CIG Reports Positive 1Q Results (CIG) (ELP)

Zacks

Companhia Energetica de Minas Gerais (CIG), known as CEMIG, reported encouraging results for the first quarter of 2011 as the company’s net income rose 1% year over year to R$526 million (US$316.9 million).

Revenue

In the first quarter 2011, the company’s net revenue escalated 18% year over year to R$3,387 million (US$2,040.4 million) due primarily to recovery of economy leading eventually to higher demand for electricity.

Electricity sold improved 16.0% year over year to 17,981 GWh in the first quarter of 2011 versus 15,518 GWh in a year-ago period due to higher demand in all consumer categories.

Residential sales grew 7% year over year, industrial sales increased 10%, rural consumption went up by 6%, commercial consumption grew 7% while sales to miscellaneous category went up by 5%. Transactions on CCEE were down by 35% year over year.

Margins

Operating expenses in the first quarter 2011 jumped 21% year over year to R$2,327 million (US$1,401.8 million), attributed to an increase in expenses for electricity bought for resale. Expenses also rose modestly for outsourced services, gas, depreciation and provisions.

EBITDA in the quarter soared 11% year over year to R$1,292 million (US$778.3 million) while margin declined 230 basis points to 38.1%.

Balance Sheet/Cash Flow

The company’s total debt in the quarter was R$13,317 million (US$8,120.1 million) while cash and cash equivalents were R$2,733 million (US$1,666.5 million) versus R$2,980 million (US$1,817.1 million) in the previous quarter.

Net cash flow from operating activities plummeted to R$474 million (US$285.5 million) from R$1,156 million (US$638.7 million) in the year-ago quarter. Capital spending was also down to R$168 million (US$101.2 million) from R$1,175 million (US$649.2 million) in the comparable quarter of 2010.

Investments in the first quarter 2011 were R$217 million (US$130.7 million). Management plans to spend approximately R$2,319 million and R$1,134 million in the fiscal year 2011 and 2012, respectively.

CEMIG is one of the largest integrated electric utilities in Brazil with approximately 97% of the company’s installed generation capacity being hydroelectric power. The company is in stiff competition with its peers like Companhia Paranaense de Energia (ELP), EDP-Energias de Portugal, S.A. and privately-held Eletropaulo Metropolitana Eletricidade de S

Be the first to comment

Leave a Reply