Companhia Paranaense de Energia - Earnings Call - Q2 2025

Transcript

Speaker 0

Morning, ladies and gentlemen. Welcome to Companhia Paranaense de Energia Copel's video conference to discuss the earnings for the second quarter of 2025. This video conference is being recorded and will be available on the company's website, ri.copel.com. The presentation is also available for download. Please be advised that our participants will only be watching the video conference during the presentation, and then we will begin the Q&A session when further instructions will be provided. Before proceeding, I would like to note that the forward-looking statements are based on the beliefs and assumptions of Copel's management and the information currently available to the company. These statements may involve risks and uncertainties as they relate to future events and therefore depend on circumstances that may or may not occur.

Investors, analysts, and journalists should consider that events related to the macroeconomic environment, industry, and other factors could lead results to differ materially from those expressed in such forward-looking statements. This video conference will be presented by Mr. Daniel Pimentel Slaviero, CEO of Copel, Mr. Felipe Gutterres, CFO of Copel, as well as directors of the subsidiaries who will be available for the Q&A session. I would now like to turn the floor to Copel's CEO, who will start the presentation. Please, Daniel, you may begin.

Speaker 1

Hello. Good morning. I thank you all for attending our video conference. We're presenting yet another quarter with sound business results. EBITDA of R$1.3 billion, a growth of 4.2% compared to the same quarter of last year, and recurring net income above R$450 million. Our CapEx in the period was approximately R$1 billion, R$975 million to be precise, in line with our projection of more than R$3 billion by the end of 2025. We are monitoring every week the execution of the investment plan, especially in the distribution company, because this is the last year of the tariff cycle. Our leverage closed at 3.1 times, basically due to the temporary acquisition of Baixo Iguaçu, and we'll complete the second stage of the operation, which is the sale of the entire asset now in the third quarter.

If we consider this process, our leverage is at 2.9 times net debt over EBITDA, in line with our dividend policy and our projections, always noting that we have the leverage contracted for the coming years, especially due to tariff review, reduction of costs that Copel has been running on its plan and its market commitment, as well as the improvements that we've been perceiving in the price of energy sold by our company. Speaking of divestment, in July, we also had the conclusion of the small hydro asset sales that were part of Copel's divestment plan, and we closed yet another tranche of this operation with the final element, which is the Figueira plant that will likely conclude its closing now in the third quarter.

Combined to that, in the second quarter, we also had the closing of the asset swap operations with Eletrobras, consolidating the results of HPP Mauá and the transmitting company, Mata de Santa Genebra, two important steps in our strategy to optimize our portfolio. In this period, we also had important recognition that reinforced our commitment to excellence and sustainability. We received the best ESG award for the electrical sector, granted by Izumi Magazine, and for the third consecutive year, we ranked first in ANEEL's Ombudsman Award. I would like to congratulate everyone at the distribution company for this award, and thank you all for your engagement and commitment, all of our collaborators at Copel receiving these awards and recognitions. Without their effort, dedication, and professionalism of all Copelians, these accomplishments would simply not be possible. Thank you all very much.

We will enter the first or the top subject of this moment, which is the migration of Copel to Novo Mercado. I'd like to remind you all that in addition to being at the highest level of governance of B3, our main objective with this migration is to unify the classes of shares, generating increasing liquidity for the company and to all our shareholders. The terms approved by the Board of Directors consider in the first phase the unification of the two classes of preferred shares without prejudice to any right of the classes involved. The following step in the proposal will be the migration without dilution to any shareholder in a ratio of one to one and to equalize dividends with a payment of a premium to preferred shares of R$0.007749.

This stage will depend on the approval of the majority of preferred shareholders in a special meeting that will be booked by the company at the right time. In addition to guaranteeing equity between the classes of shares, the proposal includes the migration of all preferred shares to common shares, which will grant the same right to vote and alignment between shareholders. We believe that this will unlock a lot of value for the company through higher liquidity of shares, as I mentioned, and it will be an important tool to attract new investors to Copel, especially foreign investors. However, on August 1, we were surprised by the deferral from CVM of a request to interrupt the general meeting for up to two weeks, 15 days, that was requested by one single Class A preferred shareholder.

I note that these class of shares represent approximately only 3 million shares in a universe of close to 3 billion shares. A universe of 3 billion shares, that's slightly over 0.1% of the company's total capital. Even with this representation, our proposal brings benefits to Class A preferred shares, in particular, a significant increase in liquidity. We are convinced that the proposal presented by Copel is in compliance with the legislation and protects the interests of all shareholders for the company. We are dedicated to clarify all of the points raised with CVM with full transparency and responsibility so that this process may be resumed within these 15 days and follow its natural flow that is to be assessed and discussed with our shareholders.

We trust that CVM will not harbor any type of abuse from any minority shareholder to the detriment of the best for the company and our more than 360,000 minority shareholders of Copel. We'll continue to maintain the market informed of all the relevant steps of this process, and I now turn the floor to Felipe, who will detail the results of our quarter. Felipe, please. Thank you, Daniel. Good morning, everyone. I would also like to thank all of you for attending our earnings conference call. I would like to start by highlighting the 4.2% increase in recurring EBITDA, which totaled R$1.3 billion in the period, with G&T and COM representing 58.4% of this result and 42.6% remaining are generated by the distribution company.

The variation was a result mostly of the better result of G&T, mostly due to the best results of transactions in the short-term market, lower generation deviation in wind complexes despite the higher curtailment, increase in revenue from the availability of electricity in the incorporation of Mata de Santa Genebra. These are the three main points. On the other hand, there was an increase of R$126.3 million in the cost of energy purchase for resale, which partially pressured the results, especially in the distribution segment. Still, the consolidated performance reflects the consistency of our strategy and the company's capacity to generate value sustainably, even in a challenging scenario, as well as the power of the integration of its business. At Copel G&T, going to the next slide, we posted recurring EBITDA of R$761.4 million, up 12.6% compared to the second quarter of 2024.

Note the positive result in the short-term market, with R$45 million additional coming from the time modulation and lower generation deviation in wind complexes contributing to more than R$18.9 million, despite the cost increase in energy purchase for resale, and the result maintained the consistency in operating results. In transmission, we had an increase of R$16.9 million with the consolidation of results at MSG. In terms of sales, we found liquidity in the price market at prices that we considered adequate, which allowed us to close contracts, reducing on average the exposure of our portfolio in approximately 50 megawatts a year between 2027 and 2030. This result showed the solidity of our operation and Copel G&T's capacity to generate value with discipline and technical excellence. On slide nine, we'll have more color on distribution.

Copel Distribution posted recurring EBITDA of R$569.3 million, up 0.6% compared to the same period last year. This performance was driven mostly by tariff adjustments in June 2024, with an average increase of 2.7% on TUSD. However, this quarter, the effect was practically neutralized by the drop of 2.6% in the billed grid market. Even with these challenges, Copel does maintain sound results, reflecting operational discipline, with regulatory EBITDA 42.8% higher. I also note that the new tariff has an average effect to be perceived by consumers of 2.02%, impacting results as of the third quarter of 2025. In the second quarter of 2025, the trading strategy progressed. Sales increased 21% compared to the second quarter of 2024, reflecting a more dynamic, efficient activity in the market. However, we also had a drop of R$15.3 million on margin, impacted by market factors and adjustments in the operation structure.

We also had an increase of 40.2% in expenses with PMSO to prepare the unit for the new growth cycle. We are confident that the change in course at Copel Trading strengthened the trading company and consolidated our relevance in the free trade energy market. We posted a 3.7% reduction in expenses with PMSO, totaling R$708.3 million compared to R$735.9 million posted in the same period of last year. This result was driven mostly by the almost 15% drop in personnel and administrative expenses, in addition to a reduction of 13% in costs with pension and assistance plans, especially due to the voluntary severance program that was partially offset by the salary adjustments applied between the periods. We reduced costs, increased efficiency, and at the same time, we're leveraging the safety of the operation and the quality of services provided. It's an important point here in this compilation of actions.

Moving on to net income, we delivered recurring net income at R$452.4 million, down 9.5% compared to the second quarter of 2024. EBITDA increased 4.2% versus Q2 of 2024, despite an increase of 38.7% in financial expenses as a result of the increasing debt required to face the renewal of concessions, investments, and acquisitions in line with the company's strategy, as well as an impact of a higher CDI compared to the same quarter of last year. Copel's performance remains sound, reflecting disciplined strategic management. Now discussing the investments, consolidated CapEx totaled R$975.3 million in the quarter and R$1.6 billion in the first half of the year, maintaining the planned pace. Investments are concentrated in assets that expand the remuneration base, focusing on quality of services, operational efficiency, and modernization of infrastructure, as well as one-off investments in strategic areas.

On our last slide, the second quarter of 2025, the company's leverage was at 2.9 times net debt over recurring EBITDA, excluding the effects of acquisition of Baixo Iguaçu that will be concluded in the third quarter. The divestment will be concluded. This level is in line with our optimal capital structure. Total net debt was R$16.6 billion, with a diversified composition between financial institutions, market instruments, ventures, and securities. The rating was reconfirmed as AAA, reinforcing the trust on Copel's financial soundness. As for the nominal cost of debt, even though it went up, the equivalence to CDI went down, demonstrating the efficiency in our funding. We remain attentive to the market dynamics and committed to the maintenance of a healthy capital structure, disciplined, allowing Copel to continue to invest safely, generating value to our shareholders. This concludes our presentation, and we can move on to the Q&A.

Thank you. Thank you. We will now begin the Q&A session for analysts and investors. If you wish to ask a question, please click on raise hand. If your question is answered, you may remove the queue by clicking lower hand. If you have a question in writing, please use the Q&A icon, including your name and company. First question, Luiza Candiota, Itaú BBA. Please, Luiza, you may go ahead. Good morning, everyone. Thank you for this opportunity. I have two questions. First, I'd like you to, if possible, give more color about the trading strategy for the quarter, since there were some movements of asset swaps, and the comparison with the first quarter is a little bit more difficult. Apparently, you focused on selling more on longer vertices like 2028, 2029. If you can give more color in the trading front.

The second question about the migration to Novo Mercado, as you mentioned in the beginning of the presentation, just to understand if in your minds it's still feasible to conclude this migration by the end of the year, to have a little bit of a perspective of your timeline. Thank you. Good morning, Luiza. I'll start from your second question, and then we'll complement. Since this interruption was for 15 days, Luiza, and this will be next Saturday, we're doing, as I said, providing all the clarification and all the additional information. If this is resolved in this period, which is what we believe will happen with a favorable decision to the company, it will be feasible for us to maintain our timeline to get this all concluded by the end of 2025.

Despite this light delay, depending on the decision, we will have to resummon the general meeting, and this fits into our timeline. We had some excess time planned, and then things will be a little bit tighter, but the other issues that do not depend on CVM continue to be prepared and continue to advance, waiting for this point that will be solved by the 16th. Any comment about this, Felipe? No, that's it. Rodolfo? If you can give a little bit of color about the trading strategy, please. Excellent. I think the first point, referring to the M&A and this asset swap strategy, since the beginning, when we outlined our long-term trading strategy, we already had a plan for this type of operation. Irrespective of what happened, there were slight adjustments, but at any time, did we have to buy energy or reduce the price?

That's the first important point. With that said, we also saw during this quarter great opportunities, especially for the long term. This is a movement that's been unfolding since the end of last year, with a change of perception and the complexity of the system operation. In September of last year, when we saw the need of dispatch from thermal power plants to cover that, the market started to see our levels, and this materialized this quarter. We made the most to sell 27, 28, 29, almost R$40 above what was sold in the past. We don't see the same for 2025, 2026. There was space for some portfolio adjustment, but we focused a lot more on these longer sales. The price is very contained, waiting for better windows.

Just to add, Luiza and everyone, these volumes, these percentages here are still very small, considering the amount of energy that the company has for these medium-term periods. This is within our strategy and dilutions between A plus 4, plus 3, plus 2. That's in line, and showing this volatility of the market, either from the price parameters, the complexity of the operation, the need for power has been showing opportunities and the trend of continued improvement in our view in the PLD price. Very clear. Thank you. Our next question, Bruno Amorim from Goldman Sachs. Please, Bruno, go ahead. Good morning, everyone. Thank you for this opportunity. I'd like to get an update about the strategic view looking forward. You delivered some important levers in terms of creation of value recently, establishing the new dividend policy, the migration to Novo Mercado.

You put together a very strong team of directors in these recent months. The question is, to that end, you are clearly preparing the company for the next cycle. If you can comment about this coming cycle, the areas of interest, in addition to the auction of the capacitive reserve, what you believe will be interesting for the company, should we expect any relevant M&A movement this year, next year, or is this something more for 2027 onwards? If you can give us an update on the strategic side of capital allocation, how you see the company going forward, that'd be great. Thank you. Good morning, Bruno. Thank you. I think you mentioned something important here. Going back, all of the promises that we made since our follow-on, we've been delivering in full, all of the promises. In many of the cases, delivering them even faster and with better results.

Quickly, renewal of the grant bonus, renewal of concessions. That was the first item that we always talked about. The second, a significant reduction in the PMSO costs through the first voluntary dismissal program. We're seeing the results of the PMSO, considering inflation, especially in the P line. Third, it was the decarbonization of the matrix with the sale of Compagas and Wega. Fourth, the reorganization of the portfolios and the small PCHs and the crossing, the swaps, and the portfolio with the assets with Eletrobras. That was the object that will be concluded this half year. We also saw the reorganization of the company and the attraction of new talents, as you so rightly mentioned. This has an effect not only on the C-level, but also some strategic areas in leadership and other specific areas, as has been said in a lot of units of the company.

In retrospect, this maintains the optimal capital structure. That's an important promise, the update in the dividend policy. To close this cycle of promises, what are the three that are moving along to be concluded by the end of 2026? It's the migration to Novo Mercado that we mentioned, the tariff review in 2026 that has a follow-up from the entire company, not only Marco Villela or Andrea from regulation or Felipe, but this is a big group considering the relevance and the results that we will deliver to the company and the market. Finally, there's also the closing of the complement of the final reduction of our commitment to reduce 20% of costs based on the 2023 nominal LCM that we intend to present, all of this closing by the end of this period in 2025.

Long story short, just to reinforce the excellence and the consistency that Copel has in delivering its commitments. With that said, in a medium to long term, there's still a lot being done in the company, not only the capacity bid, but digital transformation, restructuring, migration to new systems, the transformation of technology. There are a lot of other fronts and questions in addition to those three, commitments that need to be delivered. We're moving along and increasing the attractiveness and the enthusiasm and work with our team. Long story short, we don't have any view or any rush to consider M&A or capital allocation because I think we still have all of these paths to generate value. In this path of extracting more value of our current base, and in this Copel Day on November 19, we'll invite all of you to attend.

We will show what we see, the avenues for growth from now to 2035. This is something we will address. Why is such a long environment? Because we are here with a long-term view, with a commitment to generate value. The final point here on our energies that are being focused currently, they're very strong in an aspect of strengthening the culture of Copel as a corporation. The elements of ambition, purpose, values, what guides us, because we consider this as a competitive differentiator in our management model. This needs to be consolidated. People and management is an area where all of us, partners at the company, in particular, Marcia Baena, that's the Management VP, that's been dedicating a lot. I went on for a little bit too long, Bruno, because this is something that I really enjoy talking about.

That's a view of a trajectory of generating value in the long term, but these things will need to be done at the right time. We have here a lot that may be delivered in this execution process without any transformational movement that will have to come, in a view of 2027 onwards, in a way that this may come up. We don't have anything on the short term. Excellent. Thank you, Daniel, and congratulations again for the delivery so far. Next question, Maria Carolina Carneiro from J. Safra Corretora de Valores e Cambio Ltda. Please, you may go ahead. Good morning, everyone. Thank you for the call and the opportunity. Daniel, I'd like to, since you talked about what you've been delivering in terms of cost, this is another consecutive quarter where we see a lot of lines improvement.

You mentioned you're going to talk about this on the Copel Day, but if you can give us an overview of the type of measures and projects you're adopting, let's say the so-called second wave of efficiency, so that we can be prepared for the coming quarters, where this additional outperformance could be coming up that remains strong quarter on quarter. If you can also talk a little bit about the other side, we've been seeing energy tariffs being a bother, I mean, pressuring somehow the public opinion, the government thinking about solutions like the measures that we saw. How this has been reflecting in the trading policy, your management of ADA and other companies have been commenting on how this has been the trend of working closer in the trading side and paying debt on PLD, the spot price of each classes.

If you can talk about that a little bit as well, that'd be interesting. That's a broad scope of your question here, Carol. I'll break it down and I'll ask Felipe, Vilela to please also contribute to the answer. First about the levers. I think the company, Companhia Paranaense de Energia (Copel), has been coming from a very serious, efficient management even before the transformation process. It had already been demonstrating good deliveries, but I was always in line with our roadshows, you probably remember. There was also that discussion of Copel had already had deliveries, and the inherent ties of a company always allow for opportunities.

I think we've done some things, and the people part, I think, is already overcome, but we always look not only at supplies that you've been able to change everything in procurement and supply with a Director that is connected to Felipe, a review of some contracts, some gains in scale that were achieved and do not require bidding processes so we can gain agility, flexibility, not only for the contracts, but also volumes. I'd say that we've been seeing good reflexes of that on G&T. There's all that shock and a third wave and the shock of digitalization, transformation, project process revision, not only with smart grid that we have the largest smart grid in Brazil and the investments we've made, robust CapEx, but also in technology and processes, software, and then a coming wave that we're already perceiving for artificial intelligence.

There's nothing major, but if you add up the small consistent moves, that's how we intend to get to that commitment of the 20%. I think this would be a first main step on your question. The second part, the tariff side, is a concern for all of us, not only here in Paraná, but also everywhere in Brazil. Just before continuing on the tariff, all of these moves that we're making to reduce costs and improve performance, the objective is to seek efficiency, but always, always focusing on improving customer service. That's why in some areas, in some lines at the distribution company, you've been seeing a certain increase in service provision because at the end, what's more important is to always take care of our customers, especially in a concession area that has been growing historically above national averages.

That closes the first part because it's also a strong focus. Our view is the quality of service provided to our customers that are demanding more and more quality, especially in the economic growth we're seeing. With that said, the tariff aspect is a point of attention. It is a point of concern. Historically, and the tariff adjustment this year shows that at the concession here in the state of Paraná, we are seeing considerably moderate adjustments. I think a lot of it still comes from the subsidies to tariffs. This one of the 2% to 0.02, more than 5% come from costs of the city. I think it's a structural concern.

When you talk about opening the market and the provisional measures and so on, they always have to open, but we cannot lose sight of the client, the customer who's at the base because the customer is being penalized with rates, tariffs, and subsidies. That's a big issue. To close the ADA question, I don't know if you have, Felipe, anything to add to that and the ZBB. I have some comments. I think there are some very relevant fronts in this leverage as we did in the ZBB exercise in implementation. Some units will be more diversified in 2026, especially at the distribution company. The supply department has a strategy to review all contracts, simplify contracts, unify contracts, which also brings a new competence for negotiation that we always obviously capture value. This is intensifying.

There is an important front of reviewing and simplifying processes where technology plays a very relevant role. When you combine all of these fronts, that's where we find opportunities for cost efficiency. We prefer the concept of efficiency rather than reduction of cost because you also have a better allocation in efficiency. Just to add, this question, Carolina, is in line and connected to Bruno's previous question. One thing that I've been saying repeatedly internally and to the market, no company generates long-term value simply by reducing costs and selling assets. The company must make good capital allocation. That's why the phase three of the expansion is very relevant in the medium-long term for the company. Right now, here about ADA and cost, you see that we have that very controlled in the company. If you can, Vilela, give some color on the initiatives to address Carol's question. Excellent, Carol.

We have a strong culture and a robust process for collection and many negotiation channels and payment in installments. This year, in the first half, we achieved 1.5 million in smart meters. That's one of the biggest smart grid programs in the country. That allows us to remotely shut down the energy without having to go to the customer's house. When the payment is made, the client is reconnected within seconds. All of that, and that combined to the state of Paraná's culture, which is a paying state, we have an ADA below the tariff coverage. I think this is a big strong feature for Copel. Excellent. Thank you, everyone. Next question. Andre Sampaio at Santander. Please, Andre, you may go ahead. Good morning. I have two questions here quickly on my side that add to what has already been discussed.

First, about migration, I'd like to hear a little bit from you about the dividends dynamics or what the strategy will be in the announcements for the year, if there is any delay, if there will be the announcement of new dividends before the migration, potentially adjust the numbers or potentially delay dividends. The second question is in the provisional measures. I'd like to hear a little bit from you about implementation, if we have any, if we should expect any positive or negative surprise in the process. Hello, Andre. Let's go, Felipe. First, about the migration and how we address the dividend policy, and then I'll talk about the legislation side of the 1300, 1304. We continue working on our migration program with dividends payment by the end of until the end of the year.

The dividend policy is whole, both in the parameters for payout payments and the minimum number of payments of dividends. This is the scenario we work on today. Basically, our policy talks about at least a minimum of two payments, two annual events, and we always have in the fourth quarter, we announce the dividends of the first half of the year. The idea is to maintain that. Of course, with this migration to Novo Mercado, it is also part of this equation, as Felipe said. What's most important is that we'll maintain the two events that we committed to in the policy and the announcement of that during the fourth quarter, as the company has always been doing in recent years. That addresses the first part of your question, Andre. The second part about the environment, I mean, everybody's seeing the news and discussions.

The political institutional environment in Brazil is highly contaminated, very controversial, and this has an impact in all fronts, either in the naming of new directors at the different government agencies or the developments of bills and provisional measures in Congress. At least we are monitoring all of that, but I believe that no one, not even the highest authorities, are able to know exactly what's going to happen because every week there is something new. There's a new decision, there's a new tariff or an evolution or a legal decision. Everything ends up contaminating the political environment. Bringing it to our question, I think in a base scenario that we work on, MP 1300, 1304 will probably merge in a single tax, then one of them will have to be approved at some point because of the implementation of the social tariff, which has already occurred.

This must be approved. Even if it's a minimum scope of the approval of anything of these two-thirds, that's our base view. It will be needed. I think this is a point that is feasible in our view that generates one element and another important view for the government and society. The discussion is opening the market. The discussion is whether the proposed timelines are in line with what is feasible and addressable for the questions and a reduction of subsidies. I think these points are in the right line and the opportunities that may be for any change. Our advantage, at least in the 1300, is that we have a writer who knows it in depth. It's a congressman, Fernando, who's very reasonable, competent. He knows this in depth. He used to be minister. I think this brings confidence to the players.

A concern that is left is that everything that comes in, Congress never knows what comes out. The concern is that what comes out of Congress includes more subsidies. When there was that discussion of the vetos, they actually made it worse for the tariff environment, for the safety, and the planning, the technical planning was made worse. This is a point of attention that we have. When we work here, Andre, institutional or through the entities or with Copel directly, we work to defend and stand for what we consider fair in the political institutional environment. That requires permanent monitoring, considering the reality, as I mentioned, that something will be approved because it carries the social tariff aspect, which is something that is very dear to the population and the government. Great. Thank you. Our next question is in writing from Mr. Reinaldo Verisimo.

He says, "At the conference last quarter, you informed the intention to participate in the bid of two energy generators. Could you update us? Is there anything new on this?" Hello, Reinaldo. I think here you're mentioning the capacity bid, LRK, that we have two plants, Foz de Areia and Segredo, that are two robust, very competitive processes. I imagine that's what you're referring to because there's not any other view to invest in plants in the short term other than these that we're mentioning in the LRK. Unfortunately, since our last conference call until now, that's almost 90 days, the ministry has not published the ordinance yet. The ordinance is crucial for that. This ordinance will not only bring the guidelines because the bid should have happened at the end of June, but the ordinance will also bring some evolutions.

What we're seeing, and these are statements by the ONS itself, is that there's an urgent need of power for the system and the load and the expressive increase of PV with the generation. There's an increase of excess energy at lunchtime and a deficit of power at the end of the day that's been basically fulfilled by hydropower plants and thermal power plants. This need is urgent for the system. It's not we saying that, it's the government's declaration. What we're expecting is that for the coming weeks, we should have an announcement so that the bid could occur in the first quarter of 2026. I don't see a possibility for this to be delayed further because people are even talking about a very expressive bid, way above 12 gigawatts in the need of power to supply the next few years.

The advantage here is that hydropower plants like Copel and others with more than 5 gigawatts registered is that it's a completely renewable source of energy. Without a doubt, it will be the lowest cost for consumers, considering all products of all years. This will always be done with technology products and equipment that are national. It's clean, sustainable energy, the most affordable for consumers, and strengthens the Brazilian industry. We don't see any other path different than giving room and preference to this highest proportional to representation. We're working on our side, doing our homework. We pretty much concluded everything for both projects, waiting for this definition of the ordinance and the date of the capacity auction. In order to ask questions, please click on raise hand. Please wait while we collect the questions. The questions and answers session is concluded.

I would like to turn the floor to Mr. Daniel for his final closing remarks. If there are no further questions, I would like to once again thank you all for your participation. I send my greetings to my partners at Copel, all Copelians, for yet another quarter of consistent deliveries without hiccups, delivering what we had committed to not only during the last few years, but year on year in terms of efficiency, quality to our customers, and valuing and strengthening of our team and our Copelians. We move forward with the execution of our strategy plan, and the priority now is the execution of the plan and the deliberation to our shareholders.

They will discuss, and whatever they discuss will be the role in our meetings, so that we can, as soon as possible, continue on with the Novo Mercado process because in our view, this will unleash more value, as I said, and will generate value or benefits to all shareholders, every shareholder. The biggest asset for valuing the company is what drives us forward and what unites us. I’d like to thank you and say that we remain committed with the delivery of excellence in execution and the operation of our assets, our companies, the care with our people, and complete full discipline and capital allocation so that with all of these elements, we can continue generating a lot of value to the company and to all our shareholders and stakeholders. Thank you very much. Have a great day. Copel's video conference is concluded. We thank you all for attending.

Have a great day.