SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 


 

FORM 6-K/A

 

Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of the

Securities Exchange Act of 1934

 

For the month of March, 2023

 

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 4Q22

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

 

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Marketletter 4Q22

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

 

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Marketletter 4Q22

INTRODUCTION

Rio de Janeiro, March 13, 2022

 

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 electricity sector in Latin America, operating in the generation, transmission and commercialization segment, direct controller of 4 operating subsidiaries and a holding company – Eletropar –, a research center – Cepel and direct and indirect participation in 74 Special Purpose Entities, announces, on this date, its results for the period referring to the third quarter of 2022.

 

2022 Results

Eletrobras presented, in 2022, a net income of BRL 3,638 million, 36% lower than net income of BRL 5,714 million obtained in 2021.

The result for 2022 was negatively impacted by the accounting of expenses foreseen for the Voluntary Dismissal Plan (PDV), carried out in December 2022, in the amount of R$ 1,260 million (adherence of 2,494 employees, with 13 months of pay back) and also by the increase of R$4,475 million in provisions for doubtful accounts, which increased from R$1,027 million in 2021 to R$5,022 million in 2022, highlighting the provision of R$3,348 made by the Holding for receivables from Amazonas Energia, which aims to reflect the risk observed due to the maintenance of default on debt acknowledgment instruments (ICD), (for details, see explanatory note 40.1 of the financial statements). The 2022 result was also negatively impacted by the deflation that occurred in the period, which resulted in a reduction of R$ 1,675 million in transmission revenues, in particular contractual revenue (financial revenue) which are readjusted by IPCA and IGPM, according to the year of competence, considering the effects applicable accounting rules (IFRS).

4th QUARTER 2022

Eletrobras presented, in the fourth quarter of 2022 (4Q22), a net loss of R$ 479 million, lower than the net profit of R$ 610 million obtained in the fourth quarter of 2021 (4Q21).

The 4Q22 result was negatively impacted by the accounting of the Voluntary Dismissal Plan, carried out in December 2022, non-recurring event in the amount of R$ 1,260 million. In addition, the 4Q22 result was also impacted by the constitution of a provision for receivables from Amazonas Energia, in the amount of R$2,528 million, and there was also a decrease in the financial result of R$946 million, in particular, by the increase of R$1,098 million of financial expenses with debt charges, due to the consolidation of SPE Santo Antônio Energia (+R$ 436 million) as of 3Q22, and the impact of R$ 888 million in financial expenses (IPCA + charges) of obligations with the CDE (charge of 7.6%) and revitalization projects for the hydrographic basins and the Legal Amazon (charge of 5.67%), as established by Law No. 14,182/2021 (Privacy of Eletrobras), as one of the conditions for obtaining new concession grants for the generation of electricity for another 30 years.

The above negative effects were partially offset by the reversal of losses on investments in SPEs, with emphasis on Saesa, Jirau, Sinop, IE Madeira and São Manoel, in the net amount of 918 million, as well as discounts obtained in compulsory loan court agreements , in the amount of R$ 563 million.

 

Marketletter 4Q22

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Net Operating Revenue went from R$10,502 million in 4Q21 to R$9,009 million in 4Q22, a decrease of 14%, influenced by the deflation of the period (fall in the IPCA and IGPM), worsening the transmission revenue in a very relevant way, which which was mitigated, in part, by the tariff revision of the 22/23 cycle of 17 transmission contracts.

Generation revenue grew by R$337 million, overcoming the period's challenge in terms of energy prices, given the better hydrological conditions. Two factors were important for this growth, the first being the consolidation of Saesa (+ R$ 1,262 million) and the second the Company's effort to sell in advance, to 2022, its available energy, through bilateral contracts, allowing a margin of price significantly higher than the market price, mitigating the low PLD. These gains were partially offset by the reduction in revenues from the sale of energy imported from Uruguay (-R$964 million), in the regulated environment, due to better hydrological conditions.

Ebitda IFRS, in the amount of R$ 2,043 million in 4Q21, increased to an amount of R$ 1,420 million in 4Q22, mainly due to the aforementioned provision for PCLD, reduction in Transmission revenue as mentioned above and the increase in PMSO (+R$1,627 million), mainly due to non-recurring POS expenses. Excluding the PDV, personnel grew 4% (+R$ 136 million), less than the annual readjustment provided for in the Collective Bargaining Agreement – ACT 2022/2023 of 12.13%. Adjusted Ebitda decreased by 10%, from R$4,881 million in 4Q21 to R$4,401 million in 4Q22, influenced by the drop in transmission revenue due to deflation.

 

OTHER 4Q22 HIGHLIGHTS

 

 

üCash and Cash Equivalents + Bonds and Securities of R$22.9 million and Net Debt of R$34.8 million. Recurring EBITDA in 2022 of R$17.8 billion, forming a Net Debt/LTM Recurring EBITDA ratio of 2.0;

 

üPDV: adhesion of 2,494 employees, cost of R$ 1.2 billion and payback of 13 months, with 1,300 employees having already left by February 2023;

 

üLosses on Investments in SPEs: -R$469 million in Teles Pires (vs. Dardanelos adjustment to occur with the conclusion of the sale transaction), given the applicable accounting rules;

 

ü- R$639 million in adjustments for reconciling escrow deposits and payments in other operating expenses;

 

üAmortization Expenses of -R$ 267 million, referring to the signing of the new generation concession contracts for UTE Tucurui, Mascarenhas, Itumbiara, Sobradinho and Curua-Una, for another 30 years, and - R$ 264 million arising from the consolidation from Saesa;

 

üReduction of R$ 1.5 billion in the stock of provision for legal claims related to compulsory loan book-entry credits (2nd phase), with emphasis on -R$ 1.3 billion due to judicial agreements reached, which also generated a reduction of R$ 770 million of possible and remote risk related to the processes object of the agreements.
 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

 

Table 01: MAIN INDICATORS (R$ MILLION)

2022 2021 %   4Q22 4Q21 %
127,6 128,9 -1% Energy Sold - Generation GWh (1) 32.7 32.6 0,2%
41,038 41,006 0,1% Gross Revenue 10,803 12,244 -12%
40,965 40,932 0,1% Recurring Gross Revenue 10,803 11,854 -9%
34,074 34,627 -2% Net operating revenue 9,009 10,502 -14%
34,008 34,553 -2% Recurring Net Operating Revenue 9,009 10,112 -11%
11,398 13,860 -18% EBITDA 1,420 2,043 -30%
17,780 18,829 17,780 Recurring EBITDA 4,401 4,881 -10%
33% 40% 33% Ebitda Margin 16% 19% -3,7
52% 54% -2.2% Recurring Ebitda Margin 52% 54% -2.2%
59,107 44,016 59,107 Gross debt without third party RGR 59,107 44,016 34%
34,763 21,806 34,763 Recurring Net Debt 34,763 21,806 59%
2.0 1.2 2.0 Recurring Net Debt / Recurring LTM EBITDA 2.0 1.2 80%
3,638 5,714 -36% Net Profit -479 610 -178%
5,174 4,678 11% Investments 1,597 2,151 -26%
9,670 12,126 -20% Employees 9,670 12,126 -20%
     
(1) Does not consider Eletronuclear and Itapu; (2), (3) and (4) Adjustments detailed in the consolidated analysis presented below.
               
 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

 

 

1       ANALYSIS OF THE
CONSOLIDATED RESULT (R$ MILLION)

TABLE 02: CONSOLIDATED RESULTS
2022 2021 Income Statement for the Year 4Q22 4Q21
24,161 22,630 Generation Revenue 6,805 6,789
15,775 17,450 Transmission Revenue 3,632 5,080
1,102 925 Others Revenue 366 375
41,038 41,006 Gross Revenue 10,803 12,244
-6,963 -6,379 Deductions from Revenue -1,794 -1,742
34,074 34,627 Net Operating Revenue 9,009 10,502
-9,628 -5,555 Operational costs -3,028 -2,938
-10,028 -7,782 Personnel, Material, Services and Others -4,044 -2,430
-2,690 -1,443 Depreciation and amortization -880 -521
-6,928 -14,922 Operating Provisions -1,135 -3,548
4,799 4,925   -77 1,065
2,370 1,507 Shareholding 702 57
365 4,859 Regulatory Remeasurements - Transmission Contracts 3 0
187 1,211 Others Revenues and Expenses -87 439
7,721 12,501   540 1,561
-4,374 -1,442 Financial Result -1,678 -732
3,347 11,060 Income before tax -1,138 829
-696 -5,261 Income tax and social contribution 659 -180
2,652 5,799 NET INCOME from Continuing Operations -479 649
987 -85 Net Income From Discontinued Operations 0 -39
3,638 5,714 NET INCOME FOR THE PERIOD -479 610

 

 

Marketletter 4Q22

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Marketletter 4Q22

  

 

 

TABLE 03: RECURRING CONSOLIDATED RESULT
2022 2021 Recurring Financial Statement 4Q22 4Q21
24,089 22,548       Generation Revenue Recurring 6,805 6,468
15,775 17,450       Transmission Revenue Recurring 3,632 5,011
1,102 933       Others Revenue Recurring 366 375
40,965 40,932       Gross Revenue Recurring 10,803 11,854
-6,957 -6,379       Deductions from Revenue Recurrent -1,794 -1,742
34,008 34,553       Net Operating Revenue Recurring 9,009 10,112
-9,575 -9,876       Operational costs Recurring -2,972 -3,298
-8,275 -7,197       Personnel, Material, Services and Others Recurring -2,650 -2,278
-2,690 -1,370       Depreciation and amortization Recurring -880 -521
-747 -855       Operating Provisions Recurring 312 -408
12,720 15,254   2,820 3,606
2,370 2,204       Shareholdings Recurring 702 754
15,090 17,459       Adjusted Result before Financial Result 3,522 4,360
-3,634 -829       Financial Result Recurring -1,643 -541
11,456 16,630       Income before tax Recurring 1,879 3,819
-994 -3,552      Income tax and social contribution Recurring 659 -336
10,462 13,078       Net Income for the year Recurring 2,538 3,483
 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

1.1 MAIN VARIATIONS OF FINANCIAL STATEMENTS

Highlights in the Analysis 4Q22 X 4Q21

Below are the main highlights of 4Q22. For more details on the companies' results, see annex 2 of the Investor Report.

OPERATING INCOME

Operating Revenue - Generation 4Q22 4Q21 % 2022 2021 %
Energy supply to distribution companies 4,170 3,329 0 14,105 11,837 19%
Supply 977 922 6% 3,926 3,335 18%
CCEE 141 1,459 -90% 1,159 3,090 -62%
Operation and Maintenance Revenue 1,243 1,084 15% 4,677 4,220 11%
Construction Revenue 0 44 -100% 7 82 -91%
Itaipu Transfer 274 -50 -654% 288 66 337%
Generation Revenue 6,805 6,789 0% 24,161 22,630 7%
Non-recurring events            
(-) Reversal of Penalties for Unavailability - CCEAR 0 -277 0 -65 0 0%
(-) Construction Generation 0 -44 -100% -7 -82 -91%
Adjusted Generation Revenue 6,805 6,468 5% 24,089 22,548 7%

VARIATION ANALYSIS 4Q22 X 4Q21

ENERGY SUPPLY TO DISTRIBUTION COMPANIES: Revenue obtained from a customer that is not a final consumer, such as generators, traders and distributors.

 

·In Furnas (+R$951 million): (i) consolidation of SAESA (Santo Antônio Energia), which took place in 3Q22, with revenues of R$1,229 million referring to Energy resellers, of which ACL= R$533.3 million and ACR = BRL 695.8 million; (ii) updates of SAESA contracts, which are made annually by the IPCA and represented an increase of R$ 113.56 million; (iii) readjustment of prices of the ACR contracts of Furnas by the IPCA of approximately R$ 26 million, these factors being partially offset by (iii) lower amount of energy contracted in the ACL (1,924 GWh in 2021 to 1,823 GWh in 2022) , representing a reduction of R$ 24 million in revenue; (iv) lower dispatch from the Santa Cruz thermal plant, due to better hydrological conditions, 34 GWh in 4Q22 x 667 GWh in 4Q21, resulting in lower revenue in the amount of R$218 million.

Partially offset by:

·At Eletronorte (-R$103 million): The variation is due to: In the ACL: (i) the decrease of R$ 160 million in sales revenue from UHE Tucuruí (4Q21 R$ 713 million X 4Q22 R$ 553 million) , which occurred due to the 24% decrease in Contract Prices (4Q21 R$ 194.93/MWh X 4Q22 R$ 148.66/MWh), due to: (a) the large supply of energy, due to the reservoirs of the hydroelectric plants in historic levels and increased generation of renewable sources encouraged (distributed mini-generation) and by the timid growth in demand, due to the slow recovery of the economy. In ACR: (ii) mainly due to the R$38 million increase in sales at UTE Mauá (4Q21 R$306 million X 4Q22 R$344 million), a consequence of the 37% increase in contract prices (4Q21 R$464.4/ MWh X 4Q22 R$ 634.1/MWh), the contract had a fixed revenue readjustment in Nov/22, due to the IPCA and the increase of R$ 9 million in sales at UTE Aparecida (4Q21 R$ 93 million X 4Q22 R$ 102 million), as a result of the 44% increase in contract prices (4Q21 R$ 465.56/MWh X 4Q22 R$ 672.24/MWh), the contract had a fixed revenue readjustment in Nov/22, by the IPCA.

 

 

Marketletter 4Q22

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Marketletter 4Q22

  

SUPPLY FOR END CONSUMERS: Revenue obtained from a customer who is a final consumer.

·Chesf (+R$54 million): increase in the period by around 51 average MW in consumption by industrial customers achieved by Law 13,182/2015 in 3Q22.
·In Furnas (+R$39 million): (i) consolidation of Saesa (+R$32 million) referring to the billing of ACL customers (4,446,177 average MW and whose contracts are updated annually (IPCA); (ii). 9% readjustment in the unit prices of Furnas supply contracts, linked to UHE Itumbiara (Law 13,182), resulting in an increase of R$ 24 million in the period; (iii) new contracts started in 2022, representing an increase of R$ 2 million; and on the other hand, there was (iii) a reduction of R$ 19 million in ICMS paid due to the variation in the rate between states and allocation of billing to consumer units, by customers.

Partially offset by:

·At Eletronorte (-R$38 million): (i) the R$39 million reduction in Albrás revenues, due to variations in parameters, defined in the contract, used to calculate the final sale price: aluminum price, US Dollar and Sector Charges. (a) 18% decline in average aluminum prices (US$ 2,822.7 4Q21 X US$ 2,306.78 4Q22); (b) negative variation of 6% in the average dollar conversion rate (4Q21 R$5.58/US$ X 4Q22 R$5.24/US$); (ii) positive variation of R$ 1 million due to the increase in the sale price of the other sales contracts for UHE Tucuruí (4Q21 R$ 221/MWh X 4Q22 R$ 241/MWh).

CCEE

·In the holding company (-R$964 million): improvement of the country's hydrological conditions, significantly reducing the need to import electricity from the Oriental Republic of Uruguay.
·PLD variation of 53% (4Q21 R$ 118.70/MWh X 4Q22 R$ 55.70/MWh), affecting Eletronorte (-R$178 million), referring to energy from the Tucuruí, Samuel and Curuá-uma hydraulic power plants ; Chesf (-R$103 million) and Furnas (-R$54 million).

OPERATION AND MAINTENANCE REVENUE - PLANTS RENEWED BY LAW 12.783/2013

·Annual RAG readjustment of around 14%, according to Aneel Ratifying Resolution No. 3,068/2022, in addition to the increase in CFURH in 4Q22, compared to 4Q21, and consequently the associated taxes, with emphasis on Chesf (R$ 99 million) and Furnas (+R$59 million).

CONSTRUCTION REVENUE

·In Furnas (-R$44 million): (i) with the enactment of Law 14,182/21, the treatment for quota-holding plants was changed and, as of June 22, there will no longer be accounting of the financial asset generated in revenue of construction.

ITAIPU TRANSFER

·In Holding (+R$ 324 million): revenue was impacted by US inflation, which in 4Q21 was 5.17% and in 4Q22 was 14.57%.
 

Marketletter 4Q22

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ANALYSIS OF VARIATION 2022X2021

·Revenue from the Power Generation segment increased by 7% in 2022, around R$1,531 million, when compared to 2021, mainly influenced by (i) the incorporation of Saesa (+R$2.46 billion ); and (ii) the 11% increase (+R$456 million) in Plant Operation and Maintenance revenue, due to the readjustment of the RAG (Annual Generation Revenue), pursuant to Ratifying Resolutions issued by Aneel, and also variations in the CFURH portion. These effects were partially offset by: (iv) Reduction of 62% (-R$1,931 million) in Revenue from short-term electricity (CCEE), mainly caused by lower revenue from the resale of energy imported from Uruguay (-R $1,408 million) and the drop in the average PLD (from BRL 134.71 in 2021 to BRL 55.70 in 2022).
TABLE 05: TRANSMISSION REVENUE
Operating Transmission Revenue 4Q22 4Q21 % 2022 2021 %
Transmission Revenue 3,632 5,080 -29% 15,775 17,450 -10%
O&M Revenue - Renewed Lines -3,876 -3,483 0,1 0 0 -
O&M Revenue 5,490 5,154 7% 6,379 5,968 7%
Construction Revenue 459 471 -3% 1,494 1,536 -3%
Contractual Revenue - Transmission 1,559 2,938 -47% 7,901 9,947 -21%
Adjustment - Non-recurring events            
Retroactive readjustment of the monthly energy transport tariff from Itaipu Binacional 0 -69 -100% 0 0 -
Recurring Transmission Adjusted 3,632 5,011 -28% 15,775 17,450 -10%

ANALYSIS OF VARIATION 4Q22 X 4Q21

O&M REVENUE

·Chesf (-R$88 million): (i) In 4Q21, there was an adjustment in the amount of R$130.9 million involving one of the O&M revenue accounts, which caused a distortion in the comparison between the quarters of the years involved. Excluding this effect, 4Q21 amounts to R$ 532.2 million, which produces a positive variation of 8.1% in revenue. This positive variation is due to the publication of Aneel Ratifying Resolution 3,067/2022, which contemplated the tariff readjustment of the 22/23 cycle (of 11.29%), including the effects of the periodic tariff revision of 10 concession contracts of the Company, which are : 010/2007, 012/2007, 009/2011, 010/2011, 017/2011, 005/2012, 017/2012, 018/2012, 019/2012, 008/2011; (iii) reduction of 28% in the amount PA - portion of adjustment between periods; and (iv) remeasurement of the contractual asset in Nov/21, which impacted comparisons between periods.
·At CGT Eletrosul (-R$30 million): (i) reduction of approximately 53% of the O&M RAP related to MP 579/2012, which occurred gradually in 1/5 per cycle during the period 2018/19 to 2022/23, as stipulated by ANEEL in the periodic tariff review process, REH ANEEL nº 2.716/2020, generating a reduction of R$ 23.9 million in the analyzed period; (ii) transfer of DIT facilities and respective revenues to the CELESC distributor; in accordance with REN ANEEL º 916/2021, with a reduction effect of R$ 11.2 million in the period.

Partially compensated by:

·At Eletronorte (+R$63 million): (i) R$70.6 million increase in O&M revenue from the renewed contract (058/2001), due to: (a) R$132.8 million increase in billed revenue (4Q22 R$569.7 million x 4Q21 R$436.9 million) due to the 22% readjustment in the RAP of contract 058/2001 by Ratifying Resolution 3067/2022, effective from July/2022; (b) Reduction of R$62.2 million due to the increase in amortization (R$239.1 million in 4Q21 x R$301.3 million in 4Q22), due to the 2022 tariff readjustment. (ii) R$ increase $3.3 million in O&M revenue, due to the adjustment made to the CDE revenue (not collected) due to the accrual basis (difference between the revenue amount between the months of December/2022 and December/2021, as the revenue is received in the month subsequent to the one in which it is accounted for); (iii) Reduction of R$ 10.6 million in O&M revenue from non-renewed contracts, due to: (a) Reduction of R$ 11.2 million due to the increase in amortization (R$ 74.0 million in 4Q21 x R$85.2 million in 4Q22) due to the 2022 tariff review - Ratifying Resolution 3067/2022. (b) On the other hand, there was an increase of R$ 0.6 million in billed revenue (4Q22 R$ 159.5 million x 4Q21 R$ 158.9 million). Despite the readjustment of the RAPs of all contracts having been relevant due to the IPCA of the cycle of Ratifying Resolution 3,067/2022 (11.73% effective from July/2022), the adjustment portion of the previous cycle of ETE contracts and PVTE had a negative impact of R$15.6 million on billed revenue.
 

Marketletter 4Q22

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·In Furnas (+R$43 million): (i) readjustment of tariff cycles of 11.73%, based on current regulations (REH nº. 3067/22), in addition to the entry of new assets; (ii) additionally, in the light of the aforementioned resolution, we highlight that, in October/21, a difference was recognized in relation to the facilities dedicated to the Transport of Itaipu in the order of 60 million. According to articles 2 and 3 of REH 2.958/21 (formerly REH 2.896/21), the retroactive effects to July/21 were considered in the revenue, that is, the amounts charged under the bills for the months July, August and September/21, impacting only the 4Q21.

CONSTRUCTION REVENUE – TRANSMISSION

·Chesf (-R$80 million): investments made (appropriated and allocated) in ongoing transmission projects, associated with concession contracts: 061/2001, 021/2010, 019/2010, 012/2007, 004/2010, 013 /2010, 020/2010, 018/2012, 010/2007, 008/2011, 007/2010, 008/2005, 018/2009, 014/2008, 010/2011, 019/2012, 009/2011, 017/2012 , 005/2008, 005/2012, 007/2005, 017/2009, 006/2009, 017/2011 and 014/2010, offset by (ii) adequacy of the effects of the annual tariff adjustment in light of the publication of REH 3,067/ 2022, reducing around R$133 million in the contractual asset balance and impacting construction revenue. This is because, in Nov/22, there was an inconsistency in the percentage of progress of works associated with 2 REA's of the renewed contract, giving rise to the need to adjust the effects of the annual tariff readjustment. Thus, although there were more investments in 2022, revenue was lower due to lower performance, since construction revenue is due to a margin calculated in the measurement spreadsheet and applied to investments made in the period.
·At Eletronorte (-R$26 million): (i) Launches of annual adjustments made, in the tariff readjustment process of transmission contracts in the month of July. However, in the years 2021 and 2022, the accounting audit found differences in the amount that should have been accounted for as an annual adjustment due to the list of modules considered. These adjustments were released in 4Q22 of both years. Thus, as the reduction in 4Q22 was more relevant than that of 4Q21, the impact on construction revenue was negative. (reduction of R$ 40.6 million in 4Q22 x reduction of R$ 14.2 million in 4Q21); (ii) Increase of R$0.4 million, due to higher construction revenue (R$65.3 million in 4Q22 x R$64.9 million in 4Q21), with emphasis on: (a) increase of R$ 11.6 million in revenue from the construction of contracts 058/2001 (R$ 7.8 million) and 010/2009 (R$ 2.6 million); and (b) reduction of R$11.2 million in revenue from contracts 001/2009 (R$8.3 million) and 007/2008 (R$2.9 million); (ii) Increase of R$0.4 million due to higher construction revenue (R$65.3 million in 4Q22 x R$64.9 million in 4Q21) mainly due to: (a) Increase of R$11, 6 million in construction revenue, with emphasis on contracts 058/2001 (R$ 7.8 million) and 010/2009 (R$ 2.6 million); (b) Reduction of R$ 11.2 million in revenue from contracts 001/2009 (R$ 8.3 million) and 007/2008 (R$ 2.9 million).
 

Marketletter 4Q22

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

 

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Partially compensated by:

·In Furnas (+R$89 million): (i) increase in the value of construction revenue for CT 062-RBNI, which in 4Q22 was R$206.64 million and in 4Q21 totaled R$120.89 million. (ii) In the other contracts, the value in 4Q22 was R$ 4.48 million and in 4Q21 it was R$ 1.29 million, both adjusted to an average construction margin of 1.006%.

CONTRACTUAL REVENUE – TRANSMISSION

·The reduction is mainly due to lower inflation rates (IPCA) in the period, which ended up offsetting the effects of the increase in contractual assets between 2021 (BRL 59.5 billion) and 2022 (BRL 61 billion). The variation presented in the companies was: Furnas (-R$628 million); Chesf (-R$367 million); Eletronorte (-R$270 million); CGT Eletrosul (-R$114 million). This effect is only due to the application of IFRS rules and is different from regualatory revenue, which had the adjustment according tho (ReH nº 3.067/22), in July 2022.

VARIATION ANALYSIS 2022X2021

·Revenues from the Transmission segment decreased by 10% (-R$ 1,675 million) in 2022, compared to the same period of the previous year, mainly influenced by: (i) reduction of 21% (2,046 million) in Transmission Contractual Revenue (Financial Revenue), due to changes in the IPCA and IGPM indexes between the periods (IPCA of 5.9% and 2022 and 10.74% in 2021), which are used in the monetary restatement of the balances of contractual assets and impact the value of the financial income of the Contracts.; (ii) decrease of 3% (-R$42 million) in construction revenues. These effects were partially offset by: (iii) the 7% increase (+R$408 million) in revenue from operation and maintenance of transmission lines, due to the entry into operation of new projects and due to the Tariff Review process, based on in the current regulation (REH nº. 3.067/22), which in its annexes details the readjustments of the RAPs (Permitted Annual Revenue) of Transmitters. Emphasis on the effect of the reprofiling of the financial component of the RBSE, which reduces the portion of amortization that reduces revenue and applied the Ke, having a relevant impact on the remeasurement of the contractual asset.
TABLE 06: OTHER OPERATING REVENUE
Operating Income 4Q22 4Q21 % 2022 2021 %
Others Revenues 366 375 -2% 1,102 925 19%
Non-recurring events            
Revenue reversal energy interconnection among Brazil and Uruguay 0 0 100% 0 8 100%
Other recurring income 366 375 -2% 1,102 933 18%

 

 

 

 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

OTHERS REVENUES

VARIATION ANALYSIS 4Q21 X 4Q22

·In Furnas (-R$23 million): (i) reduction in revenue from operation, communication and teleassistance services provided by FURNAS to Mata de Santa Geneva (R$ -11 million); (ii) Accounting of R$ 79.5 million in Actuarial Gains in 4Q21 x R$ 76.6 million in 4Q22 (causing a variation of R$ -2.9 million) and (iii) Sale of Furnas payroll to Banco Bradesco, for a period of over 5 years, which took place in 4Q21 (R$ -10.7 million).
·In the Holding (-R$20 million): negative variation in revenues from Procel (-R$23 million) and Cigas (R$0 in 4Q21 and a reversal of R$35 million in 4Q22), partially offset by revenue of R$32 million from of permit withdrawals (judicial deposit) regularized in 4Q22 considering the reconciliation work of judicial deposits.
·At Chesf (+R$21 million): (i) R$14 million increase in revenues from telecommunications services; (ii) R$5 million increase in revenues from operation and maintenance services; (iii) R$1 million increase in revenue from engineering services.

OPERATING COSTS AND EXPENSES

Table 07: OPERATIONAL COSTS AND EXPENSES
Operational costs 4Q22 4Q21 % 2022 2021 %
Energy purchased for resale -976 -1,348 -28% -3,118 6 -52657%
Charges on use of the electricity grid -764 -611 25% -2,746 -2,276 21%
Fuel for production electric power -544 -353 54% -2,086 -1,890 10%
Construction -744 -626 19% -1,679 -1,395 20%
Personnel, Material, Services and Others -4,044 -2,430 66% -10,028 -7,782 29%
Depreciation and amortization -880 -521 69% -2,690 -1,443 86%
Operating Provisions -1,135 -3,548 -68% -6,928 -14,922 -54%
Total Operating Costs and Expenses -9,086 -9,437 -4% -29,275 -29,702 -1%
Non-recurring events            
    Non-recurring PMSO events 1,395 151 822% 1,753 585 200%
    Non-recurring provisions 1,446 3,140 -54% 6,181 14,067 -56%
    Generation Construction 0 44 -100% 7 82 -91%
 Extemporaneous adjustments of AGT's PIS/COFINS calculation 0 -515 -100% 0 -515 -100%
 Renegotiation of the Hydrological Risk, resulting from Resolution No. 2,932/21 0 0 - 0 -4,266 -100%
Record of expenses with GSF for adherence to the hydrological risk renegotiation 0 0 - 0 378 -100%
SAESA: Reversal of the TUST provision as a result of the administrative dispute winning. 56 0 - 51 0 -
Reclassification Candiota oil value of the material account 0 0 - -5 0 -
Reclassification of tax credits (PIS/COFINS) from undue entries 0 111 -100% 0 0 -
Adjusted Total Operating Costs and Expenses -6,189 -6,506 -5% -21,288 -19,371 10%
 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

VARIATION ANALYSIS 4Q22 X 4Q21

ENERGY PURCHASED FOR RESALE

·In the holding company (-R$854 million): improvement of the country's hydrological conditions, significantly reducing the need to import electricity from the Oriental Republic of Uruguay, accompanying the above-reported decline in CEEE revenue (-R$964 million).
·At Chesf (-R$51 million): Reduction of around 99 average Mw in electricity purchased for resale in 4Q22, compared to 4Q21. due to better hydrological conditions in 4Q22.

Partially compensated by:

·In Furnas (+R$419 million): (i) consolidation of Saesa, with a total addition of R$291 million in 4Q22, without comparison in 4Q21, highlighting: (a) registration of purchased energy of (R$257, 9 million), due to purchases of electricity for resale under bilateral contracts, and (b) result of the liquidation of CCEE (R$ 33.5 million); (ii) Price readjustment of the current contracts for the purchase of Furnas, representing an expense increase of approximately R$36 million; ; (iii) higher volume of purchases made in 2022 (1,820 GWh vs 1,331 GWh) of R$133 million due, in part, to the carrying out of energy purchase operations not linked to Furnas' generation portfolio. These purchase operations, which totaled approximately R$ 110 million, are directly associated with the sale of energy in the same amount, and do not aim to offset GSF as with traditional purchases; (iii) R$23 million related to energy purchase operations carried out in 2021, to mitigate the hydrological risk projected at the time, for the year 2022; (iii) increase in PIS/COFINS items, in the amount of R$15.6 million.
·At Eletronorte (+R$94 million): (i) +R$26 million referring to the contractual readjustment of the PIE's based on the IGP-M, which has a counterpart in revenue, due to being pass-through; (ii) +R$ 5 million in the purchase of energy in the ACL to replenish ballast in the Southeast submarket; (iii) +R$ 64.7 million, due to the adjustment in the SPOT market liquidation estimates registered lower in the period.
·At CGT Eletrosul (+R$26 million): (i) increase of 8.5% in the average acquisition price, according to contractual rules, due to the impact of inflation (IPCA), raising the cost by R$15.6 million; (ii) an increase of 14 MWm in the quantity purchased (from 372 MWm in 4Q21 to 386 MWm in 4Q22), causing an increase of R$ 7.5 million in cost; (iii) increase in energy purchased through the MCP, impacting a cost increase of R$3.1 million. These effects were partially offset by (iv) the variation in PIS/COFINS credits between the periods, resulting in a reduction of R$0.8 million in the purchase cost.

FUEL FOR ELECTRIC POWER PRODUCTION

·At Eletronorte (+R$553 million): (A) Fuel Costs: (i) R$515.2 million related to the adjustment of the extemporaneous credit entry of AmGT's PIS/COFINS calculation in 4Q21, with no counterpart in 4Q22, relating to the years 2015 to 2020. The adjustment was made on a net basis between calculated credits and liabilities of the same nature, non-recurring entry; (ii) R$125.4 million referring to ancillary expenses for natural gas (Ship or Pay for Transport and Margin) given that there was an increase due to the readjustment of the price of natural gas for the period, as well as the increase in the volume of natural gas which is no longer consumed due to the -17.12% reduction in natural gas consumption at the UTEs. Thus, the natural gas that was no longer consumed for the production of electricity generated an overpayment obligation of Ship or Pay. We emphasize that this expense is not affected by the ICMS reduction, given that it is not characterized as a circulation of goods, but as a contractual financial obligation. On the other hand, reduction of: (iii) R$ 91 million referring to expenses incurred with the purchase of Fuel for the production of electricity (Natural Gas) in 4Q22, which were lower than expenses in 4Q21 by -16.03% mainly due to the reduction of -24.22% in energy generation at the UTE that consume natural gas imposed by the ONS as a result of the increase in the reservoirs of the Hydroelectric Power Plants – UHE of the Submarket of the North Region, causing the dispatches of the UHE of the North Subsystem to be prioritized in comparison with thermal plants that have inflexibility in their contracts and use fuel in their operation. We also highlight that in 4Q22 the reduction of ICMS in the total cost of natural gas was also perceived in compliance with State Decree No. based on the IPCA variation in the last twelve months) showed an increase of only 0.93% in the average price of natural gas, given the reducing effect on the price as a result of the ICMS exemption. (iv) R$39 million referring to the reversal of ICMS on sales of energy produced by UTE Mauá 3, due to the consumption of natural gas. The reversal occurs because the sale is outside the state of AM and is exempt from ICMS; (B) Recovery of expenses - Subsidy received: (i) revenue from the CCC in 4Q22, which had an increase of 25.94% when compared to 4Q21, due to the readjustment of the price of natural gas for the period, in addition, in 2021 the reimbursement for the month of November of natural gas was only effected in the month of January 2022.
 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

Partially compensated by:

·In Furnas (+R$277 million): (i) lower dispatch from the Santa Cruz plant, of 667 GMh in 4Q21 and 43 GWh in 4Q22. This dispatch of 43 occurred due to the combined cycle tests and not due to the need to dispatch given that we are in a hydrologically favorable period.

NETWORK USE CHARGES

·Readjustment of network usage charges, according to Ratifying Resolution 3066-ANEEL of 06/12/2022 of 15%.
·Furnas (+R$206 million), highlighting the consolidation of Saesa which had a variation of R$192 million, with the composition of 4Q22 of (R$212 million) referring to TUST and PIS and COFINS credits in the amount of (R$ 20 million).

Partially compensated by:

·Eletronorte (-R$44 million): (i) - R$77 million, due to the reclassification of COFINS and PASEP credits, which in 4Q21 were allocated to the third-party services account; offset by (ii) an increase of R$33.1 million related to the annual readjustment.

CONSTRUCTION

·Furnas (+R$36 million): (i) the amount is based on changes in transmission contract investments in the period. of which 4.45 million in 4Q22 and R$ 1.28 million in 4Q21. In CT 062-RBNI, the value in 4Q22 was R$ -197 million and in 4Q21 it was R$ -120.43 million; (ii) With Law 14,182/21, the treatment for shareholder plants was changed and, as of June/22, there will no longer be accounting of the financial asset generation in construction expenses (-R$ 44 million), without effect on income, due to the counterpart in construction revenue.

VARIATION ANALYSIS 2022X2021

The cost of energy purchased for resale increased by R$3,124 million in 2022, compared to the same period of the previous year, mainly influenced by the increase in the cost of energy purchased for resale, due to the registration, in 2021, of credit of around BRL 4,266 million, as a reduction in the expense of energy purchased for resale, as a result of the hydrological risk renegotiation, regulated by Aneel Resolutions 2,932/21 and 2,919/2021, which ratified the extension period of hydroelectric plants generating a credit in in favor of the generators, and by recording the expense with GSF for joining the renegotiation of the hydrological risk, in the amount of -R$378 million, making a net credit impact of R$3,888 million, which appeared as a reduction of this expense account, an event that did not occur in 2022.

 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

The Fuel account increased by 10% year-over-year, from R$1,890 million in 2021 to R$2,086 million in 2022, mainly due to the adjustment to the extemporaneous credit entry of the PIS/COFINS calculation of Amazonas Energia, which occurred in 4Q21, and ancillary natural gas expenses (Transport Ship or Pay and Margin), due to the effect of the natural gas price readjustment. These effects were partially offset by the generation difference between the periods at UTE Santa Cruz (generation dispatches to the Santa Cruz plant in 2022 amounted to 659 GWh and in the same period of 2021 were 1,745 GWh) and the ICMS reversal of R$ 124.1 million on sales of energy produced by UTE Mauá 3, due to the consumption of natural gas. The reversal occurs because the sale is outside the state of AM and is exempt from ICMS.

Charges on the use of the electricity grid increased by 21% (R$470 million) in 2022, compared to the same period of the previous year, mainly influenced by the readjustment of the TUST, according to Ratifying Resolution 3,066-ANEEL of 06/12 /2022 of 15%.

TABLE 08: PERSONNEL, MATERIAL, SERVICES AND OTHER
Personnel, Material, Services and Others 4Q22 4Q21 % 2022 2021 %
Personnel -1,341 -1,369 -2% -4,634 -4,340 6,8%
  -1,260 0 - -1,260 0 -
Material -92 -95 -3% -269 -248 9%
Services -788 -499 58% -2,065 -1,542 34%
Others -562 -466 21% -1,800 -1,652 9%
    PMSO total -4,044 -2,430 66% -10,028 -7,782 29%
Non-Recurring Items            
Incentive Plans (PAE, PDC) 1,260 0 0% 1,260 0 0%
Termination costs 0 1 0% 1 81 1%
Indemnity Allowance Health Plan 0 16 0% 32 16 202%
Labor Claims 10 8 125% 48 76 63%
Historical Hour Bank Payment 25% / Retroactive ACT / Vacation Bonus 0 97 0% 0 71 0%
Coal transfer to Fuel account 0 0 - 0 -13 0%
PIS/COFINS credit - inputs from UTE Candiota III previous periods 0 0 - 5 -4 -144,2%
FEE Capitalization Consent 0 0 - 16 0 0%
Recovery of expenses (Commissions and Debentures) 0 0 - 0 -8 0%
Loss with CCC corresponding to Boa Vista inspection 0 0   0 58  
Income tax not paid on conviction paid in 2015 0 0 - 0 42 0%
IR arising from the Donation - AmGT Transfer 0 0 - 0 40 0%
Court costs and holding fees and Furnas 0 1 6% 15 48 31%
Less value SPE FOTE 0 -29 0% 0 -10 0%
Generator set rental (emergency to Amapá) 0 6 0% 0 63 0%
Reimbursement of Transmission Assets to Energisa 0 0 - 0 29 0%
Indemnities, losses and damages - Engevix, CIEN and AMPLA, IBDD, FRG, CONVAP, CMELPAR and CAEFE. 225 0 0% 360 45 800%
Transfer of energy trading activity from Itaipu to ENBPar 62 0 0% 199 0 0%
Record of losses arising from the termination of the lease of UTE Camaçari 0 51 100% 0 51  100%
 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

 

Reversal of provisions that occurred at the end of the construction of the Passo São João, São Domingos and Barra do Rio Chapéu HPPs 0 0 - -20 0 0%
SAESA - Capitalization of CCSA Costs - arbitration No. 21,511 -163 0 0% -163 0 0%
PMSO adjusted -2,650 -2,278 16% -8,275 -7,197 15%

 

SAESA IMPACT

 

Personnel, Material, Services and Others 4Q22 2022
Personnel -40 -65
Material -8 -16
Services -71 -127
Others 101 100
    PMSO total 18 -108

 

VARIATION ANALYSIS 4Q22 X 4Q21

PERSONNEL

·Non-recurring provision related to the Voluntary Dismissal Program, in the amount of R$1,260 million, related to the 2,494 employees who adhered to the Plan. Around 160 employees already left the company in 4Q22. The amounts referring to the departure of the 821 employees who left the company in 4Q22 were already recorded as an expense in Dec/22 (R$ -373.9 million) in the Incentive Indemnity accounts, under the PDC heading. The difference of R$ 886.5 million refers to the provision for the remaining number (1,673 employees) and will be written off as an expense, according to the schedule of future departures.
·Collective Bargaining Agreement – ACT22/23, which had an increase of 12.13% (IPCA), with an estimated impact of R$178 million in the quarter. It is important to note that, at Chesf, the account variation is reflecting the readjustment of collective bargaining agreements - 2-year ACTs, since the 2021/22 ACT, which had a 6.76% readjustment, only took effect from January 2022 (retroactive to May 2021), and this impact, at Chesf, is added to that of ACT22/23. In addition, the 2022 salary progression is also highlighted, with effects on salaries, benefits, 13th salary, among others. Personnel growth, excluding POS expenses, was 4%, lower than the readjustment of the collective ACT.
·Consolidation of R$40 million from SAESA, as of 4Q22, which did not occur in 4Q21, in which SAESA was brought in through the equity account.
·Lower provision for Profit Sharing: highlight for Furnas (-R$ 76 million), Chesf (-R$ 47 million) CGT Eletrosul (-R$ 33 million).

Material

·At Eletronorte (-R$ 14 million): (i) reduction of R$ 16.3 million in direct acquisition operational maintenance material, mainly maintenance for the Turbines of UTE Aparecida (in Amazonas).

Partially compensated by:

·In Furnas (+R$10 million): (i) Saesa consolidation (+8 million).
 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

ServiCES

·In Furnas (+R$140 million): (i) Operational Maintenance Services in the amount of R$20 million; (ii) In MESA, R$ 70 million was recorded, related to maintenance and operation services of R$ 52 million and expenses with consulting, advisory and legal services of R$ 19 million.
·At Eletronorte (+R$140 million): (i) increase of R$108 million in group realization due to the reclassification of PIS/PASEP & COFINS credits. In 4Q22, R$69.7 million in credits from January to November 2022 were reclassified from this account to the transmission charges account. Thus, the realization of this account was -R$55 million in 4Q21 vs. R$53 million in 4Q22. (ii) an increase of R$6 million in maintenance of operational assets, mainly due to payments related to gas turbine maintenance; (iii) an increase of R$5.6 million in the subscription of digital tools, due to the payment for the Microsoft package; (iv) increase of R$5.6 million in expenses with financial system services, mainly due to the payment related to the Commission for Structuring the Guaranteed Gas Account, in December. Punctual payment, due to the change in the Guarantee with CIGAS for the supply of Natural Gas in the Thermoelectric Plants of Amazonas. (v) increase of R$ 3.9 million in contractors, mainly due to the write-off of amounts allocated in the asset account related to the various stages of the Luz para Todos and Mais Luz para a Amazônia programs that were not reimbursed.

OTHERS

·Holding (+R$132 million): (i) variation of R$62 million, due to adjustments resulting from the process of securing the Itaipu Account, for transfer to Enbpar, after the privatization process; (ii) reduce of R$83 million related to the recovery of expenses.
·Furnas (+R$ 37 million): (i) consolidation of SAESA, with an impact on the recovery of expenses of R$101 in 4Q22, without comparison in 4Q21, due to the reversal of R$163 million due to the capitalization costs of arbitration of CCSA- Consórcio Construtor Santo Antônio Energia, partially offset by the expense with the deactivation of Fixed Assets (lines of the Log Boom) of R$ 58 million, in 4Q22; (b) Real Grandeza Fund (R$ - 22.2 million), related to the retirement supplement - mathematical reserve, being written off (contingency reversal), for the same amount, in the operating provisions account; and (c) Fine - Procedural/Administrative, in the amount of R$ -16 .87 million (ANEEL Notice of Infraction nº 17/22), due to non-conformities found in inspection carried out at SE Adrianópolis facilities); partially offset by: (d) Actuarial Losses, reduction of R$ 69 million (4Q21 R$ -98 million x 4Q22 R$ -30 million); (e) reduction in Bank Guarantee, in the amount of R$32.3 million due to the lower expectation, in 2022, of the need to present a judicial guarantee for ongoing proceedings.

Partially compensated by:

·At Eletronorte (-R$ 55 million): with emphasis on (i) effect of - R$ 120.6 million in write-off of assets, in 2021, with no contra entry in 2022, partially offset by: (ii) + R$ 24.9 million in losses on the deactivation of assets and rights, referring to the write-off of telecommunications projects that were in property, plant and equipment in progress and were discontinued or had no forecast for entry into operation; (iii) + R$12.6 million in loss on write-off of receivables, referring to the write-off of accounts receivable in 2020 in O&M service provision agreements; (iii) + R$ 18.6 million of accumulated depreciation (from July/21 to October/22) of assets that were incorporated into AmGT.
·At Chesf (-R$24 million): (i) R$23 million increase in expenses with retiree benefits, due to the increase in the cost of interest on the BD benefit plan; (ii) an increase of R$8 million in environmental lawsuits; (iii) R$5 million increase in insurance; on the other hand, we had (iv) record of losses related to the termination of the lease of UTE Camaçari in the amount of R$ 51 million, with no counterpart in 2022; (v) registration of leniency revenue (Camargo Correa) in the amount of R$8 million.
 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  
Other Costs and Expenses 4Q22 4Q21
Other expenses    
Indemnities Losses and Damages -233 0
Operating Losses -144 0
Gain (loss) on the sale of assets and rights - MESA -58 0
Actuarial Losses -30 -98
Capitalization of CCSA costs 163 0
Other expenses -156 -282
1. OTHER EXPENSES -458 -380
2. OTHER COSTS -40 -36
3. DONATIONS AND CONTRIBUTIONS -65 -50
TOTAL OTHERS (1+2+3) -562 -466

VARIATION ANALYSIS 2022X2021

·The variation in the personnel account is mainly due to the readjustment of 12.13% (IPCA), application of additional for length of service (ATS) and the consolidation of SAESA, as of 3Q22, adding expenses of R$ 65 million/year for the consolidated. In addition, in 2022, there was a Provision related to the Voluntary Dismissal Program, in the amount of R$1,260 million, related to the 2,494 employees who adhered to the Plan. The material account did not show relevant variation. The Service Account increased, especially in Furnas, with an increase of R$287 million, R$127 million of which due to the consolidation of SAESA as of 2Q22. In addition, in Furnas, there were increases in: (i) Medical, Hospital and Dental Care of R$ 35.7 million; (ii) Technical Service and IT Software in R$40.6 million; (iii) Expenses of R$ 13.6 million with advisory services to obtain a waiver for the contribution to SAESA, in June/22. At Eletronorte, there was an increase of R$145 million in the service account, with highlights for: (i) maintenance of operating assets, of R$24 million; (ii) maintenance of office equipment and services, of R$15.8 million; (iii) driver services, of R$11.3 million; (iv) environmental services, of R$9.4 million; (v) third-party services provided by contractors, in the amount of R$7 million; (vi) technical service IT - Software, of R$6.8 million; (vii) third-party service - security and surveillance, of R$6.7 million; (viii) expenses with financial system services, of R$6.1 million; (ix) miscellaneous services totaling R$13.6 million. In “others”, there was an increase of around 9% (R$148 million), with emphasis on: (i) Indemnities, losses and damages, in subsidiary Furnas, in Ampla processes (R$138 million) + IBDD (R$63 million), CONVAP (R$89 million); (ii) At Chesf, R$86 million increase in pensioner benefit expenses, due to the increase in the interest cost of the BD benefit plan and the increase in write-offs for the conversion of guarantees for legal claims (R$40 million). Partially offset by: (iii) write-off of assets in 2021, with no counterpart in 2022, of R$121 million, at Eletronorte.

DEPRECIATION AND AMORTIZATION

Table 09: Depreciation and Amortization
Depreciation and Amortization 4Q22 4Q21 % 2022 2021 %
    Depreciation and Amortization -880 -521 69% -2,690 -1,443 86%
Non-recurring items - Adjustments            
Depreciation referring to previous periods 0 0 - 0 73 -100%
Adjusted Depreciation and Amortization -880 -521 69% -2,690 -1,370 96%

 

 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  
·The increase in amortization expenses in 4Q22 is due to (i) the new concession assets resulting from the privatization of Eletrobras (Sobradinho, Tucuruí, Curuá-Una, Itumbiara and Mascarenhas de Moraes), by approximately R$267 million. The amortization of new contracts arising from the plants that will be released from shares will only start in 2023, in a non-linear way, according to the release of shares; (ii) consolidation of Saesa, with an impact of R$264 million, without comparison with 4Q21.

OPERATING PROVISIONS

Table 10: OPERATING PROVISIONS

Operating Provisions 4Q22 4Q21 % 2022 2021 %
    Operational provisions / reversals -1,135 -3,548 -68% -6,928 -14,922 -54%
             
Non-recurring provisions/reversals            
Provision for Disputes 379 -1,569 -124% -1,858 -13,081 -86%
PECLD - Financing and loans -2,528 -625 304% -3,348 -639 424%
PECLD - Fuel consumption account 0 29 -100% 0 -499 -100%
PECLD: Prospective credit loss estimate (CPC 48) ELN + RPCs Chesf 0 0   -867 908  
Onerous contracts -14 39 -136% 230 16 1316%
Estimated losses on investments 918 91 912% 92 -21 -545%
RAP adjustment portion 0 0 - 0 0 -
Estimated loss due to impairment of assets (Impairment) -110 21 -624% -268 475 -156%
Provision for Implementation of Shares - Compulsory Loan -31 -15 108% -102 -108 -5%
Provision for judicial deposits 0 -234 -100% 0 -234 -100%
Provision for reduction of fuel inventories -26 -126 -80% -26 -126 -80%
Provision for unsecured liabilities 0 -706 -100% 0 -706 -100%
Candiota III Plant - Inflexibility 0 -10 -100% 0 -10 -100%
Candiota III Plant - Coal 0 9 -100% 0 0 -
Provision for actuarial liabilities -35 -44 -19% -35 -44 -19%
             
Recurring Provisions/Reversals            
Guarantees 214 2 12883% 189 26 626%
PCLD (excluding PCLD Prospective Estimate of Prospective Credit Loss (CPC 48) and losses of clients-Chesf -7 -340 -98% -808 -798 1%
GAG Improvement 118 21 456% -9 -29 -69%
Others -14 -91 -85% -119 -54 121%
Recurring provisions / reversals 312 -408 -176% -747 -855 -13%

The positive values in the table above mean reversal of provision.

VARIATION ANALYSIS 4Q21 X 4Q22

The variation is mainly explained by:

·Increase of R$1,902 million in PECLD (provisions for loan losses) for Loans and Financing, which went from R$625 million in 4Q21 to R$2,528 million in 2022, with emphasis on the constitution of a provision for receivables from Amazonas Energia, which aims to reflect the risk observed due to the maintenance of the default of debt acknowledgment instruments (ICD), for more details, see explanatory note 40.1 of the financial statements.
·Provision for Litigation showed a reversal of R$379 million in 4Q22, compared to a provision of R$1,569 million in 4Q21, mainly due to the reversal, in the Holding, of Compulsory Loan provisions. The reduction in the operating provision for the compulsory loan, in the total amount of R$517 million, mainly influenced by discounts of R$563 million obtained in court agreements that were signed in 4Q22. The stock of provision for legal proceedings that discuss the difference in monetary restatement of book-entry credits (2nd phase), in 4Q22, was R$24.3 billion against R$25.8 billion in 3Q22, a reduction, therefore, of R$1.5 billion, influenced by the discounts mentioned above, for the payments of agreements that have already had their respective judicial homologation and the final and unappealable decision, in the total amount of R$ 737 million, as well as for the increase in monetary restatement, which was R$ 1,620 million (as will be explained in the financial result line), in the year 2022.
 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  
·The provision for Guarantees presented a reversal of R$214 million in 4Q22 due to the change in the methodology for calculating the provision.
·Estimated Losses on Investments showed a reversal of R$918 million in 4Q22, compared to a reversal of R$91 million in 4Q21, mainly explained by: (i) constitution in Teles Pires of R$468 million (vs the fact that that the gain from the transfer of the Dardanelos plant will be accounted for upon completion of the operation); and (ii) constitution of a provision of R$68 million in LT Mata de Santa Geneva. On the other hand, there were reversals in: Companhia Energética Sinop S.A. – R$215 million in SINOP, R$309 million in Jirau, R$218 million in Interligação Elétrica do Madeira S.A. - IE Madeira.

 

HIGHLIGHT OPERATING PROVISIONS: LOSSES ON INVESTMENTS

SPE/ Affiliate 4Q22
MESA 546
SINOP 215
Teles Pires -468
São Manuel 178
IE Madeira 218
Mata de Sta Genebra -68
ESBR (Jirau) 309
Others -12
Total 918

 

VARIATION ANALYSIS 2022X2021

·The Operating Provisions account showed a 52% reduction, which is mainly explained by the variation in the provision for litigation account, which went from R$13,081 million in 2022 to R$1,858 million in 2021. The Provision for Litigation was impacted, mainly due to the records related to the compulsory loan, which amounted to R$133 million in 2022 and R$10,897 million in 2021 (due to the review of legal theses and precedents that took place in 3Q21). The reduction in the operating provision for the compulsory loan was mainly influenced by discounts of R$563 million obtained in court agreements that were signed in 4Q22.

 

·On the other hand, there was an increase of R$2,709 million in provisions for doubtful accounts of financing and loans, which increased from R$639 million in 2021 to R$3,348 million in 2022, with emphasis on the provision for loan receivable balances with to Amazonas Energia (See Note 10 of the Explanatory Notes). There was also constitution of PECLD on consumers and resellers, in the year ended December 31, 2022, in the amount of R$1,674 million, which is mainly due to the provision of 100% of the Debt Confession Instruments of Amazonas Energia entered into with Eletronorte . (See note 09 of the Explanatory Notes).

 

REGULATORY REVIEWS - TRANSMISSION CONTRACTS

 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

 

  4Q22 4Q21 % 2022 2021 %
Regulatory Remeasurements - Transmission Agreements 3 0 - 365 4,859 -92%

 

·In the fourth quarter of 2021, the recording under this heading resulted from the remeasurement of the RBSE asset, resulting from the reprofiling of the financial component and the additional recognition of the cost of equity (KE). (ii) In the fourth quarter of 2022, the impact resulted from the Periodic Tariff Review - RTP ANEEL for the RAPs of concession contracts 014/2011 and 016/2011.

 

SHAREHOLDINGS

 

Table 12: Shareholdings
Shareholdings 4Q22 4Q21 % 2022 2021 %
Shareholdings 702 57 1135% 2,370 1,507 57%
Non-recurring items - Adjustments            
             
Santo Antonio 0 697 -100% 0 697 -100%
Adjusted Shareholdings 702 754 -7% 2,370 2,204 8%

 

VARIATION ANALYSIS 4Q22X4Q21

SHAREHOLDINGS

·Among the main variations in the equity interest account are: (i) Madeira Energia, which presented a negative amount of R$490 million in 4Q21 and started to be consolidated from 4Q22, no longer impacting this account; (ii) CTEEP (-R$113 million), due to lower remuneration on concession assets; and (iii) Eletronuclear, which ceased to be consolidated as of 3Q22, and impacted this account by R$71 in 4Q22, with no counterpart, therefore, in 4Q21.

VARIATION ANALYSIS 2022X2021

·The shareholding account showed an increase of R$862 million, or 57%. This account is impacted by the result of all minority interests held by Eletrobras and, among these variations, the main one was the Recognition, in 2021, of the write-off of investment – Arbitration in Saesa, in the amount of R$697 million. Also noteworthy are the negative variations in CTEEP (R$269 million) and NESA – Norte Energia S.A (R$107 million) and positive variations in the SPEs ESBR R$36 million and IE Guaranhus R$31 million.

FINANCIAL RESULT

Table 13: FINANCIAL INCOME AND EXPENSES

Financial Result 4Q22 4Q21 % 2022 2021 %
Financial Income            
Interest, commission and fee income 288 33 765% 997 756 32%
Income from financial investments 638 241 165% 2,212 620 257%
Moratorium addition on electricity -144 120 -220% 253 326 -22%
Interest income on dividends -57 -209 -73% 11 0 -
Other financial income 244 38 543% 567 320 77%
(-) Taxes on financial income -341 -185 85% -612 -416 47%
Financial expenses            
Debt charges(1) -1,542 -443 248% -4,705 -2,777 69%
Other financial expenses -56 -104 -47% -805 -577 40%
Financial items net            
Monetary Variations -349 -139 151% -1,098 -35 3080%
Exchange Variations 215 -125 -272% 447 -385 -216%
Derivatives 220 41 433% -356 726 -149%
Charges of obligations with CDE -655 0 - -1,097 0 -
Charges for revitalizing watersheds -139 0 - -187 0 -
Financial Result -1,678 -732 129% -4,374 -1,442 203%
Adjustments            
(-) Revenue from Distribution Companies + AIC -244 -121 102% -839 -357 135%
(-) Bonus Award + FIDC Commission 0 0 - 0 0 -
(-)Regularization of credits tax process / Fine and Notices of Infraction 0 0 - 0 82 -100%
(-) RPCs Chesf 0 0 - 0 118 -100%
(-) Monet update, company compulsory 286 286 0% 1,621 699 132%
(-) Monetary restatement of the addition of 14 months of economic and energy inefficiency 0 0 - 0 -151 -100%

(-) Chesf: update of lawsuits due to

from Benner's go live

0 0 - 0 -231 -100%
(-) Financial expense corresponding to the exchange of the fee Selic by IPCA according to CNPE Resolution No, 15/2021 0 0 - 0 432 -100%
(-)Interest and exchange variation on ITAIPU Sale Transaction to ENBPar 0 0 - -242 0 -
(-)Reversal of Penalties for Unavailability - CCEAR - CGT Eletrosul 0 0 - -34 0 -
(-) Financial expense related to the write-off of the client to adjust the client's balance related to the renegotiation of the CEA, 0 26 -100% 0 26 -100%
(-) Financial Charges/correction of the differences between the prices practiced in the energy sale contracts and the new price agreed in the contractual amendments until October/22 -139 0 - 0 -5 -100%
(-) Write-off of unreconciled judicial deposits 132 0 - 132 0 -
(-) Tax installment payment indemnification of reversible assets UHE Tucuruí and UHE Curua-Uma 0 0 - 101 0 -
Adjusted Financial Result -1,643 -541 203% -3,634 -829 338%

(1) This item includes the updating of obligations with the CDE and Projects according to Law 14,182/21 and as detailed in the table below.

FINANCIAL RESULT:

VARIATION ANALYSIS 4Q22X4Q21

 

In 4Q22, the financial result presented a negative variation, having presented a negative result of R$732 million in 4Q21 and negative R$1,683 million in 4Q22. The main variations were:

·Debt Charges, from -R$443 million in 4Q21 to -R$1,542 million in 4Q22, with emphasis on the consolidation of Saesa, where there was a record of -R$436 million. Of this amount, around R$296 million is monetary restatement and debt interest restated by the IPCA and around R$137 million is debentures, also restated by the IPCA. In addition, 3 new loan contracts were raised, in Furnas, in 2Q22, with an impact of R$ 93 million more on the 4Q22 result. Consolidated accounts were also impacted by the increase in interest on loans indexed to the CDI, which increased from 13.65 in 4Q22 to 9.15 in 4Q21;
 

Marketletter 4Q22

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

 

22
 

Marketletter 4Q22

  
·Monetary restatement expenses of the provision for compulsory loan lawsuits (2nd phase – book-entry credits) of R$284 million in 4Q22, although there was no relevant variation in this expense, since the increase in the selic rate has already started to from 4Q21.
·Financial Expenses of IPCA + Charges on the outstanding balance of obligations with the CDE (charge of 7.6%) of R$746 million and obligations with the revitalization projects of the hydrographic basins and the Legal Amazon (charge of 5 .67%), of R$143 million in 4Q22, with no counterpart in 4Q21. These obligations were established by Law 14,182/21 (Eletrobras Privatization), as one of the conditions for obtaining new concession grants for electricity generation, for another 30 years. Charges were calculated based on data published in Resolution CNPE 015/2021: (i) present value of the obligation; (ii) the future flow of payments; and (iii) the payment term.
Charges with the CDE and Projects - Law 14.182/2021 4th Quarter 2022 – In million
Chesf Eletronorte Furnas TotaL
Debt charges - Obligations with the CDE (154) (224) (158) (536)
Debt charges - Revitalization of watersheds (25) (38) (32) (94)
Passive monetary restatement - Obligations with the CDE (60) (88) (62) (210)
Passive monetary update - Revitalization of watersheds (13) (19) (16) (49)
Total charges with the CDE and Projects - Law 14,182/2021 (252) (369) (268) (888)

 

Partially compensated by:

·The net exchange variation, which went from a negative net exchange variation of R$125 million in 4Q21 to a positive net exchange variation of R$215 million in 4Q22, mainly due to the debt exposure in dollar and dollar variation in the respective periods.
·At Eletronorte, a positive net result associated with derivatives in the amount of R$41 million, in 4Q21, against a positive net result of R$220 million in 4Q22, due to the variation of the LE - London Metal Exchange in the period. The contract with Albras provides for a price for the sale of energy plus the payment of a premium, which varies according to the price of aluminum on the LME, quoted in dollars.

VARIATION ANALYSIS 2022X2021

·The Net Financial Result went from a net expense of R$1,442 million in 2021 to a net expense of R$4,374 million in 2022, representing an increase of R$2,932 million. This variation is mainly due to: (i) the increase in debt charges, caused by the consolidation of SAESA, by the raising of new loan agreements that occurred during the year 2022; (ii) expenses with CDE Financial Charges and Revitalization Projects - Law 14,182/2021, which total R$1,505 million; and (iii) losses on derivatives, which went from a net income of R$726 million in 2021 to a net expense of R$356 million in 2022, influenced by the variation in the price of aluminum on the London Metal Exchange – LME, quoted in dollars, which is used as a reference for payment of the premium provided for in the contract with Albras; (iv) net monetary variations, which went from a net expense of R$35 million to a net expense of R$1,098 million referring to monetary restatement, especially by Selic, of the provision for compulsory loan lawsuits, which went from an expense from R$699 million in 2021 to R$1,621 million in 2022, given the variation in the update index between periods.
 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

OTHER INCOME AND EXPENSES

Other Income and Expenses 4Q22 4Q21 % 2022 2021 %
Reimbursement of Fixed Assets in Progress - AIC - - - 121 589 -79%
Gain from the Sale of CEEE-T1 Shares - - - 454 0 -
Reimbursement of inefficiency -CCC - - - 0 622 -
Effects of Law 14.182/20212 - - - -355 - -
Other Income and Expenses -87 439 -120% -33 - -
TOTAL OTHER INCOME AND EXPENSES -87 439 -120% 187 1.211 -85%

¹ Eletrobras sold its entire equity interest in CEEE-T to CPFL de Energia Cone Sul Ltda, in April 2022, see note 2.3.

² The residual values of the new concessions were written off against the result for the period due to the irrecoverability determined by the CNPE, for further details see note 1.1.5.

 

·The variation was mainly due to (i) expense arising from the write-off of judicial deposits due to reconciliation adjustments, in the amount of -R$ 507 million, partially offset by (ii) write-off of liabilities of R$ 97 million related to compulsory loan credits not converted into shares; (iii) R$21.6 million referring to the gain from the sale of the investment in the sale of CEEE-G shares, as part of the payment of the compulsory loan agreement; and (iv) entry of + R$ 266 million in write-off of CCC pass-through liabilities, pursuant to article 206, paragraph 5, I, of the Civil Code.

 

INCOME TAX

Income tax 4Q22 4Q21 % 2022 2021 %
Current income tax and social contribution 99 -25 -490% -1.630 -1.438 13%
Deferred income tax and social contribution 560 -154 -463% 934 -3.823 -124%
Total income tax and social contribution 659 -180 -467% -696 -5.261 -87%
Adjustment            
(-) Eletrosul Adjustments/Chesf PCLD/IR Estimate Furnas SAESA 0 -156 -100% -298 1.709 -117%
    Adjusted income tax and social contribution 659 -336 -296% -994 -3.552 -72%

 

DISCONTINUED OPERATIONS

  4Q22 4Q21 % 2022 2021 %
    Discontinued Operations 0 -39 -100% 987 -85 -1258%

 

As provided for in Law nº 14,182/2021, the capitalization of Eletrobras was conditioned to the corporate restructuring to maintain, directly or indirectly, the companies Eletronuclear and Itaipu Binacional, through the transfer of control to ENBpar. The effect on the result, as well as the comparison, were disclosed in 2Q22 in accordance with accounting pronouncement CPC 31/IFRS 5, to present the transactions of the segments mentioned above separately from the continuing operations. Thus, after the capitalization, Eletrobras' shareholding in the total capital of Eletronuclear increased from 99.95% to 67.95%, but Eletrobras does not hold the majority of common shares and no longer has control. In this sense, since 2Q22, Eletronuclear ceased to be a controlled company and became an affiliated company.

 

Marketletter 4Q22

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

 

24
 

Marketletter 4Q22

  

1.2 EBITDA Consolidated

Tabela 14: EBITDA DETAIL

     EBITDA 2022 2021 % 4Q22 4Q21 %
Result of the period 3,638 5,714 -36% -478,62 610 -178%
  + Income Tax and Social Contribution Provision 696 5,261 -87% -659 180 -467%
 + Financial Result 4,374 1,442 203% 1,678 732 129%
 + Depreciation and Amortization 2,690 1,443 86% 880 521 69%
 = EBITDA 11,398 13,860 -18% 1,420 2,043 -30%
ADJUSTMENTS            
Result of discontinued operation -987 85 -1257,8% 0 39 -100,0%
Other revenues and expenses -187 -1,211 -85% 87 -439 -120%
Regulatory remeasurement – transmission contracts -365 -4,859 -92% -3 0 -
 Renegotiation of the hydrological risk -resolution No. 2,932/21 0 -4,266 -100% 0 0 -
Record of GSF expenses for adhering to the hydrological risk renegotiation 0 378 -100% 0 0 -
SAESA: Reversal of the TUST provision as a result of the administrative dispute winning. 69 0 - 65 0 -
Reclassification Candiota oil value of the material account -5 0 - 0 0 -
Revenue reversal energy interconnection between Brazil and Uruguay 0 8 -100% 0 0 -
Reversal of Penalties for Unavailability - CCEAR -65 0 - 0 -277 -100%
Retroactive readjustment of the monthly energy transport tariff from Itaipu Binacional 0 0 - 0 -69 -100%
Reversal of penalty deductions 6 0 - 0 0 -
 Extemporaneous adjustments of AGT's PIS/COFINS calculation 0 -515 -100% 0 -515 -100%
 Reclassification of tax credits (PIS/COFINS) from undue entries 0 0 - 0 111 -100%
Incentive Plans (PARA, PCD) 1,260 0 - 1,260 0 -
Labor Claims 1 81 -99% 0 1 -100%
Indemnity Allowance Health Plan 32 16 102% 0 16 -100%
Reversal of provisions that occurred at the end of the construction of the Passo São João, São Domingos and Barra do Rio Chapéu HPPs -20 0 - 0 0 -
Labor claims 48 76 -37% 10 8 25%
Historical Hour Bank Payment 25% / Retroactive ACT / Vacation Bonus 0 71 -100% 0 97 -100%
Coal transfer to Fuel account 0 -13 -100% 0 0 -
PIS/COFINS credit - retroactive UTE Candiota III inputs 5 -4 -244% 0 0 -
FEE Capitalization Consent 16 0 - 0 0 -
Recovery of expenses (Commissions and Debentures) 0 -8 -100% 0 0 -
Loss with CCC corresponding to Boa Vista inspection 0 58 -100% 0 0 -
Indemnities, losses and damages: CAEFE (2022) Furnas 0 0 - 0 0 -
Income tax not paid on conviction paid in 2015 0 42 -100% 0 0 -
Income tax arising from the Donation - AmGT Transfer 0 40 -100% 0 0 -
Court costs and holding fees and Furnas 15 48 -69% 0 1 -94%
Transfer of energy trading activity from Itaipu to ENBPar 199 0 - 62 0 -
 Record of losses arising from the termination of the lease of UTE Camaçari 0 51 -100% 0 51 -100%
Less value SPE FOTE 0 -10 -100% 0 -29 -100%
Generator set rental (emergency to Amapá) 0 63 -100% 0 6 -100%
Reimbursement of Transmission Assets to Energisa 0 29 -100% 0 0 -
Indemnities, losses and damages - Engevix, CIEN and AMPLA, IBDD, FRG, CONVAP, CMELPAR and CAEFE. 360 45 700% 225 0 -
SAESA - Capitalization of CCSA Costs - arbitration No. 21,511 -163 0 - -163 0 -
SAESA Shareholding 0 697   0 697  
Provision for Disputes (a) 1,725 2,184 -21% 138 766 -82%
Compulsory Loan 133 10,897 -99% -517 803 -164%
PECLD - Financing and loans 3,348 639 424% 2,528 625 304%
PECLD - Fuel consumption account 0 499 -100% 0 -29 -100%
PECLD: Prospective credit loss estimate (CPC 48) ELN + RPCs Chesf 867 -908 -195% 0 0 -
Onerous contracts -230 -16 1316% 14 -39 -136%
Estimated losses on investments -92 21 -545% -918 -91 912%
Estimated loss due to irrecoverability of assets (Impairment) 268 -475 -156% 110 -21 -624%
Provision for Implementation of Shares - Compulsory Loan 102 108 -5% 31 15 108%
Provision for judicial deposits 0 234 -100% 0 234 -100%
Provision for reduction of fuel inventories 26 126 -80% 26 126 -80%
Provision for unsecured liabilities 0 706 -100% 0 706 -100%
Provision for actuarial liabilities 35 44 -19% 35 44 -19%
Candiota III Plant - Inflexibility 0 10 -100% 0 10 -100%
Candiota III Plant - Coal 0 0 - 0 -9 -100%
 = EBITDA Adjusted 17,798 18,829 -5% 4,410 4,881 -10%

Note: As of 2019, the Company began to consider, in its adjusted EBITDA, the RBSE revenue from the extended concessions in light of Law 12,783/2013, in order to maintain a protocol similar to the debenture covenants issued in 2019. 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 as non-adjusted the relevant effects of financial income, expenses, reversals of PL and provisions for prospective PCLD (CPC 48) of loans contracted with them before or as a result of the privatization process, although revenues and eventual provisions arising from loans contracted may continue to affect the company's accounting result until their complete exhaustion. However, they were treated as adjusted PCLD of outstanding effective debt of distributors, as well as their debts related to energy supply, with the exception, therefore, of prospective PCLD provisions (CPC 48) for energy supply.

 

Recurring Cash Generation with Adjustment of Regulatory Transmission RAP

 

  4Q22 4Q21
1. EBITDA Recurrent 4,401 4,881
     
Revenue from Transmission 3,632 5,080
O&M Revenue - renewed 1,614 1,671
Construction Revenue 459 471
Contractual Revenue Transmission 1,559 2,938
     
3. (+)Total Payment of Allowed Annual Revenue 3,908 3,025
Revenue of RAP and indemnities 3,908 3,025
     
4 = 1 - 2 + 3 : Approximate Cash Generation 4,677 2,826

* Disclosure of 4Q21 adjusted and disregarding Eletronuclear's impacts

 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

1.3       Consolidated Results by Continued Operations segment:

Table 15: FINANCIAL STATEMENT BY SEGMENT – R$ THOUSAND    

 

2022

Finacial Statement

by Segment

Administration Generation Transmission Eliminations Total
Net Operating Revenue 380 20,209 14,045 -559 34,074
Operating Costs -17 -11,157 -5,209 525 -15,858
Operating Expenses -4,644 -3,574 -5,234 34 -13,418
Regulatory Remeasurements - Transmission Contracts - - 365 - 365
Operating Income Before Financial Result -4,281 5,478 3,967 - 5,164
Financial Result         -4,374
Result of Equity Interests         2,370
Other income and expenses         187
Income tax and social contribution         -696
Net Income from Continuing Operations         2,652
Net Income from Discontinued Operations         987
Net Income         3,638

 

2021

Finacial Statement

by Segment

Administration Generation Transmission Eliminations Total
Net Operating Revenue 1.366 17.994 15.714 -448 34.627
Operating Costs -1.273 -5.715 -3.120 429 -9.678
Operating Expenses -13.164 -3.864 -3.015 19 -20.024
Regulatory Remeasurements - Transmission Contracts 0 0 4.859 0 4.859
Operating Income Before Financial Result -13.071 8.415 14.438 0 9.783
Financial Result         -1.442
Result of Equity Interests         1.507
Other income and expenses         1.211
Income tax and social contribution         -5.261
Net income from discontinued operations         -85
Net Income         5.714
 

Marketletter 4Q22

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

 

26
 

Marketletter 4Q22

  

 

1.3.1. INDEBTEDNESS AND RECEIVABLES

Table 16: GROSS DEBT AND NET DEBT  
  12/31/2022
Gross Debt - R$ million 59,107
(-) (Cash and cash equivalents + marketable securities) 22,933
(-) Financing Receivable 1,022
(-) Net balance of Itaipu Financial Assets1 389
Net debt 34,763

1See Explanatory Note 18b to the Financial Statements.

Highlight: Since 3ITR22, Eletrobras' debt has been substantially affected by the consolidation of SAESA's gross debt, in which Furnas now holds a 72% interest.

 

Marketletter 4Q22

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

 

27
 

Marketletter 4Q22

  

 

Creditor Indexer Cost (% per year) Total balance
(R$ million)
Debentures, FIDC and other securities CDI

CDI + 1.00% to 2.75% p.a.,

108% to 117.6% CDI

               12,054
Debentures and other securities IPCA IPCA + 3.75% to 7.03% p.a.                10,206
BNDES TJLP, TLP (IPCA),
fixed rate

TJLP + 0.00% to 3.28% p.a.,

TLP + 3.90% p.a., 3.50% p.a.

                8,111
Banco do Brasil TJLP, TLP (IPCA), CDI TJLP + 2.13% p.a., CDI + 1.65% to 2.25% p.a., 107.5% to 125.5% CDI, TLP + 4.7% p.a.                 4,517
Petrobras / Vibra Energia Selic Selic                 4,329
Caixa Econômica Federal CDI, TLP (IPCA)

113.7% CDI,

TLP + 4.7% p.a.

                2,639
Banco do Nordeste do Brasil IPCA, TLP (IPCA),
TFC (IPCA), fixed rate
IPCA + 2.74% p.a., TLP + 4.70% p.a., 2.94% to 8.62% p.a., TFC + 2.7382% to 3.3467% p.a.                 1,695
Other Creditors CDI, TLP (IPCA), TJLP + 5,00% a.a., fixed rate TLP + 4.70% p.a., CDI + 1.60% to 2.62% p.a., 122.84% CDI, 2.94% to 8.5% p.a.                 8,014
Foreign Currency - Bonds and other debts USD 2.41% to 4.63% p.a.                 7,307
Foreign Currency - other debts EUR 2.00% to 4.50% p.a.                    234
TOTAL                  59.107

 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

 

Total Consolidated Gross Debt without RGR with Debentures – R$ billion

 

 

Gross Parent Debt without RGR – R$ billion   
  2023 2024 2025 2026 2027 After 2027 Total (R$ billion)
Annual Amortization with Debentures (without RGR) 3.7 10.2 3.0 2.5 0.3 6.2 25.9

 

  2023 2024 2025 2026 2027 2028 After 2028 TOTAL
Asset (US$ million) 80.89 9.87 0.00 0.00 0.00 0.00 0.00 90.76
Liabilities (US$ million) 51.96 19.35 519.35 19.35 19.35 17.83 798.23 1.445.43
Foreign Exchange Exposure 28.93 -9.48 -519.35 -19.35 -19.35 -17.83 -798.23 -1.354.67

Due to the atypical scenario and potentially unpredictable characteristics, it is not possible to accurately predict the scenarios that may materialize in the coming months in the company's operations.

*On the balance of the 2030 and 2025 Bonuses, there is an accounting effect on the deferral of expenses with the repurchase of the 2021 bonus due to the operation carried out in February.

 

Marketletter 4Q22

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

 

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Marketletter 4Q22

  

Ratings

Table 18: Ratings
Agency National Classification / Perspective Last Report
Moody’s Escala Global “Ba2”: / Estável 07/15/2022
Moody’s SACP “Ba2”: / Estável 07/15/2022
Fitch - Issuer Default Ratings (Foreign Currency) “BB-”: / Estável 06/15/2022
Fitch - Issuer Default Ratings (Local Currency) AA(bra) / Estável 06/15/2022
Fitch - SACP “bb-” 06/15/2022
S&P (Foreign Currency) BB-/Estável 06/15/2022
S&P SACP bb- 06/15/2022
S&P Escala Nacional (Local Currency) brAAA/brA-1+ Estável 06/15/2022

*CreditWatch

FINANCING AND LOANS GRANTED (RECEIVABLES)

 

Total Consolidated Loans and Financing Receivables – R$ billion

 

 

Does not include: receivable from Itaipu's financial assets of R$ 389 million and allowance for loan losses of R$ 3,989 million and current charges.

Company and Financing receivable Parent company - R$ billion

 

Receivables Projection 2023 2024 2025 2026 2027 2028 after 2028 TOTAL
Parent Company                           1,6                         1,2                            0,9                              0,7                              0,5                               0,5                             3,4 8,8

Does not include charges and PCLD.

 

In the process of privatization of distributors, CCC credits were assigned, which depended on Aneel's analysis and inspection. These credits are recorded in the Company's Financial Statements, in two accounts, namely Right of Reimbursement and Financing receivable, as per Notes 9 and 14 of 4Q22.

 

 

Marketletter 4Q22

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

 

30
 

Marketletter 4Q22

  

 

RBSE

In June 2022, SGT/ANEEL published Technical Note No. 085/2022, which revisited the requests for reconsideration filed in connection with the payment of the financial component and reprofiling of the RBSE. The production of effects of this Technical Note depends on adequate procedural instruction for the merit to be analyzed by the collegiate board of ANEEL. The Company continues to monitor and act in relation to the issue so that the assumptions, methodologies and calculations considered so far remain in force.

 

Table 21: RBSE reprofiling R$ million

 

Financial Component reprofiled with sectoral charges       
  22-23 23-24 24-25 25-26 26-27 27-28
Chesf 988 1841 1841 1841 1841 1841
  439 859 859 859 859 859
CGT Eletrosul 240 402 402 402 402 402
Furnas 1,340 2,944 2,944 2,944 2,944 2,944
Total 3,007 6,046 6,046 6,046 6,046 6,046
Economic Component reprofiled with sectoral charges
  22-23 23-24 24-25 25-26 26-27 27-28
Chesf 1,216 731 731 731 731 731
Eletronorte 628 271 271 271 271 271
CGT Eletrosul 205 77 77 77 77 77
Furnas 1,974 1,269 1,269 1,269 1,269 1,269
Total 4,023 2,348 2,348 2,348 2,348 2,348
TOTAL 22-23 23-24 24-25 25-26 26-27 27-28
Chesf 2,204 2,572 2,572 2,572 2,572 2,572
Eletronorte 1,067 1,130 1,130 1,130 1,130 1,130
CGT Eletrosul 445 479 479 479 479 479
Furnas 3,314 4,213 4,213 4,213 4,213 4,213
Total 7,030 8,394 8,394 8,394 8,394 8,394

 

 

The above amounts include TFSEE (Electric Energy Services Inspection Fee) charges and resources for R&D and Energy Efficiency, and do not include PIS and Cofins. Furthermore, the data refer to the tariff cycle (July to July of each year) and not to the calendar year (January to December). The values approved in the reprofiling were updated by the IPCA.

Amortizations RBSE 2022- R$ million

Chesf CGT Eletrosul Eletronorte Furnas Total
1,967 397 953 2,952 6,270

Note: TFSEE and R&D values are included. PIS and COFINS are not included.

 

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1.4. Investiment

Table 22: INVESTMENTS BY SEGMENT - R$ million

 

Investment (Corporate + Partnerships) Realized 4Q22 Realized 2022 Budgeted PDNG 2022 % 2022
Generation - corporate             563                   1,103                1,368 81%
Implementation / Expansion             225                      382                   648 59%
Maintenance             338                      721                   720 100%
Transmission Corporate             827                   1,981                2,206 90%
Ampliation               94                      252                   241 105%
Improvements and Reinforcements             512                      931                1,147 81%
Maintenance             221                      797                   819 97%
Infraestructura and others*             189                      411                   495 83%
SPES               19                   1,679                   920 183%
Generation - Contributions               12                   1,660                   601 276%
Generation - Acquisition                -                            -                      217 -
Transmission - Contributions                 6                        19                      86 22%
SPES Others (Furnas)                -                            -                         15 -
Total       1,597               5,174             4,988 104%
Eletronuclear             -                         465                   243 192%
Total c/ Nuclear       1,597               5,639             5,231 108%
 

 

Others: Research, Infrastructure, Environmental Quality

* For further details on investments, by subsidiary or by project, see attachment 3 to this Investor Information, to be released shortly.

 

 

 

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IN 2022, BRL 5,639 MILLION WAS INVESTED, OF WHICH BRL 1,597 MILLION OCCURRED IN 4Q22.

GENERATION: INVESTMENTS MADE OF BRL 3,227 MILLION

 

CGT Eletrosul invested R$ 236 million in Expansion of the Generation System, R$ 230.5 million of which related to the Coxilha Negra Wind Farm and the remainder to the CGH Cachoeira Branca.

Investments in Maintenance at Chesf Plants, such as Sobradinho and Paulo Afonso, among others, totaled R$ 348 million

In SPE's, the main highlight is the contribution made in Santo Antonio, totaling R$ 1,583 million, not foreseen in the 2022 PNG, and made to cover expenses with arbitration loss in SAESA.

CGT Eletrosul and Furnas contributed a total of R$ 46 million to SPE Teles Pires Participações Ltda for the SPE to honor debt service related to the issue of debentures.

Regarding Eletronuclear, it was predicted that it would only remain consolidated by Eletrobras until January 2022, given the forecast for privatization and transfer of control of Eletronuclear to Enbpar in the first quarter of 2022. 2022 only the amount of R$ 242 million for Eletronuclear. However, due to the privatization taking place in June 2022, investments of R$464 million were made by Eletronuclear in 2022, exceeding the R$242 million forecast.

Disregarding Eletronuclear's total investments, in 2022, the Eletrobras Companies invested a total of R$382 million in generation, which corresponds to 59% of the budget in this segment for the Companies, with the exception of Eletronuclear.

TRANSMISSION: INVESTMENTS OF BRL 2,000 MILLION

 

Investments in Expansion and Reinforcements and Improvements accounted for 60% of the Corporate Investment in the segment, with the main highlights being:

 

·R$607 million in maintenance at Chesf, with emphasis on improvements aimed at maximizing the result of the 2023 tariff review;
·R$410 million in Reinforcements and Improvements at Chesf, with 84% of its annual budget realized;
·R$266 million in Reinforcements and Improvements at Furnas achieving 76% of its budget; It is
·R$145 million in Reinforcements and Improvements at Eletronorte, bringing forward deliveries and improving execution of the planned budget.

 

INVESTMENT FRUSTRATIONS

Generation: frustrações de R$ 785 milhões (expurgando aporte Santo Antônio)

As the main frustrations in investments, we highlight the amount of R$ 51 million referring to UTE Santa Cruz, due to the delay in the approval of the contract amendment request to conclude the implementation of the Combined Cycle, which was extended to 2023.

In SPEs, there were frustrations of R$ 482 million referring to the failure to make a contribution by Furnas to the SPE Holding Brasil Ventos due to the extension to 2023 of the process of purchasing wind turbines for the Itaguaçu Wind Farm in Bahia.

 

 

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Transmission: frustrations of BRL 292 million

Transmission: of the total frustrated in the transmission segment, R$ 225 million refer to corporate investments, with highlights to:

R$ 83 million in Reinforcements and Improvements at Furnas justified by the delay in the processes due to adaptation to the new regime (76% of the budgeted amount realized)

R$ 81 million in Maintenance at Furnas due to discounts on hiring, denial of termination by the ONS and adaptations of hiring processes to the new regime;

R$ 75 million in Reinforcements and Improvements at Chesf (84% of the budgeted amount realized) mainly due to delays in equipment deliveries.

In SPES, SPE Transnorte Transmissora de Energia provided contributions of R$ 86 million for the start of works on LT Manaus / Boa Vista. However, there were delays due to public civil actions related to environmental licensing, whose court settlement took place at the end of September. For this reason, we had a frustration of R$ 67 million in relation to the amount budgeted for the year.

On the other hand, there were greater investments in Transmission, with emphasis on the maintenance of Chesf due to the payment of taxes (DIFAL), not foreseen in the PDNG, combined with an improvement in the execution process of maintenance projects.

R$44 million was invested in SPES in 4Q22, of which R$31 million in the Holding, related to the contribution for reimbursement for energy not generated in the Holding's Chapada do Piauí and R$13 million in Eletronorte related to the termination of public civil action at SPE TNE .

 

 

 

Marketletter 4Q22

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1.5. COMMERCIALIZATION

1.5.1. ENERGY SOLD IN 4Q22 – GENERATORS – TWh

In terms of energy market evolution, the Eletrobras Companies, in 4Q22, sold 32.7 TWh of energy, against 32.1 TWh traded in the same period of the previous year, which represents a reduction of 0.2%. These volumes include energy sold by plants under the quota regime, renewed by Law 12,783/2013, as well as by plants under the exploration regime (ACL and ACR). With the advent of capitalization, energy from Itaipu and Eletronuclear from 3Q22 and referring to 2021 were excluded for comparative purposes. Saesa information is not included.

 

 

Sales: includes developments under Law 13,182/15

 

NOTE: Average ACR Prices in the chart do not include O&M. In Eletronorte's values, Amazonas-GT is included. And the Average ACR Prices in the chart do not include PIEs contracts and thermal plants contracts due to unavailability

 

 

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1.5.2. ENERGETIC BALANCE

Energectic Balance (MWmed)   2022 2023 2024 2025 2026
Resource with no impact in the balance (1) 1,419 1,419 1,419 1,192 1,192
             
Ballast 8,030 9,018 10,352 11,658 12,815
  Own Resources (2) (3) (4) (5) 7,108 8,213 9,542 10,876 12.122
  Energy purchased 922 804 810 782 693
 Sales 7,032 6,145 4,461 2,834 1,586
  ACL – Bilateral contracts + MCP realized (6) 6,296 5,362 3,678 2,101 854
  ACR – Exceto cotas 737 784 784 733 733
Avg. prices            
  Avg prices of sales  R$/MWh 204,05 199,02 195,84 201,01 231,64
  Avg prices of purchase R$/MWh 262,55 251,53 232,93 234,57 238,81
 Balance (Ballast – Sales) 998 2,872 5,891 8,824 11,229
 Uncontracted energy* 11% 28% 50% 69% 80%
 Uncontracted energy considering hedge estimate from 2023 (9) 0% 12% 34% 52% 63%
* The uncontracted portion includes energy reserved for the company's hedge, strategically defined according to the GSF estimate for the period.  

Contracts concluded until 12/31/2022. It should be noted that the balance sheet does not consider the SPE Santo Antônio Energia, consolidated by Furnas as of 3Q22, either in terms of resources, sales or average prices.

1- Not included in the balance sheet, either in terms of resources, requirements (sales) or average prices, are the IPP contracts resulting from the unbundling process of Amazonas Distribuidora, the thermal plant contracts based on availability and the Physical Guarantee Quotas. These resources are presented in order to compose the total resources considered.

2- Own Resources include the Descotization plants (new PIEs) and the New Grants (Sobradinho, Itumbiara, Tucuruí, Curuá-Una and Mascarenhas de Moraes). For hydroelectric projects, an estimate of GFIS2 was considered, that is, the Physical Guarantee considering the Adjustment Factors due to Internal Losses, Losses in the Basic Network and Availability.

3- The plants with new concession grants are considered, in 2022, with their current Physical Guarantees.

4- Upon release of quotas, the plants currently subject to quotas will have a new concession under the Independent Energy Producer - PIE regime, gradually occurring over a period of 5 years starting in 2023. The Physical Guarantee amounts were defined in Ordinance GM/MME No. 544/21.

5- Considering the new concession grants from 2023 for the Sobradinho, Itumbiara, Tucuruí, Curuá-Una and Mascarenhas de Moraes plants, whose Physical Guarantee values were defined in Ordinance GM/MME No. 544/21.

 

 

6- It should be noted that, for contracts in the ACL, there were reductions in the contracted amounts agreed under the aegis of Law 13.182/2015 (UHE Itumbiara), pursuant to §§ 12, 12-A and 12-B of art. 10 of the aforementioned ordinance, transcribed in Clause 6 of the contracts, which take effect from the years 2023 and 2024. The amounts presented consider, on the one hand, these reductions, but also the volumes of new contracts signed.

 

 
Physical and Nuclear Energy Guarantee Quotas (MWmed) 2022 2023 2024 2025 2026
  Physical Guarantee Quotas (7) (8) 7,464 5,252 3,939 2,626 1,313
             

 

7- Current values of Total Physical Guarantee of the developments.

8- Decotization takes place gradually over a period of 5 years from 2023.

9- The values present an estimate of the uncontracted energy considering a historical average value of GSF, from 2017 to 2022, of 80.1%. Source: CCEE, obtained from the CCEE website.

 
 

Marketletter 4Q22

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

 

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2.
Result Analysis of
Parent Company

In 4Q22, Eletrobras Holding posted a net loss of BRL 456 million, a decrease of 176% compared to the net profit of BRL 602 million in 4Q21. The 4Q22 result was decisively influenced by: (i) recording a provision of R$ 2,528 million in PCLD for Financing and Loans due to the provision for loan balances receivable from Amazonas Energia; (ii) the R$964 million reduction in revenue from CEEE and the R$854 million purchase of energy for resale between the quarters due to the improvement in the country's hydrological conditions, significantly reducing the need to import energy electricity from the Oriental Republic of Uruguay for resale; (iii) Recording in Other Income and Expenses, the negative amount referring mainly to the write-off of unreconciled escrow deposits in the amount of R$507 million; (iv) registration, in 4Q22, of tax payments in the amount of R$292 million, which did not occur in 4Q21, due to the receipt of JCP (interest on equity) from the subsidiaries; partially offset by (v) Result from Equity Interests, in the amount of R$2,343 million in 4Q22, while in 4Q21 it was 2,252 million, an increase of R$91 million, mainly influenced by the results of subsidiaries; (vi) lower provision for compulsory loan, with a reversal of R$517 million recorded in 4Q22, influenced by discounts obtained from court agreements, in the amount of R$563 million, while in 4Q21, there was a provision of R$ $803 million.

 

In 2022, Eletrobras Holding presented a total net income of R$3,635 million, of which R$2,648 million refer to continued operations and R$987 million refer to discontinued operations, a 36% reduction compared to the net income of R$5,646 million recorded in 2021. This 2022 result was decisively influenced by: (i) Result from Equity Interests, of R$7,567 million, mainly from the result of controlled companies, against a result of R$18,811 in 2021; (ii) result of Discontinued Operations in R$ 987 million, given that, as provided for in Law nº 14,182/2021, the capitalization of Eletrobras was conditioned to the corporate restructuring to maintain, directly or indirectly, the companies Eletronuclear and Itaipu Binacional, through the transfer of control to ENBpar; and (iii) an increase of R$2,709 million in provisions for loan losses and loan losses, from R$639 million in 2021 to R$3,348 million in 2022, with emphasis on the provision for loan balances receivable by the holding company Amazonas Energia (See Note 10 of the Explanatory Notes).

 

Marketletter 4Q22

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2.1       Shareholdings in the Parent Company

In 4Q22, the Equity Interest result impacted the Parent Company's result by R$2,343 million, resulting from the Equity Income of investments in subsidiaries and affiliates, while the result in 4Q21 was R$2,252 million. Highlight for the improvement in the results of Furnas (+R$ 690 million), being offset by the worsening of Chesf (-R$ 387 million), Eletronorte (-R$ 274 million) and CGT Eletrosul (-R$ 77 million).

In 2022, the result from Equity Participations positively impacted the Company's result by R$7,567 million, in 2021 the result was R$18,811 million. The reduction observed was, in particular, due to the credit registration in 2021 referring to the renegotiation of the hydrological risk with the effect of reducing the expense in the purchase of energy occurred in 2021, according to ANEEL resolutions 2919/21 and 2932/21, without occurrence in 2022.

 

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2.2       Operating Provisions of Parent Company

In 4Q22, Operating Provisions negatively impacted the Parent Company's result by R$1,872 million, compared to a provision of R$1,389 million in 4Q21. This variation is mainly explained by: (i) the provision of R$ 2,528 million for PCLD for Financing and Loans, mainly due to the provision for loan balances receivable from Amazonas Energia, partially offset by (ii) the effect positive in provisions for lawsuits, with emphasis on compulsory loan lawsuits, which had a reversal of R$ 517 million in 4Q22, compared to a provision of R$ 803 million in 4Q21.

In 2022, Operating Provisions negatively impacted the Parent Company's result by R$3,501 million, compared to a provision of R$12,254 million in 2021. This reduction is mainly explained by: (i) lower constitution, in Contingencies, with highlight for the compulsory loan in the amount of R$ 133 million in 2022, against a constitution of R$ 10,897 million in 2021. the risks involved and enable better planning of cash disbursements to optimize tax use. In this context, Eletrobras created the Compulsory Loan Executive Committee with the objective of seeking judicial agreements with discounts and full settlement of the aforementioned processes. Therefore, although there was a provision of R$ 133 million in 2022 due to unfavorable court decisions, we highlight that, as a result of the negotiations that took place, Eletrobras obtained in the 4th quarter of 2022, the reduction of the provision in the amount of R$ 1,300 million, R$563 million of which are discounts obtained in agreements that have already been signed and R$737 million due to payments made, under agreements that have already had the respective court approvals, with the due final and unappealable decision. On the other hand, (ii) the increase in PCLD - Financing and Loans, in the amount of R$ 2,709 million, related to the provisioning of loan balances receivable by the Amazonas Energia holding company. Further details are found in Explanatory Note 10.2 of the financial statements.

Table 24: Operating Provisions (R$ million)
 Operating Provisions 2022 2021 4Q22 4Q21
Guarantees 150 10,902 -214 -2
Provision for Disputes 67 67 -492 728
PCLD - Financing and Loans 3,348 639 2,528 625
PECLD - Fuel consumption account 0 580 0 0
Investment Losses -189 -26 38 20
Provision for Implantation of Shares - Compulsory Loan 102 108 31 15
Others 22 -16 -19 2
TOTAL 3,501 12,254 2,042 1,389

2.3       Parent Company Financial Result

In the quarter, the financial result showed a negative result of R$ 84 million in 4Q22, against a negative result of R$ 555 million in 4Q21, that is, an improvement of R$ 471 million between the periods. The positive variation is mainly due to: (i) the increase in the net exchange variation, which went from R$ -91 million in 4Q21 to R$ 210 million in 4Q22 due to the 2.5% variation in the dollar , in 4Q21 and -2.4% in 4Q22 on the company's foreign currency financing; (ii) an increase in Income from financial investments of R$282 million between the compared periods, due to the improvement in profitability indexes in 4Q22. This was partially offset by: (iii) the increase in passive monetary variations of R$373 when compared to 4Q21, in particular, due to the adjustment of R$ -132.1 million in monetary restatement resulting from the write-off of unreconciled escrow deposits.

 

Marketletter 4Q22

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In 2022, the Financial Result negatively impacted the Parent Company's result by R$273 million, but represents an improvement of R$948 million compared to the previous year, influenced, in particular, by: (i) the increase in Revenue from investments financial in R$774 million due to the increase in the Holding's cash balance through the following initiatives: (a) issuance of Commercial Notes in the amount of R$6 billion; (b) Capitalization: issuance of shares of the Supplementary Lot of R$4,387 million; (c) Financing Receivables: R$2,578 million; (d) Itaipu receivables of R$1,206 million and (e) Sale of shares associated with CEEE-GT: R$1,103 million. Also noteworthy is the increase in the Selic/DI rate in the period; (ii) an increase of R$345 million in loan and financing revenues due to the increase in the Selic rate, which was 0.77% p.m. to 1.12% p.m. in 4Q22; (iii) positive variation in net exchange rate adjustments of R$633 million and (iv) monetary restatement of lawsuits discussing the difference in monetary restatement of book-entry credits (2nd phase), whose variation between periods was R$898 million, given the significant variation in the Selic rate and the increase in the provision base, due to the risk review carried out by Eletrobras, as of 3Q21, impacting only two quarters of 2021 and all quarters of 2022. The total monetary restatement for 2022 was R$ 1,620 million, and R$701 million in 2021.

Table 25: Financial Result (R$million)
FINANCIAL RESULT 2022 2021 4Q22 4Q21
Financial income        
Interest, commission and fee income 1,282 937 366 240
Income from financial investments 1,066 291 367 85
Additional moratorium on electricity 0 69 0 46
Interest income on dividends 418 224 49 15
 Other financial income 276 131 74 77
(-) Taxes on financial income -512 -350 -309 -147
         
Financial expenses        
Debt Charges -1,953 -1,481 -461 -401
Other Financial expenses -180 -637 -8 -382
         
Financial items, net        
Monetary variations -997 -99 -371 1
Exchange variations 327 -306 210 -91
Financial Result -273 -1,220 -84 -555

 

 

 

Marketletter 4Q22

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3.
General Information

Corporate Structure on 12/31/2022

Table 26: Structure of the Capital Stock  

 

 

 

Shareholding position on 12/31/2022 

 

 

 % Capital  
Shareholders Quantity of Shares Value (R$)

Species/

Class

Total  
 
           
COMMON 2,021,139,464 62,841,166,980,23 100.00% 87.83%  
           
Government 667,888,884 20,765,967,728,23 33.05% 29.02%  
BlackRock 98,319,628 3,056,948,949,16 4.86% 4.27%  
GIC Private 92,090,802 2,863,282,603,16 4.56% 4.00%  
BNDES 74,545,264 2,317,757,614,48 3.69% 3.24%  
BNDESPAR 71,956,435 2,237,265,872,88 3.56% 3.13%  
Citibank 50,903,042 1,582,674,832,24 2.52% 2.21%  
FND 45,621,589 1,418,464,160,10 2.26% 1.98%  
Banco do Nordeste 1,420,900 44,178,551,63 0.07% 0.06%  
FGHAB 1,000,000 31,091,949,91 0.05% 0.04%  
3G Radar Backgrounds 963,132 29,945,651,90 0.05% 0.04%  
Iberclear - Latibex 298,550 9,282,501,65 0.01% 0.01%  
Victor Adler / VIC DTVM 218,000 6,778,045,08 0.01% 0.01%  
Board of Executive Officers 20,000 621,839,00 0.00% 0.00%  
Board of Directors 1 31,09 0.00% 0.00%  
Others 915,893,237 28,476,906,649,71 45.32% 39.80%  
           
PREF. A 146,920 3,657,455,09 100.00% 0.01%  
           
Victor Adler / VIC DTVM 54,200 1,349,265,35 36.89% 0.00%  
Shareholders to be identified 42,451 1,056,783,46 28.89% 0.00%  
Others 50,269 1,251,406,27 34.22% 0.00%  
           
PREF. B 279,941,393 6,968,915,542,31 100.00% 12.16%  
           
3G Radar Backgrounds 30,451,076 758,055,014,81 10.88% 1.32%  
BNDESPAR 18,691,102 465,299,932,37 6.68% 0.81%  
BNDES 18,262,671 454,634,487,64 6.52% 0.79%  
BlackRock 13,027,180 324,301,155,33 4.65% 0.57%  
GIC Private 7,643,805 190,286,369,93 2.73% 0.33%  
Citibank 4,846,843 120,658,253,33 1.73% 0.21%  
Board of Directors 4,364,579 108,652,679,42 1.56% 0.19%  
Shareholders to be identified 1,964,408 48,902,355,22 0.70% 0.09%  
Victor Adler / VIC DTVM 360,000 8,961,910,09 0.13% 0.02%  
Iberclear - Latibex 121,853 3,033,432,31 0.04% 0.01%  
Board of Executive Officers 50,000 1,244,709,74 0.02% 0.00%  
União 493 12,272,84 0.00% 0.00%  
Outros 180,157,383 4,484,872,969,29 64.36% 7.83%  
           
PREF. C - GOLDEN SHARE UNIÃO 1 24,89 100.00% 0.00%  
           
           
Total 2,301,227,778 69,813,740,002,52   100.00%  
           
 

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3G Radar Backgrounds 963,132 29,945,651,90 0.05% 0.04%
Iberclear - Latibex 298,550 9,282,501,65 0.01% 0.01%
Victor Adler / VIC DTVM 218,000 6,778,045,08 0.01% 0.01%
Board of Executive Officers 20,000 621,839,00 0.00% 0.00%
Board of Directors 1 31,09 0.00% 0.00%
Others 915,893,237 28,476,906,649,71 45.32% 39.80%
         
PREF. A 146,920 3,657,455,09 100.00% 0.01%
         
Victor Adler / VIC DTVM 54,200 1,349,265,35 36.89% 0.00%
Shareholders to be identified 42,451 1,056,783,46 28.89% 0.00%
Others 50,269 1,251,406,27 34.22% 0.00%
         
PREF. B 279,941,393 6,968,915,542,31 100.00% 12.16%
         
3G Radar Backgrounds 30,451,076 758,055,014,81 10.88% 1.32%
BNDESPAR 18,691,102 465,299,932,37 6.68% 0.81%
BNDES 18,262,671 454,634,487,64 6.52% 0.79%
BlackRock 13,027,180 324,301,155,33 4.65% 0.57%
GIC Private 7,643,805 190,286,369,93 2.73% 0.33%
Citibank 4,846,843 120,658,253,33 1.73% 0.21%
Board of Directors 4,364,579 108,652,679,42 1.56% 0.19%
Shareholders to be identified 1,964,408 48,902,355,22 0.70% 0.09%
Victor Adler / VIC DTVM 360,000 8,961,910,09 0.13% 0.02%
Iberclear - Latibex 121,853 3,033,432,31 0.04% 0.01%
Board of Executive Officers 50,000 1,244,709,74 0.02% 0.00%
União 493 12,272,84 0.00% 0.00%
Outros 180,157,383 4,484,872,969,29 64.36% 7.83%
         
PREF. C - GOLDEN SHARE UNIÃO 1 24,89 100.00% 0.00%
         
         
Total 2,301,227,778 69,813,740,002,52   100.00%
         

 

 

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Asset Behavior Analysis

Shares

Table 27: B3, ELET3 and ELET6
  (R$) (R$) (pts.) (pts.)
Price and Volume ELET3 ELET6 IBOV IEE
  Shares COM Shares PN (Index) (Index)
Closing Price on 12/31/2022  42.12  43.23 109,735 78,679
Maximum in the quarter  51.57  54.94 119,929 85,120
Average in the quarter  45.22  47.85 111,684 79,666
Minimum in the quarter  40.94  42.15 102,856 74,286
Variation in 4Q22 -2.0% -4.3% -0.3% 0.2%
Change in the last 12 months 28.4% 36.1% 4.7% 3.1%
Average Daily Traded Volume 4Q22 (R$ million) 606.05 152.65 - -
         
Book Value per Share (R$) 48.02 48.02  -  -
Price / Profit (P/E) (1) 26.64 27.34  -  -
Price / Shareholders' Equity (P/B) (2) 0.88 0.90  -  -
(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 12/31/2021 = 100 e valores ex-dividendo.

 

Marketletter 4Q22

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

 

43
 

Marketletter 4Q22

  

ADR Programs

Table 28: NYSE, EBRN and EBRB
Price and Volume (US$) NYSE (US$) NYSE
EBRN EBRB
Closing Price on 12/31/2022 7.93 8.20
Maximum in the quarter 10.20 11.03
Average in the quarter 8.55 9.16
Minimum in the quarter 7.63 7.93
     
Variation in 4Q22 -1.2% -3.3%
Change in the last 12 months 32.8% 36.7%
Average Daily Trading Volume 4Q22 (US$ thousand) 21,828 233

 

Evolution of Shares Traded in ADR

 

 

Source: AE Broadcast

Index number 12/31/2021 = 100

 

 

 

 

Marketletter 4Q22

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

 

44
 

Marketletter 4Q22

  

Latibex - MADRID MARKET

Table 29: LATIBEX, XELTO and XELTB
Price and Volume (€) LATIBEX (€) LATIBEX
XELTO XELTB
Closing Price on 12/31/2022 7.45 8.05
Maximum in the quarter 10.40 9.80
Average in the quarter 8.69 8.56
Minimum in the quarter 7.40 7.40
     
Variation in 4Q22 -8.0% -6.4%
Change in the last 12 months 41.9% 61.0%
Average Daily Traded Volume 4Q22 (thousands of Euros) 253.1 1.6

 

Evolution of Foreign Currencies

Index number 12/31/2021 = 100.

Source:: Banco Central

 

Marketletter 4Q22

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

 

45
 

Marketletter 4Q22

  

 

Nº of Employees

PARENT COMPANY

Table 30: Employees by Working Time
Tempo de trabalho na empresa (anos) 1T22 2T22 3T22 4Q22
Up until 5 23 18 17 19
6 to 10 31 45 47 41
11 to15 390 434 397 375
16 to 20 148 149 182 196
21 to 25 18 17 17 17
More than 25 60 62 61 60
Total 670 725 721 708
Table 31: Employees by Federation State
Federation State 1T22 2T22 3T22 4Q22
Rio de Janeiro 653 708 704 691
Brasília 15 15 15 15
São Paulo 1 1 1 1
Expatriate 1 1 1 1
Total 670 725 721 708
 

Marketletter 4Q22

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

 

46
 

Marketletter 4Q22

  

 

Balance Sheet

(R$ thousand)
Asset Parent Company Consolidated
12/31/2022 12/31/2021 12/31/2022 12/31/2021
CURRENT        
   Cash and cash equivalents 4,927,871 7,384 10,739,126 192,659
   Restricted cash 2,917,849 2,544,594 3,098,401 2,710,165
   Marketable securities 3,611,904 6,026,365 12,193,654 15,475,205
   Customers 462,628 719,906 4,794,924 5,094,976
   Asset contractual transmission 0 0 9,349,126 7,356,356
   Loans and financing 389,438 0 389,438 0
   Remuneration of equity interests 1,524,088 2,275,301 692,839 1,251,766
   Taxes to recover 3,028,085 5,028,731 707,875 443,142
   Income tax and social contribution 857,466 456,725 1,135,913 755,906
   Reimbursement rights 261,321 640,191 1,749,225 1,487,777
   Warehouse 796,776 741,255 827,490 768,848
   Nuclear fuel stock 262 293 429,310 627,573
   Derivative financial instruments 0 0 0 487,895
   Hydrological risk 0 0 501,355 690,333
   Others 0 0 0 0
   Asset held for sale 966,804 685,320 2,326,092 2,014,705
   Cash and cash equivalents 320,691 289,331 688,359 387,690
  20,065,183 19,415,396 49,623,127 39,744,996
         
NON CURRENT        
LONG-TERM REALIZABLE        
   Reimbursement rights 2,048,517 5,529,316 2,124,907 5,627,386
   Loans and financing 3,366,460 8,180,605 328,806 4,591,761
   Customers 0 0 703,055 993,080
   Marketable Securities 411,705 398,280 417,648 398,648
   Amounts Receivable - ENBPAR 1,223,316 0 1,223,316 0
   Nuclear fuel stock 0 0 0 1,490,820
   Taxes to recover 3,705 3,365 439,196 449,258
   Current Income Tax and Social Contribution 0 0 3,541,162 1,500,987
   Escrow deposits 6,402,122 6,393,647 8,558,013 8,247,485
   Transmission contractual asset 0 0 51,703,084 52,158,612
   Financial assets - Concessions and Itaipu 0 428,865 0 2,601,027
   Derivative financial instruments 0 0 485,507 653,022
   Advances for future capital increase 20,596,029 3,932,463 0 0
   Hydrological risk 0 0 0 0
   Decommissioning Fund 0 2,055,713 0 2,055,713
   Others 1,755,305 2,024,412 1,063,250 1,087,508
  35,807,159 28,946,666 71,888,527 82,550,135
INVESTMENT 113,736,819 88,740,622 33,985,522 27,647,781
Fixed assets net 231,883 235,453 34,739,705 33,367,981
INTANGIBLE 67,857 61,387 79,980,581 4,992,176
  149,843,718 117,984,128 220,594,335 148,558,073
TOTAL ASSETS 169,908,901 137,399,524 270,217,462 188,303,069
 

Marketletter 4Q22

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

 

47
 

Marketletter 4Q22

  

 

 

(R$ thousand)
Liabilities Parent Company Consolidated
12/31/2022 12/31/2021 12/31/2022 12/31/2021
CURRENT        
    Loans and financing and Debentures 3,682,702 5,310,178 7,524,770 8,234,753
    Compulsory loan 1,289,602 1,216,335 1,289,602 1,216,335
    Suppliers 994,922 773,858 3,517,173 4,031,532
    Advances from customers 1,486,222 1,370,946 1,653,122 1,460,455
    Taxes payable 370,739 259,336 1,271,700 804,485
    Income tax and social contribution 0 0 0 19,624
    Remuneration to shareholders 913,018 1,381,111 924,644 1,406,891
    Financial liabilities - Concessions and Itaipu 0 578,626 0 578,626
    Estimated liabilities 166,337 153,568 2,318,554 1,602,947
    Reimbursement Obligations 1,912,423 836,744 1,912,423 859,003
    Provisions for contingencies 0 0 246,437 233,304
    Provisões para litígios 2,646,711 2,267,649 2,709,161 2,267,649
   Regulatory charges 0 0 996,610 542,913
   Obligations arising from Law 14.182/2021 0 0 1,472,662 0
    Lease 8,710 7,773 224,319 209,774
    Others 74,919 64,061 209,251 246,700
  13,546,305 14,220,185 26,270,428 23,714,991
      Liabilities associated with assets held for sale 0 0 170,448 168,381
  13,546,305 14,220,185 26,440,876 23,883,372
NON-CURRENT        
    Loans and financing and Debentures 22,269,941 19,294,960 51,581,752 35,780,892
    Suppliers 0 0 0 16,555
    Advances from customers 0 0 213,921 186,348
    Obligation for asset retirement 0 0 0 3,268,301
    Provisions for contingencies 22,084,048 23,666,275 30,623,558 31,142,222
    Post-employment benefits 680,399 885,455 4,947,234 5,851,502
    Obligations arising from Law 14.182/2021 0 0 35,186,792 0
    Provision for unsecured liabilities 0 0 0 708,516
    Onerous contracts 0 0 209,099 428,164
    Lease 32,571 40,560 528,849 693,710
    Concessions payable - Use of public goods 0 0 372,420 81,655
    Advances for future capital increase 86,919 77,336 86,919 77,336
    Sector Charges 0 0 464,358 649,341
    Tributos a recolher 0 0 723,716 260,612
    Deferred income tax and social contribution 427,390 569,816 6,294,347 7,244,737
    Others 276,532 2,523,733 1,514,985 1,613,042
  45,857,800 47,058,135 132,747,950 88,002,933
         
EQUITY        
    Share capital 69,705,554 39,057,271 69,705,554 39,057,271
    Capital reserves 13,867,170 13,867,170 13,867,170 13,867,170
    Profit reserves 33,910,233 30,890,165 33,910,233 30,890,165
   Other comprehensive cumulative results -6,978,161 -7,693,402 -6,978,161 -7,693,402
   Non controlling shareholdins 0 0 523,840 295,560
  Retained earnings 0 0 0 0
TOTAL SHAREHOLDERS' EQUITY 110,504,796 76,121,204 111,028,636 76,416,764
TOTAL LIABILITIES AND  SHAREHOLDERS' EQUITY 169,908,901 137,399,524 270,217,462 188,303,069

 

 

Marketletter 4Q22

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

 

48
 

Marketletter 4Q22

  

Income Statement

  Parent Company Consolidated
31/12/2022 31/12/2021 31/12/2022 31/12/2021
NET OPERATING REVENUE 377,721 1,365,825 34,074,233 34,626,834
    Operating costs        
    Personnel, Material and Services 0 0 -3,589,651 -2,786,732
     Energy purchased for resale -16,685 -1,273,156 -3,117,655 5,932
    Charges upon use of electric network 0 0 -2,746,132 -2,276,254
    Fuel for electricity production 0 0 -2,085,996 -1,889,722
    Construction 0 0 -1,678,631 -1,395,066
    Depreciation 0 0 -1,427,843 -1,056,466
    Amortization 0 0 -1,052,849 -245,215
    Operating Provisions /Reversals net 0 0 0 177,482
    Others Costs 0 0 -158,853 -212,389
GROSS RESULT 361,036 92,669 18,216,623 24,948,404
Operating expenses        
    Personnel, Supllies and Services -662,660 -551,426 -3,378,346 -3,343,075
    Depreciation -42,999 0 -1,260,370 0
    Amortization -11,184 -11,841 -174,359 -121,291
    Donations and contributions -11 -11 -35,217 -20,313
    Operating Provisions /Reversals net -126,339 -87,399 -206,438 -164,696
    Others -3,501,113 -12,254,011 -6,928,425 -15,099,545
Operating expenses -294,439 -257,986 -1,434,542 -1,274,941
  -4,638,745 -13,162,674 -13,417,697 -20,023,861
         
Regulatory Remeasurements - Transmission Contracts 0 0 365,178 4,858,744
         
OPERATING INCOME BEFORE FINANCIAL RESULT -4,277,709 -13,070,005 5,164,104 9,783,287
         
Financial result -272,650 -1,220,245 -4,373,595 -1,441,954
         
INCOME BEFORE EQUITY -4,550,359 -14,290,250 790,509 8,341,333
RESULTS OF EQUITY 7,566,709 18,810,602 2,369,777 1,507,418
OTHER INCOME AND EXPENSES 195,661 1,210,754 186,924 1,210,754
OPERATING RESULT BEFORE TAXES 3,212,011 5,731,106 3,347,210 11,059,505
    Current Income Tax and Social Contribution -563,419 0 -1,630,034 -1,437,671
    Deferred Income Tax and Social Contribution 0 0 934,421 -3,822,971
NET INCOME FROM CONTINUING OPERATIONS 2,648,592 5,731,106 2,651,597 5,798,863
NET INCOME (LOSS) FROM THE DISCONTINUED OPERATION 986,785 -84,965 986,785 -85,230
NET INCOME FOR THE PERIOD 3,635,377 5,646,141 3,638,382 5,713,633

 

 

Marketletter 4Q22

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

 

49
 

Marketletter 4Q22

  

 

Cash Flow Statement

(R$ thousand)
  Parent Company Consolidated
  31.12.22 31.12.21 31.12.22 31.12.21
Operating Activities        
Income before income tax and social contribution 4,198,796 5,646,141 4,333,995 10,974,275
         
Depreciation and amortization 11,196 11,852 2,690,269 1,443,285
Net foreign exchange rate variations 669,681 405,588 650,770 419,569
Financial charges 252,917 291,817 4,980,707 2,035,779
Equivalence equity results -7,566,709 -18,810,602 -2,369,777 -1,507,418
Other Income and Expenses -195,661 -1,210,754 -186,924 -1,210,754
Revenue from the contractual asset - transmission 0 0 -15,774,884 -17,450,333
Construction Revenue Generation 0 0 0 0
Contractual revenue - Transmission 0 0 1,671,307 1,312,861
Regulatory Remeasurements - Transmission Contracts 0 0 -365,178 -4,858,744
Operating provisions (reversals) 3,501,113 12,254,011 6,928,425 14,922,063
Participation of non-controlling shareholders 0 0 0 0
GSF reimbursement 0 0 0 -4,265,889
Financial instruments - derivatives 0 0 356,494 -725,826
Others 145,382 -122,873 1,751,340 1,503,130
  -3,182,082 -7,180,961 332,549 -8,382,276
(Increases) / decreases in operating assets        
Customers 194,947 0 -408,364 1,671,234
Receivables - ENBPAR 0 0 0 0
Marketable securities 2,414,460 1,638,290 2,264,059 -1,972,451
Reimbursement rights 518,779 0 537,338 -22,909
Financial assets - Itaipu 499,071 605,581 499,071 605,581
Hydrological risk 0 0 0 0
Credits with subsidiaries - CCD 0 0 0 0
Others -227,870 1,322,103 -436,278 1,534,289
  3,399,387 3,565,974 2,455,826 1,815,744
Increase / (decrease) in operating liabilities        
Suppliers -61,608 67,950 233,911 39,894
Advances 0 0 104,964 -85,928
Lease 0 0 0 0
Personnel obligations 12,769 -13,776 222,345 213,739
Indemnification obligations 0 0 0 0
Sectorial charges 0 0 159,695 -82,459
Obligations with personnel 12,769 -13,776 222,345 213,739
Liabilities associated with assets held for sale 0 0 0 0
Others -69,227 485,574 -382,451 44,173
  -118,066 539,748 338,464 129,419

 

 

 

Marketletter 4Q22

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

 

50
 

Marketletter 4Q22

  

 

Payment of financial charges -1,515,464 -1,328,795 -3,211,343 -2,176,135
Payment of financial charges - leases 0 0 0 0
Revenue of RAP and indemnities 0 0 14,623,582 15,204,734
Revenue of financial charges 677,776 861,026 316,278 672,085
Payment of income tax and social contribution -236,134 -172,502 -2,607,461 -2,463,047
Revenue of remuneration for investments in equity interests 4,617,624 7,302,271 1,494,560 2,175,585
Supplementary pension payment -33,894 -21,595 -469,943 -383,424
Payment of legal contingencies -3,074,367 -3,355,498 -4,222,504 -6,228,610
Pledge and related deposits -441,255 -2,462,388 -1,199,426 -2,511,386
Net cash from (used in) operating activities of continuing operations 4,292,323 3,393,421 12,184,577 8,826,963
Net cash from (used in) operating activities of discontinued operations 0 0 -2,908,844 -600,801
Net cash from (used in) operating activities 4,292,323 3,393,421 9,275,733 8,226,163
         
Financing activities        
Receivables for share issuing 30,648,282 0 30,648,282 0
Payment of loans and financing and obtained debenturesl 6,000,000 2,700,000 8,500,000 4,828,697
Payment of loans and financing and obtained debenturesl - principal -4,048,309 -7,181,654 -6,734,696 -8,175,960
Payment of remuneration to shareholders -1,433,059 -3,813,501 -1,490,058 -3,747,606
Payment of finance leases 0 -12,454 -721,074 -571,829
Others 44,746 0 44,746 -499,734
Net cash from (used in) continuing operations financing activities 31,211,660 -8,307,609 30,247,200 -8,166,432
Net cash from (used in) the financing activities of discontinued operations 0 0 -174,814 2,105,924
Net cash from (used in) financing activities 31,211,660 -8,307,609 30,072,386 -6,060,508
         
Investing activities        
Receipt of loans and financing 3,397,329 7,581,413 2,358,352 4,897,907
Acquisition of fixed assets -7,697 -2,621 -1,585,639 -1,085,090
Acquisition of intangible assets -6,480 -18,424 -32,038,772 -103,494
Transmission infrastructure - contractual asset 0 0 -1,652,992 -1,299,710
Acquisition/contribution of capital in equity interests -188,367 -3,744 -254,498 -274,354
Granting of advance for future capital increase -34,926,186 -2,656,682 0 -2,447,464
Disposal of investments in equity interests 1,147,905 0 1,169,784 0
Net cash in the business combination 0 0 180,191 0
Others 0 0 -57,832 -443,738
         
Cash and cash equivalents at the beginning of the year of continuing operations -30,583,497 4,899,942 -31,881,406 -755,943
Cash and cash equivalents at the end of the year from descontinued operations 0 0 3,079,754 -1,503,660
Net cash from (used in) investing activities -30,583,497 4,899,942 -28,801,652 -2,259,603
         
 

Marketletter 4Q22

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

 

51
 

Marketletter 4Q22

  

 

Increase (decrease) in cash and cash equivalents 4,920,487 -14,246 10,546,467 -93,948
         
 Cash and cash equivalents at the beginning of the year 7,384 21,630 192,659 286,607
Cash and cash equivalents at the end of the year 4,927,871 7,384 10,739,126 192,659
  Increase (decrease) in cash and cash equivalents from discontinued operations 0 0 -3,904 1,463
  4,920,487 -14,246 10,546,467 -93,948

 

 

 

 

 

Marketletter 4Q22

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

 

52
 

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: March 15, 2023

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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