EDP reports R$2.3 billion EBITDA in 2016 | EDP Brasil

S‹o Paulo, February 23, 2017 - In 2016 EDP, a company engaged in energy generation, trading, services and supply, reported an EBITDA (earnings before interest, taxes, depreciation and amortization) of R$2.3 billion. Net revenues last year amounted to R$8.9 billion, while net profits totaled R$667 million. Excluding the non-cash effect, net profits amount to R$538 million, 34% higher than in 2015 (R$401 million).

"Even in a recession period, EDP has delivered consistent results and invested, for the second consecutive year, over R$1 billion in Brazil, reaffirming its commitment to the country. The Company has capitalized itself in 2016 and is prepared to continue on its growth path," says EDP CEO Miguel Setas.

EDP has invested R$1.2 billion in its operations last year, 5.7% more than in 2015. Of this total, R$481 million were invested in the company distributors in S‹o Paulo and Esp’rito Santo, 50% more than in the previous year. The funds were allocated to the installation of measuring systems, the expansion of power lines and substations, network improvements, equipment replacement, etc. As for generation, the contribution amounted to R$681,2 million, including the investments in the hydroelectric plants of Santo Ant™nio do Jari, Cachoeira Caldeir‹o, and S‹o Manoel.

Outstanding implementation results

In 2016, EDP once again demonstrated its outstanding project implementation capacity. Completed eight months before schedule and within the initial budget, the 219 MW Caldeir‹o HPP started its operations in May, reporting net operating revenues of R$28.3 million - a sum corresponding to 50% of EDP equity in the project - with the sale of the energy generated before the period of engagement in the liberalized market.

The S‹o Manoel Hydroelectric Power Plant, under construction on the border between Mato Grosso and Par‡, has reached 83.4% of completion in December. With an installed capacity of 700 MW, the plant - where EDP holds a 33.3% stake - will generate sufficient energy to supply a city with about 2.5 million people. After the inauguration, scheduled for 2018, EDP will have a total generation capacity of 3.0 GW.

PecŽm turnaround, another important goal for the company, achieved record levels last year. The thermoelectric plant availability closed 2016 at 88.5%.

Progress in supply

Investments by EDP distributors in S‹o Paulo and Esp’rito Santo to combat bad debt and fraud have helped reduce losses and expenses involving Provisions for Doubtful Debtors (PDD). Non-technical low voltage losses in the state of S‹o Paulo dropped by 0.62% between 4Q15 and 4Q16, standing at 9.98%. In the region of Esp’rito Santo, the results declined to 13.50% in December, compared to 14.98% at the end of the previous year.

PDD expenses in S‹o Paulo dropped from R$19.9 million in the first quarter to R$8.9 million in the last quarter. In Esp’rito Santo, PDD expenses declined from R$12.4 million to R$ 4.3 million during the same period.

Another milestone of the segment in 2016 was the periodic tariff review carried out by ANEEL (National Electricity Agency) in EDP concession areas in Esp’rito Santo, which has triggered an increase of about 10% in the B Segment (for supply services). It is also important to note that the agency has increased the limit of allowed regulatory losses. The base target for non-technical low voltage losses has increased from 7.87% to 11.45%.

Capitalization and New Businesses

The R$1.5 billion capital increase completed in July made it possible to anticipate the payment of the PecŽm I debt to the Inter-American Development Bank (IDB), amounting to R$922,6 million. The funds have also made it possible to settle the company Bank Credit Note, totaling R$303.2 million. These anticipated payments have reduced the cost of debt by about 2%.

With the consolidation of the financial equilibrium, the company is now in a position to invest in new fronts. In October, EDP won the bid for lot 24 in the Transmission Auction carried out by ANEEL, obtaining the concession to operate a 113-kilometer line in Esp’rito Santo. The company has also entered the field of distributed solar generation with the launching of the implementation of EDP Solar.

In early 2017, the Company invested in new technologies to improve the efficiency of its operations. EDP became an industry pioneer by implementing the first robotic system to process internal activities - R1SP (Robot 1 Shared Services), which will focus on routine operations with large volumes of data.

"The digital agenda is a priority for EDP in order to improve the company efficiency levels even more," Miguel Setas points out.