CIG

Good afternoon, everyone. I am Carolina Sena, CEMIG's Investor Relations Superintendent. Welcome to CEMIG's first quarter 2026 earnings video conference call. Please note that this video conference is being recorded, and it will be available on the company's IR website at ri.cemig.com.br, where you will also find the company's presentation. Should you need a simultaneous interpretation, the feature is available by clicking on the globe icon located on the center bottom of the screen. Upon choosing interpretation, select your language of choice, Portuguese or English. Should you choose to follow the call in English, you may also select mute original audio. During the company's presentation, all participants will have their microphones disabled. After that, we will open a Q&A session.

Before turning to the results presentation, we would like to inform you that the appointment of Alexandre Ramos Peixoto as the new CEO of CEMIG has been approved as of yesterday. Alexandre Ramos Peixoto replaces Reynaldo Passanezi Filho, to whom the company recognizes and expresses its gratitude for the work carried out. Under his management, CEMIG conducted a consistent financial recovery process, resumed investment levels, and developed a strategic plan worth approximately BRL 70 billion through 2030. During this period, the company has strengthened its infrastructure, expanded the number of substations, modernized the grid, and eliminated historical bottlenecks. It also resumed sustainable growth and achieved the highest market value in its history, increasing it from BRL 8 billion to BRL 45 billion. His departure stems from the term limit restriction provided for in the State-Owned Enterprises Law Nº 13,303/2016.

It is precisely to give continuity to this trajectory that Alexandre Ramos Peixoto comes in, a career employee of the company with solid experience in the Brazilian electric sector. He is an engineer by training. He holds a degree in quality engineer and management from PUC Minas and a degree in management and strategic planning from the Universidade Federal de Minas Gerais. In addition to specializations of an MBA in related areas related to generation and planning in the sector. Throughout his career, he has worked at ANEEL, MME, and EBE, and at CEMIG itself served as Regulatory and Institutional Relations Officer. Since May 2023, he has chaired the board of directors of CEP. Now we will start the conference. With us, we will have Andrea Marques de Almeida, CFO and IR Officer. Luis Cláudio Correa Villani, Chief Information Technology Officer.

Marco da Camino Ancona Lopez Soligo, Marco da Camino Ancona Lopez Soligo, Chief Generation and Transmission Officer. Marney Tadeu Antunes, Chief Distribution Officer. Yuri Araujo de Mendonca, CEMIG's CEO. Marcos Vinícius de Castro Lobato, Trading Planning Superintendent. For the initial remarks, we would like to bring to the floor Andrea Marques de Almeida. She is going to be making the presentation.

Good morning and good afternoon to all of you. It's a pleasure to be here again to bring you the results for CEMIG, and we are very proud of that. We always start talking about the quarterly highlights. CEMIG has the benefit of being a diversified company which is maintaining its results consistently. These are the operating results, and this quarter, it is just like the others. Of course, we reached results of BRL 1.79 billion in EBITDA and BRL 979 in profit.

I usually say that we have to balance out all the plays here, we have worked on our investment plan, here of BRL 1.48 billion. We also have shareholders' remuneration, another important topic of our strategy, BRL 658 million. We have a small acquisition, PCH Pipoca and Temacu in Mesquita, that we acquired in the quarter. Also, we talked about this at the end of the year, about the post-employment, employment agreement and all the impacts that we recorded at the time. This is an agreement that in fact is going to allow us to have effects over time, and we can already see a reduction in our expenses in the amount of BRL 80 million, and that's an important highlight as well. Now we have a snapshot of the quarter.

The total of BRL 1.48 is in the main area here. Distribution is always carrying the highest representativeness of our investment here with BRL 1.28 billion for distribution. We have More Energy, main delivery phase. We are delivering substations. six new substations and one substation that was modernized in the More Energy Program. Now, 765 of low and average voltage network. As transmission, we usually grow in reinforcement and improvements. It was just like that we have investments in the quarter, BRL 103 million, which added in terms of our RAP is the Annual Permitted Revenue. That was BRL 15 million for our cash generation portfolio. For generation, I think we have a lower amount as CEMIG is still moving on with its project in the Midwest as the most relevant one.

Cemig Wind, here we start seeing that in our charts as a relevant investment with seven new solar photovoltaic plants and added 19 MW capacity to our portfolio. The quarter results are in line with the results of last year, considering that the highlights of the distributing company, the positive highlight here is that we effectively had in May the rebuilding of Parcela B, which was 7.78%. Comparing quarter to quarter, this is the main impact in the distributing company. We also had an increase in residential consumption, which is positive. In terms of challenges, also known already by the market, we had the effect of price that starting 2025, energy prices are more volatile. As you know, we have positions that need to be closed over time.

With the higher prices, the positions closing, ended up having negative results in the creating company, in the generating company. The main effect was GSF. If we compare year against year, we had 0.92 in the first quarter of 2026. The purchase of energy to tackle the hydrological risk allowed us to have impact in the EBITDA of BRL 49 million. We go into the details of what I just mentioned. We have the level of prices, clearly we can see the change in the price volatility that started in the beginning of 2025. We started from January to March of 2025. The prices were around BRL 59 per megawatt, then they went up.

Last year we also had a GSF close to one, which is no longer the reality in 2026 when we have a lower GSF and the price is much higher. We reached levels of BRL 382 per megawatt, impacting the management of the hydrological risk. That's an impact of BRL 49 million. Turning into a zoom to our cost and expenses, the main item, and it has been, and in the other quarters also it was the same, so it is a recurrence, it is third party services. This quarter maybe we had higher expenses in preventive maintenance as well as corrective maintenance. Obviously we had the right of way cleaning. All of these services are in order to deliver a better quality of services to our clients.

They come with all the investments that we are making on the investment branch, on, sorry, distribution branch. This is to provide better services for our clients, and we'll go over that when we discuss our GAC and other expenses. Also, with this large investment program, we have decommissions, and we have a disposal of assets which has been part of our management. We are disposing of assets that in the past has been used for CEMIG but no longer have. Now, talking about the impact, already the post-employment restructuring that we had up to December of last year. We see that if we compare that growth, including the post-employment effect, the growth is then 2.5% quarter-on-quarter.

We will also be discussing how this increase can be seen in regards to the network kilometers of stations, which is also important for the distributing company. Now, we talk about our debt profile and all the work that we have been doing to match the profile of the debt with the profile of our investment. We know that we have five years of investment in the distributing company up to the tariff review that's going to happen in 2028. That's why we are increasing to expand our debt. We reached 6.6 years of average maturity. Also important is that 76%, that is the bulk of our debt, is due after the tariff review rebuilding in 2028.

This debt profile is being extended so that also it matches with the recovery time of the tariff that we'll have in the future. The last funding that we had in the quarter was a debenture combined with a loan of Law 4,131. They have been made lower than the sovereign risk, and we were able to include BRL 2.6 billion to the distributing company in this quarter. We reached the leverage of 2.45, net debt over recurring EBITDA. It's very healthy. This is a leverage that also includes the financing of the investment program. This leverage is always going to be at very healthy levels over the whole program that, of course, will peak in 2028 when we are going to have that tariff review. That cost also is very reasonable.

It's 89% of the CDI. Of course, interest rates are high for everyone, but this is a cost that's very positive for the company. Going over the operating cash generation and how it has been used over the quarter, we start on the EBITDA of BRL 1.79, we discount among cash. In fact, we reached the EBITDA of BRL 1.6. We have the effect of the CVA, Parcel A Variation Account, which has had a relevant impact because of the higher price. The distributing company has a cash impact that is going to be recovered next year. Dividends received, working capital with a positive effect, we reach the operating cash flow of BRL 1.5 billion, how we have used it over the quarter.

Income tax, social contribution, interests, leases, and our investments, which is the most representative share here of 1.6. The cash delta was negative, and we show that in the cash availability that we have from one quarter to another. Going into the details of these companies, as we said, Cemig D, it had a representative performance in EBITDA, an increase of 26.6%, reaching BRL 1,000,000,010 of EBITDA in the quarter, especially because of the fact I already mentioned of that adjustment of 7.78%. Also, we have an increase in the residential market. This is nice. It is representative, significant for us. As we know, residential tariffs are higher, that has a good impact in our revenue. Here we have our energy market.

We have been saying that in the past quarters, that there is a migration in the case of the transported energy from two clients to the basic network. We will no longer see this drop effect after the second or third quarter. We will no longer be seeing these effects because it will be then have been integrated in the quarters, but we do see that reduction. We also talked about the positive effect that we had in the residential area. We did have a period with a lot of rainfall and milder temperatures, and we see rural with a significant drop, especially because of the rainfall period. We still see the effect of GD, distributed generation, impact in Minas Gerais. A piece of information is that DG represents 26% in the captive market. It's very representative in our region.

Regarding operating efficiency for Cemig D, we have already mentioned. I believe that the main effects have already been offset. We are working on an efficient management, we have been working on the management of right-of-way cleaning and everything that we need to do to provide a better service to client, we are under the regulatory limits as we should. For operating efficiency, our indicators for Cemig D are within the regulatory indicators for losses. Here you have the losses indicator for our spot price. We did have a change in criteria in 2025. We went from 24 to 35 months, that's why we had a positive effect. Over the period, it balances out. This was just because of a change in criteria, we see that our delinquency is very low. We have positive indicators.

Here, you know, we are very proud to bring you these results. Our DEC of 8.75, the best one in our history, and also FEC that has a positive performance, bringing better services and better conditions to our clients. For Cemig GT, as I mentioned, it's important to stress Cemig GT today, obviously it has generation, transmission, and it also has a share of the contract coming from the trading company. The main effects, we already mentioned, I'll talk more about them, but the main one is here, as the management of hydrological risk achieved. When we break it down per business for generations, in fact, here we had that hydrological risk and energy purchase at a much higher price.

In transmission, we had a lower IPCA, and we know that our contract asset is remunerated by IPCA or inflation, and that's the impact in the transmission company. Turning to the trading area here, we see the main challenge in the quarter, and the main impact has been the closing of positions. That is because we did not fulfill contracts, that we're not delivering T90 in some contracts, that we are able to recover part of this amount at the end of the year because some of the positions have been closed and also because of some credit events. I believe the whole market is seeing that. The main effect here, yes, is really price. Cemig SIM. Cemig SIM is adding capacity to its portfolio, and it did have a significant increase in recurring EBITDA of around 100%.

That's a very nice to see Cemig SIM's growth and the addition of new operations that will be bringing more energy to our portfolio. Gasmig, this quarter also boasted this effect. As clients migrate to the free market, this margin is reduced, and that is the main factor that we see in Gasmig. We will be seeing that happening over time because there is a migration of clients to the free market. Now we end the presentation of very proudly honoring our electricians. They are the heart of CEMIG. We do exist because of them. They represent us, and they were the winners of the Rodeo Champion team in Costa Rica. We went there for the competition. We did compete. We were the winners, and we did not have any safety failure. This is the main message.

We want to be efficient. We want to provide the best services to our clients, but we also want to deliver services in a safe way. A special congratulations to our champions because they move energy, CEMIG's energy. Thank you all very much, and now we will open the floor for the Q&A session. We will right now start the Q&A session. To ask your question, click on the Q&A item located in the bottom of your screen and type your name to get into the queue. When you have your name announced, you will receive a request to enable your microphone. By accepting it, you can ask your question live. Please ask all your questions at once and wait for the company's reply. For the session's dynamics, the names of participants will be announced so that they can ask their questions live.

You will see a request to enable your microphone, and then you should open your microphone to ask your question. Participants also may send their questions on the chat, and those will be organized according to the time available. Once again, I would like to say that all of us here are available to take any questions you might have. Our first question is from André Sampaio, South Side from Santander Bank. André, please, you can ask your question live. I'm going to read his question. André's question is, I would like to understand how the discussion on the plant renewal is going. I will turn that question to Marco da Camino of this. Hello, André. Thank you very much for your question and the discussion about the concessions renewal, Sá de Carvalho and Emborcação and Nova Ponte is going well.

We have great contact and interaction with the Ministry of Energy and ANEEL, we expect to renew these concessions in the next few months before they are due. Thank you. Okay. A question to our Marcus Olego, the question is from Marcus and Marcus Vinicius. How can we reduce hydrological risk with alternative energy so that we can address these efficiencies? Good afternoon. Thank you very much for your question. To reduce hydrological risk, if we diversify our portfolio, we are able to avoid the dependency of a single generation. Our portfolio is already designed like that. We have our hydrological plants, but also we have other wind and solar components. We do have the GSF impact, but we believe that this is at a lower proportion, rather than if we have everything concentrated on HPP.

The other way of managing that is really to hire ahead of time, and we are paying attention to that. There was a reduction of GSF in the beginning of the year, but the second half of the year that would concern us and GSF could be at a lower level. We already have an adequate reserve for that to avoid significant impacts over the years. Thank you very much, Marcus Vinicius. I have two questions to our CFO and IR Officer, Andrea Almeida. The first question is, what can we expect from the, for the next tariff review in 2028? The second question is related to the increase of the debt vis-à-vis the investments, considering that we have a two-digit interest rate.

Talking about the tariff review, obviously, we are making the most effective investment according to our plans in the distributing company. We are sure that these investments will be well acknowledged in our tariff review. Of course, we will know that in the future, but we take into consideration the increase of the asset base, discount, the depreciation, and we will see the impact of the rebuilding of the EBITDA based on what we will see in the five years. Maybe we will have BRL 22 billion. Considering these investments, we will have a rebuilding of the base. We reduce depreciation, then we will get to a variation that's going to vary the level of the EBITDA in 2028. We are very optimistic about the recognition of this investment because we are very cautious in our investment.

Thank you for your questions. I forgot to thank you. Moving to the other question on the leverage. CEMIG finds itself at a very healthy leverage stage. We do believe that over the investment program, leverage tends to grow so that we can carry out the investment program of BRL 44 billion in the next five years. Leverage tends to grow up to 2028, when it's going to come down, and of course, with the tariff review of the distributing company. Always considering very healthy levels. Much so that we got another AAA. Now we have two AAA ratings by Fitch Ratings and Moody's, proving that CEMIG's credit quality is very positive.

Yes, we have high interest rates right now in the country, but we do have a return on our investments that are higher than. That's why we are focusing investments, especially in the regulated sectors of distribution and transmission. Yes, we do believe that these investments generate value for shareholders, and this leverage is at a level that is very comfortable for the company. Thank you, Andrea. Our next questions are for Marcos Vinícius. First, from Ricardo Bella from Sasa. He would like to understand which are the possible impacts with the change of the risk parameter of CVaR in the price curve. Is that already impacting you at the trading level? Thank you for your question. We are following up this discussion. We did have a public hearing, and the SMA is going to discuss the change of these parameters for next year.

There is an initial assessment of maintaining them. We have seen that in the public hearing, a lot of contributions arose considering possibility to reduce the levels of CFR, considering that we already have a more controlled situation and simulations show that it is possible to have a risk level, the right protection at a lower price. We would not be so risk averse. If that changes, of course, we are going to have prices impact and the prices could be lower and that would be beneficial for our position because we still have open positions. We have long positions for 2027, 2028, which are the colder years and the ones that will be more affected in the spot price. If that happens, and we are observing this movement, it might be interesting for us to start closing these positions. Thank you, Marcus.

Next question is for you again. From Rafael Corrêa. He would like to understand. He wants us to talk more about the strategy of the company's trading branch and considering that for 2026 we have a challenging GSF and what are going to be the impacts on the market. Thank you. 2026 is a challenging year for us. We did discuss that in our Cemig Day because we did have a development of our margins in 2022 that would be the lower margin of our history, and it's going to recover in the future. In 2026 because of the history of prices in the market, we contract ahead of time, and we know that we had a decrease in the contracts and the contracts have reduced the margin. In addition to that, we have short-term elements that could reduce results.

Difference in submarket prices that are high in the beginning of the year. We expect them to drop for the rest of the year. As an impact, also reduction in some contracts. There are situations, factors that could turn this year into a more challenging one. Our vision is that in the future, these impacts will come down because of the systemic progress and our margin because of the prices of the market also is going to evolve. The hydrological risk, once again, we had in the first quarter a realization that was lower than the expectation. The challenging situation usually comes in the first quarter.

We believe that's going to happen according to what we are planning in a way that in the second half of the year that's not going to be an impact as we had in the first quarter. Thank you, Marcus. Another question now coming from João Fagundes from Banco Bradesco. Can you tell us how is the season profile of our plants, if it's like MRE? What is our discussion in the risk parameters? You already talked about this, right? Well, our seasonality is very close to MRE. We did have smallest difference in January. Maybe we suffered this effect a little bit more because it's concentrated in the rest of the year. It is very close. About the VaR, as I mentioned, there is a perception that you can see and because of the contributions from the public hearing.

We see that there is room for a reduction. We had 45 contributions and two-thirds of them were of our parameters that were not averse or less averse to risk. We might have a review, and by having a review, we will see this beneficial effect to close the positions as I mentioned. Thank you, Marcos Vinícius. We thank you all very much for your participation. The IR superintendents are available for any other questions you might have. We end the via conference for the earnings of the first quarter of 2026 for CEMIG. Have a nice afternoon.

Good morning everyone, and thank you for waiting. I'm Carolina Senna, Cemig's Investor Relations Superintendent. Welcome to Cemig's fourth quarter 2025 earnings video conference call. We inform you that this video conference is being recorded and will be available on the company's IR website at ri.cemig.com.br, where you'll also find the company's presentation. Should you need simultaneous interpretation, the feature is available by clicking on the globe icon located on the center bottom of your screen. Upon choosing interpretation, select your language of choice, Portuguese or English. Should you choose to follow the call in English, you may also select Mute Original Audio. During the company's presentation, all participants will have their microphones disabled. After the presentation, we'll start the Q&A session.

We now start Cemig's video conference with Reynaldo Passanezi Filho, our CEO, Andrea Marques de Almeida, CFO and IR officer, Luis Cláudio Correa Villani, Chief Information Officer, Marco da Camino Ancona Lopez Soligo, Chief Generation and Transmission Officer, Marney Tadeu Antunes, Chief Distribution Officer, Sergio Lopes Cabral, Chief Trading Officer, Sérgio Pessoa de Paula Castro, Chief Legal Officer, Marcos Montes Cordeiro, Institutional Officer, Carlos Camargo de Colón, Gasmig CEO, and Iuri Mendonça, Cemig SIM CEO. For the initial remarks, I'll turn the floor to our CEO, Reynaldo Passanezi Filho.

Good morning everyone. Welcome to our fourth quarter video conference call. Also talking about the results for 2025. We may turn to the highlights of the presentation. I would like to go over the main figures.

They show the recurrence of very positive results of Cemig in this full transformation process, which has allowed a cash generation that is very significant to face a record investment program. This is what we see in these two first topics. Recurring EBITDA of BRL 7.3 billion, very consistent with the different sectors, with very consistent results in all of the sectors. This amount goes up to BRL 8.3 billion when we include the non-recurring ones. That is what allows us to finance this record investment program for Cemig. Over the year, we had BRL 6.6 billion, probably one of the most successful investments in Cemig's history. This is a major transformation when we compare to the past. Some years ago, Cemig was investing less than BRL 1 billion a year. Now we are investing BRL 6.6 billion.

As all of you know, basically we're investing in regulated sector with a warranted profitability. We have the works that are guaranteeing our profitability. Some of them already show in the results and all the other ones, which we will see in the tariff review times, but they are already here. You can see them as accumulated results because we already have almost BRL 10 billion accumulated in the distribution area, for instance, which are not yet open or s-posted on this value because they will show in the next tariff review. It's exactly this combination of cash generation that is very consistent with investments that will generate revenue in regulated sectors that are very stable that allow us to have this result. We are very happy to see our credit quality. Moody's just raised Cemig's rating to triple A in September.

This is a huge transformation. We have increased and grown almost 7 notches in less than 3 years. This is a historical result. Very few companies have this type of speed of credit rating transformation. Now we have a triple A from Moody's, as we already have that kind of rating from other companies. Also relevant, an important topic for this quarter was the solution of the post-employment liability regarding our retirees. We had a relevant topic regarding the liabilities of the company, which was the funding of the healthcare plan of retirees and pension holders. Cemig had a responsibility for part of that funding. We were able to come to an agreement with the union. This agreement was approved by the Regional Labor Court, and we have a contribution here.

We will have 6 installments that will total BRL 1.25 billion. We will have 2 installments this year and then 2 installments every year for the next years until the end of the process. That changes the contribution of Cemig in this funding of the healthcare plan, and it turns to a financial debt. That's important because we no longer have an actuarial risk. Now we have a financial debt, and that's going to support the transition of the retirees to make sure that. That's crucial for us to guarantee that they have a healthcare plan. That also, as part of our results. You know that we have a policy of sharing our 50% of our net profit, so we paid in dividends and JCP of BRL 3.5 billion. This is a public policy.

It's in our bylaws, the distribution of 50% of our net profit. That shows that our dividend yield is double because 50% is being reinvested. When we look at other companies that distribute 100%, we see how much this is a significant result. The company is a good company for dividend payments. More than that, it reinvests 50% of that result to generate value. We see that value generation because our capital cost is much lower than the WACC of the regulated sectors, where we are making a larger part of our investments. The last topic that we have here is also something very important to us. We have some concessions that were due, and we were able to extend these concessions. That's very positive.

We have a very clear objective to extend all our concessions, and we were able to extend Irapé, Queimado, and Pai Joaquim in an auction that we had also in 2025. In the Trindade chamber, we participated in the auction, and we were awarded these three concessions. I would say that these are the main highlights. We are very happy once again to have these results. They do show Cemig's strength and resilience and the way we prepare ourselves to the future, not only the resilience of the results, but especially building the future. I stress this. We already have BRL 10 billion in investments for distribution after 2023, and we are moving on in this process. This is a record process for investments and distribution. We have our distribution officer by me here because these are cautious investments.

In fact, they are supporting Minas Gerais' development. We have new loads coming in. There is an improvement in the quality of service, so we feel fine about the quality of these investments and its remuneration, and by the time we have our tariff review. These are my initial remarks. We will be open for your questions later. Now I will turn the floor to Andrea. Once again, I would like to thank you all for being here with us in this video conference.

Good morning, everyone. It's a pleasure to be here bringing to you the results of another year that ends. Sustainable results and results that make us very proud to be delivering. We are delivering not only figures, but also what we are delivering to society, to our clients, our stakeholders. These are very nice results. Moving on.

After what Ronaldo already mentioned in terms of the main highlights, here we have a snapshot of the BRL 6.6 billion of investments that were made in 2025. Of course, our flagship here is distribution, as Ronaldo mentioned. Within this whole framework of investments that we're making, we had 23 new substations over 12,000 km in low and medium voltage networks, and that, of course, will bring this energy to our clients and the capacity of the state to grow after that. For generation, also mentioned by Ronaldo, we had the GSF auction, which involved around BRL 199 million, and we had a delta in this amount that reaches BRL 411 million that was invested in expansion and maintenance.

In transmission, our main investment is in reinforcements and improvements, and last year we invested BRL 410 million. That's a very relevant amount. I believe Minas Gerais is at the heart of Brazil, so it has a huge opportunity in this area. Therefore, we also show that we were able to add an allowed annual revenue in 2025. For Gasmig, we had the Centro-Oeste project, BRL 217 million being invested in the project. Cemig SIM, we had BRL 361 million with 19 new solar plants and 68 MW installed capacity. I also think it's very important to show you the development and distribution. We show how much CapEx regarding our regulatory depreciation has grown. It's good to see this number four. This is a very relevant figure. It's a highlight for Cemig as well.

Now, going over consolidated results year-over-year, comparing to 2024, we had a recurring EBITDA of BRL 7.3 billion, as Ronaldo mentioned, and a full EBITDA of BRL 8.3 billion. The main difference between the two is really the effect of the adjustment in the post-employment liabilities. The variations in these years, the main effect here that represent this drop in 4% were mainly GSF, because we had to address the hydrological risk and the generating company. We purchased energy at higher spot prices. We are seeing a scenario of higher prices. We also had, in the trading company, the main effect year-over-year, which was the difference in prices among submarkets. That was - BRL 234 million.

Now, turning to the recurring net profit of BRL 4.2 and the non-recurring of BRL 4.9, once again, that is the main difference here of the adjustment of post-employment and also the impact of the net profit in addition to the ones that we already mentioned. Also, we are taking debts to finance our investments, therefore that generates higher financial expenses, so we have higher leverage with higher financial expenses in the year when that compares to the prior years. Looking at the non-recurring effects, you see that we had effects last year that were very relevant. We already talked about those over the year. The main effect now for 2025 was a very positive one, and we will go over it in detail.

As Reinaldo mentioned, this was an intense negotiation, but it allowed us to bring a sustainable healthcare plan to our pension holders, especially thinking about the ones that have lower income. That is important for the company because it allows us to have a financial balance. If we look at the expenses that we posted in the results in 2024 and 2025 regarding the post-employment, whether for pension plan or healthcare plan, the amounts were very relevant. Now, starting in 2026, we expect to no longer have this impact of BRL 300 million that we had last year regarding the healthcare plan.

This is the impact that we expect to see from now on, in addition to the impact that we had in the year, which was BRL 1.19 billion in the EBITDA, and then the net profit around BRL 800 million, also with a positive effect in our net profit. As Reynaldo mentioned, we now have to contribute to this new healthcare plan, a compensation. That's an obligation of BRL 1.28 billion to be paid in six installments. Now, turning to our OpEx focused on Cemig D, we see two larger effects that are from headcount and outsourced services.

For headcount, we are gonna go into the details further on, but we have been adding new personnel in bases that we consider important for Cemig Agro to be closer to our rural clients who are agribusiness clients, so that we can deliver better services to them. We do have this responsibility, and we have to improve the service. This was very important. The item of outsourced services, we have all the work that the distributing company does of cleaning of power line pathways and pruning trees, and these are services that will allow us to have a better quality delivery to our clients. This is. These are the main impacts here.

Now, turning to the right of the chart, we know that we have a robust investment plan, which has added kilometers of network and substations to provide this capacity to our clients. Now, comparing this performance of OpEx against the assets that we are adding to our portfolio, you can see that these percentages are much lower. Therefore, we should say that when we increase the assets base, we have to have a service associated to that to keep delivering the deserved quality to our clients. In terms of operational efficiency of Cemig D, we are abiding by all indicators. Another year that we deliver indicators as expected by the regulatory agencies, whether it is in total losses, credit losses that are expected that have reduced year-on-year.

Those represent, in 2025, 0.63% of the revenue from energy supply. That's a very low figure, very good result. For collection also, a strong work by Cemig trying to bring in this collection to the digital channels, which are the most efficient ones in terms of cost, and also, they are easier for our clients, and we have been able to increase collection by these channels over time. In addition to that, our ARFA indicator, the receivables collection index, shows that our delinquency is very low, and it's now at 99.51%. This is some of the results of all the services that we mentioned that we are looking for. We had higher OpEx, but it's there to deliver a better quality to our clients.

We can bring to you the best DEC of history, the best average outage duration per consumer unit. That's 8.97. That's a reduction of 29 minutes compared to the prior year. The perceived DEC, it was even a higher reduction of 1 hour and 50 minutes. That's very important for us at Cemig, and we are very proud of it. How are we financing our investment program? In addition to the operating cash generation in the company, we also have outsourced or third-party financing, and we are working to increase the average tenure of this debt so that it can be extended. We have 5 years between the investment and revenue and the tariff review for the distribution company, so it's a long period of time, of course. We only see that posted back in the tariff review.

We have to comply with it, and we are able to reach 6.9 years of average tenure by the last issues that we had in the market, which were of 9.3 million of debentures, all of them priced under the sovereign risk, which is something else that makes us very proud. We are able, in spite of high interest rates, and all of us know that, we can price our operations lower than the sovereign risk. Of course, with the investment plan and with the leverage to support this plan, we reach at a leverage level of 2.3. As Reynaldo mentioned, part of the revenue will only be posted or recognized in 2028 by the time we have the tariff review. Part of the investment of that already happened.

Now, looking at our debt index, we had 87% of the CDI of the average cost, and we have a distribution of our debt between IPCA and CDI of 59% and 41%. Now, balancing out all the issues here, and this is a company's responsibility, of course, we are also delivering great shareholder return. We got to a dividend yield of 14.9%, BRL 3.5 billion, 835. Our profit reserve to be realized from past periods. We announced part of this amount still last year, and we paid those in 2025, and part of that will come now to be paid to our shareholders in the next shareholders meeting. Also, Cemig has delivered a total shareholder return of 17.5% to our investors. Also a level very compatible with our market peers.

Now, let's focus on the deliveries of the quarter. Recurring EBITDA of BRL 1.8 billion and equivalent EBITDA with non-recurring items of BRL 2.9 billion. We already mentioned the healthcare plan as the main effect. We issued in the quarter BRL 4.3 billion in debentures. This was the quarter in which we were able to bring together all the unions to the same agreement for the healthcare plan. We had an elimination of ownership crossover at Cemig in companies where we had smaller stakes, so now we have 100% of our own equity interest at Cemig SIM, and we added 37 MWp in the quarter. Also, we had an impact in generation. We had an increase in energy purchase due to hydrological risk. We had to manage that because the hydrological risk was lower than the prior year. Therefore, we had to purchase energy at higher prices.

Now, talking about the results, I already mentioned the recurring EBITDA variation in the quarter of 6.5% was mainly due to GSF effect that measures one quarter against the other as 0.8 against 0.67. Also, you see that the adjustment of the post-employment liabilities. Sorry. About distribution that had a positive impact. We had our Parcel B in May that added a higher contribution margin in the distribution company. To the negative side, a reduction of 1.4% in the market. We already talked about that because some of the clients migrated to the base network. Now, recurring net profit, similar effects. Once again, we have some of the effects of higher financial expenses on net profit and also higher depreciation because of investments that we are making over time.

Now, here we show GSF, as I mentioned, and this is the difference between 2025 GSF compared to 2024 GSF. Effectively, we worked at lower GSF rates, and we had to purchase to manage this hydrological risk at much higher prices. These are the prices that we have seen over 2025, ending December, at BRL 265 per MW. Once again, here in consolidated operating costs and expenses, we had a similar effect that we already mentioned. In the year for personnel, we added to what we call our Cemig Agro program, 228 new electricians. These are people that will be there. They will be able to take actions quicker in places where needed and places that are further away.

We are in a large state with lots of towns scattered in the state, so we need to have people close to clients to be able to cater them effectively and efficiently. For outsourced services, we do have intensified the preventive maintenance. We believe this is better than the corrective maintenance, of course, so we are working on cleaning of power line pathways and pruning. Because of this expense cost also, we have effects that we already see, such as in the financial compensations. We were able to reduce quarter-on-quarter 22%, and this does not stop there. This is an intense work we are doing, and the financial compensation is something that we still need to work on in the future.

Now, bringing to you how our EBITDA turns into cash and the cash pays the bills, right? We start at the EBITDA of BRL 8.3 billion. We have the non-cash effect, the post-employment obviously. We got to an EBITDA of BRL 7.2 billion. We had the CVA effect, the value of variation account, prices that are higher than expected. We know that the CVA we can recover next year, but it is impacting the cash, our cash in the current year. We have dividends received from companies of the group, such as Taesa, and also we had an impact of the working capital of around BRL 1 billion, reaching an operating cash flow of BRL 5.7 billion.

The other effects, taxes, interest, investments, net financings from issuance BRL 9.3 billion issued and with the repayment of the debt, BRL 6.5 billion. Cash before IOE and dividends payments, BRL 4.3 billion. With the payment of IOE and dividends, we have the cash generated of BRL 270 million. We have the cash availability for 2024 and 2025 in the chart to our right. I think we talked a lot already, so I'll go quickly here. At Cemig D, as I mentioned, we had the effect of Parcel B, an improvement in the contribution margin in the quarter, BRL 138 million. Also we had a reduction of 1.4% in the market, including DG.

In the net profit, of course, this investment program requires a higher debt to be financed, and then we have financial expenses that are higher. Here we have a snapshot of the market. Whether this is the transported energy market that we mentioned that we have lost some clients to the basic network or total energy. This is the performance. When we add the drop of the market with DG, we come to a reduction of 1.4%. That's basically it. For Cemig GT, once again, we have the effect from the management of hydrological risk of BRL 81 million reduction here. That's the main effect quarter-on-quarter. For Gasmig, the EBITDA is in line, and the net profit was affected by the increase of interest on equity with a higher limit of long-term interest rate.

Of course, we're using this limit to have a higher net profit. We already mentioned the program, the Midwest Gas Pipeline Project. The opening of this Midwest Gas Pipeline marks the arrival of piped gas in the cities, such as Betim, Itaúna, Divinópolis. This was a very important event in the quarter as well. Well, here we have our awards for sustainability. Cemig is very proud of those results because we always have a lot of awards. For the Dow Jones Sustainability Index, this was the 25th consecutive year that we got this award, and maybe the only company that has been at Dow Jones for such a long time. Also, the S&P Global Sustainability Yearbook 2025, we are there as well. CDP, we are in the A list. To reach the A list, we met 10 of the 16 criteria.

Most of these criteria analyze our real plans to come to net zero for 2040. We also have 5.4 million renewable energy certificates issued in 2025. We are also in B3 Sustainability Index for B3. In Sustainalytics, we have the risk of our economic value arising from ESG factor, and we had a score of low risk. This range goes from 10 to 20. Here we have other awards, the market recognition by Cemig's work. Two recognitions from companies that like Best Company in the Year, one coming from Veja Negócios, another one of Best Company in the Sector. CFO and CEO were also recognized by Época Negócios 2025 magazine. We were the fifth most innovative company in the electric sector. That's something that is really valuable to us, and it's very important award.

We are very happy about this award. Our financial team, we are very proud of our financial team because it got an award for Best Financial Team in the Infrastructure and Energy Sector in Brazil by Filosa. We had the ANEFAC Transparency Trophy and a second ANEFAC ESG Award, the transformative stage. I end the presentation here, and now I open the session for the Q&A session. I turn the floor to Carolina, who will help us there.

Thank you, Andrea. We will now start our Q&A session. To ask a question, click on the Q&A icon on the bottom of your screen and write your name to be on the queue. Upon being announced, a request to enable your microphone will pop up on your screen. By accepting it, you can ask your question live.

Please ask all your questions at once and hold for the company's reply. For the session, your names will be announced so you can ask your questions live. Then a request to enable your microphone will pop up on your screen, and it should be accepted so that you can ask your questions. You may also send your questions via chat on the platform, and they will be organized and answered according to the time available. Our first question is from Banco Safra. Ricardo Bello, you may enable your microphone to ask your question, Ricardo. I will read the question while you adjust the microphones. The question was about the trading result in the fourth quarter, which was positive in BRL 97 million. Can you revert or reduce the short positions that you had, and what is the gain? What is the current perspective of your energy balance? Good morning. This is Ricardo Bello.

Thank you for your question. I think the results show that. We were very cautious when we closed the positions this year. We are still working on it. 2026, the positions are already closed, and we are now aiming to close 2027 as well. We are analyzing that very cautiously. This was a result of something that we just showed in this quarter, our balance sheet. By 2027, still has an open position that we are closing. Also another position in 2028. Starting in 2029, we no longer have any open positions, and we see future prices going up. This is a good opportunity for us to sell this energy starting in 2029, as we were planning to do.

Thank you, Sergio. Our next question is from Luiz Eduardo.

What is the ideal level of leverage for the company, and what is the annual percentage of interest in the debt?

I don't think we have a target number, but we know that our leverage is going to increase over this investment cycle. We are fine at 2.3 now. We believe that it will grow over the cycle up to 2028 when we have the tariff review of D. The contract covenants that we have that read limit the s-ratio to 3.5. You know, I believe that within this range, we will be very well-placed when Moody's evaluates Cemig and gives us a Aaa. It is evaluating us through the cycle.

In fact, that they know about the investment program, they know about the increase in leverage, and so we are in a very good place. We believe that we are going to be within the expected triple A rating and of course increasing over 2.3 over the cycle and reducing again this leverage in 2028 when we in fact receive the impact of the tariff of D in the tariff review and the process that we are doing throughout this period in terms of average interest rate. We mentioned here we have 13% of nominal cost, and that corresponds to 87% of the CDI. It is an average cost that is very good for a utilities company.

Once again, remember that we have been pricing all our debts that are debentures in the local market lower than the sovereign risk. Andrea, just adding to your answer, I think it's important to mention how much this debt is generating value to the company because we have an average that is financed at 87% of the CDI with an investment which is more than 90% regulated, and you know what is the amount of the debt and the calculation of the respective WACCs. We see that this debt is much lower than what we see in the WACC calculation, therefore, it is generating value to the company.

Our next question is about if there are any plans to pay bonus to shareholders in 2026. I'll turn the floor to Andrea.

Thank you for your question. Actually, that happens when our profit reserve goes higher than the capital stock. We will analyze this over the year to see if it's going to happen. Of course, you can follow Cemig's figures, and as soon as we know we have anything new on that topic, we will let you know.

Well, thank you all very much for your questions. Since there are no other questions, we thank you very much for participating in this call. We would like to say that the investor relations superintendent is available to provide you additional comments, should you need them. Thank you all very much and have a nice day.

Good afternoon, everyone. I am Carolina Sena, Cemig's IR Superintendent. Welcome to Cemig's Third Quarter 2025 Earnings Video Conference Call. This video conference is being recorded, and it will be available on the company's IR website at ri.cemig.com.br, where you also find the full package on our earnings call. [Operator Instructions] We will now start Cemig's video conference call with Reynaldo Passanezi Filho, CEO; Andrea Marques de Almeida, CFO and IR Officer; Luis Cláudio Correa Villani, Chief Information Officer; Sergio Lopes Cabral, Chief Commercialization Officer; Sérgio Pessoa de Paula Castro, Chief Legal Officer; Carlos Camargo de Colón, Gasmig's CEO; Iuri Araújo de Mendonça, Cemig SIM's CEO. For their initial remarks, I turn the floor over to our CEO, Reynaldo Passanezi Filho.

Good afternoon, everyone. Welcome to our earnings call for the third quarter. It's always an opportunity and a pleasure to be able to bring to you our results and our efforts in another quarter. This is a quarter in which we have more difficult news. Of course, I would like to highlight some important topics that show the strength and the resilience of Cemig's earnings. About specific news on the quarter, we had distribution results that were affected by large clients that left the network. They migrated to the basic network about trading. We tried to decrease some positions. Also, that involves the submarket prices that have affected the results. What's important, and you know that when we look at our net position, it is very favorable in the scenario that we have for pricing today. The same thing happened with generation because of the difference in the GSF and the need to offset that with the spot price. This is what I would like to highlight. And despite of these topics, we moved on with a recurring EBITDA, proving the company's resilience, and we have confirmed the AAA rating by Moody's. We have 2 agencies now guaranteeing us a AAA rating, showing our resilience capacity to any type of scenario. We also had an award by a magazine called Veja Negócios, as the best energy company in Brazil in the top 30 award. And we also had the approval of our health care plan for retired employees. So we finalized a collective agreement with the union and that allows us to look for a positive structural solution that will preserve a positive transition to all of us. Therefore, they can keep their health care plan and also we'll be able to guarantee the company's sustainability. And the final topic, and Andrea is going to go over the details, which is our investment program. We are, once again, making the largest investment program in the company. For this quarter, we have BRL 4.7 billion, a significant increase when compared to last year. I believe we have a very positive message here, and we are maintaining our investment plan. And that means very positive results for the tariff review situation when that comes. So here, we have BRL 3.6 billion in distribution by itself. If we multiply that by the WACC, we know that the results bring additional revenue of a little over BRL 500 million just for that 9 months. So these are very cautious investments in regulated areas that when they get mature and the agency recognizes that we are going to have very positive results for the company. This is what allows us to have resilience today, and this is what allows us to have very positive results in the future, whether by these investments or by a very favorable position in the trading business in the near future. These are my initial remarks. Obviously, we are here to take your questions after the company's presentation. I'll turn the floor to Andrea, but I would like to stress the strength of this company and that we are very confident that we are going to move on with this investment plan and maintain the company's debt levels and the covenants and therefore, to keep on investing, keep on generating value. And this is going to get more mature according to the regulations and tariff regulations as expected. Thank you very much.

Good afternoon, everyone. It's also a pleasure to be here with all of you today, going over our third quarter earnings. Now moving on, talking about our investments, as Reynaldo mentioned, we invested in the 9 months of 2025, BRL 4.7 billion. And this is how they break down BRL 3.6 billion in distribution, focused obviously in substations. This is a milestone and we have some pictures to show you the substations that we had in the quarter, but also 5,349 kilometers of low and medium voltage networks, which are very important to bring good service to Minas Gerais. For generation, we also mentioned our participation in the GSF credit auction with BRL 199 million. That's very nice. It guaranteed the extension of our concession in some of our plants. But also we had investments of BRL 149 million in expansion and maintenance. For transmission, we have our Verona project, around BRL 30 million, and we are still investing in reinforcements and improvements, and we are going to mention some of those and how the allowed annual revenue is performing in transmission. For Gasmig, the centralized project is the most representative one, around BRL 180 million being invested in the project. And for Cemig SIM, the delivery of new photovoltaic plants and 31 megawatts of installed capacity. Moving forward, we have the pictures of the 5 new substations, the ones this quarter, Andrelândia, Coronel Xavier Chaves, João Pinheiro, São Tiago, Fronteira. These are our highlights of new substations for distribution. Now turning to transmission. We see where in our operation we had improvements: Taquaril, Três Marias, São Simão, Itajubá, Volta Grande, Lafaiete. And we were able to add over the year, BRL 32 million of allowed annual revenue in our transmission business. And of course, this brings great results as well. Moving over to the figures. As Reynaldo mentioned, we have BRL 1.5 billion of EBITDA, and we see a drop in our EBITDA in around 16.3% when we analyze the recurring EBITDA, and I will talk about the recurring numbers, and then I'll talk about the nonrecurring events of last year, which were significant. We can talk about them as well. In generation, we already mentioned we had the effects of a lower GSF. We had to buy energy to cover for the GSF. So we had an impact of BRL 54 million. In the trading business, there was an impact here. And we already had the reduction in margin in the trading comparing '24 to '25. And we ended positions. We closed positions and of course, came from our exposure and other positions that were also open. So the closing of these positions and the purchasing of energy and the prices -- the spot prices that we have seen ended up having this impact of BRL 136 million for distribution. In '24, we had a change in the methodology, which was a reversal of our ADA and that reverted how we provisioned our ADA. We didn't have that in 2025. Therefore, there is a negative delta effect in distribution. And you will see that the market also has reduced it. And as Reynaldo mentioned, some clients left and went to the basic network. Therefore, this impacted distribution. Now turning to our net profit, the major investment that we are making has a greater depreciation impact than the funding, the increase of the interest rates, and of course, the increase of leverage of the debt also affects our net profit, the recurring net profit, and we realized that there was this drop of around 30.2%. For nonrecurring effects of last year, just let me remind you, they were very relevant. We had BRL 1.6 billion of the disposal of Aliança last year. Of course, this is not happening this year, and the tariff review for the transmission business of BRL 1.5 billion. These did not show in 2025. That's why we have also this relevant delta here. Let's move on. Here, zooming in, in GSF, when we compare GSF of 2024, we see the performance of July and September. GSF for 2024 going from 0.8 to up to 0.7. So we did have to purchase to deal with the hydrological risk and also the level of the energy price that we see this year. Of course, higher levels than what we have seen last year. Just September of last year, we had higher prices than this year, as you can check in the charts. So this is the impact. Now operating costs and expenses. We are growing below the inflation rate. And outsourced services, which is what draws our attention, we have an increase in areas where distribution has to invest more efforts to guarantee the improvement of services, whether maintaining, installations or in technology, and we still are working on the improvement with smart meters. We have to invest in that. And we have to fund technology. We have to prune trees and also clear the pathway. So that's where we have a higher increase in other expenses. Also, we had the sale of a plot. For personnel, we see a performance -- a good performance here. But here, we have in-sourcing of employees. We are bringing in our own teams so that we can cater to our clients faster in specific regions. And we really want to be more efficient in our service in regions. And we know that Minas Gerais is a largest state. So we want to be quicker serving further away areas. So we have an increase here in personnel in our headcount. Moving on, in line with our capital structure, we, yes, need the debt to fund our investments, but our leverage is at very safe levels. We are at 1.76 or net debt over recurring EBITDA. That's why we have our best rating in history. As Reynaldo mentioned, two AAAs and one AA+, and we are structuring our debt in a way to increase the average tenure. We reached 5.7 with the average term -- as average term. And the cost performance, we see the fact of the high cost of the interest rates, which affect all of us in the market and as well as Cemig, of course. Now for our cash flow. This is how we have been financing our activity, our investments. We start with cash. This is for 9 months, okay? So we start with cash of 2024 at BRL 2.3 billion. We have cash from operations of BRL 3.4 billion. We have the debentures issuance in May of BRL 5.1 billion, the debentures payments, of course, obviously. These are prior debentures of BRL 2.4 billion. Dividends and IOC, BRL 1.7 billion. Our activities for investments of BRL 4.5 billion. Earmarked funds here, BRL 187 million. We have to have this amount aside. So we come to our final cash of BRL 2.3 billion. For Cemig D, everything is more or less explained already. But effectively, we show a drop in EBITDA of 4.7%, especially because of the market reduction, whether it is by economic activity, once it's not that positive and also the temperature that was mild and the market dropped. Once again, the client that has migrated in the second quarter to the basic network. And of course, now in the third quarter, we see the full impact of this migration. In addition to that, we have the reversal of the constitution that I said of the ADA, as I mentioned before. And of course, in the net profit for Cemig D, we see the effect of our fundings and also the interest rates affecting that result. Talking a little bit now about the energy market. We had a drop of 4.4%, and we see the full effect in all the different markets and our distributing company coming from the rural, commercial, industrial, all the effects coming from all the markets. And in fact, here, we see this drop being caused by this client that has migrated for the basic network. Our operating indicators show that our collection is still very strong, focusing in the digital channels and Pix, our payment method is the cheapest. And now we are going to have the auto Pix as well. And we will be able to have campaigns so that people choose this payment mode, which helps us all and also reduces our costs. And this is growing as a good option of payment. And now our ARFA, the receivables collection index is at good, stable levels, and our regulatory OpEx and EBITDA show that we are within the regulatory standards. In terms of regulatory losses, we are also within the standards. There was a change in the criteria which already happened. We are now are integrating the effects of micro and mini generations that are distributed. So we are continuing to work. We have always keep working on losses. We have to install the armored meeting panels. We have to install the smart meters. And all the actions that we have to keep on taking so that this indicator is within the regulatory limits. For Cemig GT, once again, we talked about it. GSF was the main impact. We had to purchase energy to tackle the hydrological risk and the recurring net profit. Here, you can see the results as well. And Cemig GT was the one that had the main nonrecurring effects from 2024. So the major impacts are there represented last year. Therefore, we had a higher EBITDA in 2024 effects that are not replicated in 2025. And Gasmig, that also had impact for EBITDA reduction because there was a drop of 6% in the market and also the clients that migrated to the free market. This, once again, effect on Gasmig. And on this page, we have Cemig's recognitions. Reynaldo already mentioned, and that we are very proud to be recognized as the best energy company in Brazil by Veja Negócios. And there are other recognitions. We are also recognized as the best financial team in the infrastructure and energy sector by FILASA. We also got the transparency award from ANEFAC. We have always room to improve, but it's already great to be recognized by the 19th time by ANEFAC. And there is a new one, the ESG award. Cemig has thousands of awards in sustainability. And we are very proud, and it's always great to have another one. So ESG from ANEFAC in this category, Transformative Internship category. Therefore, I end my presentation, and I turn the floor back to Carol to ask -- to open the Q&A session and take your questions.

[Operator Instructions] Our first question is from Victor Sousa, Genial Investimentos.

Hello, can you hear us?

Yes, we can hear you, Victor. Go ahead.

My question is about Technical Note 53 that changes how you post losses in the distribution sector. I would like to understand if there is a possibility of republishing the level of losses that Cemig had. Now looking backwards here, I would like to understand if this change can end up generating any accounting retroactive effect regarding the application of this technical note if your concerned amount receivables, provisions and other adjustments, or is this just a prospective impact, just an accounting impact? And another question still on this note. How would have been the level of losses for distribution if this technical note did not exist? So in the same comparison base, what would have been the performance of Cemig losses? Would they have increased, decreased, or they would have been the same? I think this is important to understand for the process of assessing the distributing companies.

Thank you, Vitor, for your question. Denis Mollica, our Strategy, Innovation and Sustainability Officer. Please, Dennis.

Thank you for your question, Vitor. About the method used for calculation of losses. The method, even having it being reviewed, it does not -- it's not applied to past calculations. Even if we were to simulate that in the prior losses and the older losses, we would still be within the limits. So for practical accounting effects, adjustments have done from now on. And as it was said already, we are still within the regulatory losses, both before and after this technical note. So we have major actions to manage and to fight our losses, and they are within the limits with no effects that might affect accounting at all. And of course, yes, we also have here a positive effect on the tariff once we have the recognition of the impacts of the DG in the method of calculating losses.

[Operator Instructions] Our next question is from Luiza Candiota from Banco Itaú.

It is about your trading strategy. Analyzing the changes in the energy balance in this quarter compared to the prior one. I would like to go over the details of the rationale regarding the short exposure when we look at '25, '26 and '28. What could be explaining this change that we see?

Thank you, Luiza. I'll turn the floor to our Chief Trading Officer, Sergio Lopes.

First, thank you for your question. We have been doing a great effort to close our positions. Of course, we have some marginal sales that we are executing with clients that are strategic, but our position is not to open more positions. We want to close, as Andrea has mentioned. For this quarter, we could close positions in these past months. And also, we have the impact of gold that ended up making us go to the market to buy energy, but we are not opening positions. We are rather than that closing them.

There are no further questions. We thank you all very much for your participation. And the superintendents of IR is available to take any other questions you might have. Therefore, we end Cemig's third call -- video conference call. Have a nice afternoon, and thank you very much.

Good afternoon, everyone. I am Carolina Senna, Superintendent of Investor Relations at Cemig. Welcome to Cemig's Second Quarter 2025 earnings video conference call. We inform you that this video conference is being recorded, and will be available on the company's IR website, ri.cemig.com.br, where you also find the full package on this call. Should you need simultaneous interpretation, the feature is available on the platform. Just click on the globe icon located on the bottom of the screen, chose interpretation and then select the language of your choice. Portuguese or English. [Operator Instructions] We will now start our call with Reynaldo Passanezi Filho, our CEO; Andrea Marques de Almeida, CFO and IR Officer; Luis Cláudio Correa Villani, Chief Information Officer; Marco Da Camino Ancona Soligo, Chief Generation and Transmission Officer; Marney Tadeu Antunes, Chief Distribution Officer; and Sergio Lopes Cabral, Chief Trading Officer. For the initial remarks, we would like to turn the floor to our CEO, Reynaldo Passanezi Filho.

Good afternoon, everyone. It's a pleasure to be here talking to you and to show the progress of our company. I would say that as our initial video brought to you, we are now with our largest investment program at all times. Once again this quarter, with growing investments, we already have BRL 2.7 billion in investments in this first half of the year and also with great consistency in resource generation, adjusted EBITDA of BRL 2.2 billion, a very sound result. This is our adjusted EBITDA with the highlights. So once again, an investment plan in full execution, we will see the opening of substations, greater grid and conclusion of works in generation, also in gas. This is -- we are very close to starting our Midwest gas pipeline. So we are at full speed in our investment plan. And with an adjusted EBITDA that is very sound, growing BRL 2.2 billion in the quarter, I would say that this shows how sound and resilient our operating performance is. There are three topics here that we should be highlighting and they are something special for this quarter. The first is RBSE, the existing system basic grid and the review of the calculation methodology here. So for Cemig, we have a noncash impact for the quarter of BRL 199 million. It's worth mentioning that the EBITDA that we usually disclose is the IFRS. So -- and this EBITDA result shows, but cash will come over time. Also, there is another impact of a topic that is of concern, and we are fully alert about that, and we see positive scenarios regarding to this topic for the second half of the year. But for the first half of the year, specifically for the second quarter, we had difference among energy submarkets in our trading sector of negative BRL 76 million. Our projections are that once we have the review of the criteria by the ONS and the greater interchange, this amount tends to be close to zero. This is what we expect, obviously, this is what we are hoping to happen. Also a tariff adjustment of 7.78% in line with other adjustments for distribution. Basically, here, we have inflation and also charges. And finally, our GSF auction. Again, we participated in this auction. And we were able to ensure the concession extensions for three power plants, one for 7 years and another for 3 years. So this is a total of funds disbursement of BRL 200 million. So I would say that the -- this also shows our commitment to the company's sustainability. After all, we are talking about concessions that we're doing 2037, and we are extending those worth 2044, so we are really thinking about the future. This is not an immediate decision, but this is an extension of concessions that are due in the future, but we understood that those were opportunities considering the energy sold for the companies. And the prices are very competitive. And therefore, we believe that this really adds value to be part in this GSF auction. So another BRL 200 million, two of them, 7 years and one of them for 3 years. I would say that these are the main highlights I would like to start the call with. Now I'll turn the floor to Andrea. And obviously, we are available to take any questions you might have shortly. Thank you.

Good afternoon, everyone I apologize, I have a cold. But we, again, are following our investment plan. It's going very well. Out of these BRL 2.8 billion that we have for the year, we have concentrated investments in distribution so that we can better serve our clients, and we have been doing that in a very structured fashion. Therefore, we have energized nine substations in these initial months. Also, we have been able to build over 2,600 kilometers in low and medium voltage networks. In generation, also, we had relevant investments in expansion. Also, we have investments in maintenance in terms of safety as well and transmission, again, investments of BRL 200 million, and especially in reinforcement and improvements for Cemig as well, as Reynaldo mentioned, we had Central West project, over 100 kilometers of gas pipelines and Cemig -- also, we added 21 megawatts following our investment plan. This is being very well executed. These are some pictures to show our substations in our Mais Energia program or more energy. And now, this is our a photovoltaic plant in Advogado Eduardo Soares, we have a grand term of 35 years, CapEx of BRL 464 million and the potential of CO2 reduction that is very relevant for us. Now turning to our results. Reynaldo already mentioned that when we compare that, now whenever we look at this comparison to 2024, we will have some nonrecurring effects from '24. And if we analyze IFRS, we will see that -- some of the effects might show a reduction. But in the recurring effect, we had a great quarter with an increase of 15% in our EBITDA. And a major factor that helped was the reimbursement of the tariff subsidies that we have received via CDE, the energy development account. And we know that in Minas Gerais, we have this large effect, and we had a significant reimbursement that came from the CDE subsidies. Also, we had a reduction of BRL 21 million and another migration of our employees to the premium plan. That was a reduction there again. and also exposure to the submarket prices already mentioned by Reynaldo. Now, analyzing our IFRS EBITDA, talking about the nonrecurring effects, we would have a reduction. But then because we had a reversal last year. And if you remember that, those were tax provisions reversals regarding INSS in the profit sharing program that were very relevant, BRL 584 million in the net profit. We also had an effect of those provisions and also reversal of amounts to be reimbursed from PIS and COFINS. And there was a decision from the Supreme Court at the end of last week, and we are still waiting the final ruling to know which will be the facts for Cemig. Now moving forward, we show a quick snapshot of the effects to the submarket exposures, and over time, we were showing you our monthly exposure, so BRL 480 in April, BRL 533 in May, BRL 619 in June, but you see that the price difference is already coming down. We've seen June a price difference of BRL 4.88. So the effect on this quarter has been much lower than the one that we had in the past quarter and a gross effect gross effect of BRL 76 million regarding the price difference here in the submarkets. Another positive result here in -- when we look at managerial expenses, we have increased those below inflation with some effects here in terms of the PDVP or the voluntary redundancy program, the effect was a little bit lower in terms of outsourced services. We are still working pruning trees, also disconnection of some meters. And we are intensively working that, and we are making great investments in distribution. Therefore, we have greater deactivation and disposal of assets. Now looking at our debt profile, it is very good. We have come to a leverage indicator of net debt over adjusted EBITDA of 1.59, now already, including all the debentures issuing the BRL 5 billion that we mentioned last quarter and already counting on the amortization of a prior debenture, and that helped us to reach an average that tenure of 6 years. So we are also evolving in this average term here. And obviously, we have a very comfortable position in terms of leverage to move forward with our investment plan that is ongoing. Now analyzing our cash flow for the end of the quarter, we ended at BRL 3 billion, and it was well supported by our operating cash generation of BRL 2.3 billion, the debentures that we talked about, the BRL 5 billion, we had the payments on other debentures that were amortized around 2.3%, also payments of interest on capital and dividends and also our activities on investments. Now analyzing Cemig's D results, and we will go over again what we already said about the holding. For Cemig's D results, when we compare again, the EBITDA -- adjusted EBITDA effect not considering the nonrecurring effects, we had a growth of 39%, mainly thanks to the reimbursement of the tariff subsidies, as we mentioned. Now if you analyze these results, adding the items that are nonrecurring, obviously, this effect was lower when compared to prior quarter. Now for the energy market for Cemig distribution, there was a drop of 3.3% this quarter. Obviously, we still see the effect of migration of clients, industrial clients going to the free market to relevant clients this time have migrated large clients. They migrated to the transmission network also affecting the transported energy to our right, we see the development of distributed generation. We know this is growing over time. So when we look at the progress, 2Q '24 compared to 2Q '25, we see a significant growth of around 20%. Very well. For operating efficiency for Cemig D, once again, we are working in this efficiency. One of our focuses is the collection. We are aiming to collect digitally our payments, of course, pick instantaneous payment is for Brazil as a whole, one of the most efficient way of getting paid. And today, around 67.5% collections is done via digital channels, not only Pix. And also, we have our ARFA receivables collection index of around 99%, showing that we are at a very good position vis-a-vis our collection and billing and access. Now our OpEx. It is, of course, in compliance with our regulatory OpEx and EBITDA as well as within the regulatory EBITDA. Very good results here. analyzing regulatory losses. There was a change in the calculation of losses instead of build the market, now we are considering the measured market, and that was positive to reduce distortions that were affecting losses at the distributing companies. So that's why we see a progress here in the chart. And also, there was an increase, but we are still within the regulatory limits. So here, we added losses that before, they were not taken into consideration, and this is a continuous work on losses. We continue installing smart meters. We continue working with legal energy with over 4,000 families being catered by this work of loss reduction and Cemig. Now for Cemig GT, we have the effect of contracts -- trading contracts that are in here in a way, this was the main impact of reduction we have forecasted, and we know that. We already -- we were telling that to the market. The Commercial margins regarding 2024 to 2025, these margins of the contracts come down, and this is because the margins drop. So on the side of net profit, we have a positive effect because of the repayment of the bonds that really had a negative impact in our net profit for Cemig GT because of the FX exposure. So now we have a positive effect in our adjusted net profit for Cemig GT. We have already talked about the GSF auction success. Here, we have some more details regarding the BRL 200 million and the three plants that we were awarded, Irapé and Queimado. Two plants where we had contracts with sales price that were higher over BRL 350 per megawatt that we're extending beyond the time period of the concession. So this extension was very positive for us. Therefore, obviously, we went in with a controlled premium. We were awarded. These plants, and we are very happy to add 3 more years for Irapé and 7 years more for Joaquim and Queimado. And also an important piece of news here for us. ANEEL has recommended the approval of the concession extension request for Sá Carvalho. This is a very important news in terms of renewing our concessions per quotas. It's important to say that in Pai Joaquim, we also had a benefit of discount in the TUSD. For Gasmig as well, we had great and positive effects. EBITDA for Gasmig is in line and net profit is much higher, especially driven by efficient cost management. And also, we had debentures issuance that allowed it to be funded, and this allowed us to have positive result for net profit, and we will keep on investing. And we believe that very soon, we will have the opening of our Central West project. And of course, we would like to end this call inviting you all to our Cemig day. It's going to happen on September 10, 2025. And we will go into more details about our strategy and how we see Cemig moving forward with the challenges and opportunities for Cemig because we are a wonderful company in the energy sector. Thank you all very much. So we end the presentation now, and we open the floor for the Q&A session and your questions.

[Operator Instructions] Our first question is from Carolina Carneiro, analyst from Banco Safra.

Hello. Thank you very much for the call. I would like to take this opportunity and ask you to comment about capital allocation. You went into the GSF auction. Of course, you have a robust investment plan, but the cash situation of the company is very much under control. If you can give us a little bit more of visibility, what's going to be your focus for the next transmission auction. If you were looking at any other segment? And also about the concession renewals, you had that opportunity via GSF auction, but we have some important concessions that are due in the next few years. Do you have any updates in terms of regulatory changes or discussions that are on the table that would allow us to have greater visibility about the plans for these plants? That would be very interesting. Thank you.

While the best guideline is our strategic planning, our BRL 59 billion of investment plan since 2019 up to 2029. As you know, as it is included in this plan, the bulk part of this investment will be in distribution. This is a regulated sector. We were in a situation in the past where we did not have enough investments and a great need of an unmet load, almost 15% of the load was unmet in the past. And also a huge connection of distributed generation. So this initial movement of growth and distribution is really a movement to address the expansion needs to cater an unmet load and also to also cater to distributed generation. We now have almost 5 gigawatts of distributed generation that obviously needs a lot of investment. So these are known projects, Mais Energia, Minas 3-phase and more energy. So after we conclude this initial step to face the needs of expansion to cater these two flows, the demand and supply, we then have a need of increasing resilience and automation, ANEEL and the Ministry of Energy also are requesting that. So in the beginning, it was expansion. Now in the second moment, we are making this investment to increase resilience and the quality of the service provided. This will be the bulk of our investments. We also have a gas investments in another regulated sector and about the concessions generation that you asked. Here, what we have are the regulatory rules. What we have today and we like what we see is the ANEEL's recommendation to have the renewal per quotas of Sá Carvalho. The same topic is being analyzed by ANEEL regarding our other two plants. And then ANEEL recommends that to the Ministry of Mines and Energy. And then we would have the renewal for quotas. We would not need to make any disbursement and then we would leave the free market and we go to the regulated market. A decision to go to the free market. It depends on the changes in the capital changes -- capital structure changes, and that does not depend on the company's management. So any other decision of maintaining the plants in the free market, obviously, they depend on decisions from the executive power and the statehouse, Minas Gerais in terms of changes in the capital structure. I would say these are the main comments that I can tell you about in terms of capital allocation, I don't know if anyone else would like to add, feel free if you have any comments to add. But clearly, the main guideline here is to follow our strategic plan. And there is something that I always like to highlight about our strategic plan, which is to focus in Minas Gerais and to win. So 100% of our investments will be focused in Minas Gerais. This is a role that is very strict for us. So our full investments will be done in our competitive advantages. And we understand that these involve to be here in our territory where we have the concession in most part of our assets, our plants, and that's where we have all the synergies. We take this very seriously. So any M&A possible situations, they have to happen in Minas Gerais.

Thank you very much, Reynaldo. If I can ask another question. Last week, the Supreme Court ruled about PIS/COFINS and ICMS. I know that it might be too early to ask you, but if you already have any comments and other companies in the sector have a significant balance in a possible credit to be transferred to tariffs or even to the company, do you have any ruling or do you have any reading about what was decided last week? That would be great to know. Thank you.

Well, this allows the deduction of the taxes and honor areas that have been paid. And yes, this is positive. And as you said, Cemig has already reimbursed clients for over 10 years. So now we have to see how this final ruling will be to check the impacts for us, but two positive things are to be able to discount taxes and also honoraries. This is positive, yes, but we cannot calculate that without knowing the final ruling. Let's wait for that.

[Operator Instructions] Our next question is from analyst Victor Cunha.

Good afternoon, everyone. Thank you for this opportunity. Now looking at the energy balance that you presented, we saw a reduction in the short position for the short term, '25, '26, but an increase in the short position for '27, '28. Can you share with us what was the rationale and this decision to increase the short position for '27, '28, especially during a pressure for energy prices, considering the new parameters and risk aversion, but also probable higher cost and the marginal cost of expansion, considering all challenges that renewable plants are facing. If you can tell us what you have in mind for that, I would appreciate.

Victor. Thank you for your question. Actually, we have been working to close this position. We have been looking at the market and we have been closing positions and increasing our exposure. The short exposure in these 2 years you mentioned, still a gold effect. The counterpart that we had contracted and because we do not have delivered energy, we had to buy energy and to expose ourselves a little bit more. But we are looking ahead and closing our positions. This is our guide, we do not wish to open more positions.

Our next question is from Lilyanna Yang, analyst from HSBC. I can also read your question. Okay. Well, there was a problem here with transmission, but she has two questions. First, in distribution, your next tariff review will happen just in 2028. Can you comment on how the current changes in the regulatory environment might affect the profitability of the company? And second question, when can we expect an expense reduction in the pension plan fund?

Good afternoon, Lilyanna. I can comment on those. Once again, it's too early to talk about an efficient frontier of costs. We have to be prepared to be talking about efficiency. This is one of our mantras. We want to improve the quality of services provided and at the same time, to look for more efficiency. This is something that needs to go hand in hand, and they are mantras for us, and we'll always be aiming for more efficiency. And if that -- and from time to time implies tariff modes, we will welcome it because it's good for consumers as well that need to have tariff models. We have to look for efficiency, and we know that every 5 years, there is a discussion on tariff modes and efficiency. We just hope that it's not only tariff modes regarding distribution parcel, but also that it is regarding CDEs, subsidies, charges, all of this discussion that we are following in the sector and we know that the line that has increased the most and that has affected the tariffs are charges and subsidies and not the parcels and generation and transmission. And the one that has moved forward the least was distribution. Therefore, we are working in order to look for efficiency. And we know that every 5 years, we have changes and of course, the more automation, more technology, the better. We are now working to grow our smart meters. These are all topics that aim for better service providing. And also, they work in savings. Our IT area is looking for that. About pension funds, there was another comment from Carol about health care plans. This is the post employment. That's a very relevant topic, a very relevant line in the company's results, and we are negotiating all of these topics, whether it is health care plan or pension funds, especially the benefits from Cemig. We will know more as soon as we conclude any of these topics. And before that, I think it is too early to say anything. I can tell you that we are all interested in coming into an agreement with all beneficiaries to make sure that both plants are guaranteed and for the health care plan and also the pension funds and as well as aiming Cemig's efficiency.

If there are no further questions, we end now our Q&A session. I would like to turn the floor to our CFO and IR Officer, Andrea Marques de Almeida for her final remarks.

I would like to thank you very much for your questions and for your participation. We are here available to take any questions in the IR area and our leaders to help you at any time. Thank you very much, and have a nice afternoon.

Our media conference call for the second quarter 2025 Cemig's results has ended. Thank you very much. [Statements in English on this transcript were spoken by an interpreter present on the live call.]

Good afternoon, everyone. Thank you for waiting. Welcome to Cemig's First Quarter 2025 Earnings Video Conference Call. Should you need simultaneous interpretation, the feature is available on this platform. Just click on the globe icon located on the bottom of the screen and choose interpretation. Then, select the language of your choice, Portuguese or English. Should you choose to follow the call in English, you may also select mute original audio to mute the Portuguese original audio on the back. This video conference is being recorded and will be available on the company's IR website, ri.cemig.com.br. Or, you'll also find the full package on our earnings call. You can also download the company's presentation via the chat icon in Portuguese or in English. During the company's presentation, all participants will have their microphones muted. After the presentation, we will start the Q&A session. [Operator Instructions] So, now we would like to turn the floor to Carolina Senna, Cemig's IR Superintendent. Carolina, the floor is yours.

Good morning, everyone. I am Carolina Senna, Cemig's Investor Relations Superintendent. We start now the first quarter 2025 earnings video conference call. And with us, we have Reynaldo Passanezi Filho, our CEO; Andrea Marques de Almeida, CFO and IR officer; Cristiana Maria Fortini Pinto e Silva, Chief Legal Officer; Marco da Camino Ancona Lopez Soligo, Chief Generation and Transmission Officer; Sergio Lopes Cabral, Chief Commercialization Officer; Marney Tadeu Antunes, Chief Distribution Officer; and Luis Claudio Correa Villani, Chief Information Officer. For the initial remarks, I would like to turn the floor to our CEO, Reynaldo Passanezi Filho.

Good morning, everyone. Welcome to our earnings call for the first quarter of 2025, another quarter where we post, as you can see here, resilience and results; sound results. Of course, we had some impacts in our trading company. Andrea will go into the details. But it is important to highlight that we had an EBITDA of BRL1.8 billion, very significant EBITDA. Also, with positive results in all of the segments, exception made to the trading company, also net profit of BRL1 billion. We are paying dividends here, interest on equity of BRL541 million. Also, a very significant event to finance our investment program are the ventures, BRL5 billion and the ventures. But what I would like to highlight here is, our mantras, our direction. For me, it is to carry out the largest investment program in the company's history. We will see our CapEx, the investment program. It is still ramping up. We have grown 6x our investments since 2018. This is really a significant figure. We went from BRL950 million of investments in 2018 to BRL5.700 billion in 2024, and we have a forecast reaching BRL6.3 billion in 2025, and this is what we are showing investments growing 18% from 2024 to 2025. As all of you know, these investments will mature in the tariff review, and then we will be able the financial results of these investments after the tariff review, which is going to happen in 2028. And it is very important to understand the characteristic of these investments. Most of them, over 75% is dedicated to network, to infrastructure. We are talking about investments in distribution, transmission, and also in gas. All of that involves network development. And this is a topic that is currently being discussed. If you follow the energy transition, you see that investments in network is crucial for this energy transition. So, one-third of energy's investments is on a network, and this is what we are bringing to you here. 75% of our investments is dedicated to infrastructure and network. As you all know, this is a regulated investment with a profitability that is guaranteed. Therefore, it provides great stability to the company. Our second mantra, which is also very important is efficiency. Here, we have well, our first mantra is focus in Minas Gerais and when and Minas Gerais. This is very important. And these investments are in areas where we know and sectors that we know about regulated sectors, and they have results, stability, as well as profitability. The profitability is guaranteed. The second mantra is efficiency. So, we move on within the regulatory standards guaranteeing cash generation. So, we are within our regulatory losses. We are compliant with the regulatory expenses that we call regulatory PMSO. Therefore, everything that is in the tariff, we are complying with the expenses, and we can have cash generation to finance all this investment plan. We are not using our cash with expenses or with regulatory losses or losses above the regulatory metrics. So, the first mantra, once again is to focus in Minas Gerais and when to following this investment program, it's very important to stress that this investment program is all contracted in addition to being in regulated sectors. We can say that we have a lot to follow here in this growth process because today, it's already contracted. We know that it takes a while to start moving, but it is already there. It's contracted. The second mantra then is efficiency. We will always be focusing on that. This is in our objectives and we do intend to be within the regulatory expenses and losses. We are also working on an organization restructuring already, looking for more efficiency and being closer to clients. Maybe this would be our third topic here, which is working, with efficiency and being closer to clients as well as improving the results and all the results metrics such as [CAIDI and CAIPI] (ph), and the results with clients, which is the distribution regionalization. This is a very important topic. We had a company that was very centralized in the past. And today, we have developed. We have created six regional areas and 17 regional high-voltage management units. And here we are talking about Uberlândia, Montes Claros, Governador Valadares, Juiz de Fora, [Poso Levi] (ph), and obviously, the Metro region, Belo Horizonte. So, what was centralized in Belo Horizonte in the past now is divided in six regional management units or regional superintendencies. They are larger than other concessions in some cases considering the size of the state. And we have this purpose here with the superintendents is we want to be closer to clients to see what are the challenges and the different areas. And now, so we are aiming for more efficiency because being closer to clients allows us to see possible optimization situations. We are already realizing how much of these new regional units and I congratulate all of those that have taken up these new positions. And our Distribution Officer can talk more about that. But we can see that there is a clear objective or greater integration in the areas, more efficiency of physical spaces, always aiming for greater efficiency. And also we have Cemig Agro, which is a very important topic that goes together with investments. Agribusiness is one of the main growth drivers of Minas Gerais' economy. And for us, it is very important to work driving up the agribusiness with investments, and that's what we call Mina's three phase. And also with a more efficient operation, improving service quality and providing greater agility in service. And this is what we are adding here with this reinforcement of our teams with several new units with 228 new electricians. And the objective here is very clear. We are looking for greater proximity with our clients. It's very important to follow these mantras. The first one is focus in Minas Gerais and win in Minas Gerais with prudent and cautious investment plan, but at the same time, a very bold one and always aim for our efficiency metrics, the regulatory ones, and also with metrics that are better than the regulatory ones and to improve our service to clients. And I would like to include another one, which is innovation and modernization. And talking about restructuring, the company, we have here this development of the regionalization. And also we have an IT area. I would like to congratulate Luis Claudio Villani, our new Chief Information Officer. And this shows how much we are investing in terms of more innovation and modernization. We are bringing in a new ADMS, a new SAP S4/HANA with great advancements in digitization. This will improve our integration between IT and OT and will bring us more simplification in processes, therefore providing more efficiency and service quality. When we talk about IT, we have a wonderful situation, right? We can be more efficient and also we can improve our service providing because it's not always like that. So, welcome, Villani. And that's what I say. These are the mantras. These are the topics we have always to stress, and they are our guidelines. They are our strategy, and it this is a strategy that is consolidating itself over the past years and this transformation process in the company. I also congratulate everyone in the company for their work, especially in the divestment process. And now we are in a new path, and we created this new area, which is, the innovation and technology area, and always aiming for innovation and modernization. These were my initial remarks. So, now, I would turn the floor to Andrea. She's going to talk about the wonderful figures, right, just BRL5 billion in debentures, and we will then be available for the Q&A session at the end of the presentation.

Thank you very much, Reynaldo. Good morning, everyone. I'm very happy to be here with you. And of course, to talk about our issuance, which was very successful. In the first quarter, we had just those two top parts, which was issuing BRL2.5 billion Cemig D and BRL625 million and Cemig GT. At the time, of course, we compared ourselves to our peers. And in fact, we were able to have a issuance lower than our peers and very close to the sovereignty. This is a very, very relevant, a figure for us. We were happy because the demand was huge, over 2.5 times our booking. And that's why we're able to issue the lower, one -- the one on the bottom of the page. Because of the high demand, we had an opportunity of having an additional issuance of BRL1.9 billion. It's not in this quarter. We are just posting showing it here. It happened in April. And then, we were able to reduce a little bit more the rate of the issuance. It's for seven years. So, we were able to do something even better. So, the tenure helped. So, we were able to extend our debt from 4.8 to 5.5 years. And some relevant landmarks is that we were able to maintain the AAA credit rating assigned by Fitch Ratings. And this is another debenture that is considered green and sustainable, and we are very aware about that. Now moving towards the results, and Reynaldo already, touched up on that. So, we did have a drop of 9% in our EBITDA. That was because of the effect of the price difference in the submarkets and the trading company, which had an impact of around BRL133 million. In addition, we are already expecting lower margins from the trading company. So, there was an additional drop of our EBITDA because of the margins of the trading company. And, of course, we'll start seeing that over the year. There was a nonrecurring effect from 2024, for instance, [SHBP] (ph) sale in 2024, BRL43 million. It did not happen in 2025 on the upside, and this is also very relevant in considering the efficiency that Reynaldo highlighted here, that's very important for us. We have been able to migrate. We offered it to our employees an opportunity to migrate from the PSI health care plan that this is, a change that we are working on, and it guarantees that Cemig keeps on paying the health care plan up to their retirement. And they migrated to another health care plan. We were able to migrate over 1,000 employees, and they do not have the same conditions. And with that, we were able to have a reversal of provisions of 28 million. So, over 700 employees, active employees, also migrated after those. Today, we have around 24% of all our employees still in the prior end, the old health care plan, which we call PSI. Now when we turn to our non-profit, we also had effects of equity such as Belo Monte or Alliance that was here last year, not this year anymore. And also, Belo Monte that had an effect in the submarket impact, and this is also had an increase of our debt. We have taken funds, at costs that are very competitive, and so we had an increase of financial expenses here. So, zooming in on the submarkets, and we talked about this already in the prior quarter, and we see that we start the year with no price difference. It was very close to zero. In February, there is a price difference of 35. And then, March, when we in fact have a difficult hydrological situation, drier with less rainfall, we see a mismatch in price. Therefore, the price went up to BRL272. That's a difference in the submarket price under this new model with a greater volatility. We realized that and practice, and this is what, had the greater impact. If we look at April, this price difference has already dropped around a BRL120, and we already see the difference being reduced, of course, with the improvement of the hydrological conditions. Now looking at our managerial, expenses, what was more relevant, I already talked about, which was the reversal of the post retirement provisions. Once again, we were working on the on the efficiency. Also personnel is regular, it's normal. We have the annual adjustments, and, also, we have a small reduction in expenses helping in the reduction of manageable expenses in this first quarter. This is a snapshot of our debt. Now a 100%, Real denominated that, with the average tenure of 5.5 years and a leverage of 1.4. Once again, we stress the success of the debentures issuing our rating by Fitch is AAA. We have a corporate rating by another two agencies, and those are double a plus. So, we are in a very comfortable situation to keep on investing, to keep on working on this important investment program for Cemig's growth. And sure we'll be fine in our leverage over the way. Our consolidated cash flow, we ended 2024 with BRL2.3 billion more or less. Our operating cash flow was BRL1.5. We have a little bit of the pass parcel way variation account. We also had the loans and debentures. And in the outflow, we had the payments on loans and debentures, BRL3 billion investment activity. It's very strong as you can see, BRL1.2 billion. And we have one of the debentures that we issued last year that we have already to set aside funds for that BRL5 billion already set aside to pay for those debentures, and we ended with cash at BRL4.7 billion. Now, looking at the companies, we have, as mentioned, a greater impact in the distribution company here with a tariff increase that helped us. And also, it has a good effect that this migration of, the health care plan for employments in the post retirement that had a positive effect in the net profit. We had an effect of the debt. Of course, it affected the financial expenses when we compare IPCA from, one year to another. But once again, the indicators are all within the regulatory limits at in Cemig GT, we have operating indicators. They are all within the regulatory limits, and we continue having reductions in the perceived when we look at the twelve months, rolling window of around three hours. And that is a very relevant result. In the energy market, we had a 0.3% in the build market plus a transfer to customers. And here, we have drop in the rural because there was a lot of rain. In commercial, we still see migration to DD. And of course, we also have migration to the free market, and we see the transfer of energy growing. So, these are clients from the free market that evolved. And the residential, we had a slight increase in clients. Now, for regulatory losses, they are in compliance with the limits. We are doing a very relevant work. The inspections, they are extremely important. We are replacing out dated meters, and they are being replaced by new smart meters that and that is also part of our important investment. For, GT, as I mentioned, in the beginning, we had a nonrecurring effect in 2024, which was SHBP sales, BRL43 million, more or less, and that was the main effect in this drop. And then, the net profit last year, of course, GT had the dollar denominated bonds and we no longer have that because we paid those. So, it has a lower effect and so we had lower effects with net equity, therefore or equity income. So, here we also have the effect, Alliance and Belo Monte. For Gasmig, we had a reduction of sold volume, which was the effect of the EBITDA and the net, profit and is still moving on with the investment program being very well executed, and we believe that this project will be concluded by the end of the year. Here, once again, we have a snapshot, and it's important to show you that in the quarter, we see that in fact, the greater effect was in the trading company. We see a BRL12 billion of impact in the EBITDA, and then the submarket and part of that because of the difference in margin that we are already expecting from one year to another. We had that expectation of reducing margin in the contracts, and the other segments were also having a positive result. And this is the beauty of our portfolio. It's very diversified, and it provides resiliency as Ronaldo mentioned. That's what we had to bring to you. Thank you very much for your attention. And now we turn to our Q&A.

Moving on, we will now start our Q&A session. [Operator Instructions] Our first question is from sell-side analyst, Victor Cunha from Itau BBA. Please, Victor, feel free to ask your question.

Good morning, everyone. Good morning, Carol, and thank you for this opportunity. Now my question is looking at the energy balance that the company posted, we see an increase in the short position, especially for the next years. Can you share with us what was the rationale behind this decision, especially doing a period of a pressure for energy prices considering also the recent adoption of the hybrid new wave and the new parameters for risk aversion? Can we consider a marginal cost of expansion that might be higher than what we have today? I just would like to have your understanding regarding this decision. What was the rationale behind it and the perspective, that we have looking ahead?

Thank you, Victor. Now, who is going to answer the question is our trading officer, Sergio Cabral. Please, Sergio?

Good morning. Good morning, everyone. Good morning, Victor, and thank you for your question. Actually, we have not increased. We still have a short exposure this year because of the deliveries that have not been, carried out. For 2026 and 2027, we will maintain a short position. We should bring it over to the future a little bit more when we analyze prices, and we are already looking at a price stabilization. And as Andrea said, the end of this submarket effect, but we do not intend to increase exposure, we are trying to work with the lowest exposure possible and also observing these changes and fluctuations in price.

Thank you, Sergio.

Victor, anything else?

No. It's very clear. Thank you.

Thank you, Sergio.

Now moving on, our next question is from sell-side analyst from Safra, Maria Carolina Carneiro.

Hello, everyone. Good morning, and thank you for the call and for this opportunity. I have two questions. The first, on the details that you mentioned and efficiency, in this quarter, we have seen, as you said, the initial impact of the health care plan migration. In fact, can you tell us what we could what we could expect for the next quarters? And Andrea, you said that you have a new window for enrollment. I would like to understand how this is going to move forward over the year. Also, my second question on the trading company, I would like to understand if in 2025, you have been able or if you're looking for a way of mitigating the impact of the submarket. We see that there is a mismatch of prices or a detachment of prices, not with the same strength of March, but still a strong. But I would like to understand if the company is trying to mitigate these impacts for the next quarters in terms of the prices for the submarket. Thank you. To ask the question about the health care plan, Andrea Almeida, our CFO. Thanks, Andrea.

Thank you very much for your question. What we can expect in the next quarter in terms of this migration, we have 700 employees migrating, so we will have an amount to be reduced because of this provision reversal. But this is not as significant as we saw we had a migration of 1,000 and we had 28 million in reversal. As a provision, as a whole of course, we are negotiating with our Unions in order to come to an agreement. And as this agreement is finalized, we might have it, but we don't have a final date for that. We don't know when it's going to happen, and not even the amount because it's still something we are working on that's not possible to define right now. Now already answering the other question on the trading, yes of course, we are looking at mitigation tools for the current year. And for the current year, of course, the instruments considering the price differences are very expensive. But if we have an opportunity to have clients buying in the regions where we have that production, we will be working on it. So, yes, we are always looking at it, but we have to come up to a price that is reasonable. We are also looking at the development of what is happening and also the possibility of having the energy agency being less conservative and to make a more feasible transference from the Northeast to the Southeast to the Southeast and so that we can reduce the difference between the submarkets. So, this is all part of a study that we are running in house about this issue. Thank you very much.

Thank you, Andrea for your answers. If there are no further questions, we will now end. Oh, there is another one. I'm sorry. Victor, sell-side analyst from Genial Investimentos. Please, you can open your microphone and ask your question.

Good morning, everyone and thank you very much for taking my question. You can ask if someone wants to ask another question also. Well, it's now being back this in discussion in the media, the decision of CEMIG regarding Propag, and it has to do with the decision of Romeu Zema, the Minas Gerais Governor. Is there anything you knew about this topic comparing to what has already been discussed? The legislative assembly Minas Gerais has anything new. It's a feeling like things come and go and we are kind of lost regarding whatever has been discussed. What can we expect from this topic now?

I turn the floor to Reynaldo, our CEO, to answer this question.

Well, Victor, I think the matter here is just the same. The government just sent a project to deal with Propag. And in this project to deal with Propag, it included some assets. Among the assets, we have CEMIG. And just like you're asking about CEMIG, COPASA is also included here. So, this is a relevant topic for Minas Gerais legislative assembly, and it has to be discussed there. So, what is new is that this topic is going to be prioritized, to be discussed at this legislative assembly.

The next question comes from the analyst [Xin Lai from Trigono] (ph). [Operator Instructions] Yes, we can hear you.

I would like to know if you will have any changes in the dividends policy of the company in regards to the payout. What are you considering for 2025?

Thank you, Xin. Who's going to answer your question? It's Andrea Almeida, our CFO.

Thank you, Xin, for your question. And actually, Xin, we do not expect any changes in our dividends policy. We'll keep on paying 50% of our profits. And as you have seen in prior years when we had non-recurring effects, we were able to pay -- even if they were not generating cash, we were able to pay dividends as well. So, it is our practice. If it happens, it's also going to happen this year. But the policy is the same, 50% of net profit. And that is in our bylaws.

Thank you, Andrea. Our next question is from sell-side analyst from HSBC, Liliana Yang. Please, Liliana, you may ask your question.

Hello, and thank you for this opportunity. I would like to hear from you about the capital structure. And this has to do with what Andrea talked about related to dividends. But how do you see this indebtedness structure and capital? Because some companies in the sector are indicating that they should be more conservative considering the price volatility in the energy market. Thank you.

Thank you. And I turn the floor to our CFO, Andrea Almeida.

Thank you very much for your question. I think Cemig was already being conservative. We had a low leverage. We know that leverage over the investment period was going to reach around 2.5 times net over EBITDA up to 2027. In 2028, we have the tariff review, or Cemig D that will bring us to another level. So, it's fine. Our leverage will come down then. So, we believe we have room to adjust that additional volatility that we see now. And with those prices, I believe that when compared to other companies, you are already in a more conservative situation. I'm sorry. Reynaldo wants to comment as well.

Our results are of great resiliency. So, we are bringing resilient results in this quarter in spite of the volatility. And I think that we also mentioned that we aim to reduce risk exposure. So, both banks are moving towards keeping the dividends distribution policy and not changing our investment plan. Either we will keep on working with our investment plan as well as our dividends distribution policy on the same terms and dates. I see the last question here, the same periods of time that the company already does. We'll keep on following that. Thank you very much.

Thank you, Reynaldo. If there are further questions, please feel free to ask them. Please write your name in our Q&A icon. Since there are no further questions, we end here our Q&A session. Thank you very much for participating in the first quarter 2025 videoconference call. There is another one, it looks like it. It looks like his was not answered, Antonio Alex. The IR Superintendent is available to answer any other questions you might have. Thank you all very much, and have a nice day. If you have additional questions, Amelia and our website is available to get your questions, and we will be answering them. Thank you all very much, and have a nice day.

Good afternoon, everyone. I'm Carolina Senna, Cemig, Investor Relations Superintendent. Welcome to Cemig's Fourth Quarter 2024 Earnings Video Conference Call. We inform that this video conference is being recorded and will be available on the Company's IR website, where you'll also find the Company's presentation. We inform you that, if you need simultaneous interpreting, the feature is available by clicking on the Globe icon located on the bottom of the screen. Upon choosing Interpretation, select the language of your choice, Portuguese or English. Should you choose to follow the call in English, you may also select Mute Original Audio. We are now starting Cemig's video conference with Reynaldo Passanezi Filho, CEO; Andrea Marques de Almeida, CFO and IR Officer; Cristiana Maria Fortini Pinto e Silva, Chief Regulatory Officer; Marco da Camino Ancona Lopez Soligo, Chief Participation Officer and also Generation and Transmission Officer; Sergio Lopes Cabral, Chief Commercialization Officer. And for the initial remarks, we turn the floor to our CEO, Renaldo Passanezi Filho. Thank you.

Good afternoon, everyone. It is a pleasure to be here in this video conference earnings call to bring you 2024 results. I would like to bring to you a message on our highlights. These are our main highlights. For us, this is a historical very important result. 2024 gave us the highest EBITDA, the highest in Cemig's history, the highest net profit as well of our history higher annual CapEx of Cemig's history and also the best rating and history, which is AAA by Fitch ratings. I would say that here, you can see the strength of transformation of the Company's change. Our turnaround when we compare this company in 2018 and what we have been able to reach in all the figures, you will see in our EBITDA, net profit, CapEx, we are talking about 500% and 600% of increase in any of these indicators. So, for us, this just confirms absolute wonderful results. Not only is spectacular, but also historical results. Once again, I say that we have reached BRL11.3 billion in EBITDA. This is a significant growth when compared to the prior year, we reached BRL5.7 billion in investments, which also has a very positive effect. We know that investments that are concentrated and regulated sectors that has a great effect in the Company's profitability when we are becoming more mature and also working on divestments, we reached a AAA rating our issuances have been made with interest rates that are in terms of the spread very good, the lowest all-time this year in 2024, we concluded another step of our divestment program. We sold Alianca Energia. And also, we had a very positive impact in the tariff review for transmission, which was of BRL1.5 billion enzyme transmission results. This one for me is one of the charts that I like the most. Because I think all of this turnaround that we're able to do also allowed us to guarantee the Company's sustainability. And increased our investment capacity as well as improving the quality of service to clients and go back to being a driver in Minas Gerais development because when you talk about infrastructure, electric power, we are talking about an input base that is crucial for the development of the state in the country in our case, is very much concentrated in Minas Gerais. Here, we invested in 2018, BRL954 million, last year, in 2024, we invested BRL5.7 billion, once again, 34.8% of investment growth. That's the annual average growth. And this is our perspective. You see a very high amount of investments. And year-to-date, it's very important to say that, if you look at the start, you will be able to see that it took a while to really take off because we had to improve the Company's efficiency. We had to bring the Company into the regulatory standards, also the regulatory PMSO also technical and commercial regulatory losses. So, we did have to go over all the divestments, and that also takes time and how to prepare the strategic plan the old growth program should be successful in our bidding. So, if you look at 2018, '19, '20, '21, we had not taken enough then. And all of a sudden, you see this growth strong growth, of course, since 2021 showing the whole process of preparing, moving forward in the Company's turnaround and allowing the Company to be more sustainable financially because it is within the regulatory standards and because we no longer need to invest in non-strategic areas for Cemig. Here, we are talking about all our minority stake holding. You know that very well. and we divested from those. And then we were able to reach that level, and we believe that the level will be moving forward in the future. You know our investment program is a very bold one. Actually, we had a BRL59.1 billion from 2019 to 2028. And the figure for me is wonderful, which is to invest 4x QRR the regulatory depreciation. We had invested below the QRR, but last year, we invested 4x our QRR. For this year, we will still have a number of transformations. We are working still on our growth program to build substations, also will be growing and developing networks, especially three Phase Is. We have a special highlight now, a special attention to the agri business, which is the Minas three phase program. And also, it aims to improve the quality of the services for the agri business. We are back to investing in infrastructure in gas with the gas pipeline to the Midwest of the state of Minas Gerais, we are also investing in DG and transmission. And I highlight some important transformations in terms of efficiency. And I believe they will have the same pattern. It will take a while to take off. But when it takes off, it's really a huge transformation. I see a very positive transformation in information technology. Next year, we should start with a new DNS. I think this is going to have a wonderful effect in terms of cost and in terms of improving in the quality of services. We also have been able to move forward in terms of supply, logistics, with new distribution centers all over the state. And more recently, we announced the regionalization, which has the main objective here of decrease the distances, and that's to become more efficient and also to be closer to clients and to be able to improve the quality of the services we provide. Therefore, we are very pleased with this year's result that approves this transformation moment of the Company when I look at it as a whole picture -- in the big picture, we see the transformation. These are my initial remarks. And of course, we will be available to take your questions later on in the Q&A session. Thank you very much for being with us.

So, I will move forward. Thank you, Reynaldo. So as Reynaldo well said it, we delivered a lot to our clients, to our society and a lot also to our investors with our AAA. And also, we delivered to our stockholding investors. This was the highest yield in the electric sector, 15%. Our shares increased 43% of preferred shares in the year, it is BRL7 billion of market value increase. And we have, if approved, the BRL1.8 billion in the next shareholders' meeting, we will be distributing BRL5 billion in dividends. In fact, we are in line. We have had great results, and we are always in line with our peers in the electric sector. This is a trademark as well with our investors and also our stock investors. In terms of sustainability, in addition to being a company with a 100% clean matrix. We have wonderful results. We have included for the 25th consecutive time in the DJSI now up 6 points when compared to the previous year Also, we are included in the sustainability year book 2024 for S&P Global and the A list of CDP as for Climate 2024, which is an index that measures transparency in the analyzed transparency criteria, we had the top score in 10 of the 16 criteria analyzed. We also adhered to the utility for NetZero Alliance and other great achievement in our sustainability pillar, in addition to our Cemig REC, not only Cemig REC, but we also have I-REC, our renewable energy certificates that we are issuing with our own generation or with the generation that we buy in our contracts, which also generate value for the Company, and we generate value for society as well. So, all of these are amazing achievements in our sustainability pillar. Now turning to the results and Reynaldo basically gave you an overview, but I will go over some details to show what happened. So, we ended the year really with a record of BRL11.3 billion in EBITDA, up BRL32 million vis-à-vis the prior year, we did have non-recurring relevant effects that add BRL3.6 billion. Among them, some that have already been mentioned, BRL1.5 billion from the tariff review from the transmission company also BRL584 for reversal of INS over the profit-sharing program and non-recurring events, also the sale of Alliance, we had non-recurring events in 2023, the sale of Baguari and Retiro Baixo, which corresponded to around BRL300 million. So, all of these events have been non-recurrent and relevant from one year to another. Now in terms of recurrence and also regarding negative things for this year, we were already expecting a drop in the trading company margins. They were already forecasted and they represented around BRL600 million and the drop of EBITDA when compared these years. Now turning to net profit, of course, the same effects can be applied and of course, on the net profit. And then we have effects of increase because we are investing more. Of course, we also had effects of payment of higher taxes because we have higher net profit, therefore, we pay more taxes. And also, we have effects in terms of FX exchange because we had the overall bonds that were settled by the end of the year. This is also an important effect when we compare 2024 to 2023. Highlights for the fourth quarter also for the holding company. We ended with an EBITDA of BRL1.9 billion, very relevant in the fourth quarter of 2024. Important operating indicators everything that we have been doing in the distributing company and believe that Reynaldo has mentioned, how important that is for delivering good service to our clients. This has been in a way. We can see it in the operating indicators. And one of them that's very relevant is the perceived DEC, and we have been able to see a reduction of 2.5 hours in the DEC indicator, which is very important for us. It's a great achievement for our fourth quarter. Now for GT, we also had relevant achievements. Some of them are also related to the bidding process. There are a number of improvements that are regarding our bidding process, logistics, purchasing stock reduction. In this case, we had unlocked BRL808 million that will be flowing through the next months to improve investments and improvements in the transmission business. And also, in our Sierra Wind Park will have the installation of new wind turbines, and we should estimate recoverable revenue of BRL11.3 million. So, when we compare the EBITDA from the fourth quarter of this year to the fourth quarter of the prior year, we did have drop in the margin of the trading company here, BRL225 million drop in terms of margin. We did have the same non-recurring effect last year because of the sale of Baguari and Retiro Baixo, which affected positively the EBITDA last year because it didn't have this year. And also, there was an increase in PMS. So once again, I usually say that this is a positive PMSO because we have an increase and pathway cleaning because that improves our DC. We spend more, but this is something that we need to do to improve our operating indicators, but -- and that was offset by our post-employment for around BRL40 million. So, this is more or less, these are the effects on the EBITDA. And on net profit, we did have an impact of BRL300 million of financial expenses because of the euro bonds that we settled that we paid for at the end of the year, so we ended with a net profit of almost BRL1 billion. Now looking at our expenses. I mentioned some of them. We did have an increase, but it was below inflation. And as I mentioned, we did have events such as outsourced services, which had to do with free pruning and cleaning of pathways, and that improves the some of our indicators and some also related to IT, but nothing that is a major concern. This is the debt profile. We ended the year with BRL9.9 billion. Now this is a real-denominated debt. We no longer have FX exposure and also, we have a landmark here in terms of sustainability, debentures from last year and the ones that we just issued. They are sustainable debentures. This is another relevant and despite of the slight increase in the leverage, you see that it is very good. We know that over the investment program, this will increase, but it would always increase in a safe fashion over our back up to 2028 when we have the rebuilding of distribution EBITDA and our debt cost is also very much within the standards around 12%, and these are according to the market's percentage. So, it is okay in terms of our profile. So, our cash flow, operating cash flow and really cash here, we ended 2023 with BRL2.3 billion in cash. We did have cash from operations and that were very relevant, BRL5.9 billion, BRL4.5 billion in loans and debentures. Also, we had Alianca divestment, a very significant amount that we received BRL2.7 billion. And then we had proceeds that were paid, also dividends paid and also investment activity and payments of loans and CBA. All of that has been very relevant over time, and we ended the year with BRL2.4 billion in our cash. So now I'll turn the floor to Carolina. She is going to go into the details on each company of the group.

Thank you very much, Andrea. So now moving on Cemig's D results when we compare the third quarter of 2023 -- fourth quarter of 2023 and fourth quarter of 2024, we had an increase in our EBITDA of 19.2%. Remember that in 2024 in the second quarter, we detached a loss indicator. And we've committed ourselves to end the year within the regulatory limits. And this happened in the fourth quarter bringing better results. And when we compare the fourth quarter of '23 and '24, we also had an improvement in our ADA. And when you look at the market, the fourth quarter, hydrology was favorable in November and December with more rainfall. And so we did have a reduction in the energy demand in the rural area, which neutralize those effects. But in any way, we were able to have significant results for net profit, not as a large growth, but that was affected by higher income, and we also have already talked about the increases because of the depreciation, so we have higher depreciation over the... As I mentioned, when I look at the captive market and the free market, we see that the free market is still growing and that shows that part of the captive clients have migrated to the category of three clients. Recently, the retail traders, we are leaders in Brazil, not only in no time, but also in the amount of transacted energy showing that this investment also allows the growth of the industry initiative and on the other hand, the captive, as I mentioned, because of migration it had reduction in some categories and also because of hydrology temperatures in 2024 compared to 23 were lower. Therefore, we see that in the third quarter of 2024, we had a strong residential growth because of high temperatures. And here, the opposite is happening. We had a slight reduction of 0.6% and our estate, our concession area is an area that has solar projects of micro mining manage generation distributed one. If we did not have that effect of the micro many of BG would have grown a higher amount. As I mentioned in the beginning, and that affects the financial results of the distributing company in 2021, the Company was within the limit of core losses. This is very important for the Company. And this is a commitment that we have year after year and in 2024, we not only were within the regulatory limits. But also, we had a result showing a good work of the Company. This is a very important indicator, and there are a number of actions that allow us to be within these limits and I would like to draw your attention to the 384,000 customer inspections now here and in delinquency and collection we see over time how the Company has changed the proportion of digital channels in collection. And this is very important because it has a lower cost in 2024, 67.2% came through these new channels with a highlight to peak. And therefore, we have 50% reduction in tariff costs and another indicator that we have -- it's what we call ARFA, the Receivables Collection Index. How much we are being able to collect in the last three years, we are ’24, ’23 very close to 100%, and that shows how important it is to have the collection of those. On the side of OpEx and the regulatory EBITDA, this is another achievement. In the past, the Company was operating with the OpEx that was above the tariff limit. So, we were able to reach that with a lot of work dedication, operating efficiency. And over the years, we are meaning that limit the compliance, and we ended the year with BRL156 million lower than the regulatory ops. Removing the non-recurring events that we had in 2024 and the distributing company was the program that we had for dismissal and also the profit share and distribution for EBITDA has also improved a lot still a little bit off, but we are working to bring that back to the regulatory EBITDA. For Cemig GT, we already mentioned and I here bring to you when I compare the fourth quarter of 2024 to the '23, we already know in the market when we shared that with you on Cemig data, the margins of the trading company and '24 would be lower when compare to 2023. Remember that we started a movement of bringing the trading activity to the holding company, but still 40% of the contracts are still under Cemig GT. So, in 2024, we end up having lower margins and lower results. In addition to 2023, as Andrea mentioned, we had a non-recurring event, which was the sale of grant adding to our strategic planning that improved our results in 2023. So in Cemig GT, we had a reduction because of these two main effects that I just mentioned. This is a very important slide because we have part of the trading activity in Cemig GT and the holding. And here, we break it down by business. Here when you compare the quarters per business, we can see that there was an improvement in the distribution EBITDA, as I mentioned, and generation when we compare '23 to '24, we had adjustments here trading was down. We also had Baguari and Retiro Baixo transmission, and Reynaldo already talked about that. We are very successful in the tariff review for the transmission company, there was an increase of RAP and Gasmig also had a reduction compared to prior year, and there was a reduction in the cubic meter of the industrial category, which had a negative impact. This is a very important differential. The diverse portfolio of the Company is what allows us to have this consistent result, and that's when we what we really should take into consideration when we compare our Cemig to other segments. Now going over Gasmig, which I already talked about, it had a reduction of a few big meters for industrial clients. And we had lower EBITDA and net profit, but it's important to mention that Gasmig is now back to making significant investments, and it's developing a pipeline for monopolize, the Midwest of Minas Gerais, which also will allow us to cater to new clients with this new project. And now, I'll turn the floor back to Andrea, and she's going to talk about the results of our strategic plan.

I think it's important here to say that in addition to the financial results, we have the results in all the pillars. Reynaldo gave us a very good overview, so I will be brief. Everything that we have been doing in distribution, and we talked about a number of indicators here, the regionalization of distribution to understand the reality of clients that -- so that we are closer to them and so that we can deliver to each client in an individualized fashion also Cemig agro and enforcement indicators that we are going for and also the DEC when we had an improvement of the rural DEC of eight hours. So, these are improvements not only numbers. In numbers as well, but some of them are greater that follow our strategic pillars in terms of innovation and technology, ADMS mentioned, also S/4 HANA, we are still implementing it. And the platform that is available for our clients of the retail trading companies, a digital platform. We don't see it here but we have a program called Cemig Inova lab. This is an open innovation program. I would say this is the largest one that we have today in the energy market. We are very proud of it. The modernization, the maturity, we know that our transformation -- digital transformation program is not some here. We did have very relevant deliveries this year and that sustained the Company and we look for new technologies. And we need to really be connected to them, also sustainability this year, we have planted 1 million trees. So, we the number. We are going to go beyond it, but we did meet the number and we also launched a program that is called Ecociente environmental awareness program for valuation inventory management is something very important, and all the logistics work, how you cater to inventory reduction, reducing logistics and inventory, we were able to bring that down BRL40 million and inventory logistics is a huge work, and we are working on it. We are mainly to be close to suppliers and closer to clients as well. So, all that work is very significant in the Company, our liability management work -- we talked about tax provision reversal of the INSS one, but also, we had a superior labor court decision that was very important that it was in favor of Cemig, and this is work that is being done by our legal team. They are all here with us. Also, significant work in health and safety. We had a reduction in the total frequency rate of occupational accidents. So, the work that we are doing in Cemig at all strategic pillars, that's very relevant, and we can bring it all together and it's difficult to put them all in a single page, but we are very proud of everything that we have done so far. And of course, we still have a dominance for the future. We still have divestments to be made, the digital transformation, which is still being developed. We will be renewing concessions there are auctions in terms of capacity reserve. And obviously, ringing new technology, new technologies also for electric transition. We are looking at those, and we are connected to the future. We thank you all very much for your attention. We are available to take your questions. Thank you and good afternoon.

So, now we are going to start our Q&A session. [Operator Instructions]. Our first question is from Carolina Carneiro from Banco J. Safra. Please, Carolina, you may ask your question.

Thank you very much for this opportunity. I have two questions. First one, so talking about efficiency. Over last year and also over 2023, you have taken a series of measures that really improved the margin. And we were able to see in the lines of PMSO all the evolution. And recently, you have seen in some newspapers also that, you are negotiating a possible migration of health care plans. Can you comment on that case? How are the negotiations with the union? And if you can also give us an update on other possible divestments of assets. I'll then turn to my second question. We have seen that another listed company that is under the control of Minas Gerais Administration has received a notice from the secretary of development to start just saying the possible privatization of the Company. So, did you also have -- did you also receive that kind of notice? And I would like to understand if for Cemig, this is, also ongoing in there?

Our first question is going to be addressed by Cristiana Fortini about the health care plan. Then I'll turn the floor to the other officers.

Good afternoon, everyone. About post-employment specifically regarding the health care plan. We have a significant achievement last year. And the labor court was in favor to Cemig. Thanks to. We had to collective agreements. And according to those, the benefit of post-employment for health care plan would be indefinite in terms of time that the Company would have the owners for the health care plans with no limit of time. So, we have a discussion ongoing, very specific ones. We have a discussion that is still in a court, and it should be judged by next week. And obviously, we are open to negotiation, and we were very much interested in negotiating with the unions. And towards something that will not repeat what we had in terms of success in the labor port, but also something that allows us to get closer and to negotiate with the unions. So, about the health care plan. What we can tell you is that we had a positive ruling favoring Cemig in 2024. Also, there is an opportunity for our active employees to migrate their health care plan. We had an important adherence here. And today, we have most of our employees already migrated to a health care plan that has greater sustainability. It's still protecting our employees. It is still guaranteeing the health of our employees. But in terms of its financial sustainability is much healthier for the Company. This migration process happens in the beginning of 2025. Anything else?

Now the next question related to divestments. I will talk -- I will turn the floor to Marco Soligo.

Good afternoon. Thank you very much for your question. We are and we are still working and divestments that have not been concluded of Taesa, Belo Monte and also on the consolidation of some minor stake holding or such a sale or acquisition [indiscernible] and others. It will be informed in due time as you always having. That's it.

Thank you, Marco. And now, I will turn the floor to our CEO Reynaldo Passanezi.

Good afternoon, Carol. If I well understood, as a question about privatization, right? Yes, we have been receiving notices. And we are talking to the controlling shareholder, the Economic Development Secretariat, they are asking questions in terms of the rules that apply in a possible process of control transfer. And we are supporting all the questions that we received from the Economic Development Secretariat and as a representative of Minas Gerais administration.

Next question is from Guilherme Lima from Santander. Please, Guilherme, you may ask your question.

Good afternoon, everyone. I would like to make a quick follow-up in the post time post-employment, I believe -- you will have a discussion and on a ruling next week, you're already talking to the union for a possible negotiation and agreement or you wait until you go to court? And how is the union behaving in this negotiation? And another question is regarding volumes of exposure in terms of differences of the sub-markets. You mentioned in the release 120 megawatts, with a negative effect of BRL20 million. I would like to understand that volume in the first quarter of 2025. And how do you expect this will affect the prices?

About post deployment. But the Company not only is open to negotiation as it has always been. During the lawsuit that ended with the rolling of the labor court. And also, after the victory that we had in the superior labor law, we are not waiting the ruling next week to negotiate. We are already contacting the union, and we are available to receiving the proposals that the union may want to send our way.

And our next question regarding energy trading is going to be answered by Marcos Vinicius. He is the superintendent of planning for the trading company, please, Marcus.

Good afternoon, Guilherme. Thank you for your question. Yes, we do have that exposure to price differences. You follow the portfolio that we have with the resources of renewable energy in the Southeast and Northeast, but a higher amount in the Northeast. And we do have an exposure annually of around 800 average megawatts and that is seasonalized. In the first quarter, we have something close to 700 average megawatts that is under that exposure.

Thanks, Marcos. Now we are going to move towards the end of our video conference of the fourth quarter of 2024. I will turn the floor to our CFO and IR Officer, Andrea Almeida Marcus for her final remarks. Please Andrea.

I would like to thank you all very much for being with us, for your questions. We are here all year around and with the whole IR team to share our results and everything that's happening in the Company or challenges and opportunities to share all that with you. Please feel free to make contact and to talk to us and we are open to talk to you at any time, whether by the team or the conference calls that we will be at. So have nice afternoon, and thank you very much.

Good morning, everyone. I am Carolina Senna, Cemig's Investor Relations Superintendent. Welcome to Cemig's Third Quarter 2024 Earnings Video Conference Call. We inform you that this video conference is being recorded and will be available on the company's IR website where you also find the company's presentation. Should you need simultaneous interpreting, the feature is available by clicking on the Globe icon located on the bottom of the screen. Upon choosing Interpretation, select the language of your choice, Portuguese or English. Should you choose to follow the call in English, you may also select Mute Original Audio. We are now starting Cemig's Video Conference with Reynaldo Passanezi Filho, CEO; Dimas Costa, Chief Commercial Officer; Leonardo George de Magalhaes, CFO and IR Officer; and Marney Tadeu Antunes, Chief Distribution Officer. For the initial remarks, I turn the floor to our CEO, Reynaldo Passanezi Filho.

Good morning. Good morning, everyone. Welcome to the earnings video conference call for the third quarter of 2024. Once again, very consistent results, results that prove the significant turnaround of the company as well as its financial softness. We do have some highlights that are very special. They have already been announced over this period of time and they are very positive. We right now have the best rating in our history, AAA. We couldn't be better. This is the best rating in the company's history and this is the best rating possible. We have over six notches of growth in a period that is lower in five years. So this is really an acknowledgment by Fitch. Thanks to our consistent results, our cash generation and also EBITDA over net debt, that is one of the best in history. Also in this quarter, we concluded the sale of Alianca Energia. This has been announced 45 days ago. We have received BRL2.7 billion and now we are recording in this quarter a capital gain of BRL1.6 billion. And also we have very positive results of our transmission tariff revision with a gain of BRL1.5 billion in the IFRS and the adjustments of ARTT for transmission. Therefore, we're reaching the best EBITDA in our history. BRL5 billion in this third quarter. These are wonderful results. In addition to the consistency of the results effectively with these events, we are reaching, again, the best EBITDA in our history as well as AAA, which is the best rating possible. I would like to highlight these results to all of you that are here with us. And this is reflecting the permanent commitment in certain results and that what I really like to focus on is the focus and growth in investments. Once again, the quarter with almost 20% of growth compared to the same quarter of 2023. And when we look at this whole picture, we see that we are at five times higher in terms of investments when compared to Cemig's in 2018. And in these nine months, we have already invested over BRL4 billion. Just last year was BRL4.8 billion. This year, we will go over that number. So that proves our commitment to be working in the company's future, because a lot of these investments go to our base and also improve the company's future profitability. These were the main highlights I wanted to go over and obviously, I want to talk about the material fact and also I have something to tell the market. Well, the first what I would like to tell you has to do with our Investor Relations position and also our CFO position. Andrea Almeida is going to replace Leonardo. And Leonardo, really I would like to acknowledge and to thank you for your work at Cemig and for the whole period where you worked as our CFO and IR Officer. You have over 30 years in the company. You are a leader, a great leader. I already have known you before I brought you over to be a CFO. You have always been praised by everyone and I can only stress what I have heard about you before. And really I wanted to publicly acknowledge you and to thank you. I'm extremely thankful to you and it just couldn't be crowned with anything else different from a AAA rating. You provided us a crucial contribution and also to help us reach the regulatory OpEx to the minimum leverage in our history in the adjustments of post-retirement as well as I already said, with the AAA rating that we have just received. And now we are appointing Leonardo and this has been approved in the Executive Board also in the last week. He's going to be appointed for Luiz to be the CEO there and now we have to wait for the controlling parties there. But this is what we would like to see that -- to have Leonardo taking over for Luiz as the CEO and also helping us in the challenges in the post-retirement at that entity. And I would like to welcome Andrea Almeida. We are very happy to have you with us, Andrea. She has worked for Vale for 25 years. Also she worked in Canada for Vale, she worked in the controlling area in the treasury department, she has been the CFO of Petrobras and she was the CFO of Santander. This is a CV that requires no further comments. Andrea, welcome to be in the company now and to be part of the transformation. You see that we have been posting great and consistent results. So once again, Leonardo, thank you very much. And also I would talk about the material fact which we posted last Friday. We have received a communication from the controlling shareholder announcing the submission of a bill to -- this is a bill for the legislative assembly so that they can no longer be a Cemig's controlling party. Therefore, turning Cemig's into a corporation. There is going to be the whole process in our legislative assembly. So this is a very important announcement from our controlling shareholder and about his desire to turn Cemig into a corporation. Carolina, these are my initial remarks. And we will be ready to take your questions after the company's presentation. And once again, I would like to stress that we did have consistent results. Our investment plan is in line with what was planned and all of these historic numbers, AAA, the highest EBITDA ever, also higher investments and this material fact and communication we had to the market and the desire of the controlling shareholder in turning Cemig into a corporation. So we'll be available to take your questions later on. So now moving on, I would like to turn the floor to our CFO and IR officer, Leonardo Magalhaes.

Good morning, everyone. Thank you very much for being here in this video conference. For these results, I would like to start by thanking you as well. I'd like to thank Reynaldo for his trust in these period in which we worked together here in the Board and also thank him for his leadership in this transformation process in the company. The figures tell it all, but he created the base of the company in order to ensure to -- that we would have the sustainable growth for this company in the next few years. Thank you very much, Reynaldo. I would like to welcome Andrea. Great professional, a renowned professional and she's going to have a relevant role in providing continuity to our strategy and the continuous generation of value to our shareholders. And also I would like to thank our investors for the relationship all of these years. The foundation is one of the important topics of the company. They have an important role with all their participants and we will try to do the best work possible for Luiz. So thank you very much for that appointment. And of course, now we will just depend on the regulating agents. So we had a number of positive results. One of them was the sale of our company and Alianca. And also we had the tariff review. And we did have the effects of the tariff review now. So it's important to mention that we almost doubled our remuneration base and we forecast BRL3.5 billion investments for the next years for transmission lines in the state of Minas Gerais. Important investments that we understand that they are important for the country and also for the company and they would generate value to shareholders when we compare to returns and transmission auctions. And these are investments that the company is doing right now, according to its transmission concession. Now moving on. Reynaldo talked about investments. We had a bold investment planned for this year, BRL6.2 billion and we are confident that we will be able to invest over 90% of what was forecasted for this year. We have already been able to realize over 65% up to this third quarter. Of course, in the fourth quarter, we will accelerate that. But here we have the distribution of the breakdown. We have BRL4.4 billion of realized investments. We are in line with what was forecasted. The company was investing close to BRL800 million, BRL900 million a few years ago in distribution. And now we are investing almost four times the QRR. We believe these are profitable investments and they prove the correct capital allocation for the company in the last few years. Now moving on, some highlights in the results. I'll turn the floor to Carolina, but before that, I would like to mention a few topics here. First, we were awarded the Transparency, one of the most transparent companies in Brazil because of the quality of our -- and the transparency of our financial statements. So we provide quality and quick information to our investors so that they can correctly assess our results and operations. And in this result -- in the consolidated result, we have a cash generation once again that is robust for businesses that generate a lot of results in the company. BRL1.8 billion in EBITDA in this third quarter and the trading results have been negatively impacted because of the load restrictions between Northeast and Southeast that had effects in the grocery stores. Comparing the prices of energy that we buy in the Northeast and use it in the Southeast, it was difficult. October was a difficult month. But because of rain in November and December, we have more favorable months for our trading business. And Cemig D, we still have very good quality indicators within the regulatory limits and the average tariff adjustments of this quarter of 7.32%, market growth of 4.5%, and we understand that the year-end result for Cemig Distribution is to be very favorable. It's a company with -- that has disciplined costs and also is still focused on the clients to improve the service quality that we are providing to the Minas Gerais society. And Cemig GT, here in this third quarter, we posted BRL1.6 billion in capital gain because of the sale of Alianca Energia and also we had for Cemig GT positive results stemming from the tariff review. Now I'll turn the floor to Carolina and she's going to go into the details of the results for this third quarter.

Thank you very much, Leonardo. So now moving on, and this is the slide that we always show you with the results. The IFRS result and the recurring results here. As Reynaldo mentioned, we had the best EBITDA in our history, thanks to the tariff review and Alianca sale and this shows the success of our divestment plan. Net of the recurring effects which are the tariff review and Alianca, I'll say we had a drop of 10% but most of that was affected by what Leonardo already told us that has to do with commercialization or trading activity that it had the difference between -- because of the submarkets price and now with the rain effect, we will no longer have this price difference. Now analyzing PMSO, we see that we have grown 2.9%, a highlight for outsourced services. Also right-of-way clearing tree pruning when we compare quarters to quarters. Just to give you an idea of right-of-way clearing, we cleaned 40,000 kilometers of right-of-way clearing, that is to mitigate interruptions of energy that is -- that are provoked by climatic events. We already see rains here and sometimes we are affected by these events. And that also so that we can keep on providing services at the best quality possible for clients avoiding hours of interruption of energy because of some type of event. And also under other expenses, when we compare the same quarters '23 and '24 because of the asset deactivation and we have the largest program of divestment in the company in the distribution sector. So it is natural that we have a higher deactivation of assets over this program over these years where we are executing the program. In our cash flow, as Leonardo mentioned, the company has a robust cash generation. When we look at the year-to-date and these nine months just for operating cash, we have BRL5 billion. We had two fundings for Cemig D that were very successful so that we could foster our investment program. Just this year Cemig D will be investing over BRL4 billion in its concession distribution. Also we had interest on equities or dividends paid. The payment of these dividends that is done in two installments at the end of the year and in June. So we had investment activity which also meant a cash outflow. And we had Alianca divestments and we ended the quarter with BRL6.7 billion that will be used in the next quarters also by dividends payment because of investments. And also let's remember that we have our last share of the Eurobonds of $380 million which will also be paid now in December. Now I'll turn the floor to Leonardo to talk about our successful 11th issuance of debentures.

Yes, once again, a successful issuance of debentures. This is already a AAA company. But in the last issuance, we know clearly that we already being considered a AAA company. These issuances, when compared to our basis to the market, the market really trusted the company. Thanks to our low leverage, our good financial structure. So we had issuance of BRL2.5 billion, all of them placed in the market banks. It had a huge demand. It was higher than our offer. We issued a CDI of BRL1 billion and a second series of BRL1.5 billion. With IPCA, we have a natural hedge. And our revenue from distribution also is attached to IPCA. And we have good terms here, seven years and 12 years. Cemig has an average maturity up to last quarter of 2.7 years. And so after December next year, so it's going to be 5.4 years our debt profile. So we adjusted our debt profile, we extended the debt profile. And right now, we have very high rates. But considering our market situation, we have been able to pay off our investments and to finance that in the market so that they can be feasible using third-party or capital. Now turning the floor to Carol. She will go back to the profile and additional information.

Now moving on. As Leonardo mentioned, we had a recent issuance for Cemig D of BRL2.5 billion with an extension of our debt profile. We still have low leverage, especially thanks to Alianca's funds incoming. But this leverage is going to be used because of our investment program which is the best in history as well as in December, as I mentioned, we will be paying Eurobonds, we will no longer have debts and dollar after 2025 and also we'll be paying dividends. So this leverage will naturally increase because of the events that I just mentioned. Moving on to Cemig D. We had no non-recurring event in this quarter. We have significant results over each quarter. In EBITDA, there was a drop when compared to '23 and that was because of a higher increase in outsourced services expenses. As I mentioned, over 40,000 kilometers that we had to clear the right-of-way to mitigate possible adverse events stemming from climate events. And also we were affected by market losses from captive market to DG. Now talking about the market, we had a significant increase of 4.5% mainly affected by transported energy showing how the Minas Gerais state is growing in terms of energy demand, new clients that are coming to the state and also a demand the Cemig D's concession services. And the captive market is kind of sideways. We had a significant improvement in the residential clients because of high temperatures. But distributed generation is still affecting our captive client which is migrating from that segment. And if we were not to have the adverse event of distributed generation, we would have grown 6.6%. Now for regulatory losses, we always say that, in 2021, we committed ourselves to be within the regulatory limits. So we had a slight mismatch here because of those three days in May and Cemig's Distribution anniversary is May 28. So there were differences in just three days that affected that a significant indicator of regulatory losses. We have already had a reduction and we are optimistic about our commitment to end the year within the regulatory losses. We need to keep on investing in the inspection of consuming units to continue our program to replace the conventional meters by smart ones, to increase the shielding, the protection for the meters and also to convert illegal connections into legal ones so that we can provide the best service to our consumers and also to maintain to keep ourselves within the regulatory limits. For operating efficiency, when I compare the realized OpEx and regulatory OpEx the ones that I have the coverage in the tariff. And remember, in the second quarter, we had a non-recurring positive effect which was the reversal of tax provisions of INSS on the Voluntary Dismissal Program. And even with that, we are within OpEx with a performance of 6.8%. Within EBITDA, we are at 5.6% lower than the regulatory EBITDA. But we are very optimistic. We are still working so that we can end over the year within the regulatory EBITDA just like the OpEx. For Cemig GT, the sale of Alianca and the periodic tariff review are under Cemig GT. We had an EBITDA for IFRS higher and 380%. Removing those effects, we are down 19% that is affected by the trading activity. And we are starting to bring all the trading contracts to Cemig Holding. But this process is not 100% concluded yet. Therefore part of that activity is under Cemig GT, therefore, affecting the recurring results. Now, to show you the breakdown per business, per area of the company, we have the slides for distribution. We are ready now. We have increase in expenses with outsourced services and that is to bring best quality of service for people. So generation is more or less in line so trading. We already mentioned that the margin for 2024 would be lower than 2023, but also we had the effect of the submarket difference, the reduction in the gas consumption and I will show you ahead. And we already talked about this, the industrial activity had a reduction in cubic meters for gas in addition to 2023. There was a compensatory parcel that was improving the results for 2023. So when I compared that to '24, there is a difference in the results. And the transmission improved in 11%, showing that one of the strengths of the company is to have a footprint in different segments in a way that as a whole we are able to deliver a recurring robust result. For Gasmig, then as I mentioned, there was this cubic meter reduction in gas volume from industrial clients of 6.6% affecting our EBITDA in 1.7%. Remember that Gasmig has an investment program. They are building a gas pipeline up to the Midwest. So after seven years without investing in the state, we're now investing again. So this is the largest investment program in the group, as we are saying. And now I'll turn the floor to our CFO and IR Officer, Leonardo so that he can talk about our commitments.

Well, this is a slide that we always like to bring you every quarter because this is the commitment from the company, to be transparent. And these commitments are in line with our strategy. And we usually say that if we go back and what we said that we were going to do in 2021, 2020, during the pandemic and look at what we had talked about, our strategic planning and what we had for the future, we can clearly see that the company is delivering exactly its strategic plan. Here we have some of the objectives that have already been met, such as the bonds and the Cemig's in the regulatory OpEx, quality index also in the regulatory limits. Also we divested from more complex holdings, also Cemig Distribution investment program. So it's BRL23 million from '23 up to '28. So the ongoing projects that in progress, a number of them are at full speed and we are already market leaders in energy here in Brazil. We are meeting already that commitment of this leadership that we already have in the pre-market and now also in retail trading showing Cemig's competence and Cemig's team competence in generating value. Also digital transformation. We are investing a lot in technology to prepare Cemig for the future. And also we are implementing initiatives to comply with non-technical losses within regulatory levels. So here we are talking about assets where we would like to reallocate capital and thinking about the future, other projects. Also we have renewals of generation concessions. We are just paying attention to the topic and also technologies for energy transition. That's something else that the company is very much aware of so that we can have a relevant position in the future so that we can have a good position on how to deal with energy transition topics. Now I'll turn the floor to Carolina. We will have a Q&A session and I would like to thank you all very much.

Thank you, Leonardo. So now we will start the Q&A session. Please ask all your questions at once and wait for the company's answer. [Operator Instructions] Our first question is for Marcelo Sa, a sell-side analyst from Banco Itau. Please, Marcelo.

Hello, everyone. Thank you very much for your call. I have two questions. The first one is that I would like to understand this bill of law authorizing Cemig to become a corporation. But I believe it would have to have the approval of another bill that was sent a while ago. So why sending this bill now before that prior project approval. And second I would like to know if there is anything new in terms of Taesa's stakeholding.

Thank you, Marcelo. I will ask Mr. Reynaldo to answer your question.

Good morning, Marcelo. It is obvious that the best entity to answer this question would be Minas Gerais administration, the controlling shareholder. It is a strategy that is coming from the controlling shareholder. Yeah, we know that there are two things there. We have this bill of law now and now we have the constitution amendment proposal. If just the bill of law is approved, our understanding, and it's just an initial understanding, is that we will need a referendum. So if this bill of law is approved regardless this constitution amendment proposal, according to the constitution, we would have to have a referendum. About Taesa, we do not have anything new about it. And if anything comes up, we will then publish a notice and you will know about it.

Thank you, Reynaldo. Next question from Daniel Travitzky, sell-side analyst from Safra Bank. Please, Daniel.

Hello, everyone. Thank you for this opportunity. I have two questions. They are related to the results. I would like to better understand the purchase and sale of energy in this quarter. There was an increase in that line. I would like to understand how was the quarter on that topic. And second question has to do with leverage. You mentioned that you were expecting leverage to increase after payments of dividends and the Eurobonds. So where do you project this leverage at and what is your mindset for additional dividends distribution up to the end of the year? Thank you.

For the first question about energy trading, I will ask the support of Dimas Costa. And about leverage, I'll turn the floor to Leonardo.

Good morning, everyone. Thank you for your question, Daniel. Let me understand it. You were asking us about the quarter -- the quarter's purchase of energy. Cemig, this year, sometimes we have an open -- positions. We were not in that situation, so we did not need to buy to purchase energy. But we did have a price difference. Today, we have an energy that we purchased. We have one-fourth of that energy coming from the Northeast. And usually that energy in September-October is stressed, because there is a restriction in transmission. And there is a price difference in the markets. And because of the lower prices, it's around BRL200, BRL300, BRL600 that is more -- usually more or less the amount. But this year, the price detached. It went to BRL300 and BRL400 in September and October. So out of the 1,100 megawatts that we acquired from the Northeast, we were able to hedge around 300 and the other 800 is at a risk and we have to manage that risk. But in addition to the impact, therefore, we were not open, and -- but we did have that difference. We had to buy energy in the Southeast and settle in the Northeast. And this is the regular dynamics of those that have -- that has -- have energy in the submarket and have to sell it in another. And also we had some trading companies that and some large trading companies did not deliver what they had promised in September and October. So we had to cancel contracts with no losses for Cemig and for other -- two other small ones, just for 2025, they will be reused and a large one, which was the largest impact then we were able to negotiate with it. It did not post energy to us and that amount of million or millions of Reals was converted in a price reduction in the contract for 2025. So actually there was a deferral. When you check the results, a lot of the impact in addition to the price difference was this deferral that we had to a trading company. Not only to help the trading company, but also to help ourselves, because no one wants judicialization, especially when you have a large amount of money involved and that was then transferred to 2025.

Thank you, Dimas. Now moving on. On the question of leverage, I'll turn the floor to Leonardo.

Hello, Daniel. Thank you for your question. Well, this topic regarding dividends and leverage reflect Cemig's situation. This is a company with a very low leverage, with a large investment program with access to the capital market to be able to finance future investments and what we are usually telling the market is that because of this large investment program, we also have large investments for next years is that our leverage is grow -- is going to grow considering dividends of 50% of the IFRS results, we would reach 2027 with a leverage between 2 and 2.5 considering the level of investments that we have now and this leverage will go down in 2028 with Cemig's Distribution tariff review. But we understand that even without talking about extraordinary dividends higher than the payout today that we have today, which is the 50% of the IFRS, we believe that these are very attractive dividends. The company just last year and the prior years, we have already paid higher -- the highest dividends in the elect sector. Also in this year, for the results that we already have, we can say that these will be very good dividends. And then I believe that this is a sustainable strategy because we can pay great dividends considering the company's profits and we are also investing, we are increasing leverage slowly without hindering the credit quality of the company. So this is a strategy that we see in the market that's very successful, very few companies have it and that's going to generate value for shareholders in the next few years. And in 2028, we will have a greater cash generation with a tariff review for the distribution company and also transmission, thanks to all the investments that are forecasted and we are executing these years.

Thank you, Leonardo. If there are no further questions, we now end the Q&A session. Now I would like to turn the floor to Reynaldo Passanezi, our CEO, for his final remarks. Please, Mr. Reynaldo.

I would like to thank you all very much for being with us in this video conference. Have a great week and we will continue working on consistent results on our investment program and meeting our targets. Have a nice day and a great week.

Thank you. Our video conference for the earnings call of the third quarter of 2024 has ended. IR Superintendents are available to take any further questions you might have. Thank you very much to all of you and have a great day.