Business Context and Reporting Period
This Form 6-K filing by Energy Company of Minas Gerais (CEMIG) covers the period ending March 31, 2026, primarily summarizing corporate events and financial results for the fourth quarter of 2025 (4Q25). CEMIG is a Brazilian utility operating in electricity distribution, generation, transmission, and natural gas distribution. The filing includes shareholder notices regarding dividends and interest on equity, strategic asset acquisitions, and the company's 4Q25 earnings release.
Key Financial Metrics (4Q25)
| Metric | 4Q25 Value (R$) | 4Q24 Value (R$) | Change (%) |
|---|---|---|---|
| Net Revenue | 11,501 million | 11,177 million | +2.9% |
| Net Profit (IFRS) | 1,876 million | 998 million | +88.0% |
| Adjusted Net Profit | 1,023 million | 1,166 million | -12.3% |
| EBITDA (IFRS) | 2,947 million | 1,914 million | +54.0% |
| Adjusted EBITDA | 1,811 million | 1,937 million | -6.5% |
| Gross Debt | 19,465 million | 12,279 million | +58.5% |
| Net Debt | 16,804 million | 9,889 million | +69.9% |
Note: All figures are in Brazilian Reais (R$) millions unless otherwise noted. Adjusted metrics exclude non-recurring items such as post-employment liability remeasurements and specific tax provisions.
Material Changes vs. Prior Period
- Profit Surge: IFRS Net Profit increased 88% year-over-year, driven largely by a one-time positive adjustment of R$788 million from the settlement of post-employment health and dental plan obligations.
- Adjusted Performance: Excluding non-recurring items, Adjusted Net Profit declined 12.3% and Adjusted EBITDA fell 6.5%. This was due to higher energy purchase costs (lower hydrological generation scaling factor), increased spot market prices, and a new tax provision of R$128 million regarding historical employee indemnities.
- Debt Expansion: Net debt rose nearly 70% to R$16.8 billion, reflecting significant capital raising activities (R$4.3 billion in debentures issued in 4Q25) to fund a R$6.63 billion investment program in 2025 and extend debt maturity profiles.
- Operational Volume: Total energy distributed (excluding distributed generation) fell 3.5% due to industrial client migration to the Free Market and Distributed Generation (DG). However, the client base grew 2.0% to 9.6 million.
Guidance, Outlook, and Strategic Events
Strategic Acquisitions and Reorganizations
- Hydro Acquisition: CEMIG exercised preemptive rights to acquire 51% of Hidrelétrica Pipoca S.A. (20 MW capacity) for R$36.33 million, pending regulatory approvals.
- Transmission Completion: Completed the acquisition of Empresa de Transmissão Timóteo-Mesquita S.A. (ETTM) for R$30.0 million, adding 24km of transmission lines and a substation.
- Solar Portfolio Optimization: Concluded a corporate reorganization of 11 photovoltaic plants, resulting in CEMIG SIM holding 100% of 6 plants (27.0 MWp).
Shareholder Returns
- Dividends: Declared R$417.3 million in dividends (R$0.146/share) paid in December 2025.
- Interest on Equity (IoE): Declared R$677.4 million in IoE (R$0.237/share), payable in two installments in June and December 2026.
Outlook and Risks
- Investment Plan: CEMIG plans to invest R$43.7 billion from 2026 to 2030, with R$6.72 billion allocated for 2026 alone, focusing on grid modernization and renewable expansion.
- Regulatory Environment: The 2025 annual tariff adjustment (effective May 2025) resulted in an average 7.78% increase for consumers, providing revenue support.
- Risks: Key risks include hydrological variability affecting generation costs, migration of industrial clients to the Free Market, and potential outcomes of ongoing legal actions regarding tax provisions.
Key Facts for Investor Verification
- Quality of Earnings: Verify the sustainability of the 88% profit increase, as it is heavily influenced by a R$788 million one-time gain from settling post-employment liabilities. Adjusted profit actually declined.
- Debt Servicing: Assess the impact of the 70% increase in net debt and the higher interest rate environment (Selic at 15.00% in 4Q25) on future cash flows.
- Regulatory Exposure: Monitor the impact of the "Anuênios" tax provision (R$128 million) and the status of the Hidrelétrica Pipoca acquisition approvals (CADE and ANEEL).
- Market Migration: Track the continued migration of industrial clients to the Free Market and Distributed Generation, which reduced billed volumes by 3.5% despite a growing customer base.
- ESG Performance: Confirm the company's "A List" status with CDP and inclusion in the S&P Global Sustainability Yearbook, which may influence cost of capital and investor sentiment.