SAO PAULO (Reuters) – Brazilian energy giant Eletrobras reported late on Wednesday first-quarter net profit of 331 million reais ($65 million), down 19% from a year earlier, as the company renewed investments in power transmission and faced falling energy prices.
WHY IS IT IMPORTANT
Eletrobras is Latin America’s largest utility and is pursuing new strategies following its privatization in June 2022, when the Brazilian government diluted its stake in the company in a deal worth more than $6 billion.
The company currently has dispersed ownership.
KEY QUOTE
“The first quarter results reflect a continued search for cost rationalization, a focus on financial management and renewed investment in electricity transmission,” Eletrobras said in a statement.
MARKET REACTION
Shares in Sao Paulo-traded Eletrobras fell more than 5% after the results, underperforming Brazil’s benchmark stock index, which traded 1.5% lower.
Itau BBA analysts said in a note to clients that core earnings were slightly below their expectations due to lower average free market energy prices, but Eletrobras performed well in terms of managing its statutory debt obligations.
IN NUMBERS
Eletrobras’ net revenue fell 6% in the first three months of the year to 8.72 billion reais.
Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) fell 19% to R$4.5 billion.
($1 = 5.0904 reais)