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Summary     
    Conference Call in Portuguese 
    March 27, 2018 
   Page  2:00 PM (GMT) 
Introduction  03  1:00 PM (New York time) 
I. Consolidated Income Analysis  06  5:00 PM (London time) 
II. Parent Company Results Analysis   20 Phone: (11) 3137-8037 
III. General information  25  Conference Call in English 
IV. Attachment:    March 27, 2018 
I. Financial Information from Subsidiaries    2:00 PM (GMT) 
II. Financial Analyses from Subsidiaries Companies    1:00 PM (New York time) 
III. Operating Infomation from Subsidiaries    5:00 PM (London time) 
    Phone: (11) 3137-8037 
    Contact RI: 
    Ombud [email protected] 
    www.e letrobras.com.br/ri 
    Tel: (5 5) (21) 2514-6333 
    Preparation of the Report to 
    Investors: 
    Superintendent of Investor 
    Relations 
    Paula P rado Rodrigues Couto 
    Capital Markets Department 
    Bruna Reis Arantes 
    Fernan do D'Angelo Machado 
The Marketletter – Annex I, II and III can be found    Luiz Gu stavo Braga Parente 
in .xls extension at our website:     
www.eletrobras.com.br/ri    Mariana Lera de A. Cardoso 

 

Get to know the Eletrobras IR Ombudsman, an exclusive platform for receiving and forwarding suggestions, complaints, compliments and requests from protesters regarding the securities market on our Investor Relations website

 



 
 

Rio de Janeiro, March 26, 2017 - Eletrobras (Centrais Elétricas Brasileiras SA) [B3- Brasil, Bolsa, Balcão: ELET3 and ELET6 - NYSE: EBR and EBR-B - Latibex: XELTO and XELTB] the largest company in the electricity sector in Latin America, operating in generation, transmission, distribution and comercialization, the Parent Company company of 14 subsidiaries, a holding company - Eletropar - a research center - Cepel and accounting for 50% of the capital Itaipu Binacional, announces its results for the period.

In 2017, Eletrobras presented a net loss of R$ 1,726 million, lower than the R$ 3,513 million Profit obtained in 2016.

 

The Result for 2017 was mainly influenced mainly by operating provisions in the amount of R$ 4.646 million (excluding distribution segment provisions) and the loss of the distribution segment in the amount of  R$ 4,179 million. The result of 2016 was mainly influenced by the Accounting of Remuneration related to the credits of the Basic Network of the Existing System (RBSE).

 

Managerial net income recorded in 2017 was R$ 178 million, 22% lower than the managerial net income of R$ 229 million in 2016. The managerial Net Operating Revenue increased 21%, from R$ 25,549 million in 2016 to R$ 30,887 million in 2017. The EBITDA increased by 44%, from R$ 3,845 million in 2016 to R$ 5,554 million in 2017. The highlights of 2017 are presented below:

 

2017 HIGHLIGHTS

 

»     Net Operating Revenue of R$ 37,876 million;

»     Accounting for the Remuneration related to the credits of the Basic Network of the Existing System (RBSE) referring to the transmission lines renewed in accordance with Law 12,783 / 2013, as per Ministerial Order No. 120, dated April 20, 2016, of the Ministry of Mines and Energy, which established the payment conditions, with effect of R$ 4,923 million in 2017.

»     Itaipu transfer in the amount of R$ 626 million;

»     Positive CVA in the amount of R$ 1,441 million;

»     Impact on the result of R$ 853 million related to the provision for the Extraordinary Retirement Plan (PAE);

»     Provisions for Contingencies in the amount of R$ 4,398 million, with emphasis on the provision related to the compulsory loan of R$ 2,337 million;

»     Provisions Aneel - CCC in the amount of R$ 986 million to finance resources reviewed by Aneel in the scope of the inspection of the Sectoral Fund CCC due to the distributors, in accordance with Law 12,111 / 2009;

»     Reversal of provisions for onerous contracts of R$ 1,493 million, mainly as a result of the reduction of personnel expenses observed with the realization of the extraordinary retirement plan - PAE;

»     Provisions for impairment of R$ 641 million;

»     Net Financial Result of R$ 5,194 million;

»     Result of the negative distribution segment in the net amount of R$ 4,179 million, especially the loss of R$ 2,313 million of Amazonas Distribution;

»     EBITDA in the amount of R$ 6,744 million and Managerial EBITDA in the amount of R$ 5,554 million in 2017;

 

In the fourth quarter of 2017 (4Q17), Eletrobras reported a net loss of R$ 3,998 million. In 4Q16 the net loss was 6,258 million. Managerial net loss for the quarter was R$ 491 million, 155% lower than in 4Q16.

 

4Q17 HIGHLIGHTS

 

»     Net Operating Revenue of R$ 11,029 million;

»     Positive CVA in the amount of R$ 966 million;

»     Sale of CPFL shares by subsidiary Eletropar in the amount of R$ 49.9 million;

»     Provisions for Contingencies in the amount of R$ 3,621 million;

»     Reversal of provisions for onerous contracts of R$ 477 million;

 

 

 
 

»     Provision for impairment of R$ 1,201 million;

»     Negative Net Financial Result of R$ 296 million;

»     Negative Distribution segment result in the net amount of 1,630 million, with a highlight to the loss of the subsidiary Amazonas distribution in the amount of R$ 676 million;

»     EBITDA negative in the amount of R$ 3,540 million and positive Managerial EBITDA in the amount of R$ 568 million in 4Q17;

 

 

R$ Million

2017

2016

%

 

4Q17

4Q16

%

155,5

162,4

-4%

Energy Sold - Generation GWh (1)

40,8

41,5

-2%

16,1

17,3

-7%

Energy Sold - Distribution GWh

4,1

4,3

-5%

45,990

70,988

-35%

Gross Revenue

13,342

17,537

-24%

38,746

32,514

19%

Gross Revenue from Management (2)

11,541

8,005

44%

37,876

60,316

-37%

Net operating revenue

11,029

12,181

-9%

30,887

25,549

21%

Net Operating Revenue Management

(2)

9,229

6,355

45%

6,744

19,797

-66%

EBITDA

-3,540

-4,783

-26%

5,554

3,845

44%

Management EBITDA (3)

568

983

-42%

-1,726

3,513

-149%

Net profit

-3,998

-6,258

-36%

178

229

-22%

Management Net Income (4)

-491

892

-155%

5,214

8,711

-40%

Investments

1,449

1,943

-25%

(1) Does not consider the energy allocated for quotas, from the plants renewed by Law 12,783 / 2013

(2) Excludes CELG D and Construction Revenue and Transmission Revenue with RBSE, referring to Transmission Lines renewed by Law 12.783 / 2013;

(3) Excludes item (2) and Extraordinary Retirement Plan (PAE), expenses with independent research, research findings, contingency provisions, onerous contracts, Impairment, Provision for losses on investments, Provisions for adjustment to market value, (TFRH), Provision ANEEL CCC, Equity interests (RBSE CTEEP);

(4) Excludes item (3) and monetary restatement for compulsory and IRPF provision for RBSE. 

 

 

 

 


 
 

 

 

 

ANALYSIS OF CONSOLIDATED RESULTS (R$ million)

 

Consolidado IFRS

2017

2016

Statement of Income

4Q17

4Q16

21,136

18,632

Generation Revenue

5,762

4,409

10,378

33,557

Transmission Revenue

2,570

2,502

12,416

16,349

Distribution Revenue

4,254

9,085

2,060

2,450

Other Revenues

756

1,541

45,990

70,988

Gross Revenue

13,342

17,537

-8,114

-10,672

Deductions from Revenue

-2,313

-5,357

37,876

60,316

Net Operating Revenue

11,029

12,181

-15,374

-16,211

Operational Costs

-4,784

-5,591

-12,703

-12,698

Personnel, Material, Services and Others

-3,696

-4,410

-1,751

-1,844

Depreciation and Amortization

-367

-516

-5,747

-14,724

Operational Provisions

-6,238

-7,587

2,301

14,839

 

-4,056

-5,924

2,692

3,114

Shareholdings

150

625

4,993

17,953

Income before Financial Income

-3,907

-5,299

-5,193

-5,929

Financial Result

-296

-1,863

-200

12,024

Income before Tax

-4,203

-7,162

-1,525

-8,511

Income tax and social contribution

205

904

-1,726

3,513

Net Profit

-3,998

-6,258

 

 

Consolidated Management*

2017

2016

Statement of Income

4Q17

4Q16

21,083

18,590

Generation Revenue Management

5,738

4,470

4,538

3,781

Transmission Revenue Management

1,055

972

11,106

8,128

Distribution Revenue Management

3,994

1,459

2,019

2,014

Other Recipes Management

756

1,105

38,746

32,514

Gross Revenue Management

11,541

8,005

-7,859

-6,965

Deductions from Revenue Management

-2,313

-1,650

30,887

25,549

Net Operating Revenue Management

9,229

6,355

-13,432

-11,238

Operational Costs Management

-4,176

-2,250

-11,684

-11,207

Personal, Material, Services and Others Management

-3,612

-3,341

-1,751

-1,844

Depreciation and Amortization Management

-367

-516

-1,034

-864

Operational Provisions Management

-816

-408

2,986

397

 

259

-160

818

1,602

Shareholdings Management

-57

625

3,804

1,999

Income before Financial Income Management

201

465

-4,213

-2,983

Financial Result Management

-1,303

-915

-409

-984

Income before Tax Management

-1,101

-450

586

1,213

Income tax and social contribution Management

610

1.343

178

229

Net Profit Management

-491

892

* Excludes CELG D results, construction revenues and expenses, RBSE Transmission Revenue, RBSE Revenue referring to Transmission Lines renewed by Law 12.783 / 2013, expenses with independent research, Research findings, Impairment, onerous contracts, provisions for contingency, provision for losses on investments, provisions for adjustment to market value, provision for the Water Resources Inspection Fee (TFRH), ANEEL CCC Provision, result of CTEEP's equity investments impacted by RBSE, compulsory loans, Extraordinary Retirement Plan (PAE), Provision of Pará Rate relative to Eletronorte and provision for IRPJ / CSLL related to RBSE.

 

 

 

 

 


 
 

 

 

I.1 Main variations of the Statement of Income

Variations of Statement of Income (2017 x 2016)

The 2017 Result registered a 149% variation compared to 2016, with a net loss of R$ 1,726 million in 2017, compared to a net profit of R$ 3,513 million in 2016.

The Managerial Result for 2017 registered a 22% decrease regarding 2016, with a managerial net income of R$ 178 million in 2017 compared to a managerial net income of R$ 229 million in 2016, especially due to the factors remain prominent.

Operating Income

Generation Revenues

2017

2016

%

Variation

Supply of energy for distribution companies

14,698

12,886

14.1

The variation was mainly due to the variations in the following subsidiaries: (i) In the subsidiary Furnas, new Contracts in the Free Contracting Environment with variation in the average price due to the market conjunctures and IPCA price contracts of around 238.8 MW. (ii) In Eletrosul, adjustments were made to the IPCA contracts, price changes in the ACL - Free Contracting Environment, referring to the energy generated by PCHs - Small Hydropower Plants, by wind power and energy purchased through PPAs - Purchase and Sale Agreements which is resold in the ACL in short-term contracts; new contract, as of April 2017, signed with SPE Teles Pires; and from April / 17, the Hermenegildo I, II, III and Chuí IX SPEs discontinued the ACRs through the New Energy Leftovers and Deficits Compensation Mechanism, and the unrestrained energy acquired by Eletrosul and resold in the ACL - Environment of Free and / or liquidated contract to PLD; (iii) At Eletronuclear, updating the contracted revenue according to Aneel Homologatory Resolution 2,193 / 16, which established the fixed revenue for the year 2017.

Supply of energy for final consumers

2,554

2,946

-13.3

The variation was mainly due to: (i) in the subsidiary electrosul, price variation in long-term contracts; (ii) Migration of consumers Free to the ACL in the subsidiary Amazonas Energia.

CCEE (short term)

1,006

927

8.5

The variation is mainly due to the following factors: (i) LDP increase; (ii) In the subsidiary Amazonas Energia, due to the increase in the participation of SIN energy, with less energy remaining to be settled in the CCEE, (iii) the termination of the ACR contract by Eletronorte, and part of this energy was now traded in the short term.

Revenue from Operation and Maintenance Extended Power Plants Law 12.783 / 13

2,198

2,179

0.9

This change was mainly due to the updating of the renewed power plant contracts, partially offset by (ii) a change in the CFURH tariff in 2017, which comprises the revenue from quotas of the new plants, and (iii) the frustration of the forecast of the financial income occasioned by the difference between the rate of remuneration used in the forecast and the rate actually realized.

Construction Revenue

53

41

27.9

No effect for the result, since it has expense in corresponding amount.

Transfer Itaipu (see II.3.a)

626

-347

-281

The variation was mainly due to the increase in the rate on which the monetary restatement is calculated based on the US Commercial Price and Industrial goods indexes, which offset the lower appreciation of the US dollar, and also due to the recognition of the interministerial ordinance which determines Itaipu revenues.

TOTAL GENERATION REVENUES

21,136

18,632

13.4

The variation was mainly due to the factors explained above.

(-) Construction

-53

-41

27.9

 

MANAGEMENT GENERATION REVENUES

21,083

18,590

13.4

The variation was mainly due to the factors explained above.

 


 
 

 

 

Transmission Revenues

2017

2016

%

Variation

Revenue from Operation and Maintenance (LT Renovated Law 12.783 / 2013)

3,132

2,736

14.5

The variation was mainly due to the RAP - Annual Revenue Allowance.

LT RAP Under Exploration regime

265

240

10.8

The variation was mainly due to (i) the RAP update, and (ii) the remuneration of investments related to the reinforcement of lines in the transmission system.

Construction Revenue

917

1,175

-21.9

No effect for the result, since it has expense in corresponding amount.

 

Return Rate Updates

6,063

29,406

-79.4

The variation was mainly due to the accounting of the Remuneration related to the credits of the Basic Network of the Existing System (RBSE) referring to the transmission lines renewed in accordance with Law 12,783 / 2013, following Administrative Rule no. 120, dated 04/20/2016, of the Ministry of Mines and Energy, which established the payment conditions, with effect of R$ 4,923 million in 2017 and R$ 28,601 million in 2016, since in 2017 the registration refers only to the remuneration of the financial asset and, in 2016, to the financial asset itself, as homologated by Aneel. In addition, as of August 2017, upon the beginning of the amortization of the asset, the calculation base for the incidence of the remuneration decreases monthly, according to payments.

TOTAL TRANSMISSION REVENUE

10,378

33,557

-69.1

The variation was mainly due to the factors explained above.

(-) Rate of Return related to RBSE Compensation

-4,923

-28,601

-82.8

 

(-) Construction

-917

-1,175

-21.9

 

RECEIVE MANAGEMENT TRANSMISSION

4,538

3,781

20.0

The variation was mainly due to the factors explained above.

 

 

Distribution Revenues

2017

2016

%

Variation

Supply

9,468

15,208

-37,7

The variation was mainly due to the accounting of CELG D in the result of 2016 and against the accounting in 2017 of the result of only 1 month of operation of the company. The supply revenue was also affected by the following factors: (i) in the subsidiary ED Piuaí, there was a reclassification of revenue from distribution to other revenues and revenue from excess demand and surplus of reactive items for special obligations in compliance with the Accounting Manual of the Electric Sector; (ii) positive tariff readjustment in CEAL, CEPISA and ELETROACRE.

Short Term Revenue

725

315

130,3

The variation was mainly due to the increase in LDP in 2017 and over-contracting in some Distributors (Amazonas, Cepisa and Ceron) and increase in PLD.

Construction Revenue

782

1,166

-32,9

No effect for the result, since it has expense in corresponding amount.

CVA and other Financial Components

1,441

-339

-524,7

Variation of CVA values with effects resulting from positive constitution and amortization in 2017 (active CVA), while in 2016 generated negative result (passive CVA) - see detail in the chart below.

TOTAL DISTRIBUTION REVENUE

12,416

16,349

-24,1

The variation was mainly due to the factors explained above.

(-) CELG D

-528

-7,055

 

 

(-)  Construction

-782

-1,166

-32,9

 

MANAGEMENT DISTRIBUTIONREVENUE

11,106

8,128

36,6

The variation was mainly due to the factors explained above.

 

 

CVA and Other Financial Components

2017

2016

ED Acre

-25

18

ED Alagoas

311

-153

Amazonas Energy Distribution S.A.

695

-129

ED Piauí

279

67

ED Rondônia

126

162

ED Roraima

67

-9

Celg-D

-11

-296

 TOTAL CVA and Other Financial Components

1,441

(339)

 


 

 

 

 

Other Revenues

  2017

  2016

%

Variation

Other Recipes

2,060

2,450

-15.9

The variation was mainly due to the exclusion of CELG-D income from the deconsolidation carried out from February 2018.

CELG D

-42

-437

-90.4

 

Other Management Income

2,019

2,014

0.3

 

 

   Operating Costs and Expenses

 

OPERATING COSTS

2017

2016

%

Variation

Energy purchased for resale

-11,585

-11,264

2.8

The variation was mainly due to: (i) In Furnas, due to the variation of the energy purchase balances and the updating of the prices of existing contracts, as well as the agreement of new Energy Purchase Agreements. subsidiary Eletronorte, there was an increase in the average LDP in 2017 (reflecting, also, the costs of settlement of the Short Term in the operation of the Contract with Termonorte). (iii) change in the power generation contract for the isolated system.

Charges on the use of electricity

-1,611

-1,805

-10.7

There was no relevant variation.

Fuel for cars of electricity

-425

-760

-44.1

The variation is mainly explained by (i) the decrease of the average ACR in 2017, impacting on the recovery of CCC Expenses; (ii) a change in the power generation contract for the isolated system, as in 2016 the company purchased fuel to produce energy, and in 2017 this responsibility is from PIE - Indepedente de Energia. As a result, it reduced fuel, but increased the cost of electricity purchased for resale.

Construction

-1,752

-2,382

-26.4

No effect for the result, since it has expense in corresponding amount.

TOTAL OPERATIONAL COSTS

-15,374

-16,211

-5.2

The variation was mainly due to the factors explained above.

(-) CELG D

190

2,592

-

 

(-) Construction

1,752

2,382

-26.4

 

OPERATING COSTS. MANAGERS

-13,432

-11,238

19.5

The variation was mainly due to the factors explained above.

 

 


 
 

 

 

OPERATING EXPENSES

2017

2016

%

Variation

Personel

-7,722

-6,549

17.9

The variation was mainly due to: (i) the impact of the launch and adherence to the Extraordinary Retirement Plan (PAE) in the amount of R$ 853 million; (ii) readjustment resulting from ACT 2016-2018, with effect of 9% per cent from 4Q16, referring to the period 2016-2017, due to collective bargaining, and a 4% increase for the period from 2017-2018 to from May 2017; and (iii) In the subsidiary Eletronorte, inclusion in the Company's payroll, as of September 2016, of effects made under an agreement to close two hazardous and uninterrupted processes.

Material

-324

-330

-1.7

Decrease, in 2017, the expenses with materials related to the operation and maintenance of the electric system, as a cost reduction measure foreseen in PDNG 2017-2021.

Services

-2,884

-3,485

-17.2

Reduction was due to the interruption of the consolidation of CELG D in February 2017 and the reduction of expenses with contracting for independent research, which went from R$ 291 million in 2016 to R$ 71 million in 2017.

Others

-1,773

-2,335

-24.1

Reduction was due to the interruption of the consolidation of CELG D in February 2017 and to the registration in 2016 of the research findings in the amount of R$ 211 million.

Depreciation and amortization

-1,751

-1,844

-5.0

Reduction is due to the interruption of the consolidation of CELG D in February 2017.

Operating Provisions / Reversals

-5,747

-16,723

-65.6

The variation is mainly explained by the reversal of onerous contracts in the amount of R$ 1,493 million, mainly due

 to the launch of the Extraordinary Retirement Plan (PAE) and the lower volume of impairments in 2017.

TOTAL OPERATING EXPENSES

-20,202

-31,264

-35.4

The variation was mainly due to the factors explained above.

CELG D

96

1,008

-90.4

 

PAE – Extraordinary Retirement Plan

853

0

-

 

Investigation Findings

0

211

-100.0

 

Independent Investigation Expenses

71

291

-75.8

 

Contingencies

4,398

5,993

-26,6

 

Onerous Contracts

-1,493

2,194

-168.1

 

Provision / (Reversal) for Losses on Investments

-336

1,479

-122.7

 

Impairment

641

5,537

-88.4

 

Aneel Provision - CCC

986

742

32.9

 

Adjustment to Market Value

-1

0

-1.444

 

Hydrological Risk

0

-451

-100.0

 

Water Resources Inspection Fee (TFRH) - Para Fee

518

346

49.5

 

Operating Expenses Managerial

-14,469

-13,914

4.0

The variation due to the factors explained above.

 

Shareholdings

 

Shareholdings

  2017

  2016

%

Variation

Shareholdings

2,692

3,114

-13.5

The variation is mainly due to: accounting for the sale of CELG D in 2017 in the amount of R$ 1,525 million and for the recognition of RBSE by the associate CTEEP in 2016, with an impact on Eletrobras' equity income of R$ 1,603 million , partially offset by the decrease resulting from the research findings at SPE Belo Monte (R$ 91 million).

(-) CTEEP

-349

-1,512

-76.9

 

(-)  Alienation CELG D

-1,525

0

-

 

Shareholdings Management

818

1,602

-49.0

The variation was mainly due to the factors explained above.

 

 

 

 


 
 


 

Financial Result
 

FINANCIAL RESULT

  2017

  2016

%

Variation

Interest Income and Financial Income

1,809

2,241

-19.2

Variation is mainly due to the lower availability of resources for application.

Net Monetary Update

0

399

-100

The variation was mainly due to: (i) reduction of the rates of the main indexes (inflation and SELIC) on credits as receivables from the updated CCC / CDE of Amazonas; (ii) a reduction in the updating of renegotiated energy credits, derived from Law 8727/93 and also from payment of credit by the Federal Government in August 2017.

Net Foreign Exchange Variation

-119

138

-186

The variation is due, mainly, to the exchange variation in the period on financing agreements and with suppliers.

Debt Charges

-5,757

-6,376

-9,7

The variation is mainly due to the fall in the SELIC rate and the decrease in the outstanding balance of financing contracts due to depreciation.

Shareholder Remuneration Charges

-388

-201

93

The variation was mainly due to the correction of the amounts related to the Advance for Future Capital Increase (AFAC), carried out by the Union in the holding company; (ii) updating of dividends not yet paid.

Other financial results

-738

-131

464

The variation was mainly due to the following factors: (i) In the Holding Company, adjustment to the deferred PIS / Cofins account in 2016 as a result of the decline of the US dollar in that period, since these deferred taxes are calculated on the exchange variation, generating a positive effect on other financial expenses; (ii) Renegotiation of CEA's debt that was renegotiated and the Company granted a remission of R$ 64 million..

TOTAL FINANCIAL INCOME

-5,193

-3.931

32,1

The variation was mainly due to the factors explained above.

CELG D

32

-121

-126,3

 

Monetary adjustment of compulsory loans

949

1,068

-11,2

 

MANAGEMENT FINANCIAL RESULT

-4,213

-2,983

41.2

The variation was mainly due to the factors explained above.

 

Income Tax and CSLL

 

INCOME TAX AND CSLL

    2017

  2016

%

Variation

Imposto de Renda e Cont. Social

-1,525

-8,511

-82

The variation is mainly due to the collection of IRRF on the transmission revenue due to the accounting of the Remuneration related to the credits of the Basic Network of the Existing System (RBSE).

(-) IRRF RBSE

1,674

9,724

-82.8

 

(-)  IRRF Disposal CELG D

438

0

-

 

Income Tax and Managerial Social Contribution

586

1,213

-52

The variation was mainly due to the factors explained above.

 

 


 
 


 

 

 

Variations of Statement of Income (4Q17 x 4Q16)

The 4Q17 Results posted a net loss of R$ 6,258 million in 4Q16 to a net loss of R$ 3,998 million in 4Q17, especially due to the following factors:

 

Operating income

Generation Revenues

4Q17

4Q16

%

Variation

Supply of energy for distribution companies

4,070

3,020

34.8

The variation was principally due to the following reasons: (i) in the subsidiary Eletrosul, from April / 17, the Hermenegildo SPEs, II, III and Chuí IX SPCs were decontracted through the Surplus and Deficit Compensation Mechanism of New Energy, being the uncontracted energy acquired by Eletrosul and resold in the ACL - Environment of Free Contracting and / or liquidated to PLD. partially offset by (ii) in the subsidiary Eletronuclear, an increase in revenues mainly due to the increase in fixed revenue established by ANEEL for Angra I and II, pursuant to Resolution 2,193 / 16, for 2017 and for the variable portion referring to the excess of generated by the Angra I and II mills. (iii) in the subsidiary Eletronorte, and price adjustment, which is a billing mode heavily impacted by Albras' revenues and South 32, the company's two largest contracts. These contracts have particularities such as dependence on exchange, aluminum price in the international market (LME) and provides for reimbursement of sector charges up to the limit established in contract.

Supply of energy for final consumers

696

788

-11.8

The variation was mainly due to the reclassification of the revenues of the subsidiary Amazonas Distribuição due to the process of unbundling of generation and transmission activities.

CCEE (short term)

138

242

-43.1

The variation is mainly due to the strategy of seasonality and allocation of more energy in the first half of 2017, besides the market variations (PLD, GSF, Portfolio of contracts, etc.).

Revenue from Operation and Maintenance

541

583

-7.3

The variation is primarily due to the following reasons: (i) investments made in the renovated generation facilities, partially offset by: (ii) change in the CFURH tariff in 2017, which comprises the revenue from quotas of the refurbished plants, and (iii) forecast of the financial income caused by the difference between the rate of remuneration used in the forecast and the rate actually realized.

Construction Revenue

24

-61

-139.7

No effect for the result, since it has expense in corresponding amount.

Transfer Itaipu (see II.3.a)

293

-163

-279.5

The variation was mainly due to the increase in the tariff on which the monetary adjustment calculated on the basis of the US Commercial Price and Industrial Goods price indices is affected.

TOTAL GENERATION REVENUES

5,762

4,409

30.7

The variation was mainly due to the factors explained above and also due to the recognition of the interministerial ordinance which determines Itaipu revenues.

(-) Construction

-24

61

-139.7

 

MANAGEMENT GENERATION REVENUES

5,738

4,470

28.4

The variation was mainly due to the factors explained above.

 

 

 


 
 

 

 

Transmission Revenues

4Q17

4Q16

%

Variation

Revenue from Operation and Maintenance (LT Renewed Law 12,783 / 2013)

723

672

7.5

The variation is mainly due to the following reasons: (i) the annual update of the RAP - Allowed Annual Revenue from concessions related to Transmission Lines extended pursuant to Law 12.783 / 2012; and (ii) investments related to line reinforcements in the transmission system. Highlight for Chesf.

O & M LT Revenue Under Exploration Regime

58

73

-20.0

The variation was mainly due to the unavailability of the system during the period and prepayments, mainly in the LTs: JARDIM / PENEDO and ARAPIRACA III and TAUÁ-MILAGRES of the subsidiary Chesf.

Construction Revenue

324

239

35.4

No effect for the result, since it has expense in corresponding amount.

Return Rate Updates

1,466

1,518

-3.4

The variation is mainly due to the accounting of the Remuneration related to the Credits of the Basic Network of the Existing System (RBSE) referring to the transmission lines renewed according to Law 12,783 / 2013, according to Ordinance No. 120, of April 20, 2016, of the Ministry of Mines and Energy, which established the payment conditions, with effect of R$ 1,192 million in 4Q17 and R$ 1,291 million in 4Q16, related to the remuneration of financial assets, and the decrease in remuneration between the periods is due to the beginning of the amortization of assets in August 2017.

TOTAL TRANSMISSION REVENUE

2,570

2,502

2.7

The variation was mainly due to the factors explained above.

(-)  Rate of return related to RBSE Compensation

-1,192

-1,291

-7.7

 

(-) Construction

-324

-239

35.4

 

MANAGEMENT TRANSMISSION REVENUE

1,055

972

8.5

The variation was mainly due to the factors explained above.

 

 

Distribution Revenues

4Q17

4Q16

%

Variation

Supply

2,819

8,743

-67.8

The change was mainly due to the deconsolidation of CELG D as of February 2017. If CELG D is disregarded, there is a growth in Supply, mainly due to: (i) Tariff Adjustment in the subsidiaries Eletroacre, Ceal , Ceron and Boa Vista; and (ii) reclassification of revenues at Amazonas Energia and Cepisa.

Short Term Revenue

208

74

183.1

The variation was mainly due to: (i) Higher availability of energy (over-contracting) in relation to the same period of the previous year; (ii) Increase in the value of LDP; (iii) reclassification in 2017, when this revenue began to be recognized, previously recorded as cost recovery with energy and; (iii) Over-trading in subsidiaries Cepisa and Ceron.

Construction Revenue

260

571

-54.4

No effect for the result, since it has expense in corresponding amount.

CVA and other Financial Components

966

-303

-419

The variation was mainly due to the constitution of CVA and Financial items due to positive overcontracting in the subsidiaries CEAL and CEPISA. The result was also impacted by the CVA variation in the other companies, as shown in the table below.

TOTAL DISTRIBUTION REVENUE

4,254

9,085

-53.2

The variation was mainly due to the factors explained above.

Celg- D

 0

-7,055

100 

 

(-) Construction

-260

-571

-54.4

 

MANAGEMENT DISTRIBUTION REVENUE

3,994

1,459

173.7

The variation was mainly due to the factors explained above.

 

 

 


 
 

 

 

 

 

CVA and Other Financial Components

4Q17

4Q16

ED Acre

-29

0

ED Alagoas

52

0

Amazonas Energy Distribution S.A.

707

0

ED Piauí

61

0

ED Rondônia

135

0

ED Roraima

39

0

Celg-D

0

0

 TOTAL CVA and Other Financial Components

966

-303

 

Other Recipes

4Q17

4Q16

%

Variation

Other Recipes

756

1,541

-51.0

A variação se deu, principalmente, em função da desonsolidação da CELG D a partir de fevereiro de 2017 e da Venda das ações da CPFL pertencentes a controlada Eletropar no montante de R$ 49,9 milhões .

Celg D

-437

 

 

Other Management Recipes

756

1,105

-31.6

 

 

Operating Costs and Expenses

 

OPERATING COSTS

4Q17

4Q16

%

Variation

Energy purchased for resale

-3,636

-4,304

-3,636

Regardless of the costs of CELG D, the account would show growth mainly due to the following factors: (i) In the subsidiary Amazonas GT, increase in the purchase of energy in the Short-Term Market as the thermal plants are generating below contracted energy due to maintenance problems; (ii) In the subsidiary Eletrosul, additional amounts of energy purchased from the Teles Pires HPP, due to the decontracting of the energy sold by the same in the ACR; (iii) in the isolated system distributors, because in 4Q16, the company bought fuel to produce energy, and in 417 that responsibility is from PIE - Independent Producer of Energy. As a result, it reduced fuel, but increased the cost of electricity purchased for resale.

Charges on the use of electricity

-404

-573

-404

The variation is mainly due to the following reasons: (i) forecast update in transmission contracts; and (ii) increase in generation revenue.

Fuel for electricity production

-136

36

-136

The variation is explained mainly by the recovery of fuel expenses in 2016, in the subsidiary Amazonas Energia, due to the calculation of CCC's rights, according to Law 12,119 / 09.

Construction

-609

-749

-609

No effect for the result, since it has expense in corresponding amount.

TOTAL OPERATING COSTS

-4,784

-5,591

-4,784

The variation was mainly due to the factors explained above.

CELG-D

2,592

 

 

(-) Construction

609

749

609

 

MANAGEMENT OPERATING COSTS

-4,176

-2,250

-4,176

The variation was mainly due to the factors explained above.

 

 


 
 


 

 

OPERATIONAL EXPENSES

4Q17

4Q16

%

Variation

Personal

-2,072

-2,147

-3.5

The variation is primarily due to the deconsolidation of CELG D. Partial compensation is due to the following factors: (i) the impact of the Extraordinary Retirement Plan (PAE) in the amount of R$ 109 million in the quarter, referring to additions after July 14 and adjustments. (ii) readjustment of 4% for the period 2017-2018 as of May 2017).

Material

-95

-111

-13.8

Reduction of material expenses related to the operation and maintenance of the electric system, as a cost reduction measure foreseen in PDNG 2017-2021.

Services

-963

-1,493

-35.5

The decrease was mainly due to the deconsolidation of CELG D. Excluding CELG D, the Services account decreased, mainly due to lower expenses with independent research (R$ 80 million in 4Q16 and R$ 28 million in 4Q17 ).

Others

-566

-659

-14.1

The variation is fragmented in several accounts, and the main variations are due to the reduction of donations and contributions and of measures to optimize the use of resources, such as budgetary contingency of non-priority expenses.

Depreciation and amortization

-367

-516

-28.9

 

Operational Provisions / Reversals

-6,238

-9,586

-34,9

The variation is mainly explained by (i) Contingencies in the amount of R$ 3,396 million, influenced by provisions related to the compulsory loan .; (ii) impairment of R$ 1,172 million (iii) Aneel CCC Provision in the amount of R$ 986 million. The main operating provisions are detailed below (for the full detail of the Operating Provisions see Explanatory Note 43).

TOTAL OPERATING EXPENDITURE

-10,301

-14,512

-29,0

The variation was mainly due to the factors explained above.

CELG D

0

1,008

-100.0

 

PAE

57

0

-

 

Research Findings

0

0

100.0

 

Independent Research Expenditure

28

80

-65.0

 

Contingencies

3,621

1,208

199.8

 

Onerous Contracts

477

1,061

-55.1

 

Provision / (Reversal) for Losses on Investments

-363

1,479

-124.5

 

Impairment

1,201

2,926

-58.9

 

Aneel Provision - CCC

986

741

33.0

 

Adjustment to Market Value

-407

-149

172.1

 

Hydrological Risk

-263

-451

-41.8

 

Water Resources Inspection Fee (TFRH) - Para Fee

169

346

-51.3

 

Operating Expenses Managerial

-4,794

-4,265

12.4

The variation was mainly due to the factors explained above.

                                                                  

Shareholdings

 

Shareholdings

4Q17

4Q16

%

Variation

Shareholdings

 

150

 

625

 

 

-76

 

Variation refers basically to the RBSE accounting in CTEEP, in 4Q17. Discounting the impact of CTEEP, the main impact was the reversal of provisions with exclusions of liability and other provisions, made by ESBRp in November 2016, whose net amount of taxes was R$ 333.1 million  and a negative result of Eletronorte with Sinop SPEs in the amount of R$ 105 million resulting from impairment in the SPE.

(-) CTEEP

207

0

-

 

Management Shareholdings

-57

625

-109

The variation was mainly due to the factors explained above

 

 

 


 
 


 

 

 

 

Financial Result

 

FINANCIAL RESULT

4Q17

4Q16

%

Variation

Income from Interest and Financial Investments

366

726

-49.6

The variation was mainly due to the reduction of indexer rates in 2017 (SELIC, IPCA and others).

Net Monetary Adjustment

1,175

-351

-235

The variation was mainly due to (i) reduction of the discount rates on CCC receivables, the applicable indicator being the SELIC on the Passive monetary restatement, in addition to the amortization of the principal of the receivable with the CCC referring to the CCD 1, in order to receive regular installments; and (ii) reclassification of the TN / Petrobrás update referring to installments in the amount of R$ 47 million.

Net Foreign Exchange Variation

-38

476

-108

The variation is mainly due to the variation of the exchange rate in the period on financing agreements and with suppliers.

Debt Charges

-1,398

-1,538

-9.1

The variation was mainly due to the reduction of indexer rates in 2017 (SELIC, IPCA and others).

Shareholder Remuneration Charges

-73

-92

-20

The variation was mainly due to the correction of the amounts related to the Advance for Future Capital Increase (AFAC) made by the Union in the holding company, by the Selic;

Other financial results

-327

212

-254

The variation was mainly due to the following factors: (i) In Holding, adjustment to deferred PIS / Cofins account; (ii) Positive change in the account in the subsidiary Furnas, mainly influenced by the increase in interest income and the reversal of tax contingencies included in the REFIS installments; (iii) In the subsidiary Ceron, reclassification of interest from CCC to right of compensation in R$ 365 million; and reclassification of the update of Eletronorte / Termonorte by R$ 207.5 million and Petrobrás by R$ 212.2 million, for reimbursement obligations.

TOTAL FINANCIAL INCOME

-296

135

-318,8

The variation was mainly due to the factors explained above

CELG D

0

-121

-100,0

 

Monetary adjustment of compulsory loans

-1.006

-930

8,2

 

MANAGEMENT FINANCIAL RESULT

-1,303

-915

42,3

The variation was mainly due to the factors explained above

 

Income Tax CSLL

 

INCOME TAX AND CSLL

 4Q17

4Q16

%

Variation

Income Tax and Social Contribution

205

904

-77

The variation is mainly due to the collection of IRRF on the transmission revenue due to the accounting of the Remuneration related to the credits of the Basic Network of the Existing System (RBSE).

(-) IRRF RBSE

405

439

-7,7

 

Income Tax and Managerial Social Contribution

610

1,343

-55

The variation was mainly due to the factors explained above.

 

 


 
 


 

 

I.2 Sale of Energy

 

I.2.1  Energy Sold in 2017 - Generators – TWh

 

In terms of the evolution of the energy market, Eletrobras Companies sold 162,4 TWh of energy in 2017, against 155,5 TWh traded in the same period of the previous year, representing a reduction of 4,3%.

 

(1)   Renews plants unde Law 12.783/13 – quotes

(2)   Exploration Plants: Sales ACR and ACL

(3) The Company acts as an agent for the sale of electricity from Itaipu. The energy sales revenues presented above is not consolidated as part of Eletrobras' sales revenues mentioned in the Financial Statements

 

I.2.2 Energy Sold in 2017 - Distributors – TWh

 

In terms of the evolution of the energy market, Eletrobras Distributors in 2017 sold 16,1 TWh of energy, against 17,3 TWh traded in the same period last year, representing a reduction of 6,9%

 

 

* Considers 30.4 thousand MW of CERR, whose concession began to be operated by the Roraima Distribution from January 2017.

** It considers only the captive market and supply.

 


 
 


 

 

 

I.3 Impairments and Onerous Contracts

 

 

Accumulated

 

Moviment

Impairment

31/12/16

12/31/17

1Q17

2Q17

3Q17

 

4Q17

2017

Generation

12,160

13,824

189

-27

492

1,010

1,664

UTN Angra 3

8,949

9,900

220

264

222

245

951

UHE Samuel

436

309

0

0

-127

0

-127

UHE Batalha

408

385

0

0

-19

-3

-23

Candiota Fase B

356

366

0

0

0

10

10

Casa Nova I

325

363

0

0

21

16

38

UHE Simplício

342

280

0

0

-253

191

-62

UTE Camaçari

304

281

-7

7

-219

196

-23

Outros

1,081

1,940

-24

-299

868

314

859

Transmission

3,670

2,593

125

-18

-3,426

2,242

-1,077

CC 061-2001

2,077

1,116

130

-130

-961

0

-961

LT Jauru Porto Velho

312

253

0

0

-59

0

-59

CC 018-2012 Mossoró Ceará Mirim

100

100

0

0

0

0

0

Outros

1,181

1,124

-5

112

-525

361

-57

Distribution

237

0

-43

-72

-65

-57

-237

Administration

79

264

0

0

0

185

185

Assets of Distributors held for sale

236

236

Acquisition of control: Livramento (Eletrosul) - Consolidation of the equity position

-130

-130

Total

16,147

16,681

270

-118

-713

1.201

641

                 

 

 

 

Onerous Contracts

BALANCE ON 12/31/2016

BALANCE ON 12/31/2017

Movement

 

1Q17

2Q17

3Q17

4Q17

Transmission

 

 

 

 

 

 

LT Recife II - Suape II

41

50

1

-1

9

0

LT Camaçari IV - Sapeaçu

115

124

0

0

10

-1

Outros

11

10

-4

4

0

-1

 

166

185

-3

-163

185

0

Generation

 

 

 

 

 

 

Itaparica

0

0

-2

2

0

0

Funil

63

127

-2

-2

73

-5

Coaracy Nunes

371

232

0

0

-139

0

Marimbondo

236

0

-7

-6

-223

0

Angra 3

1,350

1,389

-220

-264

-40

563

Outros

487

147

22

-197

-164

-1

 

2,507

1,895

-205

-472

-493

558

Distribution

 

 

 

 

 

 

Ceal

8

0

0

0

 

-8

Cepisa

65

0

-16

-16

-16

-17

Ceron

191

0

-44

-44

-55

-48

Boa Vista

2

0

4

2

-8

0

Amazonas D

813

0

-54

-380

-190

-189

 

 

 

 

 

0

0

 

1,079

0

-110

-439

-269

-261

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL

3,753

2,079

-319

-907

-744

296

 

 

 


 
 


 

 

 

I.4 Consolidated EBITDA

 

 

EBITDA

2017

2016

(%)

 

Result for the Year

-1,726

3,513

-149%

 

 + Provision for Income Tax and Social Contribution

1,525

8,511

-82%

 

 + Financial Result

5,193

3,931

32%

 

 + Amortization and Depreciation

1,751

1,844

-5%

 

 = EBITDA

6,744

17,799

-62%

 

AJUSTES

 

 

 

 

(-) Celg D (EBITDA and Disposal - Equity Shares)

-1,554

-184

744%

 

(-) Basic Network Effects of the Existing System (RBSE)

-4,923

-28,601

-83%

 

(-) Extraordinary Retirement Plan (PAE)

853

0

-

 

(-) Expenditure Independent research

71

291

-76%

 

(-) Research Findings

0

211

100%

 

(-) Contingencies

4,398

5,993

-27%

 

(-) Onerous contracts

-1,493

2,194

-168%

 

(-) Provision / (Reversal) for Losses on Investments

-336

1,479

-123%

 

(-) Impairment

641

5,537

-88%

 

(-) ANEEL Provision - CCC

986

742

33%

 

(-) Adjustment to Market Value

-1

0

-1,444%

 

(-) Water resources inspection fee (Para Rate)

518

346

49%

 

(-) Hydrological Risk

0

-451

-100%

 

(-) Shareholdings (RBSE CTEEP and SPE Research)

-349

-1,512

-77%

 = MANAGEMENT EBITDA

5,554

3,845

44%

 

Management EBITDA for the 2017 period was adjusted based on the accounting for the additional RBSE granted to CTEEP by Aneel in said quarter and had not been adjusted as a non-recurring item, impacting the period.

  The adjustments made to the management Ebitda refer to non-recurring events or events that are expected to be treated under PDNG 2018-2022 and therefore are expected not to affect the Company's future cash flow. However, there are risks and uncertainties related to the Company's business, such as, but not limited to, general economic, regulatory, political and commercial conditions in Brazil and abroad, changes in interest rates, inflation and value of the Real, changes in volumes and standards of consumer energy use, competitive conditions, payments related to our receivables, changes in rainfall and water levels in the reservoirs used to operate our hydroelectric power plants, our financing and capital investment plans, existing and future government regulations , and other risks described in our annual report and other documents filed with the Securities and Exchange Commission and the Securities and Exchange Commission of the United States of America that may change those estimates and expectations of the Administration. Thus, future results of the Company's operations and initiatives may differ from current expectations and the investor should not rely solely on the information contained herein.

 

 


 
 


 

 

 

Consolidated Results and EBITDA by segment

 

12/31/2017

DRE by Segment

Administration

Generation

Transmission

Distribution

Eliminanation

Total

Operating System

O & M Regime

Operating System

O & M Regime

 Net operating revenue

216

18,070

1,844

1,442

8,684

9,598

(1,978)

37,876

 Operating Costs and Expenses

(7,773)

(11,932)

(2,015)

(1,288)

(3,721)

(10,778)

1,932

(35,575)

 Operating Income Before Financial Result

(7,557)

6,138

(171)

154

4,963

(1,181)

(45)

2,301

 Financial Result

1,046

(1,497)

(243)

(406)

(637)

(3,502)

45

(5,193)

 Results of equity investments

2,692

-

-

-

-

-

-

2,692

Income tax and social contribution

(1,081)

(188)

(41)

(47)

(671)

504

-

(1,525)

 Net Income (loss) for the period

(4,900)

4,453

(455)

(299)

3,655

(4,179)

-

(1,726)

EBITDA

(4,836)

7,524

(123)

170

5,007

(953)

(45)

6,744

EBITDA Margin

-2239%

42%

-7%

12%

58%

-10%

 

18%

 

12/31/2016

DRE by Segment

Administração

Generation

Transmission

Distribution

Eliminanation

Total

Operating System

O & M Regime

Operating System

O & M Regime

 Net operating revenue

(255)

16,085

1,626

1,604

31,952

11,592

(2,287)

60,316

 Operating Costs and Expenses

(5,775)

(18,554)

(2,559)

(2,517)

(4,843)

(15,572)

2,343

(47,475)

 Operating Income Before Financial Result

(6,030)

(2,469)

(932)

(913)

27,109

(3,980)

56

12,841

 Financial Result

1,020

(1,744)

(619)

(179)

307

(2,658)

(56)

(3,931)

 Results of equity investments

3,114

-

-

-

-

-

-

3,114

Income tax and social contribution

(68)

533

166

(167)

(8,974)

-

-

(8,511)

 Net Income (loss) for the period

(1,964)

(3,681)

(1,386)

(1,259)

18,442

(6,639)

-

3,513

EBITDA

(2,864)

(1,077)

(888)

(889)

27,389

(2,136)

56

17,799

EBITDA Margin

1121%

-7%

-55%

-55%

86%

-18%

 

30%

 

 

I.5 Net debt

 

 

R$ million

Net Debt

12/31/2017

12/31/2016

Financing payable without RGR (1)

             42,982

42,590

(-) Cash and cash equivalents + Securities

              8,048

6,425

(-)  Financing Receivable without RGR (2)

             12,848

 11,299

(-)  Net balance of Itaipu Financial Asset *

              1,788

   1,428

Net Debt

           20,297

 23,438

* See item II.2 "a.1".

 1. Excluded from gross debt were financings, granted with funds from RGR, owed by a company outside the Eletrobras group (R$ 1,219 million) and credits related to the federalization of Distributors, pursuant to Article 21-A and 21-B of Law 12,783 / 2013 (R$ 1,382 million).

2. The receivables due by a company outside the Eletrobras group to RGR's account (1,219 million) and adjusted by receivables from Distributing Companies held for sale (R $ 3,801 million).

 

 

 

 

 


 
 


 

 

 

I.               Analysis of the Results of the Parent Company

 

In 2017, Eletrobras Holding reported a net loss of R$ 1,764 million, a reduction of 151% compared to the net income of R$ 3,426 million recorded in 2016.

 

In 4Q17, Eletrobras Holding recorded a net loss of R$ 4,001 million, compared to a net loss of R$ 6,261 million recorded in 4Q16.

 

This 4Q17 result was decisively influenced by: (i) Profit from Equity Investments of R$ 7,431 million (see II.1), mainly due to the effect of the remuneration on the financial asset of the Basic Network of the Existing System (RBSE) , according to Ordinance No. 120 of April 20, 2016, of the Ministry of Mines and Energy, which established the conditions of payment and remuneration relative to RBSE; (ii) Unrecognized liabilities in subsidiaries in the amount of R$ 6,171 million, mainly impacted by the subsidiaries Amazonas Energia Distribuição (R​​$ 2,601 million), Eletronuclear (R$ 542 million) and Ceal (R$ 463 million); (iii) Provision for judicial contingencies, in the amount of R$ 2,935 million, mainly due to provisions related to compulsory loan lawsuits (See Note 43 to the Financial Statements of 2017); (iv) Accounting for monetary restatement related to compulsory loans in the amount of R$ 949 million in 4Q17. The following chart presents a comparison of the results of Eletrobras holding in 2017 compared to 2016

Evolution of Results - R$ million

 

 

 

Note: The analysis of the results of each subsidiary is attached.

 

 


 
 


 

 

 

 

II.1 Shareholdings of the Parent Company

 

In 4Q17, the result of Corporate Interest positively impacted the Company's result by R$ 330 million, mainly due to the Equity in the results of investments in subsidiaries, mainly influenced by the effect of the remuneration on the net financial assets (RBSE), in accordance with Ministerial Order No. 120, of April 20, 2016, of the Ministry of Mines and Energy, which established the conditions for payment and compensation related to RBSE, as shown below:

 

R$ million

 

                        Parent company

 

 

2017

2016

4Q17

4Q16

Investments in subsidiaries

 

 

 

 

Equity

     4,881

    18,042

      2,619

- 1,236

 

 

 

 

 

Investments in associates

 

 

 

 

Interest on capital

          36

            6

          32

              6

Equity

        855

     2,247

        588

          195

 

       890

    2,253

        620

         201

 

 

 

 

 

Other investments

 

 

 

 

Interest on capital

          21

            1

          21

            -

Dividends

          39

        102

          37

            16

Compensation for investments in partnerships

            1

          -

- 0

              0

Income from capital - ITAIPU

          73

          85

          69

              5

Others

          -

- 18

          -

-           18

 

       135

       170

        127

             4

 

 

 

 

 

Sale of Investments

    1,525

          -

          -

            -

 

 

 

 

 

Total

    7,431

  20,465

     3,367

- 1,034

 

 

 


 
 


 

 

 

II2. Commercialization of Electric Power of the Parent Company

 

a.Itaipu Binacional

FINANCIAL RESULT OF ITAIPU

 

 

 

 

1Q17

2Q17

3Q17

4Q17

2017

Sale of Energy Contract Itaipu + CCEE

2,644

2,904

2,851

2,809

11,208

Revenue originating from the Right of Reimbursement (1)

161

368

459

808

1796

Others

44

39

37

57

177

Total Revenue

2,848

3,311

3,347

3,674

13,181

 

 

 

 

 

0

Purchase of Energy Contract Itaipu + CCEE

-3,228

-2,590

-2,506

-2,557

-10,881

Expenses Originating from the Compensation Obligation (2)

-106

-244

-305

-515

-1170

Itaipu repayment

457

-310

-265

-295

-413

Others

78

-38

-116

1

-75

Total Expenses

-2,799

-3,183

-3,192

-3,365

-12,539

 

 

 

 

 

 

ROL - Transfer of Itaipu

49

129

155

309

642

 

 

 

 

 

 

 

ITAIPU RESULTS (Price indexes)

 

 

 

FINANCIAL RESULT OF ITAIPU 

1Q17

2Q17

3Q17

4Q17

2017

Revenue originating from the Right of Reimbursement (1)

161

368

459

808

1796

+ Foreign Exchange Result

-88

143

-159

179

75

Result from the Right of Reimbursement (RD)

73

511

301

987

1871

Expenses Originating from the Compensation Obligation (2)

106

244

305

515

1170

+ Foreign exchange result

-58

95

-105

119

50

Result from the Reimbursement Obligations (RO)

48

339

199

633

1220

Balance: RD - RO

24

172

101

354

651

                 

 

a.1        

(see explanatory note 17.1.1 of the Financial Statements of 4ITR / 2017)

 

Pursuant to Law 11,480 / 2007, the adjustment factor for the financing agreements entered into with Itaipu Binacional and the loan assignment contracts entered into with the National Treasury, as from 2007, was withdrawn. flow of receipts.

As a result, Decree 6,265, dated November 22, 2007, regulating the commercialization of Itaipu Binacional's electricity was issued, defining the differential to be applied in the transfer rate, creating an asset related to the portion of the annual differential calculated, equivalent to an annual adjustment factor taken from financing, to be included annually in the transfer rate, as of 2008, practiced by the Company, preserving the flow of resources, originally established.

As a result, the differential arising from the withdrawal of the annual adjustment factor, whose amounts are defined annually through an interministerial ordinance of the Ministries of Finance and Mining, was included in the rate of transfer of power from Itaipu Binacional, and Energy. The transfer fee in force in 2017 includes an amount equivalent to US$ 244,681, which will be received by the Company through collections from the distributors, approved by MME / MF 605/2016.

The balance resulting from the adjustment factor of Itaipu Binacional, included in the caption Financial Assets, presented in Non-current Assets, amounted to R$ 4,045,340 on September 30, 2017, equivalent to US$ 1,276,938 (R$ 3,161,043 on December 31, 2016, equivalent to US$ 969,913), of

 

 


 
 


 

 

which R$ 2,885,878, equivalent to US$ 910,946, will be transferred to the National Treasury until 2023, as a result of the credit assignment carried out between the Company and the National Treasury in 1999.

These amounts will be realized through their inclusion in the transfer rate to be practiced until 2023.

Therefore, considering that the Itaipu Financial Asset is a remuneration derived from the financing agreement granted by Eletrobras to Itaipu, the amount of the Financial Asset to be received by Eletrobras is being considered, as a discount, in the calculation of the Net Debt.

 

II.3 Operating Provisions of Parent Company

 

In 4Q17, Operating Provisions had a negative impact on the Parent Company's result of R$ 7,309 million, compared to R$ 4,497 million in 4Q16. This variation is mainly explained by labor and judicial contingencies in the amount of R$ 2,897 million in 4Q17, compared to R$ 343 million in the same period in 2016.

In 2017, Operating Provisions negatively impacted the Parent Company's result by R$ 8,740 million, compared to R$ 14,676 million in 2016. This variation is mainly explained by the movement of overdraft liabilities in the subsidiaries in the amount of R$ 6,171 million in 2017, compared to R$ 12,155 million in the same period of 2016. Following is the table of changes in Operating Provisions:

                        R$ million

 Operational Provisions

 

Parent company

 

2017

2016

4T17

4T16

Garanties

18

30

5

1

Contingencies

2,935

4,418

2,954

343

PCLD - Consumers and Resellers

0

0

0

0

PCLD - Financing and Loans

11

17

6

4

Short-term liabilities in subsidiaries

6,171

12,155

3,028

4,115

Onerous Contracts

0

0

0

0

Losses in Investments

-570

-27

-615

-27

Impairment

-2

-2

-2

-1

Adjustment to Market Value

-1

0

0

0

Others

178

83

185

61

 

8,740

16,675

5,561

4,497

 

MUTATION PROVISION FOR DISCOVERED LIABILITIES - PARENT COMPANY

Balance on 12/31/2016

Other Comprehensive Results

Capitalization of AFAC

Equity

Balance at 12/31/2017

CEPISA

1,222

23

-

-1,245

-

BOA VISTA ENERGIA

609

0

-

-609

-

AMAZONAS ENERGIA

9,335

1

-

2,601

11,937

ELETROACRE

265

0

-

-265

-

CERON

1,296

-2

-

-1,294

-

CGTEE

2,353

-0

-

1,170

3,523

ELETRONUCLEAR

4,508

93

-

542

5,143

CEAL

574

18

-

463

1,054

TOTAL PROVISION FOR PASSIVE DISCOVERED

20,161

133

-

1,363

21,657

 

 

 

 

 


 
 


 

 

 

II.4 Financial Results of Parent Company

 

In 4Q17, the Financial Result positively impacted the Parent Company's result of R$ 1,118 million, a 446% increase over the negative financial result of 4Q16 of R$ 323 million. This variation is mainly explained by the lower result of the foreign exchange variation applicable to the financing to be received from Itaipu in US dollars.

 

In 2017, the Financial Result positively impacted the Parent Company's results by R$ 1,040 million, in relation of 2016 of R$ 1.143 million. This variation is mainly explained by the lower result of the exchange variation applicable to the Itaipu receivable in US dollar, as shown below:

 

                                                                                                           R$ million

FINANCIAL RESULT 

2017

2016

4Q17

4Q16

Financial income

 

 

 

 

Interest income, commissions and fees

3.406

3.480

779

922

Revenue from short-term investments

722

744

140

191

Moratorium surcharge on electricity

19

35

8

7

Monetary updates

-224

-36

1.194

-865

Exchange rate variations

-35

-500

10

-19

Other financial income

134

157

36

70

 

 

 

 

 

Financial Expenses

 

 

 

 

Debt charges

-2.091

-2.306

-636

-546

Lease charges

0

0

0

0

Charges on shareholders' funds

-371

-185

-70

-88

Other financial expenses

-520

-245

-110

5

 

1.040

1.143

1.352

-323

 

 

 

 

Evolution of the IGP-M and Dollar (%)

 

 

1Q17

2Q17

3Q17

4Q17

2017

Dólar

-2,78%

4,41%

-4,24%

4,42%

1,50%

IGPM

0,73%

-2,68%

-0,15%

1,62%

-0,53%

 

 

1Q16

2Q16

3Q16

4Q16

2016

Dólar

-8,86%

-9,81%

1,13%

0,40%

-16,54%

IGPM

2,97%

2,86%

0,53%

0,67%

7,19%

 

 

The main indexes of financing and onlendings contracts had the following variations in the periods:

 

 

 

 

 

 


 
 


 

 

 

III. General information

 

Portfolio of Receivables and Payables

 

a.    Financing and Borrowing Granted  

 

Financing and loans granted are made with the Company's own resources, as well as sector resources and external resources raised through international development agencies, financial institutions and arising from the launch of securities in the international financial market.

Loans and loans granted to the parent company, with a currency adjustment clause, represent approximately 28% of the total portfolio (32% at December 31, 2016). Those that foresee an update based on indices representing the domestic price level in Brazil amount to 72% of the portfolio balance (68% on December 31, 2016).

The market values of these assets are close to their book values, since they are sector-specific operations and are formed, in part, by funds from Sectoral Funds and that do not find similar conditions as a parameter of valuation at market value.

The long-term portions of the loans and financing granted based on the contractual cash flows mature in variable installments, as shown below:

R$ million

 

2019

2020

2021

2022

2023

Após 2023

Total

Parent Company

5.349

5.234

5.112

2.128

1.546

3.521

22.889

Consolidadated

1.366

2.853

1.835

416

770

555

7.795

* This amount includes receivables from other companies outside the Eletrobras System with RGR in the amount of R$ 1,778 million, since Eletrobras acts as manager of RGR and has a counterpart in assets.

 

Payable Financing and Loans

Debts are guaranteed by the Federal Government and / or Eletrobras, are subject to charges, whose average rate in 2017 is 7.94% pa. (9.65% a year in 2016), and have the following profile:

 

Parent Company

 

 

Consolidadated

 

12/31/2017

 

12/31/2016

 

12/31/2017

 

12/31/2016

Balance in R$ million

%/

TOTAL

 

Balance in R$ million

%/

TOTAL

 

Balance in R$ million

%/

TOTAL

 

Balance in R$ million

%/

TOTAL

Foreign currency

 

 

 

 

 

 

 

 

 

 

 

USD

9,308

39%

 

9,232

35%

 

9,308

21%

 

9,243

20%

USD with Libor

1,490

6%

 

2,183

8%

 

1,840

4%

 

2,552

6%

EURO

230

1%

 

204

1%

 

230

1%

 

204

0%

IENE

32

0%

 

92

0%

 

32

0%

 

92

0%

Others

0

0%

 

0

0%

 

2

0%

 

1

0%

Subtotal

11,061

47%

 

11,710

44%

 

11,412

25%

 

12,092

27%

 

 

 

 

 

 

 

 

 

 

 

 

National Coin

 

 

 

 

 

 

 

 

 

 

 

CDI

5,223

22%

 

6,286

24%

 

12,160

27%

 

12,702

28%

IPCA

0

0%

 

0

0%

 

369

0%

 

532

1%

TJLP

0

0%

 

0

0%

 

6,809

15%

 

10,064

22%

SELIC

616

3%

 

1,675

6%

 

1,783

4%

 

1,675

4%

Others

0

0%

 

0

0%

 

928

2%

 

1,359

3%

Subtotal

5,839

25%

 

7,961

30%

 

22,049

49%

 

26,332

58%

                       

Not indexed

6,753

29%

 

6,648

25%

 

11,661

26%

 

7,196

16%

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL

23,653

100%

 

26,320

100%

 

45,122

100%

 

45,620

100%

* This amount includes the debt of other companies outside the Eletrobras System with RGR in the amount of R$

1,778 million, since Eletrobras acts as manager of RGR and has a counterpart in assets.

 


 
 


 

 

 

 

 

The long-term portion of loans and financing matures as scheduled:

             

R$ million

 

2018

2019

2020

2021

2022

After 2022

Total

Parent Company

191

5,614

2,078

7,646

1,045

4,743

21,316

Consolidadated

4,547

8,234

4,191

9,195

3,165

9,903

39,236

* Includes Debentures.

** The majority of the debts of the distributors are with the Holding and therefore are eliminated in the consolidation of the gross debt (with the exception of 0.2%).

 

 

Consolidated Gross Debt

 

 

 

* The debts of the Distribution Companies are mostly with the Holding and therefore are eliminated in the consolidation of the gross debt (with the exception of 0.2%).

 

Ratings

 

 

 

*CreditWatch

Agency

National

Classification/ Perspective

Latest Report

Moody’s Issuer Rating

“Ba3”: / Negativa

06/04/2017

Moody’s Senior Unsecured Debt

“Ba3”: / Negativa

05/31/2017

Fitch Senior Unsecured Debt Rate

“BB”: / Negativa

11/29/2016

Fitch LT Foreign Currency Issuer

“AA-”: / Estável

11/29/2016

S&P LT Local Currency

“BB” / Negativa (CW)*

08/18/2017

S&P LT Foreign Currency

“BB“ / Negativa (CW)*

08/08/2017

 

 

 

 

 


 
 


 

 

 

Eletrobras Organization Chart

 

 

 

(1) The number of SPEs is taking into account the direct and indirect interests in SPE, and disregarding the Special Purpose Companies that participate in more than one Eletrobras Company, differently from the amounts considered in the charts of each company.

(2) The Serra do Mel wind farms I, II and III were disregarded from the SPE count, since they are consortia.

 


 
 


 

 

 

Investiments

 

NATURE OF INVESTMENTS

Budgeted

Realized

(%) 2017

2017

2017

 Generation

1,770

762

43%

 Transmission

1,331

773

58%

 Distribution

1,770

467

26%

 Maintenance – Generation

493

208

42%

 Maintenance - Transmission

341

274

80%

 Maintenance - Distribution

398

398

100%

Other (Research, Infrastructure and environment)

411

168

41%

 Total Corporate

6,516

3,050

47%

Financial Investments in SPEs

 

 

 

 Generation

1,802

1,542

86%

 Transmission

636

622

98%

Total SPEs

2,438

2,164

89%

Total

8,953

5,214

58%

For further details of the investments, per subsidiary or by project, see appendix 3 to this Investor Report

 

Share Capital

 

Structural of Social Capital

 


Shareholders

Common

Pref. Class “A”

Pref. Class “B”

Total

Quantidade

%

Quantidade

%

Quantidade

%

Quantidade

%

União Federal

554,395,652

51%

0

0%

1,544

0%

554,397,196

41%

BNDESpar

141,757,951

13%

0

0%

18,691,102

7%

160,449,053

12%

BNDES

74,545,264

7%

0

0%

18,262,671

7%

92,807,935

7%

FND

45,621,589

4%

0

0%

0

0%

45,621,589

3%

FGHAB

1,000,000

0%

0

0%

0

0%

1,000,000

0%

OTHERS

269,729,841

25%

146,920

100%

228,481,566

86%

498,358,327

37%

Total

1,087,050,297

100%

146,920

100%

265,436,883

100%

1,352,634,100

100%

 

In 4Q17, the capital of Eletrobras presented the following composition:

 

 


 
 


 

 

 

Stock Analysis

 

Actions

 

ELET3 - Eletrobras Common Shares

 

In the fourth quarter of 2017, Eletrobras common shares (ELET3) recorded a depreciation of 2.2%, closing at R$ 19.34. The highest quotation was R$ 23.47, recorded on October 26, and the lowest R$ 17.15 recorded on December 20, considering ex-dividend values. The average daily trading volume in the period was 2.8 million shares and the average daily financial volume was R$ 56.5 million.

 

ELET6 - Eletrobras Preferred Shares

 

In the fourth quarter of 2017, Eletrobras preferred shares (ELET6) appreciated 0.04%, closing at R$ 22.7. The highest quotation was R$ 27.35, recorded on October 26, and the lowest R$ 19.82 recorded on December 20, considering ex-dividend values. The average daily trading volume in the period was 1.61 million shares and the average daily financial volume was R$ 37.8 million.

 

 

Evolution of Traded Shares in B3

 

 

 

Source: AE Broadcast

Index number 12/29/2016 = 100 and ex-dividend values.

 

 


 
 


 

 

ADR Programs

 

EBRN - Eletrobras Common Shares

 

In the fourth quarter of 2017, Eletrobras common stock ADRs posted a devaluation of 8.8%, closing at US$ 5.7. The highest quotation was U$ 7.22, registered on October 25, and the lowest U$ 5.16, registered on December 20, considering ex-dividend values. The average daily trading volume in the period was 408.9 thousand shares. The average daily financial volume was US$ 2.5 million.

 

EBRB - Eletrobras Preferred Shares

 

In the fourth quarter of 2017, Eletrobras preferred ADRs posted a 5% depreciation, closing at US$ 6.79. The highest price was U$ 8.53, registered on October 25, and the lowest U$ 5.89, recorded on December 19, considering ex-dividend values. The average daily trading volume in the period was 60.5 thousand shares. The average daily financial volume was US$ 424.9 thousand.

 

 

 

 

Source: AE Broadcast

Index number 12/29/2016 = 100 and ex-dividend values.

 
 

 

 

 

 



 
 


 

 

 

Latibex - Madrid Stock Exchange

           

XELTO - Eletrobras Common Shares

 

In the fourth quarter of 2017, the Latibex common stock showed a 19% devaluation, closing at € 4.62. The highest price was € 6, registered on October 26, and the lowest € 4.31, recorded on December 27, considering ex-dividend values. The average daily trading volume in the period was 1.84 thousand shares.

 

XELTB - Eletrobras Preferred Shares

 

 

In the fourth quarter of 2017, Latibex preferred shares depreciated by 32.6%, closing at € 5.05. The highest price was € 6.55, registered on October 26, and the lowest, € 5.05, recorded on December 20, considering ex-dividend values. The average daily trading volume in the period was 1.23 thousand shares.

 

 

 

 

 

 Index number 12/29/2016 = 100

 

 

 



 
 


 

 

 

Nº of employees

 

Parent Company

 

By time

 

Working time in the company (years)

 

 

1Q17

2Q17

3Q17

4Q17

Up to 5

 

 

56

34

27

22

6 to 10

 

 

452

456

434

406

11 to 15

 

 

200

190

222

235

16 to 20

 

 

34

36

21

18

21 to 25

 

 

21

21

10

8

more than 25

 

 

192

196

186

127

Total

 

 

955

933

900

816

 

 

By region

State of the Federation

 

 

1Q17

2Q17

3Q17

4Q17

Rio de Janeiro

 

918

897

883

794

São Paulo

 

0

0

0

0

Paraná

 

0

0

0

0

Rio Grande do Sul

 

0

0

0

0

Brasília

 

37

36

17

22

Total

 

955

933

900

816

 

Hired / Outsourced Labor

 

 

4Q17

 

0

 

 

Turnover (Holding)

 

4Q17

With PAE – Retirement Plan

0,6%

Without PAE – Retirement Plan

6%

 

 


 
 


 

 

 

Direct Partnerships in SPEs - Parent Company

 

On December 29, 2017, Eletrosul concluded the process of transferring ownership interest held in 6 (six) Special Purpose Companies to its parent company, Centrais Elétricas Brasileiras S / A - Eletrobras. PNDG 2018-2022, The transfer of assets to Eletrobras has the purpose of promoting the settlement of the debts of this company with Eletrobras and reducing its financial leverage. These equity interests, subsequently and according to ongoing evaluations, may be sold to the market by the Company. Eletrobras, together or separately.

 

 

SPE

 

Power plant

 

Total

Investment

R$ million

Capacity

Installed

MW

Physical Warranty

Average MW

Physical Warranty

Average MW

11Q17

22Q17

33Q17

44Q17

Norte Energia SA*

UHE

40,051,71

11,233,10

4,571,00

5,214,020

 6,540,259

7,939,349

   9,117,491

Eólica Mangue Seco 2

 UEE

114,56

26

9,6

16,992,77

14,092,49

27,621,77

24,635,13

Chuí Holding S.A.

EOL

In operation

144

59,6

87,989,63

105,917,65

121,010,64

126,001,31

Chuí IX 

EOL

In operation

17,9

7,4

12,160,82

14,092,66

15,152,91

16,550,74

Hermenegildo I

EOL

In operation

57,28

24,9

41,986,64

47,763,41

53,460,17

57,608,15

Hermenegildo II

EOL

In operation

57,28

25,3

36,646,35

44,821,44

50,987,89

54,051,95

Hermenegildo III

EOL

In operation

48,33

21,0

32,209,28

39,862,45

44,012,75

44,860,45

Santa Vitória do Palmar Holding S.A. 

EOL

In operation

258

109,5

170,118,67

200,262,30

235,461,72

243,499,91

Rouar S.A.

EOL

U$ 101.72

65,1

N/A

39,844,82

44,756,01

56,490,54

47,972,05

* The commercial operation already totals 4,510 MW of capacity in commercial operation.

 

Generation

 

Power plant

Participation (%)

Location

(State)

Start of

Operation

End of

Operation

Norte Energia S.A

15,0

PA

Abr/16

Ago/45

Eólica Mangue Seco 2

49

RN

set/11

jun/32

Chuí Holding S.A.

49

RS

mai/15

abr/47

Chuí IX *

99,99

RS

out/15

mai/49

Hermenegildo I

99,99

RS

nov/15

jun/49

Hermenegildo II

99,99

RS

dez/15

jun/49

Hermenegildo III

99,99

RS

dez/15

jun/49

Santa Vitória do Palmar Holding S.A. 

49

RS

fev/15

abr/47

Rouar SA

50

Uruguay -Department of Cologne

20 years*

 

 

 


 
 


 

 

 

 

 

 

Transmission

 

Development

Object

(From to)

Participation (%)

Investiment

(R$ million)

Extension of lines (Km)

Voltage

(kV)

Start of

Operation

Termination of

Concession

Electrical Interconnection Brazil / Uruguay *

LT 230 kV

LT 525 kV

60% Eletrobras Holding

40% Eletrosul

60

02 km em 230 kV e 60 em 525 kV

230

525

Jun/16

-

 

 

 

Development

Object

Total

Investment

(R$ million) *

Transformation Capacity (MVA)

Localization

 

Start of

Operation

Termination of

Concession

Electrical Interconnection Brazil / Uruguay **

SE Candiota -525/230 kV

80

672 MVA +1 R

224 MVA

RS

Jun/16

-

 

 

 

* Eletrobras holds 60.4% and Eletrosul 39.6% of the project

 

 


 
 


 

 

 

Balance Sheet

 

Assets

Parent Company

Consolidated

12/31/17

12/31/16

12/31/17

12/31/16

Current

       

   Cash and cash equivalents

161.326

10.293

792.252

495.855

   Restricted cash

1.329.876

1.681.346

1.329.876

1.681.346

   Marketable securities

5.059.957

4.471.954

6.924.358

5.681.791

   Customers

502.236

355.031

4.662.368

4.402.278

   Financial assets - Concessions and Itaipu

0

0

7.224.354

2.337.513

   Loans and financing

8.288.875

6.783.913

2.471.960

3.025.938

   Fuel Consumption Account - CCC

0

195.966

0

195.966

   Equity Pay

1.726.958

618.566

245.577

318.455

   Taxes to recover

623.299

674.241

1.066.207

1.085.520

   Income tax and social contribution

1.436.175

769.541

1.874.475

1.086.367

   Reimbursement rights

0

74.527

1.567.794

1.657.962

   Warehouse

212

280

479.243

540.895

   Nuclear fuel stock

0

0

465.152

455.737

   Derivative financial instruments

0

0

209.327

127.808

  Hydrological risk

0

0

104.530

109.535

  Assets held for sale

1.482.907

0

5.825.879

4.406.213

   Other

802.501

1.136.336

2.115.375

1.663.473

TOTAL CURRENT ASSETS

21.414.322

16.771.994

37.358.727

29.272.652

 

 

 

 

 

NON CURRENT

 

 

 

 

LONG-TERM

 

 

 

 

   Reimbursement rights

0

0

6.509.032

7.507.024

   Loans and financing

22.889.437

28.597.843

7.794.891

10.158.306

   Customers

30.576

76.441

462.376

2.079.025

   Marketable securities

269.141

245.296

331.862

247.235

   Nuclear fuel stock

0

0

831.008

675.269

   Taxes to recover

0

0

1.635.142

1.705.414

   Income tax and social contribution

471.568

1.488.158

471.568

1.488.158

 

0

0

1.010.810

839.708

   Escrow deposits

3.052.505

2.896.676

5.874.708

6.259.272

   Fuel Consumption Account - CCC

0

6.919

0

6.919

   Financial assets - Concessions and Itaipu

2.820.172

2.412.933

50.660.769

52.749.546

   Derivative financial instruments

0

0

216.904

100.965

   Advances for future capital increase

1.701.275

1.255.184

959.838

1.617.916

  Hydrological risk

0

0

325.132

457.677

   FUNAC refund

2.278.845

2.071.256

1.108.629

1.228.143

   Other

33.513.519

39.050.706

78.192.669

87.120.577

INVESTMENTS

66.159.343

60.590.777

28.708.364

26.531.534

Fixed assets net

197.418

194.402

27.965.837

26.812.925

INTANGIBLE

0

0

749.762

761.739

TOTAL NON-CURRENT ASSETS

99.870.280

99.835.885

135.616.632

141.226.775

TOTAL ASSETS

121.284.602

116.607.879

172.975.359

170.499.427

 

 


 
 


 

 

 

 

 

Liabilities and Equity

Parent Company

Consolidated

12/31/17

12/31/16

12/31/17

12/31/16

CURRENT

 

 

 

 

    Loans and financing

2.336.333

3.397.485

5.886.141

5.833.547

    Debentures

0

0

183.432

12.442

    Compulsory loan

42.260

48.193

42.260

48.193

    Suppliers

514.752

440.976

10.443.752

9.659.301

    Advances from customers

575.962

560.277

654.853

620.781

    Taxes payable

100.767

41.554

1.173.319

1.336.089

    Income tax and social contribution

1.023.764

486.605

1.498.218

606.848

    Onerous contracts

0

0

12.048

1.093.678

    Remuneration to shareholders

9.484

458.302

18.339

462.891

    Financial liabilities - Concessions and Itaipu

783.658

1.212.017

0

0

    Estimated liabilities

107.962

106.879

1.204.222

1.188.149

    Reimbursement Obligations

1.346.660

1.693.309

1.392.542

1.868.085

    Post-employment benefits

28.830

29.632

193.847

107.571

    Provisions for contingencies

850.704

756.811

1.518.387

1.083.475

    Regulatory charges

0

0

728.180

647.201

    Lease

0

0

145.324

136.662

    Derivative financial instruments

2.175

6.614

2.466

6.946

    Liabilities associated with assets held for sale

4.805.946

391.550

7.630.670

5.175.013

    Others

314.847

100.145

1.458.952

1.251.638

TOTAL CURRENT LIABILITIES

12.844.104

9.730.349

34.186.952

31.138.510

 

 

 

 

 

NON-CURRENT

 

 

 

 

    Loans and financing

21.316.181

22.922.041

39.235.650

39.786.881

    Suppliers

0

0

7.795.345

9.782.820

    Debentures

0

0

287.347

188.933

    Advances from customers

0

0

519.391

592.215

    Compulsory loan

458.874

460.940

458.874

460.940

    Obligation for asset retirement

0

0

2.470.400

1.402.470

    Fuel Consumption Account - CCC

0

482.179

0

482.179

    Provisions for contingencies

16.946.508

13.674.073

23.033.963

19.645.954

    Post-employment benefits

578.666

394.035

2.001.715

2.368.077

    Provision for unsecured liabilities

21.656.617

20.160.828

0

311.010

    Onerous contracts

0

0

2.067.179

2.659.305

    indemnification obligations

0

0

1.062.634

1.516.313

    Lease

0

0

932.496

1.032.842

    Grants payable - Use of public goods

0

0

63.082

63.337

    Advances for future capital increase

3.639.441

3.310.409

3.639.441

3.310.409

    Derivative financial instruments

0

0

39.594

43.685

    Regulatory charges

0

0

698.423

615.253

    Taxes payable

0

2.222

326.527

1.059.880

    Income tax and social contribution

394.958

320.560

8.901.931

8.305.606

    Others

1.109.876

946.775

2.501.883

1.667.883

TOTAL NON-CURRENT LIABILITIES

66.101.121

62.674.062

96.035.875

95.295.992

 

 

 

 

 

EQUITY

 

 

 

 

    Share capital

31.305.331

31.305.331

31.305.331

31.305.331

    Capital reserves

13.867.170

13.867.170

13.867.170

13.867.170

    Revenue reserves

1.321.854

3.018.680

1.321.854

3.018.680

    Equity valuation adjustments

22.434

33.261

22.434

33.261

    Profits (losses)

0

0

0

0

    Accumulated other comprehensive income

-4.127.362

-4.004.625

-4.127.362

-4.004.625

   Amounts recognized in OCI classified as held for sale

-50.050

-16.349

-50.050

-16.349

    Non-controlling shareholders

0

0

413.155

-138.543

TOTAL SHAREHOLDERS' EQUITY

42.339.377

44.203.468

42.752.532

44.064.925

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

121.284.602

116.607.879

172.975.359

170.499.427

 

 

 

 

 

 

 

 

 

 


 
 


 

 

 

Income Statement

 

 

Parent Company

Consolidated

 

12/31/17

12/31/16

12/31/17

12/31/16

NET OPERATING REVENUE

4,511,268

3,449,345

37,876,024

60,316,003

Operating costs

 

 

 

 

    Energy purchased for resale

-3,911,372

-3,814,019

-11,584,925

-11,264,044

    Charges upon use of electric network

0

0

-1,611,398

-1,805,434

    Construction

0

0

-1,752,351

-2,381,630

    Fuel for electricity production

0

0

-424,964

-759,826

NET OPERATING REVENUE

599,896

-364,674

22,502,386

44,105,069

Operating expenses

 

 

 

 

    Personnel, Supllies and Services

-699,582

-856,008

-10,930,333

-10,363,211

    Depreciation

-4,616

-5,132

-1,511,260

-1,558,387

    Amortization

0

0

-240,043

-285,398

    Donations and contributions

-102,314

-158,453

-164,372

-219,417

    Operating Provisions /Reversals net

-8,740,434

-16,674,672

-5,746,873

-16,722,582

    Investigation Findings

0

0

0

-211,123

    Other

-221,764

-96,328

-1,608,778

-1,904,179

 

-9,768,710

-17,790,593

-20,201,659

-31,264,297

OPERATING INCOME BEFORE FINANCIAL RESULT

-9,168,814

-18,155,267

2,300,727

12,840,772

Financial result

 

 

 

 

   Financial income

 

 

 

 

    Income from interest, commissions and fees

3,406,499

3,479,762

831,562

1,154,010

    Income from financial investments

722,278

744,320

977,851

1,086,578

    Moratorium on electricity

19,252

35,148

374,977

320,836

    Restatement Assets

811,680

1,048,177

1,290,644

2,549,308

    Current foreign currency exchange rate variations

978,566

4,698,251

946,364

4,985,602

    Payment of indemnities - Law 12,783 / 13

0

0

0

0

    Regulatory asset update

0

0

43,123

231,107

    Gains on derivatives

0

0

237,386

218,714

    Other financial income

133,519

156,551

449,468

677,235

   Financial expenses

 

 

 

 

    Debt charges

-2,090,745

-2,306,205

-5,757,044

-6,375,836

    Lease charges

0

0

-320,060

-303,381

    Charges on shareholders' funds

-371,156

-184,935

-388,408

-200,857

    Noncurrent Restatement

-1,035,352

-1,084,504

-1,290,488

-2,150,636

    Noncurrent foreign currency exchange rate variations

-1,013,617

-5,197,846

-1,065,337

-4,848,040

    Regulatory liability update

0

0

-25,728

-174,485

    Losses on derivatives

0

0

-35,797

0

    Other financial expenses

-520,452

-245,381

-1,461,809

-1,100,879

 

1,040,472

1,143,338

-5,193,296

-3,930,724

INCOME BEFORE EQUITY

-8,128,342

-17,011,929

-2,892,569

8,910,048

RESULTS OF EQUITY

7,431,318

20,464,607

2,692,171

3,114,047

OPERATING INCOME BEFORE TAXES

-697,024

3,452,678

-200,398

12,024,095

    Current Income tax and social contribution

-1,023,764

-486,605

-1,593,473

-619,044

    Deferred Income Tax and Social Contribution

-43,017

459,826

68,180

-7,891,775

NET INCOME/LOSS FOR THE PERIOD

-1,763,805

3,425,899

-1,725,691

3,513,276

SHARE ATTRIBUTED TO CONTROLLING

-1,763,805

3,425,899

-1,763,805

3,425,899

SHARE ATTRIBUTED TO NON-CONTROLLING

0

0

38,114

87,377

NET INCOME/LOSS PER SHARE

-1,30

2,53

-1,30

2,53

               

 

 

 

 

 

 

 

 

 

 


 
 


 

 

 

Cash Flow Statement

 

Parent Company

Consolidated

12/31/17

12/31/16

12/31/17

12/31/16

Operating Activities

 

 

 

 

Income before income tax and social contribution

-697.024

3.452.678

-200.397

12.024.095

Adjustments to reconcile income to cash provided by operations:

 

 

 

 

Depreciation and amortization

4.616

5.132

1.751.303

1.843.785

Net monetary variations

223.672

36.328

-156

-398.672

Net foreign exchange rate variations

35.051

499.594

118.973

-137.562

Financial charges

-1.903.639

-1.393.977

4.657.657

5.525.207

Financial asset revenue

0

0

-6.062.642

-29.406.261

Equivalence equity results

-7.431.318

-20.464.607

-2.692.171

-3.114.047

Provision (reversal) for capital deficiency

6.170.792

12.155.108

0

0

Provision (reversal) for doubtful accounts

10.582

17.290

530.951

351.673

Provision (reversal) for contingencies

2.934.954

4.418.406

4.398.398

5.992.745

Provision (reversal) for the impairment of assets

-1.852

-1.852

640.629

5.537.060

Provision (reversal) for onerous contract

0

0

-1.493.469

2.194.498

Provision (reversal) for losses on investments

-570.406

-26.834

-335.592

1.479.088

TRFH – (Pará rate)

0

0

517.727

346.328

 

0

0

985.573

741.623

Provision (reversal) for hydrological risk - GSF

0

0

0

-451.340

RGR Charges

587.885

220.420

587.885

220.420

Adjustment to present value / market value

-26.217

-57.664

64.854

28.864

Minority interest in results

0

0

-74.994

-132.389

Charges on shareholders' funds

371.156

184.935

388.408

200.857

Financial instruments - derivatives

0

0

-201.589

-218.714

Other

-58.455

302.214

366.542

597.024

 

346.821

-4.105.507

4.148.286

-8.799.813

(Increases) / decreases in operating assets

 

 

 

 

Customers

0

0

1.457.899

-583.469

Marketable securities

-588.003

-1.070.961

-1.303.349

1.108.738

Reimbursement rights

186.478

-700.581

1.088.160

1.338.396

Warehouse

68

80

61.652

90.774

Nuclear fuel stock

0

0

-165.154

-150.128

Financial assets - Itaipu and public service concessions

21.120

1.036.633

21.120

1.036.633

Assets held for sale

0

0

-2.902.573

217.572

Hydrological risk

0

0

137.550

226.779

Other

39.269

20.551

-242.059

215.588

 

-341.068

-714.278

-1.846.754

3.500.883

Increase / (decrease) in operating liabilities

 

 

 

 

Suppliers

-9.787

4.363

-1.286.587

-156.294

Advances from customers

0

0

-54.437

-61.195

Lease

0

0

-91.684

-82.651

Estimated liabilities

1.083

-2.618

127.036

80.116

indemnification obligations

0

700.582

-582.573

-888.864

Sectorial charges

0

0

164.149

104.859

Liabilities associated with assets held for sale

0

-20.675

2.455.657

-399.996

Other

351.623

-12.470

752.298

71.559

 

342.919

669.182

1.483.859

-1.332.466

 

 

 

 

 

     Cash from operating activities

-348.352

-697.925

3.584.994

5.392.699

 

 

 

 

 

Payment of financial charges

-1.714.960

-2.056.052

-3.705.501

-3.766.612

Payment of RGR charges

-185.152

-138.869

-185.152

-138.869

Financial charges received

0

0

4.137.804

1.226.501

income tax payment and social contribution

1.865.117

1.898.916

722.090

1.122.490

      Payment of refinancing of taxes and contributions - principal

-316.080

-302.441

-1.886.815

-1.229.862

      investment compensation received in corporate participations

0

0

-162.582

-132.879

Pension payment

972.039

372.836

1.038.498

694.003

Payment of legal provisions

-28.158

-37.381

-477.166

-229.766

Judicial deposits

-596.014

-509.488

-726.265

-739.361

 

-306.848

-221.924

-18.528

-626.298

Net cash from operating activities

-658.408

-1.692.328

2.321.376

1.572.046

 

 

 

 

 

Financing activities

 

 

 

 

 

 

 

 

 

Loans and financing

0

169.670

3.120.690

3.638.561

Payment of loans and financing - Main

-3.741.497

-2.619.108

-5.646.953

-4.543.612

Payment of shareholders remuneration

-369.905

-1.792

-381.436

-5.790

Advanced receivalbe for future capital increase

0

2.906.180

0

2.906.180

RGR resource for transfer

800.654

1.007.112

800.654

1.007.112

      Other

0

0

165.664

1.191

Net cash from financing activities

-3.310.748

1.462.062

-1.941.381

3.003.642

Investing activities

 

 

 

 

Lending and financing

-1.887.102

-2.594.270

0

-242.154

loans and financing receivables

5.171.426

3.679.863

3.662.208

2.398.790

Acquisition of fixed assets

-5.794

-4.869

-1.230.181

-1.691.089

Acquisition of intangible assets

0

0

-70.317

-79.076

Acquisition of concession assets

0

0

-1.691.177

-1.910.773

Acquisition / capital investment in equity

-173.700

-581.294

-1.794.246

-3.272.685

Advance concession for future capital increase

-63.279

-950.590

-110.124

-622.688

Investment sale in shareholdings

1.078.638

0

1.082.002

0

Net cash flow in the acquisition of investees

0

0

-1.798

0

Other

0

0

70.035

-54.131

Net cash from investing activities

4.120.189

-451.160

-83.598

-5.473.806

 

 

 

 

 

 Net decrese in cash and cash equivalents for the year

151.033

-681.426

296.397

-898.118

 

 

 

 

 

      Cash and cash equivalents at beginning of year

10.293

691.719

495.855

1.393.973

      Cash and cash equivalents at end of year

161.326

10.293

792.252

495.855

 

151.033

-681.426

296.397

-898.118