Companhia Energética de Minas Gerais

Cemig reported recurring EBITDA of BRL 2.5 billion in 2Q26, up 9.3% year over year, and net income down 15.6% year over year, pressured by higher financial expenses and a BRL 191 million provision related to a free-market customer arbitration. The company also cited a BRL 232 million reversal of expected credit losses, which helped results, while consolidated costs and expenses rose 15.5% in the quarter. In 1H26, Cemig invested BRL 3.3 billion, or 49% of its BRL 6.7 billion full-year capex plan, and raised BRL 4.6 billion in funding; it also paid BRL 631 million in interest on capital, equal to BRL 0.22 per share. Management said Cemig Distribution received a 6.5% average tariff impact and ended 2Q26 with leverage of 2.58x. Looking ahead, management expects continued heavy investment, a further leverage increase through 2027, and a tariff review in 2028 to support results; it also reiterated the bylaws’ minimum 50% dividend payout.

Alexandre Ramos Peixoto framed his first call as CEO as a message of confidence, continuity, and disciplined execution. He emphasized Cemig as an integrated utility with more than 9.5 million consuming units, strong assets, and the ability to benefit from the sector’s transformation and the planned opening of the Brazilian electricity market in November 2028. His tone was notably constructive and long-term focused, with service quality and investment in a more robust distribution network presented as core priorities.

Leonardo George de Magalhães highlighted a strong operating quarter, with recurring EBITDA of BRL 2.5 billion, BRL 3.3 billion invested in 1H26, and BRL 4.6 billion of funding raised to support the investment plan. He pointed to consolidated cash generation close to BRL 4 billion in the half year, leverage of 2.58x, and strong credit quality with AAA ratings from two agencies and AA+ from S&P Global. He also noted BRL 631 million in interest on capital, the BRL 191 million arbitration provision, and that the company expects leverage to rise until 2027 before easing after the 2028 tariff review.

Analysts focused on the impact of higher debt and the delay in tariff benefits until 2028 on 2027 earnings and shareholder remuneration; management answered that Cemig’s 50% minimum dividend policy remains in place and said dividends should remain attractive in 2026 and 2027. Questions also covered El Niño readiness, where distribution and generation management said contingency plans, preventive maintenance, automation, and resilience investments leave the company prepared without budget impact. On trading, management acknowledged a difficult first half driven by position settlements, a South sub-market detachment effect, and higher power costs, but said the impact was offset within the group and expects better trading results in the second half and significant results by 2028. There were also questions about transmission auctions, batteries, data centers, and concession renewals; management said it is evaluating each opportunity with strict capital-discipline and remains optimistic about concession renewals after a favorable ANEEL note.