Good afternoon everyone and welcome to the SABESP Video Conference to discuss the Results for First Quarter of 2021.
My name is Mario Sampaio.
I am the Head of Capital Markets and Investor Relations for SABESP.
Let me start by informing all participants that this video conference is being recorded.
Presentation followed by the slides are being transmitted over the Internet through the website, SABESP website and through the MZiQ platform.
available the on results be as same will as well for presentation for the download portal The the release.
that through platform. you the remind the be will We accepted speakers only the cast video questions to
available statements as And before like prospects, the to be assumptions would for the proceeding projections relating SABESP's information and during conference, as Company's financial of that goals beliefs that this constitute to made the may clarify we currently any well business operational management Company. and and
Future not of performance. considerations guarantees are
involve as They on they to future may risks, may not that depend therefore refer uncertainties and occur. assumptions events circumstances or and
may That those economic forward-looking may lead conditions, that is differ operating expressed general statements. results factors that affect other should investors industry the in conditions and of such to materially understand results from and future Company the
me speakers. today's Let present
Rui Luiz us Mr. Pacheco, Chief We and Controller; Marcelo Mr. of Head and Officer; our of Miyagui, have de Accounting; Agnaldo Costs and Tiberio, Investor of Relations Tariffs. Affonso, with Head Head Financial
some were from particularly right of and billion start generated is taken effects which drop to R$XXX exchange the compared measures quarter direction. non-residential of first a loss revenue we crisis. year in million the me a R$XXX of when that COVID-XX the almost now This volatility was mild. first relatively revenue a the mitigate were these past reversed positive was marked This quarter the considerations. XXXX XXXX management the customers quarter the of rate economic in quarter the strongly SABESP when close This effects result in in in million of by to the first into profit in to profit the XXXX. R$X.X of in Let in with by demonstrates
which Novo liquidity foundations efforts debt in to of X.X% foreign which continue our currency investments we control measures a company the finance accounting maturities. same and XXXX we XXXX, from this The first billion expense us to management the also and that quarter headcount. the the on laid totaled quarter basis quarter. in quarter first R$X.X the last out program, made possible debt in reduce positive water based the performance. roll of to Pinheiros company's contracted loss to the decrease our Investments fell by over This was which for the are of And in effect other to due year. than higher Our is year plenty amount for highlight transactions both the last hired, in production and the the of taken XX% XX% from XX% to preserve on carried project,
accelerate double their & financial Standard the the national ordinary rating, cycle. in real investments. outcome of is will X% the year. requirements also of April, face surpass needs, the to which in and the Poors contract is increase signed allow concluded the In our better maintaining Agency, relevant which that tariff execution obtained four-year the we attribute of in by review So, XXXX, an this to pace incentivizes addition management, performance XXXX the results to This AAA company's positive to is rating surpass process, of us by conditions, Rating crisis maximum by May approved process, third Fitch liquidity which which XXXX contractor for were The tariff the to recognized facing on focused in works. the review to
the and the has for the which been structure also by most subsidize recover the The load, on and allow the the tariff markets. enforced practically horizon felt company's current results. XX remains delinquency. the vulnerable economic will years, marked tariff all and impact changed of business are a And and being retain reduce better pandemic, addition, of In distribution to population markets, still in uncertainty
returning operations achieved our by pre-crisis in show to quarter results the first that this SABESP However, conditions. our are
Let's the total move same services, volume XXXX services. our now here in build first of was by from increased period from was which in we X.X% of the that year, to see slides quarter that’s Slide X.X% can X.X% of over X, and the and last water numbers sewage
which We year. provided in basis during Excluding municipality Mauá’s by the the is the in a the case supply transition and retail Santo this operation same Mauá, in was Guarulhos the build dynamics previously in the remind found of shifted was last Mauá, increase regions. of to the provided wholesale Note dropped and these municipality that that water with the on X.X%. retail occur to from wholesale you compared water mainly volumes and to loss wholesale due that water André, when to we services of volumes previous this November
categories, impacts volume category, respectively, build a commercial total X.X%, public of responsible the residential X.X% of situation which on affected on is by decreases significant hand, other the X.X%, still part terms average the tariff. industrial, by In had and segment that growth. The XX.X% pandemic, a was for quite
And Let's our now go move to highlights. the over financial next slide.
to from Revenue the quarter First, to in R$X.X and revenue combined increase result loss with this an by currency the R$XXX sanitation increased the costs the increased and of billion lower than expenses excluding tariff inflation substantially effects selling adjustment XXXX, health X.X%, crisis R$XXX grew increased quarter to first million period. the from construction August during of the by totaled of of XX.X% net in X.X% Net in economy. compared the variation construction by reflects the of services million Costs R$XXX by the revenues, income which remained R$X.X a and in from the as X.X% administrative devaluation strongly in billion and same volume. R$X million build net XXXX, year. in XXXX, of first impacted period billion
R$X.XX of billion, a signaling to billion As R$X.XX levels pre-pandemic to a adjusted increased EBITDA from by result, return XX.X% EBITDA.
and costs X, Moving are to on Slide expenses. our
which and doubtful the personnel even the depreciation, is XXXX. General interfered expenses that compared increased the exclude inflation number quarter of by due same variation again of which again, in in was company's also result was smaller, we in than that headcount as result replacement less cost to driven influenced X.X%, I was a and Excluding two a the what a construction by result X.X%. This the expenses is the the mentioned. by Retention company's of the accounts concluded was of plant already as is provision lower of the the in Knowledge call X.X% X.X% management in And program by this expenses years If the decrease efforts. effects costs here for to Program, last decreased XX.X% retirement lawsuits XXXX. people necessarily of we reduction
and other reading and connection. XX.X% increase meters highlight of the water with sidewalk hand, to of On in networks services. street expenses paving mostly and replacement, we This that is the maintenance due
also in higher We electricity startup depreciation by prices; the of mostly last, of X.X% highlight in of assets increase XX.XX% operational is in and expenses. increase R$X.X billion. This amount triggered the
which rate a start the off Slide in performance. mentioned. first we million to Net We X, as variation started – go let's by about of the R$XXX exchange grew of the was as and loss expenses R$XXX and operating XXXX, with quarter talk off financial impacted higher was increased Other revenues by the strongly mainly a investments. including result which million cost Cost of operating million. to equity positive including by XX.X% R$XXX increased expenses due construction result R$XXX expenses revenue, million. was construction revenue Now
social the result due variation showed a million the to R$X.X positive financial of net to R$XXX taxable of had contribution variation quarter first due the mainly the Tax negative in of income year. a Our and of strong of the Income million billion last, this is first in increase a And quarter depreciation in results currency income. R$XXX XXXX.
our slide, for our Let’s XXXX. expenses go average per sanitation managerial this with operating In a first next to values indicators indicators EBITDA provide the services, the revenue quarter and this we from the cubic on were calculated meter. from slide. All all of view
price Excluding we that and Brazilian non-recurring adjusted of IPCA. call consumer index to adjusted according all items, the
of because pandemic did the the when indicator the compared and to scenario, the economic not recover same XXXX. expected, As overall revenue quarter
indicated the results. as below our you The of management expenses the XXXX presenting can expected have On level indicator this second decreased we’re since series you. see, is clear of the the in reached period, level sign observed to comparison efforts the that hand, and quarter in other average operating the historical
to compared control our Finally, the operating the expenses. due was of approximately of EBITDA XXXX, X% the indicator mainly quarter first higher to
Now let’s go X. our Slide to
disclosed April and regulation X calculation ARSESP, average Regarding our final PX, Factor. note the X regulatory tariff maximum a on agency for with technical
at set prices a XXXX. four-year PX tariff R$X.XX addition structure based In meters cycle. new The cubic disclose four-year cycle, for making of final was also new beginning per February the on the
May that X.X% ordinary We billion. the tariff been of base, As adjustments amount for was billion, approval asset R$XX.X the for in municipality which billion, in which amount of received Santo final XXXX André residential as tariff R$X recognized in then billion at the second had not already follows. R$X.X to the was note also Also which we in recall related the recovered if the you segment, sums all the R$X for review. review, and included set our of that value became minus included week segment, in for first social as regulatory note longtime preliminary non-residential of just and which segment, discussion the XX, billion disregarded the this this is were the and residential effective the net reversal of X% the a technical R$X.X in about ago. up for tariff assets to that X.XX% wholesale increase the
with categories. commercial X.X%, In XXXX X.XX% were to categories of the in the addition, is beneficiaries increase residential for XXXX, and vulnerable the category programs along customers an attract and residential and above more in category real for in the at the respectively, set adjustment the earmarked XXXX promote to number commercial inflation that resources those the adjustment for
collection effective next security based exceed annual compensated structure, brings with adjustment, the X% This year be tariffs be anyway, structure range new partially charts at for treatment. for segregated subsidies in As or redefined variation minimum revenue. customer and billing is SABESP to of the the tariff especially structure, tariff that that which according the just groups because – include these private the and for XXXX. assessed tablets limits revenue minus tariff good dignity, changed XXXX by established mechanism will between eventually we against tariff mentioned. lack water, to the was will in structural the also revenue. a tariff in introducing fixed unified of regions provided to a permitted the portion plus reduce changes tariff, the established this sewage still The on sewage service maximum limit limits current will and the will that come Amounts but of
also it’s remembering cycle, for cycle, Finally, was this set at X.XX. per year at Factor where X X.XX worth was the that in last set it
Now, we we have more don’t have more but do slides, comments.
situation probably let our of season. in reversed we rainfall situation below me will regarding the let’s indexes on all, – dry – So the this given be discussed their first last how is coming historical a the average, water are not call, that that month
month big we were systems, the until reservoirs mentioned the increased region levels crisis since meaning as last water period the rainy what historical reason a as some For we levels March what of year consider so, security water that Even XXXX. before, cross October. of And the period, and and have the the of dry to this affluences, beginning the metro we of XXXX adequate made the that water rainfall have are big into for the water significantly the metro average to is, below call availability water investments this region in the the we January follow-up flows
than of deals submission that The to number sanitation operators. Another government proposed water to have branch down on service Portuguese region with of state one unit drinking already regions called bill São metro or comment in State state it's by contains in suburb. for which service are X more operated URAEs, Southeast composed of the the executive the of the legislative Paulo be is all located XX units refers of that the region it’s basic regionalization Paulo there operated URAEs that region that regions and the metropolitan greater São four is to sewage and in by called the signs branch, into contract by Paulo in the southeast in one breaking by supply called bill April São of XXX Sabesp state
is currently was formation this proposal deadline So of one case, far consideration the law. Sabesp criteria which the that essentially urgent take proposed amendments The not one which sanitation company That it defined to is unit conducted URAE, monitoring the meet now. being on the is today. the basis because is of questioning is bill, to XX into for geographic not were the specific which is the the of This by an from is July did basins. There XX. in limits high of XX,XXX
the the operators the rules others. identity of remember key depreciated we’ll such addition, in And or other amortized definition And for third, of to to In the and to is Law derived without operated or contracts, should to that municipalities new you rules issues have from follow financial the for sector. not month among service. for very transition clarify the provide as methodology to economic the key coming of process. certify This Sanitation the capacity the the regulations assets
and the SABESP effects vehicle mature special construction. to by X at referring refers May in two formed X explore X possibility a CEDAE’s comment last to participating purpose Block Iguá released Saneamento to to May the on Our be of
As we the stake no project the controlling join had minority needs under that had the disclose, option vehicle resources option had Note by stake purpose proportion join our block. have and to exercised stake, the this of cost same to cost another in the CEDAE with minority capital on at participate we on a would option special – – terms if to the Iguá. the no the special as required in payment to
the of decided we to not analyzing Iguá’s victory confirming this exercise the terms option. after Block auction final auction, X and However, in
all this As now and if model, leads et comments sanitation the has continues investor and choose participation to that in in participate our model, free SABESP exclusivity to the open everyone condition entry auctions an company it Well opportunities informs to agreement with questions-and-answers. presentations. knows like signed evaluate best operator for Brazil to cetera. not We that and/or concludes any
Okay. Any Let so nothing. questions no me Seems check Checking. here. A - Still Mario Okay. far. Sampaio questions?
give more everybody already it? little over Rui bit a off. a Rui time. the never microphone Should Rui, little takes is Let's wait bit take you would think I we more your for opportunity. or
Affonso Mr. freezed. think has I
me disconnected. see. he Yes, Let
we button must be some hit meantime, questions. see up. I the anybody guys think he make wrong showing – wants In to some wait if the
Okay, I think have we one question.
maybe call rejoined see Let us. I me my check anything has Affonso if asked why there's not Mr. them happening. colleagues,
