2Q14 Quarterly Information (ITR)
Transcript of 2Q14 Quarterly Information (ITR)
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Eneva S.A.(Publicly-held company)Quarterly Information - ITRat June 30, 2014and report on reviewof quarterly information
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() C 6/30/2014
C C 702524
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Quarterly Information - ITR
Balance Sheet - Assets
(thousands of Reais)
Account Code Account DescriptionCurrent
Quarter6/30/2014
PreviousYear
12/31/2013
1 Total Assets 4,736,905 4,751,985
1.01 Current Assets 327,932 141,2411.01.01 Cash and Cash Equivalents 12,011 110,156
1.01.01.01 Cash and Bank deposits 3,581 509
1.01.01.02 Fundo Multimercado MPX 63 8,430 109,647
1.01.06 Recoverable Taxes 10,611 25,701
1.01.06.01 Current Taxes Recoverable 10,611 25,7011.01.08 Other Current Assets 305,310 5,3841.01.08.01 Noncurrent Assets on Sale 303,913 01.01.08.03 Other 1,397 5,384
1.01.08.03.01 Other Advances 1,358 1,1751.01.08.03.03 Gain on derivatives 0 4,1711.01.08.03.04 Escrow Deposits 39 381.02 Noncurrent Assets 4,408,973 4,610,744
1.02.01 Long-Term Assets 1,490,549 1,464,4051.02.01.09 Other Noncurrent Assets 1,490,549 1,464,4051.02.01.09.07 Recoverable Taxes 28,026 7,215
1.02.01.09.08Accounts receivable from other
related parties 12,515 217,337
1.02.01.09.09 AFAC at Subsidiaries and JointVentures 288,795 206,678
1.02.01.09.10 Prepaid expense 841 841
1.02.01.09.11Loan at Subsidiaries and Joint
Ventures 973,278 909,327
1.02.01.09.12Accounts receivable from
Subsidiaries and Joint Ventures178,490 123,005
1.02.01.09.13 Embedded derivatives 8,602 01.02.01.09.14 Other Accounts Receivable 2 21.02.02 Investments 2,904,468 3,130,978
1.02.02.01 Equity Interests 2,904,468 3,130,978
1.02.02.01.01 Interests in AssociatedCompanies 87,674 51,899
1.02.02.01.02 Interests in Subsidiaries 1,666,324 2,181,366
1.02.02.01.03 Interests in Joint Ventures 1,088,375 835,6181.02.02.01.04 Other Equity Interests 62,095 62,095
1.02.03 Property, plant and equipment 11,332 12,634
1.02.04 Intangible assets 2,624 2,727
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Quarterly Information - ITR
Balance Sheet - Liabilities
(thousands of Reais)
Account Code Account DescriptionCurrent Quarter
6/30/2014Previous Year
12/31/2013
2 Total Liabilities 4,736,905 4,751,9852.01 Current Liabilities 2,107,631 1,580,010
2.01.01 Social and labor obligations 5,947 8,4242.01.01.02 Labor Obligations 5,947 8,424
2.01.02 Trade payables 4,860 3,4732.01.02.01 Domestic Trade Payables 4,860 3,4732.01.03 Tax Obligations 560 7092.01.03.01 Federal Tax Liabilities 560 709
2.01.03.01.01 Income taxes and contributionspayable
560 709
2.01.04 Loans and Financing 2,091,183 1,562,3232.01.04.01 Loans and Financing 2,091,183 1,562,211
2.01.04.01.01 In local currency 2,091,183 1,562,2112.01.04.02 Debentures 0 1122.01.04.02.02 Interest 0 1122.01.05 Other liabilities 5,081 5,081
2.01.05.02 Other 5,081 5,0812.01.05.02.07 Profit Sharing 4,990 4,9902.01.05.02.09 Other liabilities 91 912.02 Noncurrent Liabilities 218,227 703,232
2.02.01 Loans and Financing 172,495 660,6562.02.01.01 Loans and Financing 172,495 655,4172.02.01.01.01 In local currency 172,495 655,4172.02.01.02 Debentures 0 5,239
2.02.01.02.01 Principal 0 4,6052.02.01.02.02 Interest 0 6342.02.02 Other liabilities 44,663 34,4892.02.02.01 Related-Party Transactions 44,663 34,489
2.02.02.01.04 Debts with Other Related Parties 44,663 34,489
2.02.04 Provisions 1,069 8,0872.02.04.02 Other Provisions 1,069 8,0872.02.04.02.05 Negative Equity 1,069 8,087
2.03 Shareholders Equity 2,411,047 2,468,7432.03.01 Realized Capital 4,652,273 4,532,3132.03.02 Capital Reserves 353,865 350,5142.03.02.04 Options Awarded 353,865 350,514
2.03.05 Retained Earnings/AccumulatedLosses
-2,545,011 -2,360,800
2.03.06 Equity Appraisal Adjustments -50,080 -53,284
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Quarterly Information - ITR
Statement of Income
(thousands of Reais)
Account CodeAccount
Description
CurrentQuarter
4/1/2014 to6/30/2014
Accrued Value ofthe Current Year
1/1/2014 to6/30/2014
Same Quarterof the Prior Year
4/1/2013 to6/30/2013
Accrued Value ofthe Prior Year
1/1/2013 to6/30/2013
3.04Operating
Income/Expenses -62,698 -104,287 -156,204 -376,597
3.04.02General and
AdministrativeExpenses
-13,289 -41,613 -29,879 -53,590
3.04.02.01 Personnel andManagement -4,898 -18,185 -16,484 -27,605
3.04.02.02 Other Expenses -793 -2,032 -1,347 -2,6073.04.02.03 Outsourced Services -5,514 -17,439 -10,565 -20,361
3.04.02.04 Depreciation andAmortization -580 -1,105 -452 -905
3.04.02.05 Leasing and Rentals -1,504 -2,852 -1,031 -2,112
3.04.04Other Operating
Income 806 22,676 961 975
3.04.04.01Sale of PGN (OGX
Maranho) 0 21,858 0 0
3.04.04.02 Other 806 818 961 975
3.04.05Other Operating
Expenses -1,593 -1,722 -2,885 -3,9253.04.05.01 Unsecured Liability -171 -135 -2,883 -3,923
3.04.05.02 Provision forinvestment losses
-27 -192 0 3
3.04.05.03Losses on the Sale of
Assets-1,395 -1,395 -2 -5
3.04.06Equity in Net
Income of Subsidiaries -48,622 -83,628 -124,401 -320,057
3.05Earnings before
financial income/lossand tax
-62,698 -104,287 -156,204 -376,597
3.06 FinancialIncome/Loss -49,581 -79,924 -77,046 -107,554
3.06.01 Financial Revenue 25,954 88,706 29,068 44,049
3.06.01.01Exchange Variance
Gain 3,186 22,323 606 4,012
3.06.01.02 Interest-earningbank deposits
1,362 2,821 27,118 31,431
3.06.01.03Derivative Financial
Instruments-4,605 4,431 10,474 9,031
3.06.01.04Fair value of
debentures 0 0 -175 -426
3.06.01.05 Other FinancialRevenue 95 156 0 1
3.06.01.06 Interest on loans 25,916 58,975 -8,955 03.06.02 Financial Expenses -75,535 -168,630 -106,114 -151,603
3.06.02.01Exchange Variance
Loss -150 -15,299 -10,780 -12,760
3.06.02.02 Derivative FinancialInstruments
-4,124 -4,124 212 -2,619
3.06.02.03Debenture
Interest/Cost-185 -396 -149 -362
3.06.02.05 Debt Charges -69,406 -144,828 -32,438 -55,7883.06.02.06 Other Financial
Expenses-1,670 -3,983 -62,959 -80,074
3.07Earnings before tax
on net income -112,279 -184,211 -233,250 -484,151
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3.09Net Income from
Continued Operations -112,279 -184,211 -233,250 -484,151
3.11Net Income Loss for
the Period
-112,279 -184,211 -233,250 -484,151
3.99 Earnings per Share -(Reais / Share)
3.99.01Basic Earnings per
Share3.99.01.01 Common -0.15982 -0.26221 -0.40321 -0.83694
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Quarterly Information - ITR
Statement of Comprehensive Income
(Thousands of Reais)
AccountCode
Account Description
CurrentQuarter
4/1/2014 to6/30/2014
AccruedValue of theCurrent Year1/1/2014 to6/30/2014
SameQuarter ofthe Prior
Year4/1/2013 to6/30/2013
AccruedValue of the
Prior Year1/1/2013 to6/30/2013
4.01 Net Income for the Period (112.279) (184.211) (233.250) (484.151)4.02 Other Comprehensive Income (1.349) (2.115) (3.569) (5.333)
4.02.01 Accumulated Translation Adjustments - - 483 (617)4.02.02 Equity Appraisal Adjustments - - - -
4.02.03 Effective portion of the changes in fair value of cash flow hedges - hedge accounting (2.044) (3.204) (6.140) (7.145)4.02.04 Deferred income and social contribution taxes - hedge accounting 695 1.089 2.088 2.429
4.03 Comprehensive Income for the Period (113.628) (186.326) (236.819) (489.484)
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Quarterly Information - ITR
Statement of Cash Flows - Indirect Method
(Thousands of Reais)
Account Code Account Description
Accrued Valueof the Current
Year 1/1/2014 to6/30/2014
Accrued Valueof the Prior Year
1/1/2013 to6/30/2013
6.01 Net Cash from Operating Activities 127,056 (135,452)6.01.01 Cash Provided by Operating Activities (18,295) (116,955)6.01.01.01 Net income/loss before IR and CSLL (184,211) (484,151)6.01.01.02 Depreciation and Amortization 1,105 905
6.01.01.03 Equity in net income of subsidiary and associated companies 83,628 320,0576.01.01.04 Operations with derivative financial instruments (307) (6,412)6.01.01.05 Stock Options Awarded 6,555 22,6666.01.01.06 Amortization of deferred charges - -
6.01.01.07 Investment devaluation 192 (3)
6.01.01.08 Provision for Unsecured Liabilities 135 3,9236.01.01.09 Provision for Disassembly - -6.01.01.10 Provision for investment losses - -
6.01.01.11 Deferred income and social contribution liabilities, net - -6.01.01.12 Current income and social contribution taxes - -
6.01.01.13 Debenture Interest Cost 396 3626.01.01.14 Fair value of debentures - 426
6.01.01.15 Interest on loans and related parties 73,055 25,2726.01.01.17 Equity Appraisal Adjustment - -
6.01.01.18 Other 1,157 -6.01.02 Changes in Assets and Liabilities 152,369 116
6.01.02.01 Other Advances (181) (90)6.01.02.02 Prepaid Expenses - -
6.01.02.03 Accounts Receivable - -6.01.02.05 Recoverable Taxes (5,721) 420
6.01.02.06 Inventory - -6.01.02.07 Deferred Taxes - -
6.01.02.09 Taxes, Duties and Contributions (149) 2,9866.01.02.10 Trade payables 1,387 4,618
6.01.02.11 Provisions and payroll charges (2,478) 9496.01.02.12 Accounts Payable - -
6.01.02.13 CCC subsidies receivable - -6.01.02.14 Related Parties 159,511 (8,767)
6.01.02.15 AFAC to subsidiaries - -6.01.03 Other (7,018) (18,613)
6.02 Net Cash from Investment Activities (308,284) (583,123)6.02.01 Acquisition of PPE and intangible assets (856) (356)
6.02.02 Write-off of PPE and intangible assets - -6.02.03 Securities - -
6.02.04 Capital contribution/AFAC in investments (243,476) (358,491)6.02.05 Cash from sale of PP&E and intangible assets - -
6.02.06 AFAC to associated companies - -
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6.02.07 Debt to related parties (63,950) (223,443)6.02.08 Dividends - 2,0406.02.09 Contractual Retentions - -
6.02.10 Escrow Deposits (2) (2,873)6.03 Net Cash from Financing Activities 83,083 587,8136.03.01 Financial Instruments (4,124) (1,045)6.03.02 Capital Increase - 540
6.03.03 Advanced for future capital increase 119,959 -6.03.04 Settlement of the principal - Financing (200,000) (300,000)6.03.07 Loans and Financing Obtained 172,995 888,6056.03.08 Capital increase (decrease) deriving from minority interests - -
6.03.10 Issuance (payment) of debentures (5,747) (287)6.04 Exchange Variance on Cash and Cash Equivalents - -6.05 Increase (Decrease) in Cash and Cash Equivalents (98,145) (130,762)6.05.01 Opening Balance of Cash and Cash Equivalents 110,156 206,263
6.05.02 Closing Balance of Cash and Cash Equivalents 12,011 75,501
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Quarterly Information - ITR
Statement of Changes in Equity
Period from 01/01/2014 to 06/30/2014
(Thousands of Reais)
AccountCode Account Description
Paid-inshare
capital
CapitalReserves,Options
Awardedand
TreasuryStock
ProfitReserves
RetainedEarnings or
AccumulatedLosses
OtherComprehe
nsiveIncome
ShareholdersEquity
5.01 Opening Balances 4.532.314 350.514 - (2.360.800) (53.284) 2.468.744
5.02 Prior-year Adjustments - - - - - -
5.03 Adjusted Opening Balances 4.532.314 350.514 - (2.360.800) (53.284) 2.468.744
5.04 Capital Transactions with Partners 119.959 3.351 - - - 123.310
5.04.01 Capital Increases 119.959 - - - - 119.959
5.04.02 Stock Issuance Expense - - - - - -
5.04.03 Awarded Options Recognized - 3.351 - - - 3.351
5.04.04 Treasury Stock Acquired - - - - - -
5.04.05 Treasury Stock Sold - - - - - -
5.04.06 Dividends - - - - - -
5.04.07 Interest on Shareholders Equity - - - - - -
5.04.08 Adjustment for effect of spin-off - - - - - -
5.05 Total Comprehensive Income - - - (184.211) 3.204 (181.007)
5.05.01 Net Income for the Period - - - - - -
5.05.02 Other Comprehensive Income - - - (184.211) 3.204 (181.007)
5.05.02.01 Financial Instrument Adjustments - - - - 3.204 3.204
5.05.02.02 Tax on Financial Instrument Adjustments - - - - - -
5.05.02.03Equity Income on Comp. Income Subsidiariesand Associated Companies - - - - - -
5.05.02.04 Translation Adjustments in the Period - - - - - -
5.05.02.05Taxes on Translation Adjustments in thePeriod - - - - - -
5.05.02.06 Loss for the Period - - - (184.211) - (184.211)
5.05.03 Reclassification to Net Income - - - - - -
5.05.03.01 Financial Instrument Adjustments - - - - - -
5.06 Internal Changes in Shareholders' Equity - - - - - -
5.06.01 Creation of Reserves - - - - - -
5.06.02 Realization of Revaluation Reserve - - - - - -
5.06.03 Taxes on Realization of Revaluation Reserve - - - - - -
5.07 Closing Balances 4.652.273 353.865 - (2.545.011) (50.080) 2.411.047
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Quarterly Information - ITR
Statement of Changes in Equity
Period from 01/01/2013 to 06/30/2013
(Thousands of Reais)
AccountCode Account Description
Paid-inshare
capital
CapitalReserves,Options
Awardedand
TreasuryStock
ProfitReserves
RetainedEarnings or
AccumulatedLosses
OtherComprehe
nsiveIncome
Shareholders Equity
5.01 Opening Balances 3.731.734 321.904 - (1.364.979) (119.067) 2.569.592
5.02 Prior-year Adjustments - - - - - -
5.03 Adjusted Opening Balances 3.731.734 321.904 - (1.364.979) (119.067) 2.569.592
5.04 Capital Transactions with Partners 540 14.904 - - - 15.444
5.04.01 Capital Increases 540 - - - - 540
5.04.02 Stock Issuance Expense - - - - - -
5.04.03 Awarded Options Recognized - 14.904 - - - 14.904
5.04.04 Treasury Stock Acquired - - - - - -
5.04.05 Treasury Stock Sold - - - - - -
5.04.06 Dividends - - - - - -
5.04.07 Interest on Shareholders Equity - - - - - -
5.04.08 Adjustment for effect of spin-off - - - - - -
5.05 Total Comprehensive Income - - - (484.151) 7.762 (476.389)
5.05.01 Net Income for the Period - - - - - -
5.05.02 Other Comprehensive Income - - - (484.151) 7.762 (476.389)
5.05.02.01 Financial Instrument Adjustments - - - - 7.145 7.145
5.05.02.02 Tax on Financial Instrument Adjustments - - - - - -
5.05.02.03Equity Income on Comp. Income Subsidiariesand Associated Companies - - - - - -
5.05.02.04 Translation Adjustments in the Period - - - - - -
5.05.02.05 Taxes on Translation Adjustments in the Period - - - - - -
5.05.02.06 Loss for the Period - - - (484.151) 617 (483.534)
5.05.03 Reclassification to Net Income - - - - - -
5.05.03.01 Financial Instrument Adjustments - - - - - -
5.06 Internal Changes in Shareholders' Equity - - - - - -
5.06.01 Creation of Reserves - - - - - -
5.06.02 Realization of Revaluation Reserve - - - - - -
5.06.03 Taxes on Realization of Revaluation Reserve - - - - - -
5.07 Closing Balances 3.732.274 336.808 - (1.849.130) (111.305) 2.108.647
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Quarterly Information - ITR
Statement of Value Added
(Thousands of Reais)
Account Code Account Description
Accrued Value ofthe Current Year
1/1/2014 to6/30/2014
Accrued Value ofthe Prior Year
1/1/2013 to6/30/2013
7.01 Revenue - -
7.01.01 Sales of Goods, Products and Services - -7.01.02 Other Revenue - -7.01.03 Revenue relating to construction of company assets - -
7.01.04Allowance/(Reversal of allowance) for doubtfulaccounts - -
7.02 Consumables acquired from third parties (18.707) (22.622)7.02.01 Cost of goods and services sold - -7.02.02 Material, Energy, Outsourced Services and Other (18.707) (22.622)
7.02.03 Loss/Recovery of Assets - -7.02.04 Other - -7.03 Gross Added Value (18.707) (22.622)7.04 Retentions (1.105) (905)
7.04.01 Depreciation, Amortization and Depletion (1.105) (905)7.04.02 Other - -
7.05 Net Added Value Produced (19.812) (23.527)7.06 Transferred Added Value 4.286 (283.940)
7.06.01 Equity in Net Income of Subsidiaries (83.628) (320.057)7.06.02 Financial Revenue 2.977 40.0377.06.03 Other 84.937 (3.920)7.06.03.01 Derivative Financial Instruments 4.431 -
7.06.03.02 Provision for Unsecured Liabilities (135) (3.923)7.06.03.03 Provision for Impairment loss - -7.06.03.04 Provision for devaluation of investments (192) 37.06.03.05 Sale of PGN (OGX Maranho) 21.858 -
7.06.03.06 Interest on loans 58.975 -7.07 Total Added Value to be Distributed (15.526) (307.467)7.08 Distribution of Added Value (15.526) (307.467)7.08.01 Personnel 18.185 27.605
7.08.01.01 Direct Remuneration 12.694 21.1777.08.01.02 Benefits 610 2.9877.08.01.03 F.G.T.S. 4.881 3.4417.08.01.04 Other - -
7.08.02 Taxes, Duties and Contributions 366 887.08.02.01 Federal 366 887.08.02.02 State - -7.08.02.03 Municipal - -
7.08.03 Interest Expenses 150.134 148.9917.08.03.01 Interest 396 3627.08.03.02 Rent 2.852 2.1127.08.03.03 Other 146.886 146.517
7.08.03.03.01 Losses on derivative transactions 4.124 2.6197.08.03.03.02 Advances to suppliers - -7.08.03.03.03 Insurance 398 2597.08.03.03.04 Exchange Variance (7.024) 8.748
7.08.03.03.05 Studies and Projects - -7.08.03.03.06 Financial Expenses 150.207 135.866
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7.08.03.03.07 Other (819) (975)7.08.04 Interest earnings (184.211) (484.151)7.08.04.01 Interest on Shareholders Equity - -
7.08.04.02 Dividends - -7.08.04.03 Retained Earnings/Loss for the Period (184.211) (484.151)7.08.05 Other - -
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Quarterly Information - ITR
Consolidated Balance Sheet - Assets
(Thousands of Reais)
Account Code Account Description Current Quarter6/30/2014
Previous Year12/31/2013
1 Total Assets 8.400.491 9.689.2121.01 Current Assets 743.720 747.842
1.01.01 Cash and Cash Equivalents 87.773 277.5821.01.01.01 Cash and Bank deposits 47.504 16.493
1.01.01.02 Fundo Multimercado MPX 63 38.467 202.4441.01.01.03 Bradesco Corporate FIC FI Referenciado DI Federal - -
1.01.01.04 CDB 1.802 58.6451.01.01.05 Other Fixed-Income Investments - -
1.01.02 Short-term Investments - -1.01.02.01 Short-term investments valued at Fair Value - -
1.01.02.01.01 Marketable Securities - -1.01.02.01.02 Available-for-sale securities - -
1.01.02.01.03 Securities - -1.01.02.02 Short-term investments valued at amortized cost - -
1.01.02.02.01 Securities Held to Maturity - -
1.01.03 Accounts Receivable 214.205 294.3961.01.03.01 Trade accounts receivable 214.205 294.3961.01.03.02 Other Accounts Receivable - -
1.01.04 Inventories 66.729 78.3761.01.05 Agricultural Assets - -
1.01.06 Recoverable Taxes 28.777 47.6511.01.06.01 Current Taxes Recoverable 28.777 47.651
1.01.07 Prepaid Expenses 14.514 9.8251.01.08 Other Current Assets 331.722 40.012
1.01.08.01 Noncurrent Assets for Sale 303.913 -1.01.08.02 Assets of Discontinued Operations - -
1.01.08.03 Other 27.809 40.0121.01.08.03.01 Other Advances 7.048 5.001
1.01.08.03.03 Gain on Derivatives - 4.171
1.01.08.03.04 Escrow Deposits 39 381.01.08.03.05 CCC subsidies receivable 20.722 30.8021.01.08.03.06 Other Accounts Receivable - -
1.02 Noncurrent Assets 7.656.771 8.941.3701.02.01 Long-Term Assets 1.215.574 966.682
1.02.01.01 Short-term investments valued at Fair Value - -1.02.01.01.01 Marketable Securities - -
1.02.01.01.02 Available-for-sale securities - -1.02.01.02 Short-term investments valued at amortized cost - -
1.02.01.02.01 Securities Held to Maturity - -1.02.01.03 Accounts Receivable - -
1.02.01.03.01 Trade accounts receivable - -1.02.01.03.02 Other Accounts Receivable - -
1.02.01.04 Inventories - -1.02.01.05 Agricultural Assets - -
1.02.01.06 Deferred Taxes 218.992 302.3271.02.01.06.01 Deferred Income and Social Contribution Taxes 218.992 302.327
1.02.01.07 Prepaid Expenses 2.017 2.905
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1.02.01.08 Related-party Credits - -1.02.01.08.01 Credits with Associated Companies - -1.02.01.08.03 Credits with Controlling Shareholders - -
1.02.01.08.04 Other Related-party Credits - -1.02.01.09 Other Noncurrent Assets 994.565 661.4501.02.01.09.01 Noncurrent Assets for Sale - -1.02.01.09.02 Assets of Discontinued Operations - -
1.02.01.09.03 Gain on Derivatives - -1.02.01.09.04 Escrow Deposits 171.081 118.6061.02.01.09.05 CCC Subsidies Receivable - -1.02.01.09.07 Recoverable Taxes 35.487 14.614
1.02.01.09.08 Accounts receivable from other related parties 13.858 218.6801.02.01.09.09 AFAC at joint ventures 7.620 1501.02.01.09.11 Loan with joint ventures 586.820 191.9681.02.01.09.12 Accounts receivable from joint ventures 171.095 117.372
1.02.01.09.13 Embedded derivatives 8.602 -
1.02.01.09.14 Other Accounts Receivable 2 601.02.01.09.15 Securities - -1.02.02 Investments 1.230.385 941.853
1.02.02.01 Equity Interests 1.230.385 941.8531.02.02.01.01 Interests in Associated Companies 87.674 51.8991.02.02.01.04 Other Equity Interests 1.142.711 889.9541.02.02.02 Property for Investment - -
1.02.03 Property, plant and equipment 5.004.608 6.819.4541.02.03.01 Property, plant and equipment in operation - -1.02.03.02 Leased property, plant and equipment - -1.02.03.03 Property, plant and equipment in progress - -
1.02.04 Intangible assets 206.204 213.3811.02.04.01 Intangible assets - -1.02.04.01.01 Concession Agreement - -
1.02.04.02 Goodwill - -
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Consolidated Balance Sheet - Liabilities
(Thousands of Reais)
Account Code Account DescriptionCurrent Quarter
6/30/2014Previous Year12/31/2013
2 Total Liabilities 8.400.491 9.689.2122.01 Current Liabilities 3.659.090 2.978.859
2.01.01 Social and labor obligations 13.719 16.7702.01.01.01 Payroll Obligations - -2.01.01.02 Labor Obligations 13.719 16.7702.01.02 Trade payables 350.716 331.216
2.01.02.01 Domestic Trade Payables 350.716 331.2162.01.02.02 Foreign Trade payables - -2.01.03 Tax Obligations 24.443 45.9342.01.03.01 Federal Tax Liabilities 24.443 45.934
2.01.03.01.01 Income taxes and contributions payable 24.443 45.9342.01.03.02 State Tax Liabilities - -2.01.03.03 Municipal Tax Liabilities - -2.01.04 Loans and Financing 3.143.222 2.408.254
2.01.04.01 Loans and Financing 3.143.222 2.408.1422.01.04.01.01 In local currency 3.143.222 2.408.142
2.01.04.01.02 Foreign currency - -2.01.04.02 Debentures - 112
2.01.04.02.01 Principal - -2.01.04.02.02 Interest - 1122.01.04.03 Financing through Financial Lease - -2.01.05 Other liabilities 126.990 176.685
2.01.05.01 Related-Party Transactions - -2.01.05.01.01 Debits with Associated Companies - -2.01.05.01.03 Debits with Parent Companies - -2.01.05.01.04 Debts with Other Related Parties - -
2.01.05.02 Other 126.990 176.6852.01.05.02.01 Dividends and Interest on Shareholder's Equity Payable - -2.01.05.02.02 Minimum Mandatory Dividend Payable - -2.01.05.02.03 Expenses on Share Based Payments - -
2.01.05.02.04 Losses on Derivative Transactions - -2.01.05.02.05 Contractual Retentions 57.091 84.7892.01.05.02.06 Other Advances - -2.01.05.02.07 Profit Sharing 5.064 8.148
2.01.05.02.08 Dividends Payable - -2.01.05.02.09 Other liabilities 64.835 83.7482.01.06 Provisions - -2.01.06.01 Tax, Welfare and Civil Contingencies - -
2.01.06.01.01 Tax Provisions - -2.01.06.01.02 Social Security and Labor Provisions - -2.01.06.01.03 Provisions for Employee Benefits - -2.01.06.01.04 Civil Provisions - -
2.01.06.02 Other Provisions - -
2.01.06.02.01 Provisions for Guarantees - -2.01.06.02.02 Provision for Reorganization - -2.01.06.02.03 Provisions for environmental and deactivation liabilities - -
2.01.07Liabilities on Noncurrent Assets for Sale and DiscontinuedAssets - -
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2.01.07.01 Liabilities on Noncurrent Assets for Sale - -2.01.07.02 Liabilities on Assets of Discontinued Operations - -2.02 Noncurrent Liabilities 2.217.206 4.136.480
2.02.01 Loans and Financing 1.948.318 3.807.6172.02.01.01 Loans and Financing 1.948.318 3.802.3782.02.01.01.01 In local currency 1.948.318 3.802.3782.02.01.01.02 Foreign currency - -
2.02.01.02 Debentures - 5.2392.02.01.02.01 Principal - 4.6052.02.01.02.02 Interest - 6342.02.01.02.03 Embedded Derivatives - -
2.02.01.03 Financing through Financial Lease - -2.02.02 Other liabilities 258.125 307.7202.02.02.01 Related-Party Transactions 258.125 307.7202.02.02.01.01 Debits with Associated Companies - -
2.02.02.01.03 Debits with Parent Companies - -
2.02.02.01.04 Debts with Other Related Parties 258.125 307.7202.02.02.02 Other - -2.02.02.02.01 Expenses on Share Based Payments - -
2.02.02.02.02 Advance for Future Capital Increase - -2.02.02.02.03 Losses on Derivative Transactions - -2.02.02.02.04 Devaluation of investments - -2.02.03 Deferred Taxes 11.694 9.591
2.02.03.01 Deferred Income and Social Contribution Taxes 11.694 9.5912.02.04 Provisions (931) 11.5522.02.04.01 Tax, Welfare and Civil Contingencies - -2.02.04.01.01 Tax Provisions - -
2.02.04.01.02 Social Security and Labor Provisions - -2.02.04.01.03 Provisions for Employee Benefits - -2.02.04.01.04 Civil Provisions - -
2.02.04.02 Other Provisions (931) 11.5522.02.04.02.01 Provisions for Guarantees - -2.02.04.02.02 Provision for Reorganization - -2.02.04.02.03 Provisions for environmental and deactivation liabilities - -2.02.04.02.04 Provision for Disassembly - 2.266
2.02.04.02.05 Unsecured Liability (931) 9.286
2.02.05Liabilities on Noncurrent Assets for Sale and DiscontinuedAssets - -
2.02.05.01 Liabilities on Noncurrent Assets for Sale - -2.02.05.02 Liabilities on Assets of Discontinued Operations - -2.02.06 Unappropriated Profits and Revenue - -2.02.06.01 Unappropriated Profits - -2.02.06.02 Unappropriated Revenue - -2.02.06.03 Unappropriated Investment Subsidies - -
2.03 Consolidated Shareholders Equity 2.524.195 2.573.8732.03.01 Realized Capital 4.652.273 4.532.3132.03.02 Capital Reserves 353.865 350.5142.03.02.01 Goodwill on Share Issuance - -2.03.02.02 Special Goodwill Reserve under Merger - -2.03.02.03 Sale of Subscription Bonus - -2.03.02.04 Options Awarded 353.865 350.5142.03.02.05 Treasury Stock - -2.03.02.06 Advance for Future Capital Increase - -2.03.02.07 Investments Reserve - -2.03.02.08 Capital Reserves - -2.03.03 Revaluation Reserves - -2.03.04 Profit Reserves - -
2.03.04.01 Legal Reserve - -2.03.04.02 Statutory Reserve - -2.03.04.03 Reserve for Contingencies - -2.03.04.04 Unrealized Profit Reserve - -2.03.04.05 Profit Retention Reserve - -
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2.03.04.06 Special Reserve for Undistributed Dividends - -2.03.04.07 Tax Incentive Reserve - -2.03.04.08 Additional Dividend Proposed - -
2.03.04.09 Treasury Stock - -2.03.05 Retained Earnings/Accumulated Losses (2.558.792) (2.379.303)2.03.06 Equity Appraisal Adjustments (50.080) (53.284)2.03.07 Accumulated Translation Adjustments - -
2.03.08 Other Comprehensive Income - -2.03.09 Minority Interests 126.929 123.633
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Consolidated Statement of Income
(Thousands of Reais)
AccountCode Account Description
CurrentQuarter
4/1/2014 to6/30/2014
AccruedValue of theCurrent Year1/1/2014 to6/30/2014
Same Quarterof the Prior
Year 4/1/2013to 6/30/2013
Accrued Valueof the Prior
Year 1/1/2013to 6/30/2013
3.01 Revenue from goods sold and services rendered 489.306 1.076.078 395.133 591.232
3.02 Cost of goods and/or services sold (439.603) (934.382) (418.331) (730.940)3.03 Gross Profit 49.703 141.696 (23.198) (139.708)
3.04 Operating Income/Expenses (24.167) (58.596) (88.690) (212.220)
3.04.01 Sales Expenses - - - -3.04.02 General and Administrative Expenses (18.129) (54.921) (41.983) (81.012)3.04.02.01 Personnel and Management (6.167) (21.459) (18.845) (39.142)3.04.02.02 Other Expenses (1.462) (3.307) (2.653) (5.009)3.04.02.03 Outsourced Services (8.050) (25.408) (18.222) (32.283)3.04.02.04 Depreciation and Amortization (801) (1.570) (652) (1.290)3.04.02.05 Leasing and Rentals (1.649) (3.177) (1.611) (3.288)3.04.02.06 General and Administrative Expenses - - - -3.04.02.07 Expenses incurred on Share Options Awarded - - - -3.04.03 Impairment of assets - - - -
3.04.04 Other Operating Income 42.930 64.802 3.471 3.9833.04.04.01 Sale of PGN (OGX Maranho) - 21.858 - -3.04.04.02 Other 42.930 42.944 - -
3.04.05 Other Operating Expenses (13.749) (25.896) (5.064) (6.587)
3.04.05.01 Unsecured liability 1 111 (2.604) (3.578)3.04.05.02 Provision for investment losses 546 (1.221) (26) (23)3.04.05.0
3 Losses on the sale of assets (1.395) (1.395) (2.434) (2.986)3.04.05.05 Write-off of CCC Benefit (407) (5.945) - -3.04.05.06 Other - - - -3.04.05.07 Adomp/CCEE Penalty (12.494) (17.446) - -
3.04.06 Equity in Net Income of Subsidiaries (35.219) (42.581) (45.114) (128.604)3.05 Earnings before financial income/loss and tax 25.536 83.100 (111.888) (351.928)
3.06 Financial Income/Loss (134.541) (258.833) (162.929) (240.756)3.06.01 Financial Revenue 15.190 65.706 19.940 32.641
3.06.01.01 Exchange Variance Gain 4.121 25.489 682 4.5703.06.01.02 Interest-earning bank deposits 5.877 11.310 12.453 17.374
3.06.01.03 Derivative Financial Instruments (4.605) 4.431 10.474 9.0313.06.01.04 Fair value of debentures - - (175) (426)3.06.01.05 Other Financial Revenue 1.018 1.891 1.461 2.0923.06.01.0 Interest on loans 8.779 22.585 (4.955) -
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Consolidated Statement of Comprehensive Income
(Thousands of Reais)
AccountCode
Account Description
CurrentQuarter
4/1/2014 to6/30/2014
AccruedValue of the
CurrentYear
1/1/2014 to6/30/2014
SameQuarter ofthe Prior
Year4/1/2013 to6/30/2013
AccruedValue of the
Prior Year1/1/2013 to6/30/2013
4.01 Consolidated Net Income for the Period (110.444) (181.009) (233.488) (490.549)
4.02 Other Comprehensive Income (1.349) (2.115) (3.569) (5.333)
4.02.01 Accumulated Translation Adjustments - - 483 (617)
4.02.02 Equity Appraisal Adjustments - - - -
4.02.03Effective portion of the changes in fair value of cash flow hedges -hedge accounting (2.044) (3.204) (6.140) (7.145)
4.02.04 Deferred income and social contribution taxes - hedge accounting 695 1.089 2.088 2.429
4.03 Consolidated Comprehensive Income for the Period (111.793) (183.124) (237.057) (495.882)
4.03.01 Attributed to Partners of the Parent Company (113.629) (186.326) (236.819) (489.484)
4.03.02 Attributed to Minority Partners 1.836 3.202 (238) (6.398)
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Consolidated Statement of Cash Flows - Indirect Method
(Thousands of Reais)
Account Code Account Description
Accrued Value ofthe Current Year
1/1/2014 to6/30/2014
Accrued Value ofthe Prior Year
1/1/2013 to6/30/2013
6.01 Net Cash from Operating Activities (63.410) 112.7736.01.01 Cash Provided by Operating Activities 40.346 (337.668)6.01.01.01 Loss for the Period (175.733) (592.684)6.01.01.02 Depreciation and Amortization 96.454 44.519
6.01.01.03 Equity in Net Income of Subsidiaries 42.581 128.6046.01.01.04 Operations with derivative financial instruments (307) (9.943)6.01.01.05 Stock Options Awarded 6.555 22.6666.01.01.06 Amortization of deferred charges - -
6.01.01.07 Investment devaluation 1.221 236.01.01.08 Provision for Unsecured Liabilities (111) 3.5786.01.01.09 Provision for Disassembly (2.266) 556.01.01.10 Minority Interests - -
6.01.01.11 Deferred income and social contribution liabilities, net - -6.01.01.12 Current income and social contribution taxes - -
6.01.01.13 Debenture Interest/Cost 396 3626.01.01.14 Fair value of debentures - 426
6.01.01.15 Interest on loans and related parties 70.391 65.4856.01.01.16 Sale of PGN interest (OGX Maranho) 21.858 -6.01.01.17 Equity Appraisal - -6.01.01.18 Other (20.693) (759)
6.01.02 Changes in Assets and Liabilities 213.398 476.2406.01.02.01 Other Advances (2.047) (3.467)6.01.02.02 Prepaid Expenses (3.801) (1.841)6.01.02.03 Accounts Receivable 80.192 (331.220)
6.01.02.05 Recoverable Taxes (1.999) (41.682)6.01.02.06 Inventory 11.647 53.5696.01.02.07 Deferred Taxes - -6.01.02.09 Taxes, Duties and Contributions (21.492) 86.977
6.01.02.10 Trade payables 19.500 538.7576.01.02.11 Provisions and payroll charges (3.051) 2.4216.01.02.12 Accounts Payable 22.865 4.2636.01.02.13 CCC subsidies receivable 10.079 8.034
6.01.02.14 Debts / Credits with related parties 101.505 160.4296.01.02.15 AFAC to subsidiaries - -6.01.03 Other (317.154) (25.799)6.01.03.01 Changes in Investments - -
6.01.03.02 Other Assets and Liabilities (13.241) (25.799)6.01.03.04 Asset held for sale - Pecm II (303.913) -6.02 Net Cash from Investment Activities 952.883 (1.226.254)6.02.01 Acquisition of PPE and intangible assets (173.265) (999.229)
6.02.02 Write-off of PPE and intangible assets - -
6.02.03 Securities - (5.351)6.02.04 Capital contribution/AFAC in investments (332.320) (138.301)6.02.05 Cash resulting from sale of property, plant and equipment and intangible assets (1.036) (2.978)
6.02.06 AFAC at associated companies and joint ventures - -6.02.07 Debt to related parties (382.113) (24.881)
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6.02.08 Dividends - -6.02.09 Contractual Retentions (27.699) (33.623)6.02.10 Escrow Deposits (52.477) (21.891)
6.02.11 PPE and intangible of asset held for sale - Pecm II 1.921.793 -6.03 Net Cash from Financing Activities (1.079.283) 734.9196.03.01 Financial Instruments (4.124) (12.679)6.03.02 Capital Increase - 540
6.03.03 Advanced for future capital increase 119.959 -6.03.04 Settlement of the principal - Financing (315.014) (325.575)6.03.07 Loans and Financing Obtained 198.446 1.068.4826.03.08 Capital increase deriving from noncontrolling interests - 6.398
6.03.09 Loan and financing - held for sale Pecm II (1.072.803) -6.03.10 Issuance (payment) of debentures (5.747) (287)6.03.12 Dividends - (1.960)6.04 Exchange Variance on Cash and Cash Equivalents - -
6.05 Increase (Decrease) in Cash and Cash Equivalents (189.810) (378.562)
6.05.01 Opening Balance of Cash and Cash Equivalents 277.583 519.2776.05.02 Closing Balance of Cash and Cash Equivalents 87.773 140.715
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Consolidated Statement of Changesin EquityPeriod from 01/01/2014 to06/30/2014
(Thousands of Reais)
Account
Code
Account DescriptionPaid-inshare
capital
CapitalReserves,Options
Awarded
andTreasury
Stock
Profit
Reserves
RetainedEarnings or
AccumulatedLosses
OtherComprehensiv
e Income
Shareholder
s Equity
Minority
interests
Consolidated
Shareholders Equity
5.01 Opening Balances 4.532.313 350.514 - (2.379.303) (53.284) 2.450.240 123.633 2.573.873
5.02 Prior-year Adjustments - - - - - - - -
5.03 Adjusted Opening Balances 4.532.313 350.514 - (2.379.303) (53.284) 2.450.240 123.633 2.573.873
5.04Capital Transactions withPartners 119.960 3.351 - 4.722 - 128.033 - 128.0
5.04.01 Capital Increases 119.960 - - - - 119.960 - 119.960
5.04.02 Stock Issuance Expense - - - - - - - -
5.04.03
Awarded Options
Recognized - 3.351 - - - 3.351 - 3.3515.04.04 Treasury Stock Acquired - - - - - - - -
5.04.05 Treasury Stock Sold - - - - - - - -
5.04.06 Dividends - - - - - - - -
5.04.07Interest on ShareholdersEquity - - - - - - - -
5.04.08Adjustment for effect ofspin-off - - - - - - - -
5.04.09 Deferred Asset Adjustment - - - 4.722 - 4.722 - 4.722
5.05Total ComprehensiveIncome - - - (184.211) 3.204 (181.007) 3.296 (177.711)
5.05.01 Net Income for the Period - - - - - - - -
5.05.02 Other ComprehensiveIncome - - - (184.211) 3.204 (181.007) 3.296 (177.711)
5.05.02.01Financial InstrumentAdjustments - - - - 3.204 3.204 - 3.204
5.05.02.02Tax on FinancialInstrument Adjustments - - - - - - - -
5.05.02.03
Equity Income on Comp.Income Associatedcompanies - - - - - - - -
5.05.02.04Translation Adjustments inthe Period - - - - - - - -
5.05.02.05Taxes on TranslationAdjustments in the Period - - - - - - - -
5.05.02.07 Loss for the period - - - (184.211) - (184.211) 3.202 (181.009)
5.05.02.08 Minority interest - - - - - - 94 94
5.05.03 Reclassification to NetIncome - - - - - - - -
5.05.03.01Financial InstrumentAdjustments - - - - - - - -
5.06Internal Changes inShareholders' Equity - - - - - - - -
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5.06.01 Creation of Reserves - - - - - - - -
5.06.02
Realization of Revaluation
Reserve - - - - - - - -5.06.03
Taxes on Realization ofRevaluation Reserve - - - - - - - -
5.07 Closing Balances 4.652.273 353.865 - (2.558.792) (50.080) 2.397.266 126.929 2.524.195
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Consolidated Statement of Changes inEquity
Period from 01/01/2013 to 06/30/2013
(Thousands of Reais)
AccountCode Account Description
Paid-inshare
capital
CapitalReserves, OptionsAwarded
andTreasuryStock
ProfitReserves
RetainedEarnings
orAccumul
atedLosses
OtherCompreh
ensive
Income
Shareholders
Equity
Minorityinterests
Consolidated
Sharehol
dersEquity
5.01 Opening Balances 3.731.734 321.904 -(1.384.971) (119.067)
2.549.600 154.975 2.704.575
5.02 Prior-year Adjustments - - - - - - - -
5.03 Adjusted Opening Balances 3.731.734 321.904 -(1.384.971) (119.067)
2.549.600 154.975 2.704.575
5.04Capital Transactions withPartners 540 14.904 - 743 - 16.187 - 16.187
5.04.01 Capital Increases 540 - - - - 540 - 540
5.04.02 Stock Issuance Expense - - - - - - - -
5.04.03 Awarded Options Recognized - 14.904 - - - 14.904 - 14.904
5.04.04 Treasury Stock Acquired - - - - - - - -
5.04.05 Treasury Stock Sold - - - - - - - -
5.04.06 Dividends - - - - - - - -
5.04.07Interest on ShareholdersEquity - - - - - - - -
5.04.08 Adjustment for effect of spin-off - - - - - - - -
5.04.09 Deferred Asset Adjustment - - - 743 - 743 - 743
5.05 Total Comprehensive Income - - - (484.151) 7.762 (476.389) (10.868) (487.257)
5.05.01 Net Income for the Period - - - - - - - -
5.05.02 Other Comprehensive Income - - - (484.151) 7.762 (476.389) (10.868) (487.257)
5.05.02.01Financial InstrumentAdjustments - - - - 7.145 7.145 - 7.145
5.05.02.02Tax on Financial InstrumentAdjustments - - - - - - - -
5.05.02.03Equity Income on Comp.Income Associated companies - - - - - - - -
5.05.02.04Translation Adjustments in thePeriod - - - - 617 617 - 617
5.05.02.05Taxes on TranslationAdjustments in the Period - - - - - - - -
5.05.02.07 Loss for the period - - - (484.151) - (484.151) (6.398)(490.549)
5.05.02.08 Minority interest - - - - - - (4.470) (4.470)
5.05.03 Reclassification to Net Income - - - - - - - -
5.05.03.01Financial InstrumentAdjustments - - - - - - - -
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5.06Internal Changes inShareholders' Equity - - - - - - - -
5.06.01 Creation of Reserves - - - - - - - -5.06.02
Realization of RevaluationReserve - - - - - - - -
5.06.03Taxes on Realization ofRevaluation Reserve - - - - - - - -
5.07 Closing Balances 3.732.274 336.808 -(1.868.379) (111.305)
2.089.398 144.107
2.233.505
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Consolidated Statement of Value Added
(Thousands of Reais)
Account Code Account Description
Accrued Value ofthe Current Year
1/1/2014 to6/30/2014
Accrued Value ofthe Prior Year
1/1/2013 to6/30/2013
7.01 Revenue (745.945) 1.546.6467.01.01 Sales of Goods, Products and Services 1.076.078 591.2317.01.02 Other Revenue - -7.01.03 Revenue relating to construction of company assets (1.822.023) 955.415
7.01.04Allowance/(Reversal of allowance) for doubtfulaccounts - -
7.02 Consumables acquired from third parties (660.808) (641.493)7.02.01 Cost of goods and services sold - -
7.02.02 Material, Energy, Outsourced Services and Other (660.808) (641.493)7.02.03 Loss/Recovery of Assets - -7.02.04 Other - -7.03 Gross Added Value (1.406.753) 905.153
7.04 Retentions (96.454) (44.519)7.04.01 Depreciation, Amortization and Depletion (96.454) (44.519)
7.04.02 Other - -7.05 Net Added Value Produced (1.503.207) 860.634
7.06 Transferred Added Value 60.162 (104.134)7.06.01 Equity in Net Income of Subsidiaries (42.581) (128.604)7.06.02 Financial Revenue 13.200 28.0717.06.03 Other 89.543 (3.601)
7.06.03.01 Derivative Financial Instruments 4.431 -7.06.03.02 Provision for Unsecured Liabilities 111 (3.578)7.06.03.03 Provision for Impairment loss - -7.06.03.04 Provision for devaluation of investments (1.221) (23)
7.06.03.05 Sale of PGN (OGX Maranho) 21.858 -7.06.03.06 Interest on loans 22.586 -7.06.03.07 Contractual Penalty 41.778 -7.07 Total Added Value to be Distributed (1.443.045) 756.500
7.08 Distribution of Added Value (1.443.045) 756.5007.08.01 Personnel 45.428 52.8897.08.01.01 Direct Remuneration 25.916 28.8477.08.01.02 Benefits 7.622 13.952
7.08.01.03 F.G.T.S. 11.890 10.0907.08.01.04 Other - -7.08.02 Taxes, Duties and Contributions 6.002 (101.810)7.08.02.01 Federal 6.002 (101.810)
7.08.02.02 State - -7.08.02.03 Municipal - -7.08.03 Interest Expenses (1.313.466) 1.295.9707.08.03.01 Interest 396 362
7.08.03.02 Rent 174.805 70.8827.08.03.03 Other (1.488.667) 1.224.7267.08.03.03.01 Losses on Derivative Transactions 4.124 (912)7.08.03.03.02 Advances to suppliers (1.822.023) 955.407
7.08.03.03.03 Insurance 11.081 1.8437.08.03.03.04 Exchange Variance (9.285) 10.612
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7.08.03.03.05 Studies and Projects - -7.08.03.03.06 Financial Expenses 305.211 261.7517.08.03.03.07 Other (1.166) (3.975)
7.08.03.03.08 CCEE Penalty 17.446 -7.08.03.03.09 Write-off of CCC Benefit 5.945 -7.08.04 Interest earnings (181.009) (490.549)7.08.04.01 Interest on Shareholders Equity - -
7.08.04.02 Dividends - -7.08.04.03 Retained Earnings/Loss for the Period (184.211) (484.151)7.08.04.04 - Minority interests in retained earnings 3.202 (6.398)7.08.05 Other - -
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20.01 - OTHER INFORMATION CONSIDERED SIGNIFICANT TO THE COMPANY
Pursuant to the Company's Bylaws, the company, its shareholders and managers undertake to settle
through arbitration any and all disputes between them arising from, or in connection with, theapplication, validity, effectiveness, interpretation, violation or effects of the rules contained in BrazilianCorporation Law, the Company's By-Laws, regulations issued by the Brazilian Monetary Council, theBrazilian Central Bank and the Brazilian Securities Commission (CVM), and any other regulationsapplicable to the capital market in general, as well as those contained in the New Market Regulations,the Regulations of the Market Chamber of Arbitration and New Market Agreement.
At June 30, 2014 the Companys share capital consisted of 702,524,469 common shares distributedas follows:
ShareholderNumber of Common
Shares(in units)
%Total Number of
Shares(in units)
%
Controlling Shareholder 434,005,449 61.78 434,005,449 61.78
Executives
Board of Directors 57,070 0.01 57,070 0.02
Executive Board 0 0.00 0 0.00
Audit Committee* - - - -
Treasury Stock 0 0.00 0 0.00
Other Shareholders 268,461,950 38.21 268,461,950 38.20
Total 702,524,469 100 702,524,469 100
Free Float 268,461,950 38.21 268,461,950 38.21
* At 6/30/2014 the Company did not have an Audit Committee.
The Company's capital was increased on 5/26/2011 by the Board of Directors' meeting held3/24/2011, which raised the number of shares from 136,692,680 to 136,720,840, as a result ofsubscription options being exercised.
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Company, whereby each existing common share was split into 3 (three) shares of the same class.
ENEVA's shareholders are entitled to receive the split shares according to their shareholding atWednesday, August 15, 2012. The number of Company shares accordingly rose from 192,747,244 to578,241,732.
The Company's capital was increased in January 2013 by the Board of Directors' meeting held1/10/2013, ratifying the issuance of 147,480 new common shares, with no par value, resulting fromthe exercising of stock options awarded under the Company's stock options program. The number ofCompany shares accordingly changed to 578,389,212.
The Company's capital was increased in February 2013 by the Board of Directors' meeting held2/6/2013, ratifying the issuance of 27,000 new common shares, with no par value, resulting from theexercising of stock options awarded under the Company's stock options program. The number ofCompany shares accordingly changed to 578,416,212.
However, there was a partial subscription of the capital increase, whereby the share capital as of3/31/2013 stood at R$ 3,736,269,091.89, less than the figure presented in the minutes to the Board ofDirectors' meeting held February 06, 2013. The remainder of the share capital was paid in after theend of the first quarter, resulting in a share capital of R$ 3,736,354,722.02.
The Company's capital was increased in April 2013 by the Board of Directors' meeting held 4/5/2013,ratifying the issuance of 34,500 new common shares, with no par value, resulting from the exercisingof stock options awarded under the Company's stock options program. The number of Companyshares accordingly changed to 578,450,712. As a result of this resolution the Company's share capitalhas changed from R$ 3,736,354,722.02 to R$ 3,736,468,820.55.
The Company's capital was increased in May 2013 by the Board of Directors' meeting held 5/8/2013,ratifying the issuance of 29,250 new common shares, with no par value, resulting from the exercisingof stock options awarded under the Company's stock options program. The number of Companyshares accordingly changed to 578,479,962. As a result of this resolution the Company's share capitalhas changed from R$ 3,736,468,820.55 to R$ 3,736,568,320.85.
On 9/16/2013 the Board of Directors' meeting ratified the Company's capital increase, as approved bythe Board of Directors' meeting on July 03, 2013, of R$ 799,999,995.15, within the authorized capitallimit, as a result of the subscription and full payment of the 124,031,007 new common registeredshares with no par value. The number of Company shares accordingly rose from 578,479,962 to702,510,969. The Company's share capital has accordingly changed from R$ 3,736,568,320.85 to R$4,536,568,316.00.
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20.01 - OTHER INFORMATION CONSIDERED SIGNIFICANT TO THE COMPANY
The Company's capital was increased in October 2013 by the Board of Directors' meeting held
10/21/2013, ratifying the issuance of 13,500 new common shares, with no par value, resulting fromthe exercising of stock options awarded under the Company's stock options program. The number ofCompany shares accordingly changed to 702,524,469. As a result of this resolution the Company'sshare capital has changed from R$ 4,536,568,316.00 to R$ 4,536,608,413.70.
On 8/1/2014 the Board of Directors' meeting ratified the Company's capital increase, as approved bythe Board of Directors' meeting on 5/9/2014, of R$ 174,728,680.26, within the authorized capital limit,as a result of the subscription and payment of the 137,581,638 new common registered shares withno par value. The number of Company shares accordingly rose from 702,524,469 to 840,106,107.The Company's share capital has accordingly changed from R$ 4,536,608,413.70 to R$4,711,337,093.96. R$ 119,959,257.16 of the capital increase consists of the subscription of the jointcontrolling shareholder E.ON, paid in on 5/20/2014.
Shareholdings of over 5% of the shares of each type and class in the Company, including those ofindividuals
Company: ENEVA S.A. Position at 6/30/2014
Common shares* Total
Shareholder Quantity % Quantity %Eike Fuhrken Batista 145,704,988 20.7 145,704,988 20.7
Centennial Asset Mining Fund LLC 20,208,840 2.9 20,208,840 2.9
Centennial Asset Brazilian Equity Fund LLC 1,822,065 0.3 1,822,065 0.3
E.ON 266,269,556 37.9 266,269,556 37.9
BNDESPAR 72,650,210 10.3 72,650,210 10.3
Other 195,868,810 27.9 195,868,810 27.9Total 702,524,469 100 702,524,469 100
*ENEVA's share capital consists solely of common shares.
Distribution of share capital in our corporate shareholder (Company shareholder), including theshareholdings of individuals
Company: Centennial Asset Mining Fund LLC Position at 6/30/2014
Quotas Total
Shareholder Quantity % Quantity %
Eike Fuhrken Batista 1,000 100 1,000 100
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Total 1,000 100 1,000 100
Company: Centennial Asset Brazilian Equity Fund LLC Position at 6/30/2014
Quotas Total
Shareholder Quantity % Quantity %
Centennial Asset Mining Fund LLC 1,000 100 1,000 100
Total 1,000 100 1,000 100
To facilitate your comprehension a summary follows of the corporate changes ENEVA has undergonein the period of one year:
On 5/27/2013 E.ON SE. and Mr. Eike Fuhrken Batista ("Parties), the controlling shareholder of ENEVA, signed the Shareholders' Agreement ("Agreement"), by which the Parties establishedthe main terms and conditions that will govern their relationship as ENEVA shareholders, in order for the Parties to share control of the Company (subject to the Agreement's severanceterms). E.ON and Mr. Eike Fuhrken Batista signed an Investment Agreement on March 27,2013 for the acquisition by E.ON of ENEVA shares held by Mr. Eike Fuhrken Batista, followedby a private capital increase of ENEVA, ratified on September 16, 2013.
At March 31, 2013 the Companys share capital consisted of 578,241,732 common shares distributedas follows:
Position at 6/30/2013
ShareholderNumber of Common
Shares(in units)
%Total Number of
Shares(in units)
%
Controlling Shareholder 377,150,046 65.2 377,150,046 65.2
Executives
Board of Directors 98,085 0.02 98,085 0.02
Executive Board 521,400 0.09 521,400 0.09
Audit Committee* - - - -
Treasury Stock 0 0.00 0 0.00
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Other Shareholders 200,710,431 34.7 200,710,431 34.7
Total 578,479,962 100 578,479,962 100
Free Float 200,710,431 34.7 200,710,431 34.7
*The Company's Annual Meeting did not convene the Audit Committee in FY 2012.
Shareholdings of over 5% of the shares of each type and class in the Company, including those ofindividuals
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Economic and Financial PerformanceIn light of the partial sale of Pecm II, as described above, ENEVAs equity interest in the project
was reduced to 50%. As a consequence, following the accounting standards set forth by the IFRS
11, as of June 1st 2014, Pecm II is recognized under the equity method.
1. Net Operating Revenues
In 2Q14, ENEVA recorded consolidated Net Operating Revenues of R$489.3 million vs R$395.1
million reported in 2Q13. The increase in net revenues is mostly attributable to the beginning of
commercial operations of Pecm II in October 2013 and increased variable revenues of Parnaba I
due to higher Henry Hub prices.Net revenues in 2Q14 are comprised largely by the revenues from the Regulated Market PowerPurchase Agreements (PPA) of Itaqui, and Parnaba I, which reached, respectively, R$137.0
million and R$247.5 million in the period. Pecm II reported total net revenues of R$96.7 million
in April and May. As mentioned above, as of June 1st, Pecm II is no longer consolidated in
ENEVAs results.The breakdown of operating revenues for 2Q14 is as follows:
Operating Revenues
(R$ million) Consolidated Itaqui Pecm II Parnaba I Amapari
Gross Revenues 546.2 152.2 108.2 275.4 10.3
Fixed Revenues 248.2 80.7 47.5 110.8 9.2
Variable Revenues 255.5 42.5 49.7 162.3 1.0
Adjustments from previous periods 0.0 0.0 0.0 0.0 0.0
Other Revenues 42.4 29.0 11.1 2.3 0.0
Deductions from Operating Revenues -56.9 -15.2 -11.5 -27.9 -2.2
Net Operating Revenues 489.3 137.0 96.7 247.5 8.1
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2. Operating Costs
Operating Costs
(R$ thousands) 2Q14 2Q13
Personnel and Management (10,948) (8,434)
Fuel (189,626) (158,132)
Outsourced Services (38,336) (12,709)
Leases and Rentals (73,175) (52,154)
Energy Acquired for Resale (28,599) (76,692)
Other Costs (51,978) (84,238)
Transmission Charges (13,876) (16,125)
Compensation for Downtime (22,778) (69,511)
Other (15,324) 1,398
Total (392,662) (392,359)
Depreciation and Amortization (46,942) (25,972)
Total Operating Costs (439,603) (418,331)
Operating Costs totaled R$439.6 million in 2Q14, impacted mainly by an increase of R$31.5
million in fuel costs relative to the same period of the preceding year, due to the beginning of
commercial operations of Pecm II. The fuel cost of R$189.6 million recorded in the quarter isdivided into R$53.4 million incurred by Itaqui, R$41.4 million incurred by Pecm II in April and
May, R$92.6 million incurred by Parnaba I and R$2.3 million by Amapari.The full-quarter operation of these plants also impacted the Outsourced Services account, which
reached R$38.3 million in 2Q14, mainly due to higher costs with utilities, machinery andequipment repair, mechanical maintenance service and technical consulting.The Leases and Rentals account, which totaled R$73.2 million in the quarter, is comprised mainly
by lease costs incurred by Parnaba I, according to its gas supply agreement (R$72.1 million).The Other Costs account, which totaled R$52.0 million in 2Q14, is mainly composed by transmission charges (TUST) and compensation for downtime of the power plants (unavailability
charges).In 2Q14, Itaqui, Pecm II and Parnaba I had to reimburse discos for the energy not delivered by
the difference between their declared variable cost per MWh (CVU) and the spot price (PLD). In
the quarter, these costs amounted to R$2.7 million, R$16.0 million (April and May only) and
R$4.1 million for Itaqui, Pecm II and Parnaba I, respectively.On January 07, 2014, Itaqui filed a lawsuit against Aneel questioning the penalties being chargedon an hourly basis, considering that the Regulated Market Power Purchase Agreements (PPAs)provide for using the 60-month rolling average availability. On January 24, 2014, a Federal Court
granted an injunction to Itaqui determining that unavailability charges be calculated based on the
60-month rolling average. In the cases of Pecm II and Parnaba I, unavailability charges are still being measured and charged on an hourly basis. Downtime charges are calculated based on the difference between the actual production of the generating units and the authorized capacity
discounting forced and programmed stoppage rates, internal consumption of the units and grid
losses.
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3. Operating Expenses
In the quarter, Operating Expenses, excluding Depreciation & Amortization, amounted to R$17.3
million, a 56.8% reduction when compared to 2Q13. In the same period, the holding company
posted Operating Expenses, excluding Depreciation & Amortization, of R$12.7 million, compared
to the R$29.4 million recorded in 2Q13. During the period, the IPCA inflation index rose by
6.80%.
Operating Expenses
(R$thousands) 2Q14
Consolidated
2Q13 %
Personnel (6,167) (18,845) -67.3%
Outsourced Services (8,050) (18,222) -55.8%
Leases and Rentals (1,649) (1,611) 2.4%
Other Expenses (1,462) (2,653) -44.9%
Total (17,327) (41,331) -58.1%
Depreciation and Amortization (801) (652) 22.9%
Total Operating Expenses (18,129) (41,983) -56.8%
Operating Expenses Holding
(R$thousands) 2Q14 2Q13 %
Personnel (4,898) (16,484) -70.3%
Stock Options 160 (9,188) -101.7%
Outsourced Services (5,514) (10,565) -47.8%
Leases and Rentals (1,504) (1,031) 45.9%
Other Expenses (793) (1,347) -41.1%
Total (12,709) (29,427) -56.8%
Depreciation and Amortization (580) (452) 28.5%
Total Operating Expenses (13,289) (29,879) -55.5%
The main changes are as follows:
Personnel: Personnel expenses totaled R$6.2 million in 2Q14, compared to R$18.8million reported in the same period of the preceding year. The reduction in personnel
expenses is largely a result of: Reduction in stock option-related expenses in the Holding resulting from a
decrease in both the number of options outstanding and the share price since 2Q13 (-R$9.3 million);
Reversal of a provision for dismissals that had been booked in 2013 (-R$2.7
million);
Outsourced services: Expenses with outsourced services in 2Q14 totaled R$8.1 million,down R$10.2 million in relation to 2Q13. The highlights are:
Decrease in expenses with shared services in the holding company, resulting
from the elimination of EBXs service structure (-R$3.9 million); Negative accounting adjustments of values booked in previous periods (-R$2.4
million).
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4. EBITDA
In 2Q14, ENEVA reported a positive EBITDA of R$79.3 million, mainly due to:
Full quarter operations of Pecm II, which had a positive contribution of R$20.8 million to2Q14 consolidated EBITDA;
Improved operational performance of Itaqui, with resulting decrease in unavailability expenses. Itaqui reported an EBITDA of R$20.1 million in 2Q14;
Stable performance of Parnaba I, which reported an EBITDA of R$50.3 million in 2Q14;
Reduced operating expenses in the Holding, which reported a negative EBITDA of R$12.7million in 2Q14.
5. Net Financial Result
Financial Result
(R$thousands) 2Q14 2Q13 %
Financial Income 15,189 19,940 -23.8%
Monetary variation 4,121 682 504.4%
Revenues from financial investments 14,656 7,498 95.5%
Marking-to-market of derivatives (4,605) 10,474 -144.0%
Settlement of derivatives - - -
Present value adjust. (debentures) - (175) -100.0%
Other 1,017 1,461 -30.4%
Financial Expenses (149,729) (182,869) -18.1%
Monetary variation (192) (12,919) -98.5%
Interest expenses (134,165) (86,924) 54.3%
Settlement of derivatives - 15,770 -100.0%
Marking-to-market of derivatives (4,124) (12,608) -67.3%
Costs and Interest on Debentures (185) (149) 23.6%
Other (11,065) (86,039) -87.1%
Net Financial Result (134,541) (162,929) -17.4%
In 2Q14, ENEVA recorded net financial expenses of R$134.5 million, compared to net expenses of
R$162.9 million in 2Q13, impacted mainly by a decrease in other financial expenses (-R$75.0
million). Other financial expenses in 2Q13 were inflated by structuring and advisory fees relatedto the loans and societary transactions. Such impact was partially offset by an increase in interest
expenses, mainly in the holding company (+R$37.0 million). Higher interest expenses at the
holding level are related to the growth in debt motivated by increased cash needs in the
subsidiaries resulting from energy acquisition costs due to delays in the startup of the power plants and unavailability penalties.
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6. Equity Income
The company reported a negative equity income of R$35.2 million, mainly impacted by losses incurred by Pecm I.
The following analysis considers 100% of the projects. On June 30, 2014, ENEVA held an interestof 50.0% in Pecm I, 50% in ENEVA Participaes, 52.5% in Parnaba III and Parnaba IV.
6.1. Pecm I
INCOME STATEMENT - Pecm I
(R$million) 2Q14 2Q13 %
Net Operating Revenues 293.3 227.0 29.2%
Operating Costs (290.2) (309.7) -6.3%
Operating Expenses (4.5) (7.0) -36.6%
Net Financial Result (69.9) (46.7) 49.8%
Earnings Before Taxes (71.3) (136.4) -47.8%
Taxes Payable and Deferred 24.2 46.4 -47.8%
NET INCOME (47.0) (90.0) -47.8%
EBITDA 32.5 (63.8) -151.0%
Net revenues for Pecm I in the quarter amounted to R$293.3 million, comprised of: Fixed revenues amounting to R$151.1 million; Variable revenues amounting to R$109.8 million; Revenues referring to power trades resulting from the annual revision of the plants firm
energy, provided for in the concession contract, totaling R$68.9 million; Taxes on revenues amounting to R$36.5 million.
Operating Costs, excluding depreciation and amortization, totaled R$256.3 million, a 9.7%
decrease compared to the same period of last year, mostly attributable to the reduction in energy
acquisition costs. The second generating unit of Pecm I was granted authorization forcommercial operations in May 2013 and therefore 2Q13 figures were impacted by costs incurred
to meet contractual obligations for this unit.Fuel costs in the quarter reached R$107.4 million, split between coal (R$98.9 million) and diesel
oil and other (R$8.5 million) costs.Operating costs in 2Q14 were also inflated by costs associated with power trades resulting from
the annual revision of the plants firm energy, provided for in the PPAs, amounting to R$61.8
million. Every year, the ONS resets the plants firm energy based on the performance of the past 60 months. If the average availability rate falls below the value originally declared, the plants firm energy is reduced and the difference has to be covered by a free market collateral contract.
The plant can then sell in the spot market the energy associated with the collateral contract,
maintaining only the collateral component of the contract. In 2Q14, given high spot prices, gross
revenues resulting from this sale amounted to R$68.9 million.Other Costs totaled R$61.6 million in 2Q14. This account is composed mainly by transmission
charges (R$14.5 million) and compensation for downtime or unavailability charges (R$46.3
million).
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Total Operating Expenses (15,024) (13,865) 8.4%
In 2Q14, Pecm I recorded a positive EBITDA of R$32.5 million. Net financial expenses amounted
to R$69.9 million, compared to R$46.7 million in 2Q13, impacted mainly by increased interest
expenses due to interest on long-term financing no longer being capitalized with the start-up of
operations of the second turbine in 2Q13, interest on intercompany loans, higher losses onmonetary variation, due to differential exchange rates on hedging swaps and the reversal of
values previously booked to Shareholders Equity due to the ineffectiveness of hedge accounting.
Pecm I reported a net loss of R$47.0 million in 2Q14.
6.2.ENEVA Participaes S.A.6.2.1.Holding Operating Expenses
Operating Expenses Holding ENEVA Participaes S.A.
(R$thousands)
2Q14 2Q13 %
Personnel (6,403) (10,059) -36.3%
Outsourced Services (7,344) (2,439) 201.1%
Leases and Rentals (848) (973) -12.8%
Other Expenses (407) (390) 4.1%
Total (15,002) (13,861) 8.2%
Depreciation and Amortization (22) (4) 427.7%
In 2Q14, Operating Expenses, excluding Depreciation & Amortization, amounted to R$15.0
million, an increase of R$1.1 million compared to 2Q13. Despite the reduction of personnelexpenses, outsourced services were impacted by higher expenses related to technical consulting
services provided by E.ON (+R$6.4 million).
6.2.2.Parnaba III
INCOME STATEMENT - Parnaba III
(R$million) 2Q14 2Q13 %
Net Operating Revenues 56.9 36.8 54.8%
Operating Costs (66.8) (56.7) 17.7%
Operating Expenses (0.2) (0.1) 163.1%
Net Financial Result (2.5) (0.6)335.0%
Other Revenues/Expenses (0.5) - -
Earnings Before Taxes (13.1) (20.6) -36.6%
Taxes Payable and Deferred 5.0 7.0 -28.6%
NET INCOME (8.1) (13.6) (0.4)
EBITDA (8.4) (20.0) -58%
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On October 22, 2013, Parnaba III received authorization from Aneel to start the commercial
operations of its first generation unit, with 169MW of installed capacity. On February 17, 2014,
the plant started the commercial operations of its second generation unit, with 7MW of installed
capacity, complying with the total capacity contracted under the terms of the Regulated Marketpower purchase agreement secured in the 2008 A-5 energy auction (176 MW).Net revenues in the quarter amounted to R$56.9 million, comprised of: Fixed revenues amounting to R$25.3 million; Variable revenues amounting to R$38.1 million; Taxes on revenues amounting to R$6.5 million.
Operating Costs reached R$66.8 million in the quarter, comprised mainly of: Fuel - natural gas (R$19.2 million); Lease costs, according to the gas supply agreement (R$26.6 million) Unavailability costs (R$14.2 million)
In 2Q14, Parnaba III recorded a negative EBITDA of R$8.4 million.Net financial expenses amounted to R$2.5 million, mainly impacted by interest expenses.Parnaba III reported a net loss of R$8.1 million in 2Q14.
6.2.3.Parnaba IV
INCOME STATEMENT - Parnaba IV
(R$million) 2Q14 2Q13 %
Net Operating Revenues 5.2 - -
Operating Costs (17.0) 0.0 -
Operating Expenses (0.3) 0.1 -579.8%
Net Financial Result (8.2) 6.6 -223.5%
Other Revenues/Expenses (0.0) - -
Earnings Before Taxes - - -
Taxes Payable and Deferred 6.9 (1.3) -614.7%
NET INCOME (13.4) 5.4 -350.8%
EBITDA
(10.9)
0.1 -16862%
Parnaba IV (56MW) received authorization from Aneel to start commercial operations as a power
self-producer on December 12, 2013. The plant, a partnership between ENEVA, ENEVA
Participaes and Petra Energia S.A., signed a contract in the free market, for a five-year period, to supply 20 MWavg from December, 2013 until May, 2014 and 46MWavg from June, 2014 until
December, 2018.In 2Q14, Parnaba IV recorded net revenues of R$5.2 million and operational costs amounting to
R$17.0 million, impacted mainly by fuel costs natural gas (R$4.5 million) and energy costs resulting from submarket exposure (R$9.3 million). The hedge for submarket exposure, booked
under the ENEVA Power Trading company, had a positive result of R$8.1 million in the quarter.Parnaba IV reported a negative EBITDA of R$10.9 million in the quarter.Net financial expenses totaled R$8.2 million, mainly impacted by debt interest.In 2Q14, the plant reported a net loss of R$13.4 million.
7. Net Income
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In 2Q14, ENEVA reported a net loss of R$112.3 million, impacted mainly by interest expenses
related to the end of the grace period of the long-term project loans and higher leverage at the
holding company. However, the improved operational performance of the coal plants and reducedoverhead in the holding led to a 51.9% reduction in net loss as compared to 2Q13.
INCOME STATEMENT
(R$ million) 2Q14 2Q13 %Net Operating Revenues 489.3 395.1 23.8%
Operating Costs (439.6) (418.3) 5.1%
Operating Expenses (18.1) (42.0) -56.8%
Net Financial Result (134.5) (162.9) -17.4%
Equity Income (35.2) (45.1) -21.9%
Other Revenues/Expenses 29.2 (1.6) -1931.9%
Earnings Before Taxes (109.0) (274.8) -60.3%
Taxes Payable and Deferred (1.4) 41.3 -103.5%
Minority Interest (1.8) 0.2 -869.9%
NET INCOME (112.3) (233.2) -51.9%
EBITDA 79.3 (38.6) -305.7%
8. Debt
As of June 30, 2014, consolidated gross debt amounted to R$5,091.5 million, a reduction of18.0% in relation to the amount recorded on December 31, 2013.
Consolidated debt profile (R$ Million)
The
Short Term Long Term Working Capital Project Finance
balance of short-term debt at the end of June, 2014 was R$3,144.7 million, or R$736.6 million
higher than the amount recorded on December 31, 2013.R$1,053.5 million out of the total balance of short-term debt are allocated in the projects (vs.
R$845.9 million on December 31, 2014), as follows:
R$179.9 million refer to the current portion of the long-term debts of Itaqui and ParnabaI;
R$78.1 million refer to bridge loans to Parnaba I. The outstanding balance will be paid-off in installments, which started in October, 2013;
1,94738%
3,14562%
2,26444%
2,82856%
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57
R$795.5 million refer to bridge loans to Parnaba II.
The remaining balance of short-term debt, amounting to R$2,091.2 million, is allocated in the
holding company (vs. R$1,562.2 million on December 31, 2013). During 2Q14, ENEVA holding
raised additional R$100 million as a bridge to a long-term financing for Pecm II. This amountwill be paid-off with disbursement of Pecm II long-term financing, amounting to R$150 million.
As part of the ongoing financial restructuring of the Company, a push-down of R$600 million of
the HoldCo debt to its operating subsidiaries, with a 5-year maturity extension with three years
of grace period for the remaining portion, should be carried out after the completion of the
second phase of the capital increase.At the end of June, 2014, the average cost of debt stood at 10.41% p.a. and the averagematurity at 3.9 years.
Debt Maturity Profile* (R$ Million)
Working Capital
1,387
Project Finance
87,81,054 97,0 255,1 207,8
*Valuesinclude
Cash & CashEquivalents
debentures.
2014
2015
2016
2017 From 2018 on
principal + capitalized interest + charges and exclude outstanding convertible
Net debt in 1Q14 amounted to R$5,003.8 million, 15.7% lower than the value reported on
December 31, 2013.Consolidated Cash and Cash Equivalents totaled R$87.8 million at the end of March, 2014, a
decrease of R$189.8 million as compared to the balance in December 31, 2013.
Consolidated Cash and Cash Equivalents (R$ Million)
Consolidated
Cash and Cash
Cash and Revenues Operating CAPEX Capital Debt Raised Intercompany Debt Service Others Cash andCash
Equivalents
(1Q14)
Costs andExpenses
Increase Loan CashEquivalents
(2Q14)
Equivalents of the first quarter is already net of Pecm II consolidated cash and cash equivalents.
4,7 120 62,5
83, 87,7
507
100 128
2,091
4
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9. Capital Expenditures (Accounting view)
During 2Q14, ENEVAs consolidated capital expenditures amounted to 121.9 million. Capitalizedinterest amounted to R$21.3 million and depreciation & amortization to R$33.9 million.
Capital Expenditures (Consolidated Assets, R$ million)
2Q14 4Q13
CapexInterest
Capitalized
Depreciation &Amortization
Capex
InterestCapitalized
Depreciation &Amortization
Parnaba I 18.7 - -12.1 70.3 6.7 -3.0
Capital Expenditures (Non-consolidated Assets*, R$ million)
2Q14
CapexInterest
Capitalized
Depreciation &Amortization
Pecm I 6.9 - -8.5
Pecm II 8.1 - -8.2
* Adjusted by ENEVAs interest.
Parnaba II 87.9 21.3 - 139.0 13.7 -
Itaqui 15.9 - -21.8 92.4 13.7 -13.0
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Eneva S.A.
3
Conclusion on the parent companyinterim information
Based on our review, nothing has come to our attention that causes us to believe that the
accompanying parent company interim accounting information included in the quarterly informationreferred to above has not been prepared, in all material respects, in accordance with CPC 21 applicable
to the preparation of the Quarterly Information, and presented in accordance with the standards
issued by the CVM.
Conclusion on the consolidatedinterim information
Based on our review, nothing has come to our attention that causes us to believe that the
accompanying consolidated interim accounting information included in the quarterly information
referred to above has not been prepared, in all material respects, in accordance with CPC 21 and IAS
34 applicable to the preparation of the Quarterly Information, and presented in accordance with the
standards issued by the CVM.
Emphasis of matter
Continuity of the Company's operations
We draw attention to Note 1 to this quarterly information, which states that the Company recorded, at
June 30, 2014, an accumulated deficit of R$ 2.558.792 thousand, losses for the six-month period then
ended of R$ 184.211 thousand and presented an excess of current liabilities over current assets in the
parent company and consolidated quarterly information of R$ 1.779.699 thousand and R$ 2.894.586
thousand, respectively. This, along with other matters as described in Note 1, indicates the existence ofa material uncertainty which may raise significant doubt about the ability of Eneva S.A. to continue as
a going concern, which will depend on the success of its current plans that include capital increase ,sale of assets and renegotiations to reschedule the maturities of loans from third parties as described
in the footnote 1. No adjustments arising from these uncertainties were included in the interim
accounting information. Our conclusion is not qualified in respect of this matter.
Other matters
Statements of value added
We have also reviewed the parent company and consolidated statements of value added for the six-
month period ended June 30, 2014. These statements are the responsibility of the Companysmanagement, and are required to be presented in accordance with standards issued by the CVM
applicable to the preparation of Quarterly Information (ITR) and are considered supplementaryinformation under IFRS, which do not require the presentation of the statement of value added. These
statements have been submitted to the same review procedures described above and, based on our
review, nothing has come to our attention that causes us to believe that they have not been prepared,
in all material respects, in a manner consistent with the parent company and consolidated interim
accounting information taken as a whole.
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Eneva S.A.(Publicly held company)
Management notes to the quarterly informationas of June 30, 2014In thousands of reais, unless stated otherwise
1 of 72
1 Reporting entity
MPX Energia S.A. ("Company") was founded on April 25, 2001 and is headquartered in Rio de
Janeiro. The Extraordinary General Meeting held on September 11, 2013 approved the decision tochange the Company's name to Eneva S.A.
Its core activity is the generation of electricity through the development of a diversified portfolio of
sources, including mineral coal, natural gas and renewable sources. The Company has a diversifiedportfolio of projects, including thermal power plants in Brazil, in addition to renewable energy
projects, such as solar and wind energy. In order to integrate its operations, the Company is also a
shareholder in a natural gas production and exploration project in Brazil, which supplies gas to
plants built by the company in Maranho.
The company participates as a quotaholder or shareholder of the companies that implement theseprojects and certain projects will be implemented in partnership with other players in the energy
sector. These projects were primarily funded through funds obtained under the Company's publicshare offering made on December 14, 2007 and January 11, 2008 (supplementary batch), amounting
to R$ 2,035,410, in addition to financing and the issuance of 21,735,744 convertible debentures on
June 15, 2011 amounting to R$ 1,376,527. 21,653,300 debentures were converted on May 24, 2012,
triggering the issuance of 33,255,219 new shares, as a result of the corporate reorganizationimplemented by the Company.
On June 28, 2013 the controlling shareholder of MPX Energia S.A., Mr. Eike Fuhrken Batista,
entered into an investment agreement with E.ON SE consisting of the following events:
(a) On May 29, 2013 E.ON acquired Company shares held by Eike Batista accounting for approximately
24.5% of the share capital.
(b) On the date the shares were acquired, E.ON and Eike Batista entered into a new shareholders'agreement, which regulated the exercising of voting rights and restrictions on the transfer of shares
held by them.
(c) In August 2013 a private capital increase was concluded of approximately R$ 800 million, with asubscription price fixed at R$ 6.45 per share.
(d) The shareholders will subsequently be asked to approve the acquisition by the Company at equityvalue of ENEVA Participaes S.A., a joint-venture between the Company and EON ("JV").
As shown in the table below, on June 30, 2014 the economic group ("Group" or "Company") includes
the Company and its equity interests in associated companies, direct and indirect subsidiaries, joint
ventures and the Multimercado MPX 63 investment fund. The operational companies are (for
further details about the subsidiaries see Note 12):
Parnaba I Gerao de Energia S.A.; Porto do Pecm Gerao de Energia S.A.; Pecm II Gerao de Energia S.A.; Itaqui Gerao de Energia S.A.,; Amapari Energia S.A.; ENEVA Comercializadora de Energia Ltda., ENEVA Comercializadora de Combustveis Ltda., Tau Gerao de Energia Ltda; Parnaba III Gerao de Energia S.A.; and Parnaba IV Gerao de Energia S.A.
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Eneva S.A.(Publicly held company)
Management notes to the quarterly informationas of June 30, 2014In thousands of reais, unless stated otherwise
2 of 72
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Eneva S.A.(Publicly held company)
Management notes to the quarterly informationas of June 30, 2014In thousands of reais, unless stated otherwise
3 of 72
* Joint subsidiary.
** Associated company.
Directly or by way of its subsidiaries, joint subsidiaries and associated companies, the Company has
been making the investment required to finalize the ventures in its portfolio and subsequently begin
the commercial operation thereof.
The Company took out a short-term debt to finance its operations in 2012, 2013 and 2014. The
consolidated loans maturing in the next 12 months can be summarized as follows from June 30,
2014:
Up to 3 months: R$ 417 million. Between 3 and 6 months: R$ 2,088 million. Between 6 and 9 months: R$ 81 million. Between 9 and 12 months: R$ 341 million.
The short-term debts were taken out to finance part of the investments made and to meet working
capital requirements. The Company also is working to partially settle and roll forward its short-term
debts to the long term and is mainly considering the following events in its business plan:
Long-term financing for Panaba II in 2014 up to R$ 960 million.
Long-term financing for Panaba III and IV up to R$ 270 million.
Possibility of re-leveraging the Pecm II Gerao de Energia and Itaqui Gerao de Energia S.A.
ventures in operation via a long-term financing issuance up to R$ 650 million.
Transfer of R$ 600 to 700 million from the Company's short-term debt to long-term debt inoperational ventures.
Partial sale of Pecm II on July 14 for the total amount of R$ 408 million.
Ratification of the Company's share capital on August 01 by R$ 175 million. Of this total R$ 42million was subscribed by the bank Citibank S.A. ("Citi") through funds used entirely to pay earlypart of the principal of the debt taken out by the Company from the financial institution. It is
noteworthy that R$ 120 million of the E.ON participation on the capital increase described above,as advanced for future capital was made in May 20, 2014.
The above capital increase, less Citi's subscription, and the partial sale of the thermoelectric
power plant Pecm II, represent a capital contribution of approximately R$ 540.7 million. These
events constitute the first steps of ENEVA's stabilisation plan.
In addition to the re-leveraging of certain projects described above, the Company is implementing a
capital increase of up to R$ 1.5 billion, to bolster the capital structure and create the means
necessary to permit a substantial reduction in its leverage; for further information, see the
subsequent event described in note 29.
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Eneva S.A.(Publicly held company)
Management notes to the quarterly informationas of June 30, 2014In thousands of reais, unless stated otherwise
5 of 72
3 Presentation of the interim financial information
The financial statements have been prepared based on the historic cost basis, adjusted to realization
value when applicable, except for financial instruments held at fair value, including derivative
instruments. The interim financial statements have been prepared in accordance with the accounting
policies, principles, methods and consistent criteria in relation to those used to prepare the audited
financial statements for the financial year ended December 31, 2013 and should therefore be read in
conjunction with them.
The preparation of financial statements requires the use of certain critical accounting estimates. Italso requires management to exercise its judgment in the process of applying the accounting policies.
The areas involving a higher degree of judgment or complexity, or areas where assumptions andestimates are significant to the parent company and financial statements are disclosed in Note 5.
(a) Consolidated interim financial information
The consolidated interim financial information has been prepared and has been presented in
accordance with the pronouncement issued by the Accounting Pronouncements Committee (CPC 21- R1), interim statements, equal to International Financial Reporting Standards (IAS 34).
The presentation of the individual and consolidated Statement of Added Value (DVA) is required byBrazilian corporate legislation and the accounting practices adopted in Brazil that apply to listed
companies.
(b) Individual interim financial informationThe Parent company's individual interim financial statements have been prepared in accordance
with CPC 21 (R1) - Interim Statements issued by the Accounting Pronouncements Committee
("CPC") and are being published in conjunction with the consolidated financial statements.
In the individual interim financial statements subsidiaries are accounted for by the equity method
adjusted to the proportion held in the Group's contractual rights and obligations. The accountingpractices adopted in Brazil applicable to the individual financial information differ from IFRS
applicable to the separate financial statements only in relation to the measurement of investments insubsidiaries, joint ventures and associated companies based on the equity accounting method, while
this is based on cost or fair value under IFRS and from the deferred assets maintenance .
For the purpose of BR GAAP, Law 11941/09 abolished def