By Brazil Stock Guide – Cia Energética de Minas Gerais (B3: CMIG4) reported a 75.7% plunge in its third-quarter consolidated net income, a sharp decline largely attributed to non-recurring gains booked in the prior-year period that were not repeated.
The Brazilian utility holding company posted a net profit of R$796.7 million (approx. US$143 million) for the third quarter of 2025, a significant drop from the R$3.28 billion recorded in 3Q24. The result was primarily impacted by the absence of two major one-off gains recognized a year earlier: the effects of the Periodic Tariff Review (RTP) and a gain from the sale of its stake in Aliança Geração. Net revenue saw a modest increase of 4.6% to R$10.82 billion.
The company’s adjusted EBITDA, which excludes these non-recurring effects, fell 16.3% to R$1.47 billion. The adjusted EBITDA margin contracted to 13.6% from 17.4% a year ago. This operational decline was driven by a reduction in the captive market and energy volume transported, lower margins in the trading segment due to higher energy purchase prices, and increased hydrological risk costs in the generation segment.
“Looking at the adjusted numbers provides a clearer view of our operational performance, which was challenged by market migration and adverse hydrological conditions,” a company executive stated in the earnings release. “We continue to focus on our investment plan, particularly in our distribution network.”
The performance highlights the challenges faced by Brazilian distributors, including the ongoing migration of large consumers to the free energy market and volatile energy prices. Cemig’s results set a cautious tone for the utilities sector, which is also grappling with regulatory changes and the economic environment.
Shares of Cemig have been volatile this year, reflecting the sector’s headwinds. The company’s earnings come amid a focus on its significant investment program, including its Distribution Development Plan (PDD).
The company’s consolidated gross debt reached R$15.41 billion, while its cash and cash equivalents stood at R$1.45 billion, resulting in a net debt position.