Cemig Posts Q4 Trading Profit of 97 Million, Leverage Forecast to 3.5% by 2028
Cemig delivered a Q4 trading profit of 97 million and is closing 2026 and 2027 energy positions, targeting zero open positions by 2029 as prices rise. Leverage is at 2.3% and is expected to climb toward the 3.5% contractual limit by 2028, with debt costing 13% on average.
1. Q4 Trading Results and Position Strategy
Cemig reported a Q4 trading profit of 97 million and is taking a cautious approach to closing its energy trading positions. The company has finalized positions for 2026, is working on 2027 closures, and plans to exit all open positions by 2029 as market prices are projected to rise.
2. Leverage Outlook and Debt Costs
Current financial leverage stands at 2.3%, with a contractual ceiling of 3.5%. Management expects leverage to increase throughout the investment cycle and peak in 2028, financing debt at an average rate of 13%, corresponding to 87% of the CDI benchmark.
3. Energy Market Volume and Client Migration
The company experienced a 1.4% reduction in market volume, driven by client migration to the base network. This shift underscores competitive pressures in its service regions and may influence future market share dynamics.
4. Operational Expenses and Value-Creating Investments
Operational expenses rose due to higher headcount and outsourcing to enhance service delivery, especially in rural areas, alongside intensified preventive maintenance. Debt at 87% of CDI versus more than 90% regulated investments results in a debt cost below the weighted average cost of capital, creating value.