EDP, a company that operates in all segments of the Brazilian electricity sector, reached a Net Income of R$ 1.337 billion in 2019, an increase of 5,1% compared to 2018. This is the best result of the Company in its entire history of operations in Brazil. The adjusted EBITDA (earnings before taxes, depreciation and amortization) summed up R$ 2.264 billion, up 8% over the last year. Considering only the fourth quarter, adjusted net income was R$ 315.9 million, an increase of 25.5% over the same period in 2018, and adjusted EBITDA reached R$ 603.9 million, an increase of 34.3%.

Historical performance was the result of operational improvements in Distribution, with emphasis on returns obtained from tariff reviews; the integrated management of the generators together with the trader to mitigate energy risk and the implementation of the new Transmission segment. At the same time, the investment made by EDP in Brazil was also the largest in its history - R$ 2.818 billion, which represents a growth of 149% in comparison with 2018.

“Last year was marked by an increase in our participation in strategic businesses for the future of the Company - Regulated Networks and Energy Solutions. With the credibility of the results achieved in 2019, we are confident that we will start 2020 prepared for the new challenges in the sector and to continue on a path of sustained growth”, says Miguel Setas, president of EDP in Brazil.

Transmission Investments

In 2019, the Company reinforced its strategy in the field of Transmission with the acquisition, in the secondary market, of Lote Q, for R$ 407 million.The project consists of two substations and 142 kilometers of transmission lines, connecting the states of Santa Catarina and Rio Grande do Sul, between Tubarão (SC) and Torres (RS).

The total investment made in the Transmission segment, of R$ 1.9 billion, allowed important advances.  On October 15th, the Lot 18 installation license (IL) was issued between the states of São Paulo and Minas Gerais. In the same month, the licensing of Lot 21 was concluded, in Santa Catarina.

In addition, the completion of the works for lot 11, in Maranhão, made it possible to obtain from the National Electric System Operator (ONS), on January 4th of this year, the release of the commercial start of one of the two sections of the transmission line and of Chapadinha II substation. The start-up of partial operation was advanced by 19 months against the calendar of the National Agency of Electrical Energy (Aneel), representing an advance of R$ 17 million, equivalent to 51% of the total Annual Permitted Revenue (RAP).

Distribution Excellence

In Distribution, the resources devoted throughout the tariff cycle to improvements in operation and excellence in service provision ensured, after the revision of the tariffs of EDP ES and EDP SP, an average increase of 36% in the remuneration of the distributors, with a disallowance less than 0.5%, a reference percentage in the sector. The investment also provided for the maintenance of the reduction path in non-technical losses. In the year, Net Revenue from Distribution reached R$ 7.59 billion, an increase of 9.6% (R$ 204.1 million at EDP SP and R$ 461 million at EDP ES).

In line with its strategy of increasing Distribution's share of its investment portfolio, in December EDP acquired 691,700 additional preferred shares of Celesc at a cost of R$ 28.5 million. As a result, the Company now holds 25.35% of the share capital, becoming the main shareholder of the Santa Catarina distributor.

Pioneering energy services

In the last year, EDP's pioneering spirit became evident in the field of electric mobility. In October, the Company announced the installation of the first and largest ultra-fast electric vehicle charging network in South America. With a total investment of R$ 32.9 million, the project will connect a total of 64 charging points connecting Santa Catarina, Paraná, São Paulo, Rio de Janeiro and Vitória, forming an electric car supply corridor with more than 2,500 kilometers long. The first inaugurations are scheduled for this year, with the completion of the implementation of the network by 2021.

In the first half, the Company also delivered a solar energy complex to Multiplan, one of the main groups in the shopping center industry in the country. The set of two photovoltaic plants, located in Itacarambi, in the north of Minas Gerais, has an installed capacity of 8.33MWp and will provide an annual savings of up to R$ 5.5 million in the energy bill, according to Multiplan.

In the second half, EDP completed a solar plant in the self-production model to serve the Novos Estúdios Globo [New Globo Studios], inaugurated by the broadcaster in Rio de Janeiro. In an area of approximately 4,500 square meters, more than 2,000 photovoltaic panels were installed over the so-called Módulo de Gravação 4 [Recording Module 4] (MG4). During the lifetime of the plant, the emission of approximately 2 thousand tons of CO2 will be avoided, equivalent to the planting of 12 thousand trees.

Control of energy risk

In the Generation segment, the hydrological scenario remained below average historical records, directly impacting the plants, which were exposed to an 80.9% GSF (financial mechanism aimed at sharing hydrological risks affecting generation agents). Thus, in order to protect its energy portfolio, the Group's Generators, together with Trader, maintained around 20% of the uncontracted energy throughout the year, which allowed zero energy risk in the year. 

Concern with sustainability

In 2019, EDP expanded its support to the cause of the valorization of Luso-Brazilian culture. For this reason, the Company, which was already the largest sponsor of the reconstruction of the Museum of the Portuguese Language, also became the first master sponsor of the restoration of the Ipiranga Museum, closed since 2013. In total, the Company allocated R$ 32 million to the recovery of both museums.

In the social sphere, the EDP Institute, an organization that has been managing the EDP Group's socioenvironmental actions for 12 years, benefited more than 82 thousand people in 2019 with initiatives in Amapá, Bahia, Ceará, Espírito Santo, Rio Grande do Norte, Rio Grande do Sul, Santa Catarina, São Paulo and Tocantins. More than R$ 18 million were invested in projects aimed at education, culture, sports, entrepreneurship, social development, health and income generation.

In 2019, EDP was selected for the 14th consecutive year to compose B3's Corporate Sustainability Index (ISE) and was named the Best Company in Brazil in Transparency and Fighting Against Corruption by the EXAME Sustainability Guide. These are recognitions that encourage the Company to remain firm in its mission to lead the energy transition in Brazil, making its contribution to building a new, more ethical, human and sustainable decade.

About EDP in Brazil

With over 20 years of experience, EDP is one of the largest private companies in the electricity sector operating throughout the value chain. The Company, which has over 10,000 direct and outsourced employees, operates in Transmission, Trading and Energy Services and has six hydroeletric generation units and one thermal power station. In Distribution, it serves about 3.5 million customers in São Paulo and Espírito Santo, in addition to being the main shareholder of Celesc, in Santa Catarina. In Brazil, it is a reference in areas such as Innovation, Governance and Sustainability, having been in the B3´s Corporate Sustainability Index (ISE) for 14 consecutive years.