EDP Brasil exceeds R$3 billion EBITDA in 2015 | EDP Brasil

EDP Brasil, a company engaged in electricity generation, trading and supply, has reached important milestones in 2015, the year in which it celebrated 20 years of operations in the country and 10 years of IPO (Initial Public Offering). For the first time, the Company reports an EBITDA (earnings before interest, taxes, depreciation and amortization) higher than R$3 billion and profits above R$1 billion.

These figures reflect the implementation of the strategy set by the company for the biennium 2014/ 2015. "We are moving forward on all priorities defined for 2015, which has allowed us to deliver this year superior results," says EDP Brasil CEO Miguel Setas. "Among the goals achieved throughout the year, I would highlight the important economic and operational turnaround of the Pecém I power plant, whose purchase strengthened our position as a hydrothermal player", Setas points out.

In 2015 the company EBITDA grew by 56.8%, from R$1.9 billion in 2014 to R$3.0 billion. In the fourth quarter, the increase was 3.3% compared to the same period of 2014, from R$760.3 million to R$785.3 million.

Similarly, EDP Brasil accumulated a net profit of R$1.3 billion in 2015, a 70.3% increase compared to the R$743.5 million reported in the previous year. Figures in the fourth quarter reflect the same growth trend: a 20.7% increase compared with the same period last year, from R$317.3 million to R$383.1 million.

The net operating revenue, excluding construction revenues, strengthens the results reported in 2015: R$9.79 billion, a 13.8% increase compared with 2014. The fourth quarter saw a 13% drop compared to the same period of the last year (R$2.39 billion), reflecting the accounting in 4Q04, as per accounting rules, of the entire balance of sectoral assets at that time.

Consolidation of Pecém

In 2015 EDP Brasil purchased the remaining 50% stake in Pecém I, which enabled the Company to execute the unit economic turnaround. Focusing on operational and regulatory optimization, this was the the first year the plant generated a positive net profit. The gains amounted to R$22.15 million, reversing the loss of R$236.25 million in 2014.

The improvements in the plant resulted in a 12 pp average availability increase, from 76% in 2014 to 88% in 2015.

Portfolio Optimization

The strategy of consolidating the company position as a major player in the hydrothermal generation landscape continued to evolve in 2015, furthering the reorganization of its asset portfolio. EDP Brasil has signed a contract to sell Pantanal Energética to Cachoeira Escura Energética and completed the transfer of EDP Renováveis Brasil, which is now controlled by EDP Renováveis.

The company advanced in the construction of two hydroelectric plants: Cachoeira Caldeirão HPP and São Manoel HPP. By the end of 2015, 95% and 37% of the works had been completed, respectively.

As far as acquisitions are concerned, in 2015 EDP Brasil concluded the purchase of APS, a company specializing in energy efficiency services, thereby strengthening EDP position as one of the main players in Brazil in terms of customized solutions for energy efficiency projects.

Improved operational efficiency

In 2015 the distributors focused on fighting energy losses in concession areas, improving the quality of service offered to customers. In Espírito Santo, EDP Escelsa reported a drop of about 3% in low voltage non-technical losses, which now stand at 14.89%. This is the lowest rate in the last 13 years. In São Paulo, EDP Bandeirante also reported some improvement, reducing energy losses to 10.60% (-1.55%).

This is the result of an R$67.1 million investment in loss reduction measures carried out in 2005. The funds were used to improve remote network monitoring, leverage energy recovery operations, and promote energy efficiency programs.

The evolution of the distributors" quality indexes, which remained within the limits set by the National Electric Energy Agency (ANEEL), also showcases the company commitment to superior quality services. Both at EDP Bandeirante and EDP Escelsa, the FEC index - which measures the frequency of power interruptions per customer - dropped from 5.35 in São Paulo and 6.45 in Espírito Santo to 5.09. The DEC index - which assesses the duration of interruption per customer - increased from 7.63h to 8.42h at EDP Bandeirante and dropped from 10.37h to 9.10h at EDP Escelsa.

The highest share price increase in the electric sector

2015 was also marked by the appreciation of the company share price on BM&F Bovespa. EDP Brasil shares have grown by 36.2% over the year, the greatest upward movement in the electric sector. This positive performance contrasts with the decline on Ibovespa (-13.3%), the main stock market index, and on IEE (-8.7%), used as a benchmark for the electric sector. Thus, EDP Brasil finished 2015 with a market cap of R$5.7 billion.