Comp En De Mn Cemig ADS Q2 Earnings Call Highlights

Cemig reported solid second-quarter results: recurring EBITDA rose 9.3% year over year to BRL 2.5 billion, while recurring net income increased 15.6%. The company is maintaining its investment program, planning BRL 6.7 billion in 2026 capital expenditures and spending BRL 3.3 billion during the first half, primarily on distribution infrastructure ahead of the 2028 tariff review. Performance varied by business: distribution and transmission EBITDA grew, but trading posted negative recurring EBITDA of BRL 180 million due largely to an arbitration provision and energy-purchase costs. Management expects trading conditions to improve in the second half.

Comp En De Mn Cemig ADS NYSE: CIG reported recurring EBITDA of BRL 2.5 billion for the second quarter of 2026, with recurring EBITDA rising 9.3% from a year earlier and recurring net income increasing 15.6%, according to management during the company’s earnings call. Chief Executive Officer Alexandre Ramos Peixoto, speaking on his first earnings call in the role, emphasized continuity in the company’s strategy, financial discipline and investment program. He said service quality would remain central to Cemig’s priorities as it serves more than 9.5 million consuming units.

“We have a sound company. We deliver consistent results, and we know how to execute,” Peixoto said. He highlighted the company’s integrated operations and said Cemig is positioning its network and businesses for changes in Brazil’s electricity market, including the expected full opening of the power market in November 2028.

Investment program remains on track CFO and Investor Relations Officer Leonardo George de Magalhães said Cemig plans to invest BRL 6.7 billion in 2026 and had deployed BRL 3.3 billion through the first six months of the year, or 49% of the annual target. Distribution accounted for the bulk of investment, with BRL 2.6 billion spent during the first half. Cemig Geração e Transmissão received BRL 275 million, while gas distributor Gasmig invested BRL 227 million, including work associated with its Midwest project and 33.5 kilometers of network construction during the quarter. Management said the investments are intended to improve service quality, modernize and strengthen the distribution system, and expand the company’s regulatory asset base ahead of Cemig Distribution’s tariff review scheduled for May 2028. The company said it has more than BRL 22 billion planned for the tariff-review cycle through May 2028. In transmission, investments completed during the quarter added BRL 36 million in annual permitted revenue, or RAP, according to the company.

Planned 2026 capital expenditures: BRL 6.7 billion First-half capital expenditures: BRL 3.3 billion First-half distribution investments: BRL 2.6 billion Second-quarter funding raised: BRL 4.6 billion Interest on capital declared: BRL 631 million, or BRL 0.22 per share

Costs, debt and shareholder remuneration Consolidated costs and expenses increased 15.5% in the quarter. Magalhães attributed the increase partly to seasonal effects and spending related to network-quality improvements, while stating that the company expects the quarterly effect not to persist in the same way over a 12-month comparison. The company recorded a BRL 191 million provision related to an arbitration involving a free-market customer and contract clauses. Management said the provision did not have an immediate cash effect. Cemig also reported a BRL 232 million reversal of expected credit losses after adjusting its criteria in line with Brazil’s electricity regulator, ANEEL, and market benchmarks. Cemig’s leverage stood at 2.58 times at the end of the second quarter.