financial Statements.

TABLE 16: FINANCING PORTFOLIO PAYABLE

 

  Parent Company    Consolidated
06.30.2020   06.30.2019   06.30.2020   06.30.2019
Balance in R$ million %   Balance in R$ million %   Balance in R$ million %   Balance in R$ million %
Foreign currency                      
USD 10,808 41%   7,572 27%   11,185 26%   7,572 18%
USD with Libor 390 1%   434 2%   866 2%   799 2%
EURO 310 1%   235 1%   310 1%   235 1%

Subtotal

11,509

43%

 

8,241

29%

 

12,361

28%

 

8,606

21%

                       
Domestic currency                      
CDI 3,123 12%   4,033 14%   8,092 18%   8,698 21%
IPCA -    0%   -    0%   74 0%   73 0%
TJLP -    0%   -    0%   5,959 14%   6,233 15%
SELIC 7,870 0%   11,687 0%   7,886 18%   8,595 20%
Others 679 0%   714 0%   1,998 5%   2,465 6%

Subtotal

11,671

44%

 

16,434

58%

 

24,009

55%

 

26,065

62%

                       
Not indexed 3,422 13%   3,599 13%   7,461 17%   7,269 17%
                       

TOTAL

26,602

100%

 

28,274

100%

 

43,831

100%

 

41,940

100%

 

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

21
 

TABLE 17: DEBT MATURITY SCHEDULE, EXCLUDING RGR DUE TO THIRD PARTIES (FOR WHICH ELETROBRAS IS A MERGE MANAGER) AND INCLUDING HOLDING AND SUBSIDIARIES 'DEBENTURES:

Consolidated

  2020 2021 2022 2023 2024 2025 After 2025 Total (R$ million)
Amortization with Debentures and RGR 4,845 10,287 6,221 4,179 5,462 4,148 15,413 50,555

(-) RGR CCEE

217

146

32

19

5

3

642

1,063

Consolidated Annual Amortization (With debentures) 4,628 10,140 6,189 4,161 5,458 4,145 14,771 49,492

 

Parent Company

  2020 2021 2022 2023 2024 2025 After 2025 Total (R$ million)
Amortization with Debentures and RGR 3,492 7,228 4,154 2,340 4,158 3,180 7,086 31,639

(-) RGR CCEE

217

146

32

19

5

3

642

1,063

Consolidated Annual Amortization (With debentures) 3,275 7,082 4,122 2,322 4,153 3,178 6,444 30,576

 

Ratings

TabLE 18: Ratings

Agency National Classification / Perspective Last Report
Moody’s BCA “B1”: / Positive 09/18/2019
Moody’s Senior Unsecured Debt “Ba3”: / Positive 09/18/2019
Fitch - Issuer Default Ratings (Foreign Currency) “BB-”: / Negative 06/10/2020
Fitch - Issuer Default Ratings (Local Currency) “BB-”: / Negative 06/10/2020
S&P LT Local Currency brAAA/Estable 07/22/2020
S&P Issuer Credit Rating BB-/Estable 07/22/2020

*CreditWatch

 

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

22
 

FINANCING AND LOANS GRANTED (RECEIVABLE)

The financing and loans granted are realized with the Company's own resources and external resources raised through international development agencies, financial institutions and resulting from the launch of securities in the national and international financial market.

 

All financing and loans granted are supported by formal contracts signed with the borrowers. The revenue of these amounts, for the most part, are foreseen in monthly installments, amortizable over an average term of 10 years, with the average interest rate, weighted by the balance of the portfolio, of 6.27% per year.

 

The parent company has a loan with Itaipu with an exchange adjustment clause that represents 42% of the total consolidated portfolio (41% on December 31, 2019). The other financings and loans provide for updating based on indices that represent the level of domestic prices in Brazil and reach 58% of the balance of the consolidated portfolio (59% on December 31, 2019).

 

The parent company has a loan with Amazonas Distribuidora de Energia in the amount of R$ 4 billion, which substantially represents non-capitalized receivables in the process of disposal of corporate control. These contracts were renegotiated with a grace period of up to 3 years for amortization of the principal and, during this grace period, only interest is received. Additionally, the renegotiation considered the term that ends in January 2021, for the presentation of real guarantees that must be previously assessed and approved by Eletrobras' Management.

 

In addition to the aforementioned financing, Eletrobras, until April 30, 2017, was responsible for the management of the Global Reversion Reserve (RGR), a sectorial fund, having been responsible for granting financing, with the use of these resources, for the implementation of several sectoral programs. As of May 2017, with the enactment of Law 13.360/2016, CCEE took over this activity. However, there are still financing carried out before this date, due by third parties, managed by Eletrobras.

 

According to Decree 9.022/2017, which regulates the aforementioned law, Eletrobras is not the guarantor of these operations taken by third parties, however, it is responsible for the contractual management of financing contracts with RGR resources signed until November 17, 2016, which must be transferred to the RGR, within up to five days, counted from the date of the effective payment by the debtor agent. These receivables to be paid by third parties do not belong to Eletrobras and will be transferred to CCEE after revenue (“Transfer RGR”).

 

On June 26, 2020, the Board of Directors approved the conversion of AFAC contracts into new shares of Eletronuclear in the total amount of R$ 850,000 (more details in Note 12) and the capitalization of financing contracts in which Eletrobras is a creditor in the amount of R$ 1,035,778.

 

RGR TRANSFER

Considering the transfer of the management of RGR resources to CCEE in accordance with Law 13.360 / 2016 and in line with Decree No. 9.022 / 2017, as of June 2019, the Company revised the way of presenting the amounts raised and transferred to third parties , with resources from RGR, in order to more adequately present the resources under Eletrobras 'responsibility for those loans and financing that do not constitute Eletrobras' debt and should be paid off by third parties with RGR, with Eletrobras being responsible only for the contractual management of these loans. Accordingly, the amounts of June 30, 2020 referring to receivables from loans and financing granted with funds from RGR to third parties were segregated from other receivables from Eletrobras and have equivalent liabilities (see note 18). The following table shows “Transfer RGR”.

 

 

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TABLE 19: RECEIVABLE

R$ Thousand

  Tx. Average   CONSOLIDATED
  06/30/2020   12/31/2019   06/30/2020   12/31/2019
Itaipu 7.00   7.04   6,211,469   5,843,724
CEAL 5.78   7.28   1,517,619   1,564,724
Eletropaulo 2.78   6.96   993,151   1,314,107
Amazonas D 5.75   7.38   4,000,296   3,949,748
CEPISA 3.86   5.42   655,768   746,427
Boa Vista 4.07   5.49   154,215   160,309
CELPA 5.97   5.96   6,213   6,236
Equatorial Maranhão D 0.21   0.25   84,873   92,986
RGR Transfer 5.00   5.00   1,062,955   1,101,161
Others -   -   138,646   130,037
(-) PECLD -   -   (792,538)   (632,643)
Total         14,032,667   14,276,816

 

R$ Million

 Projection Receivables* 2020 2021 2022 2023 2024 2025 after 2025 TOTAL
Parent Company without RGR 2,654 6,249 3,130 2,661 1,977 1,380 2,130 20,183
Consolidated without RGR 1,973 5,074 2,129 1,688 1,225 731 677 13,495

* Does not include: receipts from Itaipu's financial assets of R$ 2.1 billion, receivables from RGR owed by companies of the System and not belonging to Eletrobras, PCLD of R$ 556 million and charges from third parties.

 

Tabela 20: Créditos da CCC cedidos pelas Distribuidoras Privatizadas

In the privatization process of the distributors, CCC credits were assigned, which are still being analyzed and inspected by Aneel. These credits are activated in the Company's Financial Statements, of 06/30/2020, in two accounts, namely Right of Reimbursement and Financing receivable, according to Notes 8 and 11 of 2Q20, and detailed below:

NOTE EXPLANATORY 11 - RIGHT TO REIMBURSEMENT

Registered Net Assets

R$ Thousand

 R$ thousand Amazonas Ceron Eletroacre Boa Vista Total
NT Aneel + Claims under analysis Aneel + "inefficiency 1,984,196

2,723,991

254,796 

170,306 

5,133,289

Current Rights  

220,795

57,972

26,031

304,798 

Total (a)

1,984,196

2,944,786

312,676

196,337

5,438,087

* The balance of R$ 1,984 million from Amazonas consists of a return obligation to CCC in the order of R$ 452 million referring to the final inspection result of the first and second period carried out by Aneel, and a credit receivable from the National Treasury of economic and energy inefficiency of R$ 2.4 billion. The credit for economic and energy inefficiency is updated by Selic. The amount to be returned to CCC must be discounted from the credit receivable from CCC in relation to the amounts assigned to other distributors.

 

 

 

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EXPLANATORY NOTE 8 - LOAN AND FINANCING

R$ thousand

R$ mil  Amazonas Ceron Eletroacre Boa Vista Total
Conversion into Loans (1) 442,366       442,366

(1) The R$ 442 million credit in the table above was also a CCC credit, granted by Amazonas to Eletrobras, however, as it is current, and not part of the inspection period mentioned above, and already paid by CCC to Amazonas Distribuidora., then it was converted into debt of the distributor with Eletrobras.

Total Credits Granted (Note 8 + Note 11)

R$ thousand

R$ thousand Amazonas Ceron Eletroacre Boa Vista Total

Credit assigned Net (1)

2,426,562

 

2,944,786

 

312,767

 

196,337

 

5,880,453

 

(1) Credits restated up to 03/31/20, by IPCA, based on the credit generating event, with the exception of the portion of economic-energy inefficiency (R$ 2.46 billion) assigned by Amazonas Energia and Boa Vista Energia, which are updated by SELIC.

 

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 $ 1,904,005,165 , 07 (at July 2019 prices), referring to the inspection of the 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 Eletrobras on the occasion of the privatization of said distributor; and (ii) the right to receive credits from the Fuel Consumption Account - CCC to Companhia de Eletricidade do Acre (“Eletroacre”), in the amount of R $ 191,610,318.04 (at July 2019 prices), referring to the inspection of the benefits due in the period from July 30, 2009 to June 30, 2016, credits also assigned to Eletrobras on the occasion of the privatization of said distributor.

 

Aneel's Board of Directors also approved, on March 10, 2020, the obligation to return R $ 2,061,360,021.40 (at March 2019 prices), referring to the CCC's monthly inspection and 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, since Aneel's Board of Directors had already decided, on March 19, 2019, the result of the First Inspection Period for CCC reimbursements to Amazonas Energia, with the company having the right to receive a credit of R $ 1,591,670,950.13 (at September 2018 prices), to be offset against credits to be returned. The net balance of Law credits assigned by Amazonas Energia, positive by R $ 1.9 billion, refers to the revenue of disallowances from CCC arising from the criteria of economic and energy efficiency, a right recognized by Law 13,299 / 2016, in the historical amount R $ 1,357,794,977.30 to be paid by the National Treasury. Eletrobras updated these values ​​by the Selic until 06/30/2020.

 

Aneel has not yet completed the inspection processes for CCC reimbursements for the first and second periods of Boa Vista Energia, also assigned to Eletrobras and recorded in the Financial Statements, as well as the second inspection period for Ceron and Eletroacre. Only after the completion of all the aforementioned inspection processes, and the approval of the results, will the total net value of the credits be included in the annual budget of the CDE sectoral fund for payment to Eletrobras.

 

During the 2Q20, the only change in the inspection processes was the disclosure by Aneel, dated April 6, 2020, of a new technical note (NT nº 49/2020 – SFF-SFG-SRG / ANEEL) referring to the Boa Vista's first inspection period. The previous NT was from April 2018. In this new NT issued, in addition to updating the base date of the information for February 2020, the agency accepted Eletrobras' claim on the withdrawal of the return of amounts received by the distributor regarding the initial tanking, which according to Order No. 2,793 / 2015, the amount must be returned in the last month of operation of the Monte Cristo and Novo Paraíso TPPs, the day before the connection to the SIN. As the State of Roraima has not yet been connected, Aneel accepted the request to withdraw the return of funds from the distributor to the CCC account during the inspection period. As the agency accepted exactly the amount of Eletrobras' claim, considered to be a probable acceptance by Aneel, there was no change in the recorded amount of credits assumed by Boa Vista in this quarter, only monetary restatement of credits by IPCA and Selic (credits of “ inefficiency"). Thus, due to the information contained in NT 49/2020 by Aneel, Eletobras would have credits receivable from CCC assigned by Boa Vista, in the amount of R $ 103,883,187.32 (at Feb / 20), referring to the first period of inspection by that distributor.

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Accordingly, all the movement in 2Q20 of CCC/CDE credits assigned to Eletrobras and recorded under the Right to Reimbursement was due to the monetary adjustment of the credits by IPCA and SELIC, with no new impacts.

 

TABLE 21: RECEIVABLE RBSE TRANSMISSION

 

On June 30, 2020, the National Electric Energy Agency - ANEEL approved the tariff review of transmission concessions extended under the terms of Law 12,783/2013. Consequently, it approved the new Permitted Annual Revenue (“RAP”) of these concessions for the 2020-2021 tariff cycle, which brought the following summarized changes, with an impact in relation to the cash flow projection of RBSE receivables:

• Retrospective change to the wacc for the years 2018 and 2019;

• Change in the asset base, incorporating the write-offs occurred in the 2013-2018 cycle and the readjustment of the new replacement value of the assets associated with RBSE;

• Incorporation of the payment of the controversial installment "Ke" that had been under judgment since 2017;

• 3-year redistribution of the differences between the amount effectively received between 2018 and 2019 and the portions now revised via the adjustment portion updated by IPCA.

The flow of estimated future revenue of RBSE, considering the Company's premises, are as follows:

RBSE: FINANCIAL FLOW

                    R$ milion
FURNAS 2020 2021 2022 2023 2024 2025 2026 2027 2028 TOTAL
RBSE TOTAL 2,259 4,517 4,517 3,955 3,393 2,223 1,052 1,052 526 23,495
Economic portion 813 1,626 1,626 1,339 1,052 1,052 1,052 1,052 526 10,139
Financial Portion 1,170 2,341 2,341 2,341 2,341 1,170 0 0 0 11,703
Adjustment Portion 275 551 551 275 0 0 0 0 0 1,653
RBSE TOTAL FURNAS 23,495                  
                     
CGT ELETROSUL 2020 2021 2022 2023 2024 2025 2026 2027 2028 TOTAL
RBSE TOTAL 303 605 605 491 377 218 59 59 30 2,746
Economic portion 83 165 165 112 59 59 59 59 30 790
Financial Portion 159 318 318 318 318 159 0 0 0 1,588
Adjustment Portion 61 123 123 61 0 0 0 0 0 368
RBSE TOTAL   ELETROSUL 2,746                  
                     
CHESF 2020 2021 2022 2023 2024 2025 2026 2027 2028 TOTAL
RBSE TOTAL 1,459 2,919 2,919 2,187 1,456 728 0 0 0 11,668
Economic portion 495 989 989 495 0 0 0 0 0 2,968
Financial Portion 728 1,456 1,456 1,456 1,456 728 0 0 0 7,280
Adjustment Portion 237 473 473 237 0 0 0 0 0 1,419
RBSE TOTAL  CHESF 11,668                  
                     
ELETRONORTE 2020 2021 2022 2023 2024 2025 2026 2027 2028 TOTAL
RBSE TOTAL 699 1,397 1,397 1,148 899 560 221 221 110 6,652
Economic portion 257 514 0 0 0 0 0 0 0 771
Financial Portion 339 679 514 367 221 221 221 221 110 2,892
Adjustment Portion 102 204 679 679 679 339 0 0 0 2,682
RBSE TOTAL ELETRONORTE 6,652                  
                     
TOTAL 2020 2021 2022 2023 2024 2025 2026 2027 2028 TOTAL
RBSE TOTAL 4,719 9,438 9,438 7,782 6,125 3,728 1,332 1,332 666 44,561

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Economic portion 1,647 3,295 3,295 2,313 1,332 1,332 1,332 1,332 666 16,543
Financial Portion 2,396 4,793 4,793 4,793 4,793 2,396 0 0 0 23,965
Adjustment Portion 675 1,351 1,351 675 0 0 0 0 0 4,052
RBSE TOTAL 44,561                  

 

1H20 RBSE REVENUE

        R$ thousand
R$ million Furnas Chesf Eletronorte Eletrosul Total
1Q20             840.134             503.123           260.440           90.619           1.694.316
2Q20             784.289             506.602           260.439           90.620           1.641.950
Total          1.624.423          1.009.725           520.879         181.239           3.336.266

I.4. INVESTIMENT

TABLE 22: INVESTMENTS BY SEGMENT

R$ Million

 

Investiment  (Corporate + Partnerships) Invested 1Q20 Invested 2Q20 Budged PDNG 2Q20

% Realized

2Q20

Budged PDNG 1H20 Invested 1H20

Budged

PDNG 2020

% Realized

2020

                 
Corporate Generation 89 155 582 27% 1,083 245 2,193 11%
Implantation 45 94 409 23% 749 139 1,371 10%
Angra 3 31 27 263 10% 526 59 1,052 6%
Santa Cruz 9 58 128 45% 186 67 230 29%
Casa Nova 4 4 15 28% 31 8 41 19%
Outros 1 5 3 152% 6 6 48 12%
Maintenance 45 61 173 35% 334 106 822 13%
Eletronorte 1 2 3 82% 3 4 27 13%
Chesf 8 14 29 47% 60 21 150 14%
Furnas 8 7 9 78% 16 15 104 14%
Eletronuclear 20 33 115 29% 230 54 459 12%
CGT Eletrosul 7 3 12 25% 20 11 63 17%
Amazonas GT 0 2 5 31% 6 2 20 10%
Corporate Transmission 148 169 412 41% 766 317 1,876 17%
Enlargement 31 48 87 55% 193 79 301 26%
Eletronorte - - 1 0% 1 - 1 0%
Chesf 11 23 53 43% 124 34 157 22%
Furnas 0 1 -   - 1 6 20%
CGT Eletrosul 19 24 34 70% 68 43 137 32%
Reinforcements and Improvements 58 55 225 25% 404 113 918 12%
Eletronorte 1 12 34 36% 48 13 123 11%
Chesf 26 21 114 18% 225 47 419 11%
Furnas 26 19 68 28% 116 45 337 13%
CGT Eletrosul 4 3 9 35% 15 7 39 19%
Maintenance 60 65 100 66% 169 125 657 19%
Eletronorte 3 13 22 61% 47 16 68 23%
Chesf 42 36 53 67% 82 78 255 30%
Furnas 15 16 23 72% 37 32 328 10%
CGT Eletrosul 0 0 2 11% 3 0 6 4%
Infrastructure and Others * 37 36 62 59% 155 74 408 18%
SPES 53 20 304 7% 512 73 809 9%
Generation 28 20 293 7% 446 48 676 7%
Transmission 25 - 11 0% 67 25 133 19%
Total 328 380 1,360 28% 2,516 709 5,286 13%
* Chesf - Itaparica Infrastructure Action - Maintenance Generation
                           

(1) Others: Research, Infrastructure, Environmental Quality

(2) For more details on investments, by subsidiary or project, see annex 3 to this Investor Information.

 

 

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In 2Q20, R$ 380 million was invested out of the R$ 1,360 million budgeted for the quarter.

 

Total investments in generation were R$ 175 million, of which R$ 155 million were related to corporate ventures. The main highlights of investments were: Angra 3 at R$ 58.5 million in 1H20, R$ 27.3 million in 2Q20, Angra 1 and 2 at R$ 53.8 million in 1H20, R$ 33.5 million in 2Q20 , UTE Santa Cruz R$ 67.1 million in 1H20 of which R$ 57.7 million in 2Q20 and in SPE Brasil Ventos with R$ 22.0 million in 1H20, without occurrence in 2Q20 and SPE Teles Pires Participações R$ 20, 0 million in 2Q20.

 

In transmission, total investments were R$ 169 million in corporate ventures, with no investments in SPES in this quarter. The main highlights of investments were: Chesf in amount of R$ 159.0 million in 1H20 of which R$ 79.3 million in 2Q20, Furnas R$ 78.0 million in 1H20, of which R$ 33.3 million in 2Q20, CGT Eletrosul R$ 50.9 in 1H20, of which R$ 27.6 million in 2Q20 and Eletronorte R$ 29.0 in 1H20 of which R$ 25.4 million in 2Q20.

 

In 2Q20 there was investment frustration of R$ 980 million. In generation, the non-realization of corporate investments was (R$ 427 million) with emphasis on: (R$ 236 million) Angra 3 (R$ 81 million) of maintenance Angra 1 and 2 and (R$ 70 million) of Santa Cruz.

In transmission, non-investments were (R$ 243 million). About 17% of frustrations are related to COVID-19, 33% delay in bidding due to higher prices for equipment (exchange variation and market uncertainties) and suppliers and 17% commissioning works.

In SPES the total frustration was (R$ 284 million) with emphasis on ESBR Jirau (R$ 42.2 million) and investments avoided due to COVID-19.

I.5. COMMERCIALIZATION

I.5.1. ENERGY SOLD IN 2Q20 – GENERATORS – TWh

In terms of the evolution of the energy market, Eletrobras Companies, in 2Q20, sold 46.7 TWh of energy, against 35 TWh traded in the same period of the previous year, which represents an increase of 4.3%. 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.

 

 

 

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I.5.2. ENERGETIC BALANCE

Table 23: Energetic Balance

Energetic Balance (MWmed) 2020 2021 2022 2023 2024  
 
Ballast 9,469 9,292 9,292 9,204 7,428  
  Own resources 8,314 8,314 8,314 8,314 6.647  
  Energy Purchase 1,155 978 978 890 781  
Sales 7,478 5,596 5,013 4,786 4,527  
  ACL - Bilateral Contracts + MCP performed 5,304 3,489 2,906 2,685 2.427  
ACR - Except quotas 2,174 2,107 2,107 2,101 2.101  
Average Selling Price R$ /MWh 212,00 216,59 220,44 222,45 224,06  
Average Purchase Price R $ / MWh 219,36 227,28 227,28 232,54 233,95  
Balance (Ballast - Sales) 1,991 3,697 4,280 4,419 2,901  
Uncontracted Energy * 21% 40% 46% 48% 39%  
 * The uncontracted portion includes energy reserved for the company's hedge, strategically defined according to the GSF estimate for the period.  
Physical Guarantee Quotas and Nuclear Energy Quotas are not included.  
Physical Guarantee Quotas for Hydroelectric Plants 7,451 7,451 7,451 7,451 9,118  
 Nuclear Energy Quotas 1,573 1,573 1,573 1,573 1,573  
               

Contracts concluded until 06/30/2020. It considers the end of the contracts for UHEs Mascarenhas de Moraes, in Jan / 2024, and UHE Tucuruí, in Aug / 2024, and from the respective dates, both started to be considered in the Physical Guarantee Quota regime.

The Average Sales Prices do not include projects under the Physical Guarantee and Nuclear Energy Quotas regime.

 

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II | Parent Company Result Analysis

 

In 2Q20, Eletrobras Holding posted net income of R$ 4,574 million, a reduction of 18% compared to net income of R$ 5,565 million in 2Q19.

This 2Q20 result was decisively influenced by: (i) Income from Equity Holdings, of R$ 4,842 million, influenced mainly by the result of subsidiaries, (ii) positive financial result in the amount of (R$ 67 million), mainly influenced by liability manegement measures, such as rolling over bonds and settling debts with higher costs with less onerous funding resources, (iii) reversal of the ANEEL Provision - CCC, in the amount of R$ 16 million in 2Q20 against a provision of R$ 921 million in 2Q19, partially offset by, (iv) Provisions for legal contingencies, in the amount of R$ 125 million, mainly due to the compulsory loan lawsuits in the amount of R$ 176 million. The chart below shows a comparison of Eletrobras holding's results between 2Q19 and 2Q20.

EVOLUTION OF RESULT - R$ MILLION

 

 

 

Note: The analysis of the results of each subsidiary can be found in the attachment.

 

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II.1 SHAREHOLDERS 'EQUITY

In 2Q20, the result of Equity Holdings had a positive impact on the Company's result by R$ 4,842 million, mainly due to the equity in results of investments in subsidiaries, in 2Q19 the result was R$ 1,766 million. This variation was mainly impacted by the effects of the periodic tariff review of the extended transmission concessions on RBSE.

II.2 PARENT COMPANY OPERATING PROVISIONS

In 2Q20, Operating Provisions had a negative impact on the Parent Company's result by R$ 114 million, compared to the R$ 961 million provision in 2Q19. This variation is mainly explained by the positive effect of the ANEEL Provision - CCC of R$ 16 million, while in 2Q19 it presented a negative effect of R$ 921 million, partially offset by provisions for legal contingencies, in the amount of R$ 125 million, related to compulsory loan lawsuits.

TABLE 24: OPERATING PROVISIONS (R$ MILLION)

Operating Provisions Parent Company
    2Q20 2Q19 (Reclassified)
Guarantees     5 58
Contingencies     -125 29
PCLD - Consumers and Resellers     0 0
PCLD - Financing and Loans     14 -53
Overdraft liabilities in subsidiaries     0 -95
Onerous Contracts     0 0
RAP Adjustment Losses     -17 27
Investment Losses     0 0
Provision for losses on investments classified as held for sale     0 0
Impairment     0 0
ANEEL Provision - CCC     16 -921
TFRH     0 0
GAG Improvement     0 0
Others     -8 -6
 
 
 

-114

-961

Table 25: CHANGE PROVISION FOR LIABILITIES UNDERCOVERED

 

MUTATION PROVISION FOR DISCOVERED LIABILITIES - PARENT COMPANY Balance on 12/31/2019 Other Comprehensive Results

 

Equity

Reduction Balance on 06/30/2020
Amazonas GT 119 - -141 22 -
TOTAL PROVISION FOR DISCOVERED LIABILITIES

119

-

-141

22

-

* The shares of subsidiary Amazonas GT were 100% transferred to subsidiary Eletronorte.

 

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II.3 FINANCIAL RESULT OF PARENT COMPANY

 

In 2Q20, the Financial Result positively impacted the Parent Company's result by R$ 67 million compared to the negative result of R$ 398 million in 2Q19, mainly influenced by liability manegement measures, such as the rollover of bonds and the settlement of debts with costs. higher with less costly funding resources. Debt charges went from a negative result of R$ 539 million in 2Q19 to a negative result of R$ 326 million in 2Q20. The result of the net foreign exchange variation went from a negative result of R$ 16 million in 2Q19 to a negative result of R$ 71 million in 2Q20. Interest, commission and fee income increased from R$ 481 million in 2Q19 to R$ 372 million in 2Q20. This drop was partially offset by Revenue from financial investments, which went from R$ 88 million in 2Q19 to R$ 187 million in 2Q20.

TABLE 26: FINANCIAL RESULT (R$ MILLION)

FINANCIAL RESULT     2Q20 2Q19
Financial income        
Interest, commission and fee income     372 481
Income from financial investments     187 88
Additional moratorium on electricity     1 0
Monetary updates     76 123
Exchange variations     -71 -16
Other financial income     16 431
         
Financial expenses        
Debt charges     -326 -539
Leasing charges     -1 -2
Charges on shareholder resources     -1 -60
Other financial expenses     -185 -905
 
 
 

67

-398

 

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III. General Information

 

 

 

Position on 06/30/2020. Currently, our staff has 133 SPEs, as TDG was incorporated on 12/05/2020.

The number of SPEs is taking into account the direct and indirect participation in SPE, and disregarding the SPEs that participate in more than one Eletrobras Company, differently from the quantities considered in the tables of each company. In this total, 02 SPEs abroad are included. Of the 134 national and international SPEs, 39 are in the process of divesting by the competitive procedure of sale 01/2019.

 

SHARE CAPITAL

STRUCTURAL OF CAPITAL STOCK

Eletrobras' capital stock, on June 30, 2020, 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

Shareholders Common Pref. Classe “A” Pref. Classe “B” Total
Quantity % Quantity % Quantity % Quantity %
Government 667,888,884 52% 0 0% 494 0% 667,889,378 43%
BNDESpar 141,757,951 11% 0 0% 18,691,102 7% 160,449,053 10%
BNDES 74,545,264 6% 0 0% 18,262,671 7% 92,807,935 6%
FND 45,621,589 4% 0 0% 0 0% 45,621,589 3%
FGHAB 1,000,000 0,1% 0 0,0% 0 0% 1,000,000 0,1%
Free Float 358,028,908 28% 146,920 100% 242,987,127 87% 601,162,955 38%
Total 1,288,842,596 100% 146,920 100% 279,941,394 100% 1,568,930,910 100%

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ASSET BEHAVIOR ANALYSIS

SHARES

TABLE 28: B3, ELET3 e ELET6

Price and Volume

(R$)

ELET3 (ON Shares)

(R$)

ELET6 (PN Shares)

(pts.)
IBOV (Índex)
(pts.)
IEE ((Índex)
Closing Price on 06/30/2019              29.76          30.85 95056 70160
Maximum in the quarter              30.59          31.78 97645 70490
Average in the quarter              25.21          27.44 84659 63553
Minimum in the quarter              19.82          22.25 69538 55415
         
Variation in 2Q20 29.9% 23.9% 30.2% 21.7%
Change in the last 12 months -12.0% -10.4% -5.9% 9.9%
Average Daily Traded Volume 2Q20 (R$ million) 154.0 95.5          -    -   
         
Net Income per Share in the Quarter (R$) 2.92 2.92 - -
Book Value per Share (R$) 48.32 48.32 - -
Price / Profit (P/E) (1) 10.63 11.06 - -
Price / Shareholders' Equity(2) 0.64 0.67 - -

 

(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 06/30/2019 = 100 and ex-dividend values.

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

34
 

 

 

ADR PROGRAMS

TABLE 29: NYSE, EBRN AND EBRB

 

Price and Volume

 

(US$) NYSE
EBRN

 

(US$) NYSE EBRB

Closing Price on 06/30/2019               5.39            5.09
Maximum in the quarter               6.22            5.83
Average in the quarter               4.72            4.60
Minimum in the quarter               3.40            3.36
     
Variation in 2Q20 21.4% 13.9%
Change in the last 12 months -38.1% -36.5%
Average Daily Trading Volume 2Q20 (US$ million)           3,996          322

 

EVOLUTION OF SHARES TRADED IN ADR

 

 

Source:AE Broadcast
Index number 06/30/2019 = 100

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

35
 

 

Latibex – MADRID MARKET

TabLE 30: LATIBEX, XELTO AND XELTB

Price and Volume (€) LATIBEX
XELTO
(€) LATIBEX XELTB
Closing Price on 06/30/2019        5.00        5.10
Maximum in the quarter        5.50        5.40
Average in the quarter        4.43        4.70
Minimum in the quarter        3.26        3.74
     
Variation in 2Q20 21.4% 19.2%
Change in the last 12 months -34.2% -39.3%
Average Daily Traded Volume 2Q20 (thousands of Euros)          9.1          4.3

 

EVOLUTION OF FOREIGN CURRENCIES

Index number: 06/30/2019 = 100.
Source:Banco Central

 

 

 

 

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

36
 

Nº OF EMPLOYEES

parent company

TABLE 31: EMPLOYEES FOR WORKING TIME

Working time in the company (years)     1Q20 2Q20
Up until 5     29 26
6 to 10     238 229
11 to 15     210 222
16 to 20     138 138
21 to 25     13 13
more than 25     62 63

Total

 
 

690

691

TABLE 32: EMPLOYEES BY FEDERATION STATE

Estado da Federação     1T20 2Q20
Rio de Janeiro     674 675
São Paulo     1 1
Brasília     15 15

Total

 
 

690

691

CONTRACTED / OUTSOURCED LABOR

TABLE 33: CONTRACTED / OUTSOURCED LABOR

2Q20
0

ROTATION INDEX (Holding)

TABLE 34: ROTATING INDEX HOLDING WITH PDC

2Q20
0.22%

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

37
 

BALANCE SHEET (r$ thousand)

 

Asset Parent Company Consolidated
06.30.20 12.31.19 06.30.20 12.31.19
CURRENT        
   Cash and cash equivalents 9,540 18,202 368,373 335,307
   Restricted cash 2,820,608 3,227,536 2,820,608 3,227,536
   Marketable securities 8,826,219 6,787,137 14,356,024 10,426,370
   Customers 277,713 468,429 5,212,269 5,281,333
   Financial assets - Concessions and Itaipu 0 0 8,140,823 5,927,964
   Loans and financing 6,293,585 5,120,734 4,772,313 3,473,393
   Asset contractual transmission 0 0 1,039,517 1,116,009
   Equity Pay 2,980,344 3,592,503 229,625 299,899
   Taxes to recover 356,913 807,150 812,063 1,474,662
   Income tax and social contribution 1,064,699 309,033 2,908,739 2,382,899
   Reimbursement rights 0 0 71,895 48,458
   Warehouse 328 272 481,477 471,824
   Nuclear fuel stock 0 0 553,097 538,827
   Derivative financial instruments 0 138 84,514 140,543
  Hydrological risk 0 0 3,132 13,590
   Other 2,331,351 1,444,837 2,575,414 2,016,330
  24,961,300 21,775,971 44,429,883 37,174,944
         
   Asset held for sale 1,137,157 1,546,250 3,089,149 3,543,519
 

26,098,457

23,322,221

47,519,032

40,718,463

         
NON CURRENT        
LONG-TERM        
   Reimbursement rights 5,438,086 5,382,834 5,470,799 5,415,547
   Loans and financing 15,307,902 18,282,460 9,260,354 10,803,423
   Customers 0 0 242,522 285,351
   Marketable securities 382,806 374,601 383,151 407,071
   Nuclear fuel stock 0 0 881,714 840,550
   Taxes to recover 0 0 460,945 420,370
   Current Income Tax and Social Contribution 0 0 322,742 463,451
   Deferred income and social contribution     taxes 4,097,975 4,168,575 6,889,921 6,891,416
   Escrow deposits 0 0 13,907,692 13,744,276
   Fuel Consumption Account - CCC 2,054,596 1,905,607 32,321,167 31,633,512
   Financial assets - Concessions and Itaipu 0 0 100,992 151,315
   Derivative financial instruments 1,057,536 774,468 1,541 181,257
   Advances for future capital increase 0 0 163,494 179,879
  Hydrological risk 1,675,609 1,222,393 1,675,609 1,222,393
   Other 1,256,253 1,350,913 1,464,380 1,024,607
 

31,270,763

33,461,851

73,547,023

73,664,418

INVESTMENTS 77,721,892 75,637,776 29,649,350 29,112,919
Fixed assets net 249,422 255,947 32,754,780 33,315,874
INTANGIBLE 19,513 19,518 630,301 655,041

TOTAL NON-CURRENT ASSETS

109,261,590

109,375,092

136,581,454

136,748,252

TOTAL ASSETS

135,360,047

132,697,313

184,100,486

177,466,715

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

38
 

 

(r$ THOUSAND)

Liabilities and Equity Parent Company Consolidated
06.30.20 12.31.19 06.30.20 12.31.19
CURRENT        
    Loans and financing 5,515,146 5,759,164 8,729,647 7,636,633
    Debentures 24,242 33,159 81,710 78,527
    Compulsory loan 14,727 15,156 14,727 15,156
    Suppliers 766,136 494,133 2,867,793 3,095,469
    Advances from customers 633,919 614,171 633,919 683,602
    Taxes payable 202,569 201,516 1,659,352 1,575,658
    Income tax and social contribution 0 0 2,098,004 2,532,732
    Onerous contracts 0 0 3,913 3,913
    Remuneration to shareholders 2,599,386 2,559,429 2,606,013 2,575,216
    Financial liabilities - Concessions and Itaipu 645,061 703,114 0 0
    Estimated liabilities 168,320 147,106 1,471,616 1,331,257
    Reimbursement Obligations 1,997,778 1,796,753 1,997,778 1,796,753
    Post-employment benefits 8,969 14,875 176,734 161,773
    Provisions for contingencies 1,012,658 1,014,585 1,013,957 1,031,488
    Regulatory charges 0 0 567,836 627,611
    Lease 7,739 7,574 229,739 219,484
    Accounts payable with subsidiaries 0 0 0 0
    Derivative financial instruments 800 683 800 683
    Others 89,629 89,553 654,488 579,394
  13,687,079 13,450,971 24,808,026 23,945,349
         
    Liabilities associated with assets held for sale 0 0 1,650,380 1,692,708
 

13,687,079

13,450,971

26,458,406

25,638,057

         
NON-CURRENT        
    Loans and financing 21,086,995 22,515,109 35,101,283 34,303,730
    Suppliers 0 0 17,240 18,143
    Debentures 5,012,535 5,011,069 6,642,079 5,880,751
    Advances from customers 0 0 331,134 369,262
    Compulsory loan 470,271 470,600 470,271 470,600
    Obligation for asset retirement 0 0 3,196,871 3,129,379
    Provisions for contingencies 15,506,182 16,924,171 22,686,734 24,214,938
    Post-employment benefits 822,512 822,512 4,338,592 4,353,406
    Provision for unsecured liabilities 0 119,223 3,228 0
    Onerous contracts 0 0 361,934 361,934
    Lease 52,032 55,928 864,846 987,705
    Grants payable - Use of public goods 0 0 68,330 68,555
    Advances for future capital increase 73,337 50,246 73,337 50,246
    Derivative financial instruments 0 0 4,422 5,000
    Regulatory charges 0 0 852,923 730,303
    Taxes payable 0 0 232,439 239,959
    Income tax and social contribution 598,774 628,904 4,479,717 3,978,754
    Others 2,242,063 1,741,779 1,611,318 1,271,847

TOTAL NON-CURRENT LIABILITIES

45,864,701

48,339,541

81,336,698

80,434,512

         
EQUITY        
    Share capital 39,057,271 31,305,331 39,057,271 31,305,331
    Capital reserves 13,867,170 13,867,170 13,867,170 13,867,170
    Profit reserves 23,887,181 23,887,181 23,887,181 23,887,181
    Advances for future capital increase 0 7,751,940 0 7,751,940
    Other comprehensive income accumulated -5,876,887 -5,904,821 -5,876,887 -5,904,821
    Non controlling shareholdins 0 0 497,115 487,345
    Share capital 4,873,532 0 4,873,532 0

TOTAL SHAREHOLDERS' EQUITY

75,808,267

70,906,801

76,305,382

71,394,146

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

135,360,047

132,697,313

184,100,486

177,466,715

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

39
 

 

INCOME STATEMENT (r$ thousand)

  Parent Company Consolidated
  06.30.20 06.30.19 06.30.20 06.30.19

NET OPERATING REVENUE

-22,401

237,567

18,053,226

13,066,233

Operating costs        
    Energy purchased for resale -4,558 -51,483 -1,006,544 -900,890
    Charges upon use of electric network 0 0 -840,309 -785,328
    Construction 0 0 -347,420 -267,060
    Fuel for electricity production 0 0 -995,928 -910,907

NET OPERATING REVENUE

-26,959

186,084

14,863,025

10,202,048

Operating expenses        
    Personnel, Supllies and Services -287,617 -370,248 -3,207,223 -3,685,860
    Depreciation -6,524 -6,723 -888,209 -821,277
    Amortization -5 0 -43,649 -51,453
    Donations and contributions -49,329 -58,329 -79,721 -102,880
    Operating Provisions /Reversals net -190,057 -1,311,774 -1,005,909 -2,029,036
    Investigation Findings 0 0 0 0
    Others -99,940 -88,919 -533,838 -525,655
 

-633,472

-1,835,993

-5,758,549

-7,216,161

OPERATING INCOME BEFORE FINANCIAL RESULT

-660,431

-1,649,909

9,104,476

2,985,887

Financial result        
   Financial income        
    Income from interest, commissions and fees 783,194 1,070,127 482,691 540,877
    Income from financial investments 665,066 146,071 826,007 309,563
    Moratorium on electricity 1,385 126 115,671 161,790
    Restatement Assets 280,012 576,265 376,134 563,739
    Current foreign currency exchange rate variations 4,258,703 1,003,276 4,046,811 1,087,152
    Payment of indemnities - Law 12,783 / 13 0 0 33 2,183,631
    Regulatory asset update 0 0 0 0
    Gains on derivatives 0 0 0 0
    Other financial income 110,554 478,801 145,039 598,111
   Financial expenses        
    Debt charges -1,055,138 -1,028,505 -1,663,203 -1,802,452
    Lease charges -2,868 -3,195 -185,819 -171,937
    Charges on shareholders' funds -23,091 -119,076 -143,651 -217,799
    Noncurrent Restatement -157,900 -280,237 -179,318 -412,513
    Noncurrent foreign currency exchange rate variations -4,495,124 -991,370 -4,846,293 -1,027,077
    Regulatory liability update 0 0 -1,365,606 -388,537
    Losses on derivatives 0 0 -107,451 -25,059
    Other financial expenses -674,476 -1,016,430 -340,946 -1,310,117
 

-309,683

-164,147

-2,839,901

89,372

INCOME BEFORE EQUITY

-970,114

-1,814,056

6,264,575

3,075,259

RESULTS OF EQUITY 5,844,629 3,755,390 528,110 262,000
OTHER REVENUE AND EXPENDITURE 0 0 25,042 166,294

OPERATING INCOME BEFORE TAXES

4,874,515

1,941,334

6,817,727

3,503,553

    Current Income tax and social contribution 0 -16,093 -1,209,470 -1,673,769
    Deferred Income Tax and Social Contribution 0 0 -704,068 41,364

NET INCOME FROM CONTINUING OPERATIONS

4,874,515

1,925,241

4,904,189

1,871,148

SHARE ATTRIBUTED TO CONTROLLING 4,874,515 1,925,241 4,874,515 1,925,241
SHARE ATTRIBUTED TO NON-CONTROLLING 0 0 29,674 -54,093
DISCONTINUED OPERATION        
NET LOSS OF OPERATING TAXES DISCONTINUED 0 5,037,140 0 5,037,140

NET INCOME OF THE FINANCIAL YEAR

4,874,515

6,962,381

4,904,189

6,908,288

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

40
 

 

 

cash flow statement (r$ thousand)

  Parent  Consolidated
  06.30.20 06.30.19 06.30.20 06.30.19
Operating Activities        

Income before income tax and social contribution

4,874,515

1,941,334

6,817,727

3,503,553

Adjustments to reconcile income to cash provided by operations: 0 0 0 0
Depreciation and amortization 6,528 6,723 931,857 872,730
Net foreign exchange rate variations 114,309 -307,934 602,666 -124,373
Financial charges 297,903 80,649 1,509,982 1,539,700
Financial asset revenue 0 0 -377,118 -404,702
Construction Revenue 0 0 -302,356 -249,218
Equivalence equity results -5,844,629 -3,755,390 -528,110 -262,000
Result on disposal of equity interests 0 0 -25,042 -183,222
RBSE Revenue 0 0 -6,016,565 -3,604,272
Provision (reversa operationsl) 190,057 1,317,682 1,005,909 2,034,944
Non-controlling interest 0 0 -44,982 81,957
Financial instruments - derivatives 0 0 107,451 25,059
Others 435,991 -226,852 -604,763 -369,183
 

-4,799,840

-2,885,122

-3,741,070

-642,580

(Increases) / decreases in operating assets        
Customers 0 20,440 -78,823 -999,623
Marketable securities -2,039,082 -2,765,164 -3,897,529 -3,437,349
Reimbursement rights -55,252 442,985 -78,689 -1,745,889
Warehouse -56 -124 -9,653 -5,038
Nuclear fuel stock 0 0 -55,434 78,691
Financial assets - Itaipu -207,042 28,433 -207,042 28,433
Assets held for sale 391,581 3,490,843 436,858 11,618,261
Hydrological risk 0 0 26,843 47,157
Credits with subsidiaries - CCD 0 2,406,622 0 0
Others -586,547 -1,380,736 54,280 -1,942,236
 

-2,496,398

2,243,298

-3,809,188

3,642,406

Increase / (decrease) in operating liabilities        
Suppliers 237,708 97,989 -262,874 -453,159
Advances 0 0 -107,559 -36,081
Lease 2,868 67,246 161,960 217,101
Estimated liabilities 21,214 -34,738 99,217 -84,043
indemnification obligations 0 0 0 1
Sectorial charges 0 0 62,845 5,871
Liabilities associated with assets held for sale 0 -1,832,382 -42,328 -8,579,161
Accounts payable with subsidiaries 0 -2,866,810 0 0
Other 409,774 248,814 536,518 871,063
 

671,564

-4,319,881

447,778

-8,058,408

         
Payment of financial charges -268,153 -688,097 -1,070,533 -1,663,674
Revenue of RAP and indemnities 0 0 3,916,023 3,589,228
Revenue of financial charges 709,837 986,671 445,527 672,329
Payment of income tax and social contribution -91,570 -205,568 -1,664,013 -1,470,973
Revenue of remuneration for investments in equity interests 1,273,019 1,813,145 306,934 314,831
Supplementary pension payment -5,906 -14,786 -134,929 -85,741
Payment of legal contingencies -1,542,793 -501,460 -1,573,991 -546,385
Bonds and related deposits -141,080 -233,393 -212,429 -9,745

Net cash provided by (used in) operating activities of continuing operations

-1,816,806

-1,863,858

-272,164

-755,158

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

41
 

 

Net cash provided by (used in) operating activities of discontinued operations

0

0

0

-379,997

Net cash provided by (used in) operating activities

-1,816,806

-1,863,858

-272,164

-1,135,155

         
Financing activities        
Loans and financing 5,193,319 5,000,000 7,122,573 5,755,633
Payment of loans and financing - Main -6,986,073 -2,125,022 -8,009,835 -3,574,750
Payment of shareholders remuneration 0 -476 -74,225 -10,368
Advanced receivalbe for future capital increase 0 0 0 0
       Payment of finance leases -6,599 0 -274,564 0
      Others 0 0 -23,374 2,512

Net cash provided by (used in) financing activities from continuing operations

-1,799,353

2,874,502

-1,259,426

2,173,027

Net cash provided by (used in) financing activities of discontinued operations

0

0

0

414,724

Net cash provided by (used in) financing activities

-1,799,353

2,874,502

-1,259,426

2,587,751

         
Investing activities        
Lending and financing 0 -619,724 0 -44,658
loans and financing receivables 3,871,325 3,739,200 2,153,452 3,256,667
Acquisition of fixed assets 0 -153 -480,563 -434,931
Acquisition of intangible assets 0 -53 -24,871 -14,223
Acquisition / capital investment in equity 0 -6,860 -45,212 -348,130
Advance concession for future capital increase -281,339 -197,644 -6,001 -60,282
Investment sale in shareholdings 17,512 0 19,812 16,000
Net cash flow in the acquisition of investees 0 0 0 0
Others 0 0 -51,961 -2,907

Net cash provided by (used in) investing activities from continuing operations

3,607,498

2,914,766

1,564,656

2,367,536

Net cash provided by (used in) investment activities of discontinued operations

0

0

0

6,337

Net cash provided by (used in) investing activities

3,607,498

2,914,766

1,564,656

2,373,873

 
 
 
 
 

Increase (decrease) in cash and cash equivalents

-8,662

3,925,410

33,066

3,826,469

         
Cash and cash equivalents at the beginning of the financial year 18,202 47,400 335,307 583,352
 Cash and cash equivalents at the end of the financial year 9,540 3,972,810 368,373 4,368,757
Increase (decrease) in cash and cash equivalents 0 0 0 41,064
 

-8,662

3,925,410

33,066

3,826,469

         

 

MARKETLETTER 2Q2020

Disclaimer: This material contains calculations that may not produce an accurate sum or result due to rounding performed

42
 

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: August 13, 2020

 

CENTRAIS ELÉTRICAS BRASILEIRAS S.A. - ELETROBRÁS
     
By: /SElvira 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.

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