FORM 6-K

 

securities and exchange commission
washington, d.c.  20549

 

report of foreign private issuer
pursuant to rule 13a-16 or 15d-16 of
the securities exchange act of 1934

 

For the month of May 2020

Commission File Number 1-15224

 

Energy Company of Minas Gerais

(Translation of Registrant’s Name Into English)

Avenida Barbacena, 1200

30190-131 Belo Horizonte, Minas Gerais, Brazil

(Address of Principal Executive Offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F   X   Form 40-F ___

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): _____

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): _____

 

Indicate by check mark whether by furnishing the information contained in this Form, the registrant 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  

 

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):  N/A

 

 
 

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Forward-Looking Statements

 

This report contains statements about expected future events and financial results that are forward-looking and subject to risks and uncertainties. Actual results could differ materially from those predicted in such forward-looking statements. Factors which may cause actual results to differ materially from those discussed herein include those risk factors set forth in our most recent Annual Report on Form 20-F filed with the Securities and Exchange Commission. CEMIG undertakes no obligation to revise these forward-looking statements to reflect events or circumstances after the date hereof, and claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

 

 

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SIGNATURES

 

            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.

 

 

 

COMPANHIA ENERGÉTICA DE MINAS GERAIS – CEMIG

   
   

 

By:

/s/ Leonardo George de Magalhães.

 

Name: Leonardo George de Magalhães

 

Title:  Chief Finance and Investor Relations Officer

 

 

Date:  May 14, 2020

 

 

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1.      Material Announcement Dated March 13, 2020: Taesa has reviewed its projections for the Capex and the RAP.

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COMPANHIA ENERGÉTICA DE MINAS GERAIS – CEMIG

LISTED COMPANY – CNPJ 17.155.730/0001-64 – NIRE 31300040127

MATERIAL ANNOUNCEMENT

Taesa has reviewed its projections for the Capex and the RAP

Cemig (Companhia Energética de Minas Gerais, listed and traded in São Paulo, New York and Madrid), in accordance with CVM Instruction 358 of Jan. 3, 2002 as amended, hereby reports to the Brazilian Securities Commission (CVM), the São Paulo Stock Exchange (B3) and the market as follows:

Cemig’s affiliated company Transmissora Aliança de Energia Elétrica S.A. (‘Taesa’) has today published the following Material Announcement:

“Transmissora Aliança de Energia Elétrica S.A. (B3: TAEE11) (“Taesa” or “Company”), pursuant to CVM Instruction 358 of January 03, 2002, as amended, and CVM Instruction 480 of December 07, 2009, as amended, hereby communicates to its shareholders, the market in general, and other stakeholders that, in accordance with the best corporate governance practices, it has reviewed its projections for the Nominal Capex and the incremental in the Annual Permitted Revenues (RAP) of the projects under construction wholly owned by the Company.

The total nominal Capex for these projects made in 2019 was R$ 314.0 million, a reduction of 23.4% compared to the minimum projection disclosed. This difference is basically explained by: (i) Janaúba: postponement to 2020 of part of the payment of conductor cables and withholding of payments related to services carried out in 2019 due to technical pending issues; (ii) Mariana: reduction of activities in Mariana as a result of heavy rainfalls in the state of Minas Gerais; (iii) Sant’Ana: postponement of payment of land indemnities; and (iv) Miracema: Capex savings. It is important to highlight that these factors do not compromise the expected completion of Janaúba and Sant’Ana projects. With regard to Mariana, the specific construction period provided for in the schedule of the concession contract will be met.

2019 Projected  2019 Actual 
(R$ million)  (R$ million) 
Max. 450
Min. 410  		314 

 

Based on the foregoing, the Company revised its nominal Capex projections for the projects under construction wholly owned by Taesa for 2020, since the investments not made in 2019 were transferred to the current year. It should be noted that the nominal Capex projections for years 2021 and 2022 remain unchanged.

Previous projections of nominal Capex (in R$ million):

2019  2020  2021  2022 
Max. 450  Max. 1,020  Max. 340  Max. 20 
Min. 410  Min. 940  Min. 310  Min. 15 

 

Updated projections of nominal Capex (in R$ million):

2019

(Actual)

2020

2021

2022

314

Max. 1,130

Min. 1,040

Max. 340

Min. 310

Max. 20

Min. 15

 

Av. Barbacena 1200  Santo Agostinho  30190-131 Belo Horizonte, MG  Brazil  Tel.: +55 31 3506-5024  Fax +55 31 3506-5025 

This text is a translation, provided for information only. The original text in Portuguese is the legally valid version.

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The projections referring to the Incremental in Annual Permitted Revenues (RAP) after the start-up of each of the projects wholly owned by Taesa are as follows:

2020  2021  2022  TOTAL 
78  186  107  372 

The values projected in this table consider the current RAP cycle (2019-2020) and are presented in real terms (not adjusted for inflation)

Such projections will be updated in section 11 of the Company’s Reference Form and will be available on the CVM website at http://www.cvm.gov.br/ and on the Company’s website at http://ri.taesa.com.br/, within the legal time frame.

We stress that the projections presented herein reflect Company management’s current estimates or expectations only, which are subject to risks and uncertainties, and in no way constitute a promise of performance. The information on business outlooks, projections and financial targets are mere forecasts, based on Management’s current expectations regarding the future of the Company and its subsidiaries. These expectations depend on market conditions and on the performance and execution capacity of EPC contractors, as well as the Brazilian economic scenario. Any change in perception or in the factors described above may cause the actual results to differ from the projections presented herein.”

Belo Horizonte, March 13, 2020

Maurício Fernandes Leonardo Júnior
Chief Finance and Investor Relations Officer

Av. Barbacena 1200  Santo Agostinho  30190-131 Belo Horizonte, MG  Brazil  Tel.: +55 31 3506-5024  Fax +55 31 3506-5025 

This text is a translation, provided for information only. The original text in Portuguese is the legally valid version.

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2.      Material Announcement Dated March 16, 2020: Renova receives binding offer for Phase A of Alto Sertão III Wind Complex.

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COMPANHIA ENERGÉTICA DE MINAS GERAIS – CEMIG
LISTED COMPANY – CNPJ 17.155.730/0001-64 – NIRE 31300040127

MATERIAL ANNOUNCEMENT

Renova receives binding offer for Phase A of
Alto Sertão III Wind Complex

Cemig (Companhia Energética de Minas Gerais, listed in São Paulo, New York and Madrid), in compliance with CVM Instruction 358 of January 3, 2002 as amended, hereby reports to the Brazilian Securities Commission (CVM), the São Paulo Stock Exchange (B3) and the market as follows:

Cemig’s affiliated company Renova Energia S.A. (‘Renova’) today published the following Material Announcement:

“

Renova Energia S.A., in Judicial Recovery (RNEW3; RNEW 4; RNEW11) (‘Renova’), in accordance with CVM Instruction 358/2002 as amended, hereby informs its stockholders and the market in general as follows:

Renova has received from Castlelake, L.P., on behalf of one or more funds which it manages, jointly with Vientos Agrícolas Intermediação de Negócios e Participações S.A., an investment entity of one or more funds managed by Castlelake L.P., a binding proposal (‘the Offer’) for acquisition of the total equity in the special-purpose companies that comprise Phase A of the Alto Sertão III complex of wind farms (‘the Potential Transaction’).

The Potential Transaction is subject to negotiation of the definitive final documents and obtaining of the necessary approvals for its conclusion.

The Company’s management has not yet considered the Offer, and, as alternatives, is studying other possibilities for resolving matters of its capital structure.

The Company reiterates its commitment to keeping stockholders and the market in general fully and timely informed in accordance with the applicable legislation. ”

 

Belo Horizonte, March 16, 2020

Maurício Fernandes Leonardo Júnior
Chief Finance and Investor Relations Officer

Av. Barbacena 1200  Santo Agostinho  30190-131 Belo Horizonte, MG  Brazil  Tel.: +55 31 3506-5024  Fax +55 31 3506-5025 

This text is a translation, provided for information only. The original text in Portuguese is the legally valid version.

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3.      Earnings Release - 4Q 2019 Results.

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4Q 2019 RESULTS

CEMIG REPORTS

4Q19 EBITDA OF R$ 993 MILLION

Highlights of 4Q19:

◾

Continuing improvement in Cemig D’s results in 4Q19. 

o 

4Q19 net profit: 

R$ 393 million, vs. R$ 189mn in 4Q18 

o 

2019 net profit: 

R$ 1.64 billion (all-time record) 

◾

Total energy distributed practically flat in 4Q: 

o 

From 4Q18 to 4Q19: 

down 0.12% 

o 

From 2018 to 2019: 

up 0.88% 

◾

Non-recurring expenses in Cemig GT 

o 

R$ 71.7 million write-off for Igarapé thermal plant 

o 

R$ 32.1 million in obligations under investment contract (Aliança) 

o 

R$ 21.7 mn impairment at Volta do Rio wind farm. 

 

Indicators (GWh)  4Q19           4Q18           %      2019         2018              %   
Electricity sold (excl. CCEE) – GWh  14,202 14,340 -0.97 55,045 55,555 -0.92
Total energy carried  4,783 4,906 -2.50 19,351 19,286 0.34

 

Indicators (R$ ’000)  4Q19       4Q18        %        2019     2018        %   
Sales on CCEE  24,746 28,095 -11.92 431,994 217,218 98.88
Net debt  13,486,593 13,068,690 3.20 13,486,593 13,068,690 3.20
Gross revenue  9,518,421 8,966,628 6.15 37,726,177 34,577,851 9.11
Net revenue  6,389,549 5,471,966 16.77 25,390,306 22,266,217 14.03
Ebitda (IFRS)  993,364 988,646 0.48 4,376,087 3,780,925 15.74
Net profit  497,534 1,002,368 -50.36 3,127,398 1,700,099 83.95
Ebitda margin  15.55 % 18.07 % -2,52p.p. 17.24 % 16.98 % +0,25p.p.

 

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Conference call

Publication of 4Q19 results

Webcast and Conference call

This Friday, March 20, 2020, at 11:00 a.m. (Brasília time)

The transmission will have simultaneous translation in English: See it in webcast, at http://ri.cemig.com.br, or take part by conference call via:

+ 55 (11) 2188-0155 (1st option) or

+ 55 (11) 2188-0188 (2nd option)

Password: CEMIG

Playback of Video Webcast:
http://ri.cemig.com.br
Click on the banner and download.
Available for 90 days.  		Conference call – Playback:
Tel: (+55-11) 2188-0400
Password:
CEMIG Português
Available from 03/20 to 04/03/2020 

 

Cemig Investor Relations

http://ri.cemig.com.br/
ri@cemig.com.br
Tel.: +55 (31) 3506-5024
Fax: +55 (31) 3506-5025

Cemig’s Executive Investor Relations Team

◾

Chief Finance and Investor Relations Officer

Maurício Fernandes Leonardo Júnior

◾

General Manager, Investor Relations

Antônio Carlos Vélez Braga

 

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Summary   
 
CONFERENCE CALL  2 
CEMIG INVESTOR RELATIONS  2 
CEMIG’S EXECUTIVE INVESTOR RELATIONS TEAM  2 
SUMMARY  3 
DISCLAIMER  4 
OUR SHARES  5 
CEMIG’S LONG-TERM RATINGS  6 
ADOPTION OF IFRS  7 
PROFIT AND LOSS ACCOUNTS  7 
4Q19 RESULTS  9 
CEMIG’S CONSOLIDATED ELECTRICITY MARKET  9 
THE ELECTRICITY MARKET OF CEMIG D  11 
PHYSICAL TOTALS OF TRANSPORT AND DISTRIBUTION – MWH  13 
THE ELECTRICITY MARKET OF CEMIG GT  13 
SUPPLY QUALITY INDICATORS – DECI AND FECI  14 
CONSOLIDATED OPERATIONAL REVENUE  15 
TAXES AND CHARGES REPORTED AS DEDUCTIONS FROM REVENUE  18 
OPERATIONAL COSTS AND EXPENSES  19 
DEFAULT  22 
SHARE OF PROFIT (LOSS) OF ASSOCIATES AND JOINT VENTURES, NET  24 
FINANCIAL REVENUE AND EXPENSES  25 
EBITDA  26 
DEBT  27 
COVENANTS – EUROBONDS  29 
RESULTS SEPARATED BY BUSINESS SEGMENT – 2019 AND Q4  30 
APPENDICES  31 
INVESTMENTS / CAPEX – PLANNED AND REALIZED  31 
SOURCES AND USES OF SUPPLY – BILLED MARKET  32 
LOSSES  33 
GENERATION PLANTS  34 
RAP (PERMITTED ANNUAL REVENUE – TRANSMISSION) – 2019-20 CYCLE  35 
CEMIG D TABLES (R$ MILLION)  36 
CEMIG GT TABLES (R$ MILLION)  37 
TABLES – CEMIG CONSOLIDATED (R$ MILLION)  37 

 

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Disclaimer

Certain statements and estimates in this material may represent expectations about future events or results, which are subject to risks and uncertainties that may be known or unknown. There is no guarantee that the events or results will take place as referred to in these expectations.

These expectations are based on the present assumptions and analyses from the point of view of our management, in accordance with their experience and other factors such as the macroeconomic environment, market conditions in the electricity sector, and expected future results, many of which are not under Cemig’s control.

Important factors that could lead to significant differences between actual results and the projections about future events or results include Cemig’s business strategy, Brazilian and international economic conditions, technology, Cemig’s financial strategy, changes in the electricity sector, hydrological conditions, conditions in the financial and energy markets, uncertainty on our results from future operations, plans and objectives, and other factors. Due to these and other factors, Cemig’s results may differ significantly from those indicated in or implied by such statements.

The information and opinions herein should not be understood as a recommendation to potential investors, and no investment decision should be based on the veracity, currentness or completeness of this information or these opinions. None of Cemig’s professionals nor any of their related parties or representatives shall have any liability for any losses that may result from use of the content of this material.

To evaluate the risks and uncertainties as they relate to Cemig, and to obtain additional information about factors that could give rise to different results from those estimated by Cemig, please consult the section on Risk Factors included in the Reference Form filed with the Brazilian Securities Commission (CVM) – and in the 20-F form filed with the US Securities and Exchange Commission (SEC).

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Our shares

Security / index  Ticker      Currency       Close of
2019  		     Close of
2018  		     Change in the
period %  		    
Cemig PN  CMIG4  R$  13.79 13.16 4.79 %
Cemig ON  CMIG3  R$  15.59 14.39 8.35 %
ADR PN  CIG  US$  3.34 3.38 -1.14 %
ADR ON  CIG.C  US$  3.90 3.76 3.72 %
Ibovespa  IBOV  – 115,645 87,887 31.58 %
Power industry index  IEEX  – 76,627 49,266 55.54 %

 

Source: Economática – Adjusted for corporate action, including dividends.

Trading volume in Cemig’s preferred shares (CMIG4) in 2019 was R$ 33.75 billion, of which R$ 6.14 billion was traded in the fourth quarter, corresponding to a daily average of R$ 100.63 million - 51.29% higher than in 4Q18 (R$ 206.61 mn). Trading volume in Cemig’s common shares in 4Q19 was R$ 6.49 bn, with average daily trading volume of R$ 22.61 mn. Cemig’s shares, by volume (aggregate of common (ON) and preferred (PN) shares), were the second most liquid in Brazil’s electricity sector in the period, and among the most traded in the whole Brazilian equity market.

On the New York Stock Exchange the volume traded in ADRs for Cemig’s preferred shares (CIG) in full-year 2019 was US$ 3.19 billion: we see this as reflecting recognition by the investor market of Cemig as a global investment option.

The São Paulo stock exchange Ibovespa index rose 31.58% in the year, closing on December 31 at 115,645 points. Cemig’s shares also rose in the year: the common (ON) shares rose 8.35%, and the preferred (PN) shares rose 4.79%. In New York the ADRs for Cemig’s preferred shares were down 1.17% in the year, and the ADRs for the common shares were up 3.72%.

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Cemig’s long-term ratings

This table shows long-term credit risk ratings and outlook for the Company as provided by the principal rating agencies:

Brazilian rating:

Cemig  Cemig D  Cemig GT 
Agency Rating  Outlook  Rating  Outlook  Rating  Outlook 
Fitch  A+(bra)  Stable  A+(bra)  Stable  A+(bra)  Stable 
S&P  brA+  Stable  brA+  Stable  brA+  Stable 
Moody’s  Baa1.br  Positive  Baa1.br  Positive  Baa1.br  Positive 

 

Global rating:

Cemig  Cemig D  Cemig GT 
Agency Rating  Outlook  Rating  Outlook  Rating  Outlook 
Fitch  BB–  Stable  BB–  Stable  BB–  Stable 
S&P  B  Stable  B  Stable  B  Stable 
Moody’s  B1  Positive  B1  Positive  B1  Positive 

 

Ratings of Eurobonds:

Cemig  Cemig GT 
Agency Rating  Outlook  Rating  Outlook 
Fitch  BB–  Stable  BB–  Stable 
S&P  B  Stable  B  Stable 

 

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Adoption of IFRS

The results presented below are prepared in accordance with Brazilian accounting rules, which now embody harmonization to IFRS (International Financial Reporting Standards) – and are expressed in thousands of Reais (R$ ’000) unless otherwise stated.

PROFIT AND LOSS ACCOUNTS

Consolidated – R$ ’000 4Q19      4Q18      %    
GOING CONCERN OPERATIONS       
REVENUE  6,389,549 5,471,966 16.77
OPERATING COSTS       
People  290,096 422,110 -31.27
Employees’ and managers’ profit shares  103,065 53,940 91.07
Post-retirement obligations  104,368 86,677 20.41
Materials  30,432 29,997 1.45
Outsourced services  344,605 334,574 3.00
Electricity purchased for resale  3,131,866 2,508,133 24.87
Depreciation and amortization  234,912 215,489 9.01
Operating provisions  125,684 64,650 94.41
Charges for use of the national grid  348,891 338,511 3.07
Gas bought for resale  335,426 340,182 -1.40
Infrastructure construction costs  392,970 305,284 28.72
Other operating expenses, net  310,520 140,460 121.07
TOTAL COST  5,752,835 4,840,007 18.86
Gross Profit  636,714 631,959 0.75
Share of profit (loss) in associates and joint ventures  -35,929 -27,563 30.35
Dividends declared by investee classified as held for sale  72,738 0 —
Restatement of prior equity holding in the subsidiaries acquired  0 -119,117 -100.00
Adjustment for impairment of Investments  0 -127,427 -100.00
Operational profit before financial revenue (expenses) and taxes  673,523 357,852 88.21
Finance income  -35,113 854,217 -104.11
Finance expenses  -177,846 -185,369 -4.06
Pre-tax profit  460,564 1,026,700 -55.14
Current income tax and Social Contribution tax  -145,687 -204,042 -28.60
Deferred income tax and Social Contribution tax  182,805 -106,968 -270.90
PROFIT (LOSS) FOR THE PERIOD FROM GOING CONCERN OPERATIONS  497,682 715,690 -30.46
Profit for the period from discontinued operations  0 327,774 -100.00
NET PROFIT (LOSS) FOR THE PERIOD  497,682 1,043,464 -52.30
Net profit for the period attributable to equity holders of the parent  497,534 1,002,368 -50.36
Net profit for the period attributable to non-controlling interests  148 41,096 -99.64

 

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4Q19 RESULTS

Unless otherwise stated, all figures are expressed in thousands of Reais (R$ ’000).

For 4Q19, Cemig reports net profit of R$ 497,534, which compares with net profit of R$ 1,002,368 in 4Q18.

Leading factors in the fourth quarter result were:

◾

Continuing improvement in the results of Cemig D (Distribution) in 4Q19, with profit of R$ 392,747 , compared to R$ 188,771 in 4Q18.

◾

Profit in Cemig GT of R$ 43,317 in 4Q19, vs. R$ 585,546 in 4Q18. Net profit of Cemig GT was impacted by 3 factors:

 

 

(i)     

deactivation of the Igarapé thermal plant, recognized in Other expenses at R$ 71,764;

 

 

(ii)     

the agreement relating to a contingency in Aliança – the joint venture of Cemig and Vale – contributing an expense of R$ 32,088; and

 

 

(iii)     

an impairment, of R$ 21,684, in the Volta do Rio wind farm company (Central Eólica Volta do Rio).

Particular factors in the result for the year-ago quarter – 4Q18 – were:

◾

A foreign exchange variation gain of R$ 199,104 related to the debt in dollars (Eurobonds), and recognition of gains totaling R$ 570,454 arising from a related hedge transaction – both in Cemig GT.

◾

A gross gain of R$ 378,316, on sales of telecom assets, in 4Q18.

Cemig’s consolidated electricity market

The Cemig Group sells electricity through its distribution company, Cemig Distribuição (‘Cemig D’), its generation and transmission company, Cemig Geração e Transmissão (‘Cemig GT’), and other wholly-owned subsidiaries: Horizontes Energia, Sá Carvalho, Cemig PCH, Rosal Energia, CE Praias de Parajuru, CE Volta do Rio, Cemig Geração Camargos, Cemig Geração Itutinga, Cemig Geração Salto Grande, Cemig Geração Três Marias, Cemig Geração Leste, Cemig Geração Oeste, and Cemig Geração Sul.

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These companies sell electricity to:

 

(i)     

Captive consumers in Cemig’s concession area in the State of Minas Gerais;

 

(ii)     

Free Consumers in both the State of Minas Gerais and other States of Brazil, in the Free Market (Ambiente de Contratação Livre, or ACL);

 

(iii)     

other agents of the electricity sector – traders, generators and independent power producers, also in the ACL; and

 

(iv)     

Distributors, in the Regulated Market (Ambiente de Contratação Regulada, or ACR).

In 4Q19 the Cemig group sold a total volume of 14,201,727 MWh, or 0.97% less than in 4Q18.

Sales of electricity to final consumers, plus Cemig’s own consumption, totaled 11,233,589 MWh, or 1.0% less than in 2018. Sales to distributors, traders, other generating companies and independent power producers in 2019 were 2,968,138 MWh, or 7.9% less than in 2018.

In December 2019 the Cemig Group invoiced 8,537,540 clients – a growth of 1.5% in the consumer base since the end of December 2018.

The chart below itemizes the Cemig Group’s sales to final consumers in the year, by consumer category:

Total consumption of electricity (GWh)

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The electricity market of Cemig D

Electricity billed to captive clients and electricity transported for Free Clients and distributors with access to Cemig D’s networks in 2019 totaled 11,299,265 MWh, or 0.12% less than in 2018. This result is a composition of lower use of the network by Free Clients – a reduction of 2.50%; and an increase, of 1.69%, in consumption by the captive market.

Captive clients + Transmission service (MWh)

Captive clients  4Q19       4Q18      %       2019     2018     %    
+ Transmission service (MWh)             
Residential  2,688,730 2,618,259 2.69 10,538,342 10,266,434 2.65
Industrial  4,887,100 5,198,468 -5.99 20,071,529 20,381,534 -1.52
Commercial, Services and Others  1,711,403 1,650,362 3.70 6,521,907 6,358,255 2.57
Rural  968,650 840,779 15.21 3,806,696 3,627,418 4.94
Public authorities  244,113 229,774 6.24 904,879 871,325 3.85
Public lighting  322,883 345,642 -6.58 1,357,293 1,383,878 -1.92
Public services  377,339 338,329 11.53 1,371,992 1,315,479 4.30
Concession holders (Distributors)  89,462 82,944 7.86 340,490 311,146 9.43
Own consumption  9,585 8,161 17.45 37,827 41,244 -8.28
Total  11,299,265 11,312,718 -0.12 44,950,955 44,556,713 0.88

 

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Residential

Residential consumption, which was 23.8% of the energy distributed by Cemig D in 4Q19, was 2.69% higher in 4Q19 than in 4Q18. This increase is mainly related to the inclusion (connection to the network) of a total of 149,331 new consumer units.

Industrial

Consumption by industrial clients in the captive market was negatively affected by reclassification of approximately 50% of the consumers in the industrial class to commercial and residential, and also by migration of clients to the Free Market. As a result it was 19.98% lower year-on-year, at 548,412 MWh in 4Q19, compared to 685,336 MWh in 4Q18.

In the Free Market, energy transported was 3.87% lower YoY at 4,338,688 MWh in 4Q19, compared to 4,513,132 MWh in 4Q18.

Commercial and Services

Energy distributed to commercial consumers was 3.70% higher than in 4Q18, reflecting the significant increase in consumption by the Free Market, and migration of clients from the captive market.

Volume was up 1.30% year-on-year in the captive market, but up 14.21% YoY in the Free Market.

Rural

Rural users consumed 15.21% more electricity in 4Q19 than in 4Q18 – mainly reflecting an increase in average consumption, despite the number of consumers billed being 9.22% lower than in 2018.

Number of clients

The Cemig group billed a total of 8,536,325 customers in December 2019 (excluding the group’s own consumption). Of this total, 1,441 were Free Clients that use Cemig D’s distribution network.

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  Number of clients   
Cemig D Dec. 31, 2019       Dec. 31, 2018         Change, %   
Residential  6,966,696 6,817,365 2.19 %
Industrial  29,875 72,341 -58.70 %
Commercial, Services and Others  805,811 720,535 11.84 %
Rural  647,064 712,792 -9.22 %
Public authorities  66,855 64,322 3.94 %
Public lighting  6,677 6,418 4.04 %
Public services  11,906 13,431 -11.35 %
  8,534,884 8,407,204 1.52 %
Total energy carried       
Industrial  707 574 23.17 %
Commercial  724 555 30.45 %
Rural  7 6 16.67 %
Concession holders  3 3 0.00 %
  1,441 1,138 26.63 %
Total  8,536,325 8,408,342 1.52 %

 

Physical totals of transport and distribution – MWh

Metered market     Change, 
MWh 4Q18–4Q19
4Q19       4Q18       %    
Total energy carried       

Transported for distributors (metered) 

84,851 78,888 7.56

Transported for Free Clients (metered) 

4,735,353 4,910,682 -3.57

Own load + Distributed generation (1)(2) 

8,295,057 7,902,244 4.97

Consumption by captive market – Billed supply 

6,515,789 6,406,350 1.71

Losses in distribution network 

1,779,268 1,495,894 18.94
Total energy carried  13,115,261 12,891,814 1.73

 

(1)      Includes Distributed Microgeneration.
(2)      Includes own consumption.

The electricity market of Cemig GT

Cemig GT billed a total of 7,720,172 MWh in 4Q19, 3.11% less than in 4Q18.

Consumption by industrial clients was 9.22% lower in 4Q19 than 4Q18. Meanwhile, consumption in the commercial market segment was 43.14% higher year-on-year, due to an increasing number of clients migrating from the captive market to the free market. From December 2018 to the end of December 2019, Cemig GT added 177 new commercial clients. Sales of energy in the Regulated Market were 11.40% lower,

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reflecting termination of sale contracts from the 15th Auction for Supply from Existing Plant.

Cemig GT (MWh) Change, 
4Q19      4Q18      %     
Free Clients       

Industrial 

3,512,239 3,869,146 -9.22

Commercial 

1,204,286 841,320 43.14

Rural 

1,275 548 132.71
Free Market – Free contracts  2,448,556 2,636,610 -7.13
Regulated Market  519,582 586,404 -11.40
Regulated Market – Cemig D  34,235 34,259 -0.07
Total  7,720,172 7,968,286 -3.11

 

SUPPLY QUALITY INDICATORS – DECi and FECi

Cemig is continuously taking action to improve operational management, organization of the logistics of its emergency services, and its permanent routine of preventive inspection and maintenance of substations, distribution lines and networks. It also invests in training of its staff for improved qualifications, state-of-the-art technologies, and standardization of work processes, aiming to maintain the quality of electricity supply, and as a result maintain satisfaction of clients and consumers.

The charts below show Cemig’s indicators for duration and frequency of outages –DECi (Average Outage Duration per Consumer, in hours), and FECi (Average Outage Frequency per Consumer, in number of outages), since January 2016.

These quality indicators are linked to the current concession contract of Cemig D (Distribution), signed in 2015

Note: Figures for 2016 and 2017 are according to recalculation presented by the Company to Aneel.

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Consolidated operational revenue

Revenue from supply of electricity:

Total revenue from supply of electricity in 4Q19 was R$ 7,123,326, or 6.2% more than in 4Q18 (R$ 6,708,348).

  MWh (1)      R$ ’000     Average price invoiced –
R$/MWh 		  
  4Q19       4Q18      Change %,
4Q18 – 4Q19  		4Q19      4Q18      Change %,
4Q18 – 4Q19  		4Q19      4Q18 
Residential  2,688,731 2,618,259 2.69 2,544,329 2,389,729 6.47 946.29 912.72
Industrial  4,060,651 4,554,482 -10.84 1,224,965 1,304,031 -6.06 301.67 286.32
Commercial, services and others  2,565,435 2,185,009 17.41 1,481,986 1,302,171 13.81 577.67 595.96
Rural  964,853 837,708 15.18 546,908 467,888 16.89 566.83 558.53
Public authorities  244,113 229,774 6.24 183,471 165,394 10.93 751.58 719.81
Public lighting  322,883 345,642 -6.58 155,323 160,847 -3.43 481.05 465.36
Public services  377,339 338,328 11.53 196,033 183,230 6.99 519.51 541.58
Subtotal  11,224,005 11,109,202 1.03 6,333,015 5,973,290 6.02 564.24 537.69
Own consumption  9,585 8161 17.45 — — — — —
Unbilled retail supply, net  0 0 — 133,930 -38,852 -309.58 — —
  11,233,590 11,117,363 1.05 6,414,441 5,934,438 8 .09  571.01 533 .80 
Other concession holders – Wholesale supply  2,968,138 3,223,014 -7.91 728,424 749,547 -2.82 245.41 232.56
Wholesale supply not yet invoiced, net  0 0 — -19,539 24,363 -180.2 — —
Total  14,201,728 14,340,377 -0 .97  7,123,326 6,708,348 6 .19  501.58 467 .79 
               

 

(1)     

Includes Regulated Market Electricity Sale Contracts (CCEARs) and individual (‘bilateral’) contracts with other agents.

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Final consumers

Total revenue from electricity sold to final consumers, excluding Cemig’s own consumption, in 4Q19 was R$ 6,333,015, or 6.02% more than in 4Q18 (R$ 5,973,290). The main factors in this revenue were:

◾

The annual tariff adjustment for Cemig D effective on May 28, 2019, with an average upward effect of 8.73% on consumer tariffs.

◾

Higher volume of energy sold to the commercial user category by Cemig GT and its wholly-owned subsidiaries.

Revenue from Use of Distribution Systems (TUSD charge)

This revenue in 4Q19 was R$ 745,540, or 19.40% higher than in 4Q18 (R$ 624,641), mainly reflecting the Company’s annual tariff adjustment, as from May 28, 2019, the average impact of which for Free Clients was an increase of 17.28%.

CVA and Other financial components in tariff adjustment

In its financial statements Cemig recognizes the difference between actual non-controllable costs (in which the CDE, and electricity bought for resale, are significant components) and the costs that were used as the basis for decision on the rates charged to consumers. A gain of R$ 12,869 was posted in 4Q19, compared to a gain of R$ 189,274 for 4Q18. This mainly reflects the lower costs of energy in comparison to the amounts for which the tariff provided coverage in 4Q19, compared to the prior year.

Changes in balances of financial assets and liabilities:

  R$ ’000    
Balance at September 30, 2018  1,204,748
Net constitution of financial assets  229,676
Realized  -40,402

Others – R&D Reimbursement 

0

Payments from the Flag Tariff Centralizing Account 

-340,172
Updating – Selic rate  26,843
Balance at December 31, 2018  1,080,693
Balance at December 30, 2019  1,099,974
Net constitution of financial assets  267,097
Realized  -254,228
Advances from the Flag Tariff Centralizing Account  -251,760
Updating – Selic rate  20,531
Balance at December 31, 2019  881,614

 

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Transmission concession revenue

This revenue, at R$ 129,437 in 4Q19, was 28.72% higher than in 4Q18 (R$ 100,559). The higher figure arises from (i) the inflation adjustment of the annual RAP, applied in July 2019, plus (ii) the new revenues related to the investments authorized to be included. The percentages and indices applied for the adjustment are different for different concessions: the IPCA index is applied to the contract of Cemig GT, and the IGP–M index to the contract of Cemig Itajubá. In 2019, the adjustments made to the RAP were: positive 10.53% for Cemig GT’s concession contracts; and positive 14.60% for the concession contracts of Cemig Itajubá. The adjustments comprised (i) application of the inflation adjustment index, plus (ii) recognition of works to upgrade and improve the facilities.

Revenue from transactions on the Wholesale Trading Exchange (CCEE)

Revenue from transactions in electricity on the CCEE in 4Q19 was R$ 24,746, compared to R$ 28,095 in 4Q18 – a year-on-year reduction of 11.92%. This difference mainly reflects a lower GSF (Generation Scaling Factor) in the period, and the Company’s seasonalization profile.

  Spot price  
Period   Sub-market       Average
price 
R$/MWh  		     GSF   
October  Southeast/Center-West  273.89 0.5805
November  Southeast/Center-West  317.28 0.6690
December  Southeast/Center-West  227.30 0.8587

 

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Revenue from supply of gas

Revenue from supply of gas in 4Q19 was R$ 585,012, or 7.74% higher than in 4Q18 (R$ 542,979), mainly due to passthrough of the increase in cost of gas acquired from Petrobras.

Market (’000 m3 /day)  2014      2015     2016     2017     2018      2019   
Residential  0.72 1.04 3.38 11.44 17.73 21.28
Commercial  23.15 22.42 24.68 32.67 39.37 47.70
Industrial  2,849.24 2,422.78 2,173.76 2,453.22 2,400.41 2,085.32
Other expenses  99.64 119.87 120.19 126.15 155.14 148.44
Total market excluding thermal plants  2,972.75 2,566.11 2,322.01 2,623.47 2,612.65 2,302.74
Thermal generation  1,223.99 1,309.13 591.52 990.89 414.04 793.94
Total  4,196.74 3,875.24 2,913.53 3,614.36 3,026.69 3,096.69

 

Supply of gas to the residential market began in March 2013. In December 2019, a total of 50,813 households were invoiced.

Number of clients 2014     2015     2016      2017     2018     2019   
Residential  1,446 3,820 14,935 30,605 41,377 50,813
Commercial  177 218 394 591 756 981
Industrial  111 113 112 107 109 109
Other expenses  88 62 49 50 57 61
Thermal generation  2 2 2 2 2 2
Total  1,824 4,215 15,492 31,355 42,301 51,966

 

Taxes and charges reported as Deductions from revenue

The total of these taxes and charges reported as deductions from revenue in 4Q19 was R$ 3,128,872 – or 10.47% less than in 4Q18 (R$ 3,494,662). The lower total primarily reflects: (i) lower consumer charges for the ‘Flag’ tariff band system; and (ii) the legal action won by Cemig, Cemig D and Cemig GT, in which the judiciary recognized these companies’ right to exclude ICMS tax amounts (paid or still payable) from the basis for calculation of the PIS, Pasep and Cofins taxes. As a result of the court judgment, ICMS

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amounts are no longer included in the basis for calculation of PIS, Pasep and Cofins in the bills delivered to clients of Cemig D.

Consumer charges – the ‘Flag’ Tariff system

The ‘Flag’ Tariff bands are activated as a result of low levels of water in the system’s reservoirs – tariffs are temporarily increased due to scarcity of rain. The charges to the consumer related to the Flag Tariffs were 28.33% lower in 4Q19, at R$ 200,662, than in 4Q18 (R$ 279,989).

The ’Flag’ Tariff component – history
Sep. 2019  Oct. 2019  Nov. 2019  Dec. 2019 
Red 1  Yellow  Red 1  Yellow 
Sep. 2018  Oct. 2018  Nov. 2018  Dec. 2018 
Red 2  Red 2  Yellow  Green 

 

Operational costs and expenses

Operational costs and expenses in 4Q19 totaled R$ 5,752,835, or 18.86% more than in 4Q18 (R$ 4,840,007).


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The following paragraphs comment on the main variations:

People

The expense on personnel in 4Q19 was R$ 290,096, or 31.27% lower than in 4Q18 (R$ 422,110). This mainly reflects the total number of employees in 4Q19 being 8.01% lower than in 4Q18 – and the expense on the Voluntary Retirement Program (PDVP), at R$ 65,596, being posted in 4Q18.

Number of employees – by company

 

Employees’ and managers’ profit shares

The expense on managers’ and employees’ profit shares in 4Q19 was R$ 103,065, compared to R$ 53,940 in 4Q18.

Electricity purchased for resale

The expense on electricity bought for resale in 4Q19 was R$ 3,131,866, or 24.87% higher than in 4Q18 (R$ 2,508,133). This arises mainly from the following items:

◾

Expenses on spot market purchases 310.7% higher, at R$ 638,028 in 4Q19, vs. R$ 155,360 in 4Q18, reflecting an expense R$ 524,899 higher in Cemig D in 4Q19 than in 4Q18, primarily due to the higher spot price (PLD): The average spot price was approximately 70% higher than in 4Q18;

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◾

Expenses on energy acquired in the Free Market 8.48% higher, at R$ 1,091,035 in 4Q19, vs. R$ 1,005,740 in 4Q18.

For Cemig D, purchased energy is a non-manageable cost: the difference between the amounts used as a reference for calculation of tariffs and the costs actually incurred is compensated for in the subsequent tariff adjustment.

Consolidated  4Q19      4Q18      %    
Supply from Itaipu Binacional  362,882 343,216 5.73
Physical guarantee quota contracts  187,547 178,277 5.20
Quotas for Angra I and II nuclear plants  67,294 66,711 0.87
Spot market  638,028 155,360 310.68
Proinfa  89,517 85,002 5.31
‘Bilateral’ contracts  79,750 189,154 -57.84
Electricity acquired in Regulated Market auctions  809,253 787,752 2.73
Acquired in Free Market  1,091,035 1,005,740 8.48
Distributed generation  69,514 -62,850 -210.60
Credits of PIS, Pasep and Cofins taxes  -262,954 -240,229 9.46
  3,131,866 2,508,133 24.87

 

Cemig D  4Q19      4Q18      %   
Supply from Itaipu Binacional  362,882 343,216 5.73
Physical guarantee quota contracts  197,739 178,277 10.92
Quotas for Angra I and II nuclear plants  67,292 66,711 0.87
Spot market - CCEE  616,753 91,854 571.45
Individual (‘bilateral’) contracts  79,750 73,709 8.20
Supply acquired in auctions on Regulated Market  818,020 815,829 0.27
Proinfa  89,517 85,001 5.31
Distributed generation  69,513 29,823 133.09
Credits of PIS, Pasep and Cofins taxes  -166,287 -143,884 15.57
  2,135,179 1,540,536 38.60

 

Gas bought for resale

The expense on acquisition of gas, at R$ 335,426, was 1.40% lower than in 4Q18 (R$ 340,182).

Post-retirement obligations

The impact of the Company’s post-retirement obligations was an expense of R$ 104,368 in 4Q19 – or 20.41% more than the expense of R$ 86,677 in 3Q18. This is

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mainly the result of reduction in the discount rate used in the actuarial calculation –which generated an increase in liabilities, and consequently in the expense reported.

Outsourced services

The expense on outsourced services in 4Q19 was R$ 344,605, compared to R$ 334,574 in 4Q18, a growth of 3.00%. The main impacts arise from factors prioritizing action and expenses for Cemig D, to reduce outages and improve consumer service quality. The expense on maintenance and conservation of electrical facilities and equipment increased from R$ 102,785, in 4Q18, to R$ 114,588 in 4Q19.

Operational provisions

New operational provisions were 94.41% higher in 4Q19 than 4Q18, at R$ 125,684, compared to R$ 64,650 in 4Q18. This arises mainly from the following factors:

◾

Higher new provisions for employment-law contingencies, a net R$ 34.687 million in 4Q19, compared to net R$ 8,079 million in 2018. This arises mainly from new actions, or from reassessment of the chances of loss in existing actions, based on adverse court decisions taking place in the period.

◾

Tax provisions were R$ 32,009, higher than in 4Q18.

◾

Regulatory provisions were significantly higher in 4Q19: in the quarter new provisions of R$ 856 were made, compared to a total net reversal of provisions in 4Q18 of R$ 15,848.

Default

In 2019 two marked features of the economy were: instability in the financial market, combined with continuation of the slow process of recovery in economic activity.

To overcome the effects of a still unfavorable economic scenario, and to combat the level of default, in 2019 Cemig maintained its high ratios of collection in relation to consumers in default. Cemig uses various tools of communication and collection to prevent increase in default. These include contact by telephone and email, collection

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requests by text and by letter, negative posting on credit registers, collection through the courts and, principally, disconnection of supply. Aneel Resolution 414 allows supply to be cut off after 15 days from receipt of a notice by a defaulting consumer.

The company continued with a robust plan for consumer disconnections in 2019, under which carried out more than 1.2 million consumer disconnections – over the aggregate of all the types of consumer – in the year, for the second year running.

As well as the collection methods Cemig already uses to combat default over the long term, it is in the process of implementing a technology platform for solutions to disputes through negotiation of receivables both through the courts and by out-of-court settlement. In parallel, in November the Company held a “Reconciliation Week” in the Courts of Minas Gerais State, and also a campaign for renegotiation taking place simultaneously with the release of citizens’ FGTS funds, as authorized by Provisional Measure 889/2019, to encourage clients to renegotiate their debts. The Company is also putting in place a mechanism for automatic filing of notary’s-office protests, making this a viable route for collection.

This level of activity has shown positive results. The level of default at the end of 2019, at a ratio of 5.10%, is 10% lower than the level in 2018. With continuing enhancement of its processes and more intense application of the tools for collection, the Company is confident that it will achieve an even more significant reduction in default indices in the coming periods.

Default – % – moving average
( Accumulated default over total of 12 months / Billing for same 12 months )
 

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Share of profit (loss) of associates and joint ventures, net
(Equity method accounting)

The result of equity method gains/losses in non-consolidated investees in 4Q19 was a loss of R$ 35,929, compared to a loss of R$ 27,563 in 4Q18. The losses in 4Q18 came mainly from the interests in Renova and Madeira Energia. No equity method gain or loss was reported in 4Q19 for the investment in Renova, since the entire value of that investment was written off in December 2018, as a result of that investee’s negative net equity.

Consolidated – R$ ’000  4Q19  4Q18 
Taesa  35,524 68,945
Aliança Geração  15,808 24,751
Baguari Energia  7,557 5,896
Retiro Baixo  3,263 -86
Hidrelétrica Pipoca  2,181 2,338
Hidrelétrica Cachoeirão  974 1,718
Janaúba photovoltaic plant – distributed generation  566 -27
LightGer  555 725
Axxiom Soluções Tecnológicas  361 -1,588
Guanhães Energia  24 30,298
Companhia de Transmissão Centroeste  8 1,406
Ativas Data Center  -483 -2,382
Aliança Norte (Belo Monte plant)  -4,117 11,376
Amazônia Energia (Belo Monte Plant)  -5,717 24,302
Usina Hidrelétrica Itaocara S.A.  -27,810 -120
FIP Melbourne (Santo Antônio Plant)  -29,146 -37,600
Madeira Energia (Santo Antônio plant)  -35,477 -43,785
Central Eólica Praias de Parajuru  0 1,472
Central Eólica Volta do Rio  0 -1,729
Central Eólica Praias de Morgado  0 -9,506
Renova  0 -106,100
Light  0      1,447
RME  0 686
Total  -35,929 -27,563

 

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Financial revenue and expenses

Cemig reports net financial expenses in 4Q19 of R$ 212,959, which compares with net financial revenue of R$ 668,848 in 4Q18. The main components in the year-on-year difference are as follows:

◾

A loss, of R$ 101,372, in 4Q19, on the hedge transaction contracted to protect the Eurobond issue from exchange rate variation – this compares to a gain, of R$ 570,454, in 4Q18. The positive result in 4Q18 was mainly the result of the lowering of the yield curve during the period of the contract, which helped to reduce expectations for the amount of Cemig’s obligations, which are indexed to the CDI rate – increasing the fair value of the option. This factor was not repeated in 4Q19.

◾

Negative financial expense of R$ 203,307 on loans in foreign currency, in 4Q19, due to the Brazilian currency’s gain in value in the period, compared to a negative financial expense of R$ 199,104 in 4Q18.

 

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Ebitda

Cemig’s consolidated Ebitda was 0.48% higher in 4Q19 than in 4Q18. Ebitda margin in 4Q19 was 15.55%, compared to 18.07% in 4Q18.

EBITDA – R$ ’000  4Q19     4Q18     Change, %     2019    2018    Change, %   
Net profit for the period  497,534 1,002,368 -50.36 3,127,398 1,700,099 83.95
+ Provision for income tax and Social Contribution tax*  47,959 439,637 -89.09 1,650,732 727,751 126.83
+ Financial revenue (expenses)  212,959 -668,848 -131.84 -1,360,277 518,482 -362.36
+ Amortization and depreciation  234,912 215,489 9.01 958,234 834,593 14.81
Ebitda  993,364 988,646 0.48 4,376,087 3,780,925 15.74

 

* The expense on income tax and the Social Contribution tax includes an item of R$85 million (2019) and R$129 million (2018), presented at its net value in the figure for profit/loss of discontinued activities.

 

 

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DEBT


The Company’s consolidated debt at December 31, 2019, was R$ 14,776,031, practically from R$ 14,771,828 at the end of 2018. Note, importantly, that the company has reported a net positive component of R$ 1,690,944, arising from hedge transactions related to the Eurobond issue (Call Spread on the principal: R$1,037,664; Swap for 100% of the interest: R$653,280).

In 2019 debt totaling R$ 4,883,218 was amortized – a total of R$ 133,026 of this being amortized in the fourth quarter – and no new loans were obtained in the last quarter of the year; a total of R$ 4,510,000 in new financings was raised in 3Q19.

Debt amortization (R$ mn)

 

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CEMIG H  2019      2018      %      
Total Debt  14,776,031 14,771,728 0.03 %
Cash and cash equivalents + Marketable Securities  1,289,438 1,703,038 -24.29 %
Total Net Debt  13,486,593 13,068,690 3.20 %
Debt in foreign currency  6,061,097 5,826,701 4.02 %

 

CEMIG GT  2019      2018      % 
Total Debt  7,886,783 8,198,912 -3.81 %
Cash and cash equivalents + Marketable Securities  585,203 485,042 20.65 %
Total Net Debt  7,301,580 7,713,870 -5.34 %
Debt in foreign currency  6,043,046 5,800,765 4.18 %

 

CEMIG D  2019      2018     % 
Total Debt  5,794,922 6,263,408 -7.48 %
Cash and cash equivalents + Marketable Securities  344,611 916,272 -62.39 %
Total Net Debt  5,450,311 5,347,136 1.93 %
Debt in foreign currency  18,051 25,936 -30.40 %

 

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Covenants – Eurobonds

12 months 2019
R$ mn GT       H   
Net income (loss)  835 3.127
Financial results net  -234 -1.360
Income tax and social contribution  603 1.566
Depreciation and amortization  216 958
minority interest result  83 -125
provisions for the variation in value of put option obligations  64 64
non-operating result (which includes any gains on asset sales and any asset write-off or impairments)  72 92
any non-cash expenses and non-cash charges, to the extent that they are nonrecurring  994 1.923
any non-cash credits and gains increasing net income, to the extent that they are non-recurring  -414 -1.428
non-cash revenues related to transmission and generation indemnification  -155 -155
cash dividends received from minority investments (as measured in the statement of cash flows)  134 283
monetary updating of concession grant fees  -318 -318
cash inflows related to concession grant fees  259 259
cash inflows related to transmission revenue for cost of capital coverage  181 181
Covenant EBITDA  2.319 5.066

 

12 months 2019
R$ mn GT      H   
Consolidated Indebtedness  7.887 14.776
Debt contracts with Forluz  253 1.117
The carrying liability of any put option obligation, less  483 483
Consolidated cash and cash equivalents and consolidated marketable securities recorded as current assets -584 -1.289
Covenant Net Debt  8.038 15.086
Covenant Net Debt to Covenant EBITDA Ratio  3,47 2,98
Limit Covenant Net Debt to Covenant EBITDA Ratio  4,50 3,50
Total Secured Debt (reais)    918
Total Secured Debt to Covenant EBITDA Ratio    0,18
Limit Covenant Net Debt to Covenant EBITDA Ratio    1,75

 

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RESULTS SEPARATED BY BUSINESS SEGMENT – 2019 and Q4

INFORMATION BY SEGMENT, 2019
ELECTRICITY               
DESCRIPTION  GENERATION     TRANSMISSION    DISTRIBUTION    GAS  OTHER  ELIMINATIONS  TOTAL 
NET REVENUE    6,882,174 713,931 15,918,741 1,858,211 323,934 -306,685 25,390,306
COST OF ELECTRICITY AND GAS             
Electricity bought for resale  -3,841,262 — -7,516,878 — -6 71,972 -11,286,174
Charges for use of national grid  -189,901 — -1,458,939 — — 222,562 -1,426,278
Gas bought for resale  — — — -1,435,728 — — -1,435,728
People  -207,422 -114,837 -869,289 -45,913 -34,057 — -1,271,518
Employees’ and managers’ profit shares  -35,818 -26,908 -182,856 — -17,426 — -263,008
Post-retirement obligations  -49,627 -38,138 -276,663 — -44,036 — -408,464
Materials  -16,927 -6,059 -62,632 -2,092 -3,455 27 -91,138
Outsourced services  -125,390 -44,922 -1,015,880 -19,788 -39,667 7,097 -1,238,550
Depreciation and amortization  -209,967 -5,563 -652,208 -85,920 -4,576 — -958,234
Operating provisions (reversals) and adjustments for operational losses  -975,363 -134,843 -1,100,647 -1,793 -188,460 — -2,401,106
Infrastructure construction costs  — -220,390 -936,332 -42,976 — — -1,199,698
Other operating exp (rev.), net  -174,888 -20,116 -298,633 -10,128 -377 5,027 -499,115
OPERATIONAL COSTS AND EXPENSES  -5,826,565 -611,776 -14,370,957 -1,644,338 -332,060 306,685 -22,479,011
Share of profit (loss) in associates and joint ventures  -88,279 214,564 — — -934 — 125,351
Dividends declared by investee classified as Held for Sale  — — 72,738 — — — 72,738
OPER. PROFIT BEFORE FIN. REV. (EXP.) AND TAXES  967,330 316,719 1,620,522 213,873 -9,060 — 3,109,384
Financial revenues  1,282,018 97,905 1,534,795 21,103 271,029 — 3,206,850
Financial expenses  -1,034,529 -114,784 -632,406 -45,865 -18,989 — -1,846,573
PRE-TAX PROFIT  1,214,819 299,840 2,522,911 189,111 242,980 — 4,469,661
Income tax and Social Contribution tax  -550,798 -36,042 -805,807 -47,507 -125,501 — -1,565,655
Net income from going concern operations  664,021 263,798 1,717,104 141,604 117,479 — 2,904,006
DISCONTINUED OPERATIONS               
Profit for the year from discontinued operations  — — 224,067 — — — 224,067
NET PROFIT FOR THE YEAR  664,021 263,798 1,941,171 141,604 117,479 — 3,128,073
Interest of controlling stockholders  664,021 263,798 1,941,171 140,929 117,479 — 3,127,398
Minority interests  — — — 675 — — 675
  664,021 263,798 1,941,171 141,604 117,479 — 3,128,073

 

INFORMATION BY SEGMENT, 4Q19   
ELECTRICITY
DESCRIPTION  GENERATION     TRANSMISSION    DISTRIBUTION    GAS     OTHER      ELIMINATIONS     TOTAL 
NET REVENUE  1,534,523 193,728 4,223,832 482,215 34,448 -79,197 6,389,549
COST OF ELECTRICITY AND GAS  0 0 0 0 0 0 0
Electricity bought for resale  -1,015,644 0 -2,135,179 0 0 18,957 -3,131,866
Charges for use of national grid  -47,524 0 -360,447 0 0 59,080 -348,891
Gas bought for resale  — 0 — -335,426 — 0 -335,426
People  -365,846 -203,027 -1,542,999 -79,249 -6,295 0 -290,096
Employees’ and managers’ profit shares  -13,334 -11,252 -73,376 — -5,103 0 -103,065
Post-retirement obligations  -12,616 -9,835 -70,797 — -11,120 0 -104,368
Materials  -5,630 -2,296 -18,844 -424 -3,245 7 -30,432
Outsourced services  -38,253 -12,932 -281,911 -5,837 -6,821 1,149 -344,605
Depreciation and amortization  -43,279 -1,020 -163,196 -26,550 -867 0 -234,912
Operating provisions (reversals) and adjustments for operational losses  -55,102 -20,247 -52,037 -676 2,378 0 -125,684
Infrastructure construction costs  — -70,231 -310,002 -12,737 — 0 -392,970
Other operating exp (rev.), net  -175,191 -8,179 -123,422 -3,352 -380 4 -310,520
OPERATIONAL COSTS AND EXPENSES  -1,455,571 -162,639 -3,784,790 -397,579 -31,453 79,197 -5,752,835
Share of profit (loss) in associates and joint ventures  -71,339 35,532 0 0 -122 0 -35,929
Dividends declared by investee classified as Held for Sale  — — 72,738 — — — 72,738
OPER. PROFIT BEFORE FIN. REV. (EXP.) AND TAXES  7,613 66,621 511,780 84,636 2,873 0 673,523
Financial revenues  -79,400 -9,090 132,858 -36,275 -43,206 0 -35,113
Financial expenses  -21,067 -3,015 -126,011 -26,937 -816 0 -177,846
PRE-TAX PROFIT  -92,854 54,516 518,627 21,424 -41,149 0 460,564
Income tax and Social Contribution tax  91,910 -3,879 -53,142 9,135 -6,906 0 37,118
Net income from going concern operations  -944 50,637 465,485 30,559 -48,055 0 497,682
DISCONTINUED OPERATIONS               
Profit for the year from discontinued operations  — — — — — — —
NET PROFIT FOR THE YEAR  -944 50,637 465,485 30,559 -48,055 — 497,682
Interest of controlling stockholders  -944 50,637 465,485 30,411 -48,055 — 497,534
Minority interests  — — — 148 — — 148
  -944 50,637 465,485 30,559 -48,055 — 497,682

 

35

 

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Appendices

Investments / Capex – planned and realized

R$ ’000  2019
Realized  		    2020
Proposed  		 
GENERATION  90,711 184,821

Investment program 

25,777 95,373

Capital injections 

48,934 89,448

Aliança Norte 

953 3,988

SPC – Guanhães 

19,766 —

SPC – Amazônia Energia Participações (Belo Monte) 

127 4,857

Itaocara Hydroelectric Plant 

23,088 29,881

Renova 

5,000 50,722

Acquisitions of wind farms in Ceará 

16,000 —
TRANSMISSION  222,637 249,764

Investment program 

222,637 249,764
Cemig D  986,079 1,667,470

Investment program 

986,079 1,667,470
HOLDING COMPANY  21,629 168,037
Infrastructure  — —
Capital injections  19,471 168,037

Axxiom 

9,097 —

Cemig GD (Distributed Generation) 

10,337 —

Cemig Overseas 

37 —

Gas consortia 

— 0

Efficientia – Distributed generation 

— 168,037
Acquisitions – Centroeste  2,158 —
TOTAL  1,321,056 2,270,092
   

 

36

 

Table of Contents

Sources and uses of supply – Billed market


37

 

Table of Contents

 


Losses

38

 

Table of Contents

Generation plants

Power Plant      Company     Type     

Cemig's
Stake

     Installed 
Capacity
(MW) 		    Assured
Energy
(MW médio) 		    Expiration of
Concession 		 
Emborcação  CEMIG GT  HPP  100.0 % 1,192 500 23-jul-25 
Belo Monte  Norte  HPP  12.3 % 1,152 560 26-ago-45 
Santo Antônio  SAE  HPP  15.5 % 553 376 12-jun-46 
Nova Ponte  CEMIG GT  HPP  100.0 % 510 270 23-jul-25 
Irapé  CEMIG GT  HPP  100.0 % 399 208 28-fev-35 
Três Marias  CEMIG G. TRÊS MARIAS  HPP  100.0 % 396 72 4-jan-46 
Aimorés  ALIANÇA  HPP  45.0 % 149 82 20-dez-35 
Igarapé  CEMIG GT  HPP  100.0 % 131 71 13-ago-24 
Salto Grande  CEMIG G. SALTO GRANDE  HPP  100.0 % 102 23 4-jan-46 
Amador Aguiar I (Capim Branco I)  ALIANÇA  HPP  39.3 % 94 61 29-ago-36 
Queimado  CEMIG GT  HPP  82.5 % 87 56 2-jan-33 
Nilo Peçanha  Light Energia  HPP  22.6 % 86 75 4-jun-26 
Amador Aguiar II (Capim Branco II)  ALIANÇA  HPP  39.3 % 83 52 29-ago-36 
Funil  ALIANÇA  HPP  45.0 % 81 38 20-dez-35 
Sá Carvalho  Sá Carvalho S.A  HPP  100.0 % 78 56 1-dez-24 
Rosal  Rosal Energia S. A  HPP  100.0 % 55 29 8-mai-32 
Itutinga  CEMIG G. ITUTINGA  HPP  100.0 % 52 8 4-jan-46 
Igarapava  ALIANÇA  HPP  23.7 % 50 32 30-dez-28 
Baguari  BAGUARI ENERGIA  HPP  34.0 % 48 29 15-ago-41 
Camargos  CEMIG G. CAMARGOS  HPP  100.0 % 46 6 4-jan-46 
Ilha dos Pombos  Light Energia  HPP  22.6 % 42 25 4-jun-26 
Volta do Rio  CEMIG GT  Wind farm  100.0 % 42 18 26-dez-31 
Retiro Baixo  Retiro Baixo Energética S.A.  HPP  49.9 % 42 18 25-ago-41 
Porto Estrela  ALIANÇA  HPP  30.0 % 34 19 10-jul-32 
Fontes Nova  Light Energia  HPP  22.6 % 30 22 4-jun-26 
Praias de Parajuru  CEMIG GT  Wind farm  100.0 % 29 8 24-set-32 
Pai Joaquim  CEMIG PCH S.A  SHP  100.0 % 23 14 1-abr-32 
Pereira Passos  Light Energia  HPP  22.6 % 23 11 4-jun-26 
Piau  CEMIG G. SUL  SHP  100.0 % 18 4 4-jan-46 
Gafanhoto  CEMIG G. OESTE  SHP  100.0 % 14 2 4-jan-46 
Outras        317 130  
Total        5,955 2,875  

 

39

 

Table of Contents

RAP (Permitted Annual Revenue – Transmission) – 2019-20 cycle

RAP (Permitted Annual Revenue - Transmission ) - 2019/2020 cycle
Annual Permitted Revenue (RAP)  RAP       % Cemig       Cemig    
Cemig GT  704,516,559 100.00 % 704,516,559
Cemig GT  678,468,095 100.00 % 678,468,095
Cemig Itajuba  26,048,464 100.00 % 26,048,464
Centroeste  19,527,260 100.00 % 19,527,260
Taesa  2,735,489,644 21.68 % 593,054,155

Novatrans 2 

330,901,554   63,488,599

TSN 

300,992,176   65,255,104

Munirah 

40,946,624   8,877,228

GTESA 

5,515,544   1,195,770

PATESA 

18,078,709   3,919,464

ETAU 

38,500,280   8,346,861

ETEO 

98,933,020   21,448,679

NTE 

86,286,553   18,706,925

STE 

48,636,153   10,544,318

ATE I 

167,264,727   36,262,993

ATE II 

258,668,882   56,079,414

EATE 

122,242,974   26,502,277

ETEP 

27,562,990   5,975,656

ENTE 

101,996,568   22,112,856

ECTE 

10,186,476   2,208,428

ERTE 

19,483,764   4,224,080

Lumitrans 

11,959,851   2,592,896

Transleste 

24,728,188   5,361,071

Transirapé 

20,073,621   4,351,961

Transudeste 

15,326,765   3,322,843

ATE III 

125,389,196   27,184,378

São Gotardo 

5,416,349   1,174,265

Mariana 

15,362,098   3,330,503

Miracema 

65,032,990   14,099,152

Janaúba 

194,059,383   42,072,074

Aimorés 

39,686,900   8,604,120

Paraguaçu 

59,239,231   12,843,065

Brasnorte 

27,559,465   5,280,371

STC 

18,932,098   4,104,479

EBTE 

34,360,035   7,449,256

ESDE 

7,046,946   1,527,778

ETSE 

4,026,515   872,948

ESTE 

56,088,981   12,160,091

Ivaí 

147,000,350   31,869,676

EDTE 

34,569,462   7,479,665

Sant'Ana 

60,934,539   13,167,171
São João  47,572,593   10,313,738
São Pedro  44,927,092   9,740,194

Light 

10,181,318 22.58 % 2,298,942
TOTAL RAP CEMIG      1,319,396,915

 

40

 

Table of Contents

Cemig D Tables (R$ million)

CEMIG D Market
  (GWh) GW
Quarter  Captive
Consumers  		     TUSD
ENERGY1 		    T.E.D2     TUSD
PICK3 		  
1Q18  6,213 4,637 10,850 31
2Q18  6,343 4,873 11,216 30
3Q18  6,309 4,870 11,179 30
4Q18  6,406 4,906 11,313 31
1Q19  6,529 4,760 11,289 33
2Q19  6,288 4,910 11,198 33
3Q19  6,266 4,898 11,164 34
4Q19  6,516 4,783 11,299 33

 

1.

Refers to the quantity of electricity for calculation of the regulatory charges charged to free consumer clients ("Portion A")

2.

Total electricity distributed

3.

Sum of the demand on which the TUSD is invoiced, according to demand contracted ("Portion B").

 

Operating Revenues (R$ million)  4Q19      3Q19       4Q18       QoQ       YoY       
Sales to final consumers  5,354 5,070 4,913 5.60 % 8.98 %
Revenue from Use of Distribution Systems (the TUSD charge)  751 718 630 4.60 % 19.21 %
CVA and Other financial components in tariff adjustment  13 -35 189 -137.14 % -93.12 %
Construction revenue  310 263 213 17.87 % 45.54 %
Others  363 415 322 -12.53 % 12.73 %
Subtotal  6,791 6,431 6,267 5.60 % 8.36 %
Deductions  2,567 2,522 2,954 1.78 % -13.10 %
Net Revenues  4,224 3,909 3,313 8.06 % 27.50 %

 

Operating Expenses (R$ million)  4Q19       3Q19       4Q18       QoQ       YoY       
Personnel  196 210 296 -6.87 % -33.86 %
Employees' and managers' profit sharing  73 - 11 38 -767.05 % —
Forluz – Post- retirement obligations  71 71 58 -0.29 % 22.55 %
Materials  19 15 19 25.63 % -0.74 %
Outsourced services  282 247 261 14.13 % 7.94 %
Amortization  163 164 155 -0.49 % 5.38 %
Operating provisions  52 854 39 -93.91 % 33.23 %
Charges for Use of Basic Transmission Network  360 385 344 -6.38 % 4.68 %
Energy purchased for resale  2,135 1,926 1,541 10.86 % 38.60 %
Construction Cost  310 263 213 17.87 % 45.47 %
Other Expenses  123 94 121 31.30 % 2.37 %
Total  3,785 4,218 3,084 -10.27 % 22.73 %

 

Statement of Results (R$ million)  4Q19       3Q19       4Q18       QoQ       YoY       
Net Revenue  4,224 3,909 3,313 8.06 % 27.50 %
Operating Expenses  3,785 4,218 3,084 -10.27 % 22.73 %
EBIT  439 -309 229 -242.14 % 91.76 %
EBITDA  602 -145 384 -515.45 % 56.91 %
Financial Result  7 -25 4 -127.39 % 52.26 %
Provision for Income Taxes, Social Cont & Deferred Income Tax  -53 19 -45 -379.69 % 18.96 %
Net Income  393 -315 189 -224.73 % 108.03 %

 

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Cemig GT tables (R$ million)

Operating Revenues  4Q19      3Q19       4Q18       QoQ      YoY       
Sales to final consumers  1.062 1073 1016 -1,0 % 4,5 %
Supply  728 746 773 -2,4 % -5,9 %
Revenues from Trans. Network  183 184 146 -0,8 % 25,1 %
Gain on monetary updating of Concession Grant Fee  74 68 76 9,1 % -2,0 %
Transactions in the CCEE  25 9 17 174,5 % 44,1 %
Construction revenue  70 67 83 4,8 % -15,4 %
Transmission indemnity revenue  31 34 42 -9,0 % -26,7 %
Generation indemnity revenue  0 0 -27 — —
PIS/PASEP and COFINS Taxes Credits Over ICMS  -11 0 0 — —
Others  44 52 37 -14,9 % 18,8 %
Subtotal  2.206 2.233 2.164 -1,2 % 1,9 %
Deductions  446 467 411 -4,6 % 8,5 %
Net Revenues  1.760 1.766 1.753 -0,3 % 0,4 %

 

Operating Expenses  4Q19       3Q19       4Q18       QoQ       YoY       
Personnel  76 78 93,0  -3,0 % -18,7 %
Employees' and managers' profit sharing  25 -4 12,3  -714,7 % 99,8 %
Post-retirement obligations  22 23 18,6  -2,4 % 20,5 %
Materials  8 5 10,0  57,6 % -21,5 %
Outsourced services  51 40 50,4  26,9 % 0,7 %
Depreciation and Amortization  44 57 39,3  -22,3 % 12,7 %
Operating provisions  75 289 39,4  -73,9 % 91,3 %
Charges for Use of Basic Transmission Network  48 50 44,3  -5,0 % 7,2 %
Energy purchased for resale  1016 1126 987,3  -9,8 % 2,9 %
Construction Cost  70 67 83,0  4,8 % -15,4 %
Other Expenses  183 -3 8,4  -6198,10 % 2089,9 %
Total  1.617 1.728 1.386 -6,4 % 16,7 %

 

Statement of Results  4Q19       3Q19        4Q18       QoQ       YoY       
Net Revenue  1.760 1.766 1.753 -0,3 % 0,4 %
Operating Expenses  1.617 1.728 1.386 -6,4 % 16,7 %
EBIT  143 38 367 275,6 % -61,1 %
Equity gain in subsidiaries  -71 -20 -102 — -29,9 %
Restatement of prior equity holding in the subsidiaries acquired  0 0 80 — —
Adjustment for impairment of Investments  0 0 -127 — —
EBITDA  116 75 257 54,3 % -55,0 %
Financial Result  -112 -213 670 -47,3 % -116,8 %
Provision for Income Taxes, Social Cont & Deferred Income Tax  84 61 -301 37,8 % -127,9 %
Net Income  43 -134 586 -132,3 % -92,6 %

 

Tables – Cemig Consolidated (R$ million)

Energy Sales (Consolidated)(GWh)  4Q19       3Q19       4Q18       QoQ        YoY       
Residential  2,689 2,558 2,618 5.12 % 2.71 %
Industrial  4,061 4,145 4,554 -2.03 % -10.83 %
Commercial  2,565 2,348 2,185 9.24 % 17.39 %
Rural  965 1,055 837 -8.53 % 15.29 %
Others  945 869 915 8.75 % 3.28 %
Subtotal  — 10,975 11,109 — —
Own Consumption  11 11 8 0.00 % 37.50 %
Supply  2,731 2,979 3,223 -8.32 % -15.27 %
TOTAL  13,967 13,965 14,340 0.01 % -2.60 %

 

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Energy Sales  4Q19       3Q19       4Q18       QoQ      YoY       
Residential  2,540 2,459 2,390 3.29 % 6.28 %
Industrial  1,225 1,239 1,305 -1.13 % -6.13 %
Commercial  1,482 1,337 1,302 10.85 % 13.82 %
Rural  547 594 467 -7.91 % 17.13 %
Others  535 520 510 2.88 % 4.90 %
Electricity sold to final consumers  6,329 6,149 5,974 2.93 % 5.94 %
Unbilled Supply, Net  62 -30 -14 — -542.86 %
Supply  729 756 749 -3.57 % -2.67 %
TOTAL  7,120 6,875 6,709 3.56 % 6.13 %

 

Operating Revenues  4Q19       3Q19       4Q18       QoQ       YoY       
Sales to final consumers  7,123 6,875 6,708 3.61 % 6.19 %
TUSD  746 711 625 4.83 % 19.35 %
CVA and Other financial components in tariff adjustment  13 -35 189 -136.64 % -93.20 %
Transmission concession revenue  129 132 101 -2.04 % 28.72 %
Transmission Construction revenue  70 67 83 0.00 % 0.00 %
Transmission Indemnity Revenue  31 34 42 -7.97 % -26.66 %
Generation Indemnity Revenue  0 — -27 — —
Distribution Construction revenue  323 274 222 17.64 % 45.18 %
Gain on monetary updating of Concession Grant Fee  74 68 76 9.24 % -1.98 %
Transactions in the CCEE  25 10 28 152.23 % -11.92 %
Gas supply  585 582 543 0.54 % 7.74 %
Fine for violation of continuity indicator  -15 -8 -13 86.28 % 14.43 %
Recovery of PIS/Pasep and Cofins taxes credits over ICMS  -11 — — — —
Others  425 470 389 -9.65 % 9.19 %
Deductions  -3,129 -3,109 -3,495 0.64 % -10.47 %
Total  6,390 6,071 5,472 5.25 % 16.77 %

 

Operating Expenses  4Q19       3Q19       4Q18       QoQ       YoY       
Personnel  290 304 422 -4.57 % -31.27 %
Employees’ and managers’ profit sharing  103 -15 54 -787.10 % —
Forluz – Post-Retirement Employee Benefits  104 105 87 -0.60 % 20.41 %
Materials  30 20 30 52.16 % 1.45 %
Outsourced services  345 308 335 11.88 % 3.00 %
Energy purchased for resale  3,132 3,034 2,508 3.23 % 24.87 %
Depreciation and Amortization  235 244 215 -3.72 % 9.01 %
Operating Provisions  126 1,297 65 -90.31 % 94.41 %
Charges for use of the national grid  349 376 339 -7.21 % 3.07 %
Gas bought for resale  335 375 340 -10.55 % -1.40 %
Construction costs  393 342 305 14.90 % 28.72 %
Other Expenses  311 96 140 223.46 % 121.07 %
Total  5,753 6,486 4,840 -11.30 % 18.86 %

 

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Financial Result Breakdown  4Q19       3Q19      4Q18       QoQ      YoY       
FINANCE INCOME           
Income from cash investments  20 30 35 -33.51 % -42.34 %
Arrears fees on sale of energy  88 90 92 -1.73 % -4.25 %
Monetary variations  10 7 5 41.79 % 117.61 %
Monetary variations from CVA  21 32 27 -35.84 % -23.51 %
Monetary updating on Court escrow deposits  17 13 2 29.46 % 800.96 %
Pasep and Cofins charged on finance income  -64 -13 -34 394.13 % 86.36 %
Gain on Financial instruments - Hedge  -101 486 570 -120.86 % -117.77 %
Revenue from advance payments  1 2 28 -56.45 % -96.93 %
Updating related to arbitration proceedings  0 0 77 — -100.00 %
Liabilities with related parties  0 2 56 -97.10 % -99.90 %
Updating of the tax credits in PIS, Pasep and Cofins taxes  5 22 0 -76.45 % —
Others  -31 -52 -4 -39.70 % 753.46 %
  -35 619 854 -105.67 % -104.11 %
FINANCE EXPENSES           
Costs of loans and financings  -302 -319 -312 -5.35 % -3.23 %
Amortization of transaction cost  -4 -20 -7 -82.43 % -46.63 %
FX variation – loans and financings  203 -429 199 -147.39 % 2.11 %
FX adjustment – Itaipu Binacional  -1 -8 15 -82.75 % 0.00 %
Monetary updating – loans and financings  -42 -17 -24 146.42 % 76.14 %
Inflation adjustment – paid concession  -1 0 0 - -537.06 %
Charges and monetary updating on post-retirement obligation  -12 -11 -15 7.01 % -19.39 %
Inflation adjustment – advance from customers  0 0 -2 — 0.00 %
Leasing – Inflation adjustment  -6 -9 0 -31.07 % —
Finance Expense - P&D e PEE  -24 0 -24 — 0.01 %
Others  10 -39 -18 -126.65 % -159.36 %
  -178 -852 -185 -79.13 % -4.06 %
NET FINANCE INCOME (EXPENSES)  -213 -233 669 -8.57 % -131.84 %

 

Statement of Results  4Q19      3Q19       4Q18       QoQ      YoY       
Net Revenue  6,390 6,071 5,472 5.25 % 16.77 %
Operating Expenses  5,753 6,486 4,840 -11.30 % 18.86 %
EBIT  637 -415 632 -253.35 % 0.75 %
Share of profit (loss) in associates and joint ventures  -36 -49 -27 -26.53 % 33.33 %
EBITDA  993 110 988 802.73 % 0.51 %
Financial Result  -213 -233 669 -8.57 % -131.84 %
Provision for Income Taxes, Social Cont & Deferred Income Tax  48 117 440 -59.08 % -89.12 %
Net profit for the period attributable to non-controlling interests  0 224 288 — -100.00 %
NET PROFIT  497 -281 1,002 -276.87 % -50.40 %

 

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Cash Flow Statement  2019      2018   
Cash at beginning of period  891 1,030
Cash generated by operations  2,006 1,008
Net income for the period from going concern operations  3,128 1,741
Current and deferred income tax and Social Contribution tax  -1,767 -649
Depreciation and amortization  958 849
CVA and other financial components  307 908
Equity gain (loss) in subsidiaries  -125 103
Provisions (reversals) for operational losses  2,401 467
Dividends received from equity holdings  283 311
Interest and monetary variation  1,190 1,207
Interest paid on loans and financings  -1,264 -1,290
credits of taxes awarded in the ICMS tax case  -2,952 0
Others  -153 -2,639
Financing activities  -1,172 -937
Lease payments  -65 0
Payments of loans and financings  -4,883 -3,527
Financings obtained and capital increase  4,477 2,989
Interest on Equity, and dividends  -701 -509
Capital Increase / Subscription of shares to be capitalized  0 110
Investment activity  -1,813 -865
Cash generated from discontinued operations  0 0
Securities - Financial Investment  158 290
Contract assets - Distribution and gas infrastructure  -1,856 -800
Financial assets  -45 -279
Fixed and Intangible assets  -70 -76
Cash flow in investment activities from discontinued operations  625 654
Cash at end of period  537 890

 

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BALANCE SHEETS (CONSOLIDATED) - ASSETS  2019       2018  
CURRENT     
Cash and cash equivalents  536 891
Marketable securities  740 704
Customers and traders and concession holders - Transport of electricity  4,524 4,092
Concession financial assets  1,080 1,070
Concession contract assets  172 131
Recoverable taxes  99 124
Income and social contribution tax credits  621 387
Dividends receivables  186 120
Restricted cash  12 91
Inventories  39 36
Public Lighting Contribution  165 149
Advances to suppliers  40 7
Reimbursement of tariff subsidies payments  97 91
Low-income customer subsidy  30 30
Derivative financial instruments  235 70
Others  304 359
Assets classified as held for sale  1,258 19,446
TOTAL CURRENT  10,298 27,796
NON-CURRENT     
Marketable securities  13 109
Advances to suppliers  — 87
Customers and traders and concession holders - Transport of electricity  77 81
Recoverable taxes  6,349 242
Income and social contribution taxes recoverable  228 6
Deferred income and social contribution taxes  2,430 2,147
Escrow deposits  2,540 2,502
Derivative financial instruments  1,456 744
Accounts receivable from the State of Minas Gerais  115 246
Concession financial assets  4,850 4,927
Concession contract assets  1,832 1,598
Investments - Equity method  5,399 5,235
Property, plant and equipment  2,450 2,662
Intangible assets  11,624 10,777
Leasing - rights of use  277 —
Others  147 697
TOTAL NON-CURRENT  39,790 32,059
TOTAL ASSETS  49,927 59,855

 

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BALANCE SHEETS        
LIABILITIES AND SHAREHOLDERS' EQUITY  2019       2018
CURRENT     
Suppliers  2,080 1,801
Regulatory charges  457 514
Profit sharing  212 79
Taxes payable  359 410
Income and social contribution tax  134 112
Interest on equity and dividends payable  1,579 864
Loans, financing and debentures  2,746 2,198
Payroll and related charges  200 284
Public Lighting Contribution  252 281
Post-employment obligations  288 253
Leasing  85 —
Advances from customers  — 79
Payable to related parties  8 —
Others  347 247
Liabilities directly associated to assets held for sale  0 16,272
  0 0
NON-CURRENT  0 0
Regulatory charges  147 179
Loans, financing and debentures  12,030 12,574
Taxes payable  1 29
Deferred income and social contribution taxes  661 728
Provisions  1,888 641
Post-employment obligations  6,421 4,736
Pasep and Cofins taxes to be reimbursed to customers  4,193 1,124
Derivative financial Instruments  483 419
Leasing  203 —
Other obligations  97 92
TOTAL NON-CURRENT  26,124 20,522
TOTAL LIABILITIES  34,871 43,915
  0 0
EQUITY  0 0
Share capital  7,294 7,294
Capital reserves  2,250 2,250
Profit reserves  7,915 6,362
Equity valuation adjustments  -2,407 -1,327
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT  15,052 14,579
NON-CONTROLLING INTERESTS  4 1,361
TOTAL EQUITY  15,056 15,939
TOTAL LIABILITIES AND EQUITY  49,927 59,855

 

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4.      Presentation of 2019 Results.

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5.      Material Announcement Dated March 20, 2020: Renova accepts binding offer – with 30 days exclusivity for completion of documents.

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COMPANHIA ENERGÉTICA DE MINAS GERAIS – CEMIG
LISTED COMPANY – CNPJ 17.155.730/0001-64 – NIRE 31300040127

MATERIAL ANNOUNCEMENT

Renova accepts binding offer
– with 30 days exclusivity for completion of documents

Cemig (Companhia Energética de Minas Gerais, listed in São Paulo, New York and Madrid), in compliance with CVM Instruction 358 of January 3, 2002 as amended, hereby reports to the Brazilian Securities Commission (CVM), the São Paulo Stock Exchange (B3) and the market as follows:

Cemig’s affiliated company Renova Energia S.A. (‘Renova’) today published the following Material Announcement:

“ 

Renova Energia S.A. – in Judicial Recovery (RNEW3; RNEW 4 and RNEW11) (‘Renova’), in accordance with CVM Instruction 358/2002 as amended, hereby informs its stockholders and the public as follows:

On today’s date the Board of Directors of Renova decided in favor of acceptance of the binding offer made by ARC Capital Ltda. (‘ARC’), jointly with G5 Administradora de Recursos Ltda (‘G5’), and XP Vista Asset Management Ltda. (‘XP’) for financing to conclude the works of Phase A of the Alto Sertão III wind farm complex, and to fund the current operational expenses of Renova (‘the Binding Offer’).

Under the terms of the Binding Offer, Renova will grant a period of exclusivity for thirty calendars days from today’s date, for satisfactory negotiation of the documents of the transaction between the parties.

Renova reiterates its commitment to keep stockholders and the market in general fully and timely informed in accordance with the applicable legislation. ”

 

Belo Horizonte, March 20, 2020.

Leonardo George de Magalhães
Chief Finance and Investor Relations Officer

Av. Barbacena 1200  Santo Agostinho  30190-131 Belo Horizonte, MG  Brazil  Tel.: +55 31 3506-5024  Fax +55 31 3506-5025 

This text is a translation, provided for information only. The original text in Portuguese is the legally valid version.

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