BELO HORIZONTE, Brazil, May 1, 2025 /PRNewswire/ -- A COMPANHIA ENERGÉTICA DE MINAS GERAIS – CEMIG ("CEMIG") (NYSE: CIG), (NYSE: CIG.C), (B3: CMIG3), (B3: CMIG4) - a publicly held company with shares traded on the stock exchanges of São Paulo, New York and Madrid, hereby informs the Brazilian Securities and Exchange Commission (CVM), B3 S.A. – Brasil, Bolsa, Balcão ("B3") and the market in general that it has filed on April 30, 2025, Form 20-F for the 2024 fiscal year ("2024 Form 20-F") with the U.S. Securi ...

Financial Exposure and Risk Management - As of December 31, 2024, CEMIG has no outstanding indebtedness denominated in foreign currencies, and its net liabilities exposed to foreign exchange fluctuations amount to R$210 million in a base scenario, with a probable relief of R$16 million and an adverse increase of R$10 million [1054]. - The sensitivity analysis indicates that in a probable scenario, the Selic rate will be 9.15% and the TJLP rate will be 7.94% on December 31, 2025, with net liabilities exposed to interest rate fluctuations estimated at R$1,245 million [1062]. - CEMIG's net exposure to inflation indices as of December 31, 2024, shows net liabilities of R$2,565 million, with assets indexed to inflation totaling R$5,905 million and liabilities amounting to R$8,470 million [1065]. - The company reported a positive result of R$521 million from hedging transactions related to US$381.1 million, resulting in a net cash inflow of R$443 million as of December 5, 2024 [1059]. - The company has implemented derivative financial instruments to protect against foreign exchange risks, ensuring that these instruments are not used for speculative purposes [1056]. - The company estimates that in an adverse scenario, the net effect of fluctuations in interest rates could lead to a loss of R$188 million [1064]. Liquidity Management - CEMIG's liquidity management includes monthly cash flow projections over 12 months and daily liquidity projections over 180 days, ensuring sufficient cash flow for operational needs [1070]. - CEMIG's cash equivalents and marketable securities amount to R$4,524 million, while total liabilities are R$4,898 million, resulting in net liabilities exposed of R$374 million [1061]. - The company has 2,462 million reais in principal payments due within 3 months to 1 year [1074]. Financial Obligations - Total financial obligations amount to 22,300 million reais, with principal payments of 19,374 million reais and interest payments of 1,528 million reais [1074]. - Loans and debentures account for 18,646 million reais, with principal payments of 16,000 million reais due over 1 to 5 years [1074]. - Supplier obligations total 2,926 million reais, primarily due within 1 month at 2,761 million reais [1074]. - Fixed rate obligations include 5,672 million reais due over 1 to 5 years, with 5,354 million reais in principal payments [1074]. - Interest payments on loans and debentures amount to 2,217 million reais over 1 to 5 years [1074]. - Total interest payments across all obligations amount to 2,298 million reais over 1 to 5 years [1074]. - The pension plan deficit (FORLUZ) totals 695 million reais, with 304 million reais due over 1 to 5 years [1074]. - The company has 5 million reais in obligations due within 1 month related to the pension plan [1074]. - Total obligations over 5 years amount to 6,124 million reais, with 5,902 million reais in principal payments [1074]. Credit Risk - Any reduction in CEMIG's credit ratings could increase financing costs and complicate debt refinancing, potentially impacting operational capabilities [1073]. Investment Strategy - CEMIG's financial strategy includes investing in private credit investment funds and bank CDs to optimize returns while managing liquidity risk [1071].

Financial Data and Key Metrics Changes - The company achieved a record EBITDA of BRL 11.3 billion, marking a significant increase compared to the previous year [7][24] - Net profit reached nearly BRL 1 billion, influenced by higher investments and increased tax payments due to higher profits [32] - The company reported a total debt of BRL 9.9 billion, with a stable debt cost around 12% [33][35] Business Line Data and Key Metrics Changes - The distribution segment showed an improvement in EBITDA, while the trading segment experienced a decline due to lower margins [50] - The company reported a reduction of 2.5 hours in the DEC indicator, reflecting improved service delivery [27] - The generation segment also saw adjustments, with trading margins down compared to the previous year [50] Market Data and Key Metrics Changes - The company noted a favorable hydrology in November and December, which positively impacted energy demand [39] - The captive market experienced a slight reduction of 0.6%, while the free market continued to grow [40] - The company is a leader in Brazil's retail trading market, both in terms of transaction volume and energy transacted [41] Company Strategy and Development Direction - The company is focused on a bold investment program, planning to invest BRL 59.1 billion from 2019 to 2028, significantly above regulatory depreciation [14] - There is a strong emphasis on sustainability, with the company being recognized for its clean energy matrix and various sustainability achievements [21][22] - The company is also working on digital transformation and regionalization to improve service quality and operational efficiency [54][56] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's transformation and sustainability, highlighting the importance of infrastructure investment for regional development [9][18] - The company is open to negotiations regarding health care plans and is actively engaging with unions [68] - There are ongoing discussions regarding potential privatization, with management cooperating with the Economic Development Secretariat [73] Other Important Information - The company plans to distribute BRL 5 billion in dividends, reflecting strong financial performance [20] - The company has made significant progress in reducing operational expenses, ending the year with BRL 156 million lower than regulatory limits [46] - The company is committed to maintaining compliance with regulatory standards and improving operational efficiency [43] Q&A Session Summary Question: Can you comment on the negotiations regarding health care plans and updates on divestments? - Management confirmed ongoing negotiations with unions regarding health care plans and mentioned divestments related to Taesa and Belo Monte [62][71] Question: How is the union behaving in negotiations, and what about exposure in sub-markets? - Management stated they are open to negotiations and have been in contact with the union, while also addressing exposure to price differences in energy trading [77][79]

Financial Data and Key Metrics Changes - The company achieved its highest EBITDA in history at BRL 5 billion for Q3 2024, reflecting a significant turnaround and financial strength [8][19] - The company received a AAA rating, the best in its history, with over six notches of growth in a five-year period [6][20] - Cash generation remained robust, with BRL 1.8 billion in EBITDA for the quarter [31] Business Line Data and Key Metrics Changes - The sale of Alianca Energia resulted in a capital gain of BRL 1.6 billion [7][34] - The transmission tariff revision contributed an additional BRL 1.5 billion in IFRS adjustments [8][34] - Investments in distribution increased significantly, with BRL 4.4 billion realized investments, nearly four times the previous levels [28][29] Market Data and Key Metrics Changes - The average tariff adjustment for the quarter was 7.32%, with market growth of 4.5% in Minas Gerais [33][52] - The captive market showed a slight decline, while residential clients improved due to high temperatures [53] Company Strategy and Development Direction - The company is focused on a bold investment plan of BRL 6.2 billion for the year, with expectations to invest over 90% of the forecasted amount [28][29] - The controlling shareholder has submitted a bill to turn Cemig into a corporation, indicating a strategic shift [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future cash generation and the impact of upcoming tariff reviews in 2028 [79] - The company is committed to maintaining low leverage while executing a significant investment program [79] Other Important Information - The company was recognized as one of the most transparent companies in Brazil due to the quality of its financial statements [30] - The company is investing in technology and digital transformation to prepare for future challenges [67] Q&A Session Summary Question: Understanding the bill of law for Cemig to become a corporation - Management indicated that the best entity to answer this would be the Minas Gerais administration, and a referendum may be required if the bill is approved [71][73] Question: Insights on energy purchase and sale in the quarter - The company did not need to purchase energy due to not being in an open position, but faced price differences due to market dynamics [75][77] Question: Projections on leverage and dividends - The company expects leverage to increase due to dividends and investments, projecting a leverage ratio between 2 and 2.5 by 2027 [79]

Core Viewpoint - The article emphasizes the value investing strategy, highlighting Comp En De Mn Cemig (CIG) as a strong value stock based on its financial metrics and Zacks Rank [2][8]. Financial Metrics - CIG has a Zacks Rank of 2 (Buy) and an A grade for Value, indicating strong potential for value investors [4]. - The stock's Forward P/E ratio is 6.67, significantly lower than the industry's average of 16.41, suggesting it is undervalued [4]. - CIG's P/B ratio stands at 1.11, compared to the industry's average of 2.72, further indicating attractive valuation [5]. - The P/S ratio for CIG is 0.75, while the industry average is 2.07, reinforcing the notion of undervaluation [6]. - CIG's P/CF ratio is 3.93, compared to the industry's average of 12.70, highlighting its strong cash flow outlook [7]. Investment Outlook - The combination of CIG's favorable financial ratios and strong earnings outlook positions it as an impressive value stock currently [8].

Group 1 - Cemig (CIG) is a notable stock in the Utilities sector, currently outperforming its peers with a year-to-date return of approximately 17.7% compared to the sector average of 16.8% [4] - Cemig holds a Zacks Rank of 2 (Buy), indicating a positive earnings outlook, with the consensus estimate for full-year earnings having increased by 61.4% over the past three months [3] - The Utilities sector, which includes Cemig, ranks 5 in the Zacks Sector Rank, with a total of 105 individual stocks [2] Group 2 - Cemig is part of the Utility - Electric Power industry, which consists of 59 stocks and currently ranks 42 in the Zacks Industry Rank, indicating that it is slightly underperforming its industry average return of 20.7% this year [5] - Pinnacle West (PNW) is another stock in the Utilities sector that has outperformed the sector with a return of 23.1% year-to-date [4][5] - Both Cemig and Pinnacle West are expected to continue their solid performance, making them attractive options for investors interested in Utilities stocks [6]

Group 1 - Momentum investing focuses on "buying high and selling higher" rather than traditional strategies of "buying low and selling high" [1] - Fast-moving trending stocks can be risky if their valuations exceed future growth potential, leading to potential losses for investors [2] - Investing in bargain stocks that have recently shown price momentum can be a safer strategy, utilizing tools like the Zacks Momentum Style Score [3] Group 2 - Cemig (CIG) is highlighted as a strong candidate for momentum investing, with a recent price increase of 1.5% over the past four weeks [4] - CIG has gained 17.1% over the past 12 weeks, indicating strong momentum, with a beta of 1.29, suggesting it moves 29% more than the market [5] - CIG has a Momentum Score of B, indicating a favorable time to invest, and it has a Zacks Rank 2 (Buy) due to positive earnings estimate revisions [6][7] Group 3 - CIG is trading at a Price-to-Sales ratio of 0.78, suggesting it is undervalued, as investors pay only 78 cents for each dollar of sales [7] - The stock has significant potential for further price appreciation, supported by its fast-paced momentum characteristics [8] - There are additional stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, indicating more investment opportunities [8]

Group 1 - Cemig (CIG) has returned approximately 17.7% year-to-date, outperforming the average Utilities sector gain of 14.4% [4] - The Zacks Rank for Cemig is currently 2 (Buy), indicating a positive earnings outlook with a 61.4% increase in the full-year earnings estimate over the past quarter [3] - Cemig belongs to the Utility - Electric Power industry, which has an average year-to-date gain of 18.1%, indicating that Cemig is slightly underperforming its industry [5] Group 2 - National Fuel Gas (NFG) has a year-to-date return of 18.8% and also holds a Zacks Rank of 2 (Buy) [4][5] - The consensus EPS estimate for National Fuel Gas has increased by 2.8% over the past three months [5] - The Utility - Gas Distribution industry, to which National Fuel Gas belongs, has gained 11.6% year-to-date [6]

Core Viewpoint - Cemig, a state-owned electricity company in Brazil, demonstrates strong operational efficiency and financial stability, making it an attractive option for dividend-seeking investors despite governance risks associated with its state ownership [1][10][13]. Financial Performance - In Q2, Cemig's consolidated net revenue increased by 7% year-over-year, driven by tariff adjustments of 7.4% for distribution and 5.4% for transmission [3][4]. - The company's recurring EBITDA rose by 2% to R$1.9 billion, while recurring net income decreased by 6.6% after tax adjustments [4]. - Operating cash flow for the first half of the year reached R$3.45 billion, indicating strong cash generation capabilities [4]. Investment Plans - Cemig plans to invest R$6.2 billion by 2024, with R$2.4 billion already invested, focusing on modernization and maintenance of the electric system [5][6]. - The investment plan for 2024-2028 totals R$35.6 billion, primarily allocated to regulated investments, which are predictable and less likely to face regulatory rejection [6]. Dividend Distribution - The company maintains a healthy dividend distribution strategy, with a current dividend yield of 6.1% and a payout ratio below 60% [9][12]. - Cemig's net debt to recurring EBITDA ratio stands at 1.02x, allowing for sustainable dividend payments while managing debt effectively [7][8]. Valuation - Cemig's stock is currently trading at attractive multiples, with a price-to-earnings ratio of 5.5x and a forward EV/EBITDA of 5.2x, both better than the sector median [9][10]. - Despite governance risks, the company's valuation remains appealing, with a forward price-to-earnings ratio of 7.3x, slightly below its 10-year average of 7.8x [10][12]. Governance and Risks - Governance risks are highlighted due to significant state ownership, with 50.9% of shares held by the State of Minas Gerais, which may impact investor confidence [10][11]. - The company has shown resilience in operations, but external factors such as macroeconomic conditions and regulatory changes pose potential risks [14].

Core Viewpoint - Momentum investing focuses on "buying high and selling higher" rather than traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investors often face challenges in determining the right entry point for fast-moving stocks, which can lose momentum if future growth does not justify high valuations [2] - A safer approach involves investing in bargain stocks that exhibit recent price momentum, utilizing tools like the Zacks Momentum Style Score to identify these opportunities [3] Group 2: Cemig (CIG) Stock Analysis - Cemig (CIG) has shown a price increase of 11.4% over the past four weeks, indicating growing investor interest [4] - The stock has gained 9% over the past 12 weeks and has a beta of 1.29, suggesting it moves 29% more than the market [5] - CIG has a Momentum Score of A, indicating a favorable time to invest based on momentum [6] - The stock has a Zacks Rank 2 (Buy) due to upward revisions in earnings estimates, which attract more investors [7] - CIG is trading at a Price-to-Sales ratio of 0.77, indicating it is undervalued at 77 cents for each dollar of sales [7] Group 3: Additional Investment Opportunities - Besides CIG, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, suggesting further investment opportunities [8] - Investors can explore over 45 Zacks Premium Screens tailored to different investing styles to identify potential winning stocks [9]