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| 1 |
Earnings Results 1Q22 |  |
| Highlights |
The Company recorded a net income of R$ 975.6 million in 1Q22, compared to the R$ 496.8 million reported in 1Q21, an increase of R$ 478.8 million (+96.4%).
Adjusted EBITDA totaled R$ 1,721.3 million, up by R$ 84.9 million from the R$ 1,636.4 million reported in 1Q21 (5.2%).
Revenue from sanitation services
Increase of R$ 361.0 million, impacted by: (i) tariff adjustment; and (ii) higher average tariff due to the increase in the billed volume in the Commercial and Public categories.
Costs, administrative and selling expenses (excluding construction costs)
Growth of R$ 286.0 million, mainly due to the: (i) R$ 56.6 million increase in allowances for doubtful accounts; (ii) R$ 53.1 million increase in electricity expenses; (iii) R$ 48.4 million increase in treatment supplies; (iv) R$ 47.6 million increase in depreciation and amortization; and (v) R$ 46.7 million increase in expenses with salaries, payroll charges, benefits, and pension plan obligations.
Impacts from the exchange variation
Exchange variation expenses on borrowings and financing fell by R$ 731.8 million, due to the depreciation of the U.S. dollar and the Japanese Yen against the Brazilian real in 1Q22, compared to the appreciation reported in 1Q21, as shown in the following table:
| 1Q22 | 1Q21 | |
| Debt in foreign currency - R$ million | 2,603.7 | 3,552.4 |
| Foreign currency debt as a percentage of total debt - % | 15 | 21 |
| U.S. Dolar variation in the quarter - % | (15.1) | 9.6 |
| Yen variation in the quarter - % | (19.5) | 2.2 |
| 2 |
Earnings Results 1Q22 | |
| 1. | Financial Highlights |
| R$ million | |||||
| 1Q22 | 1Q21 | Var. (R$) | % | ||
| Revenue from sanitation services | 4,298.2 | 3,937.2 | 361.0 | 9.2 | |
| Construction revenue | 888.2 | 1,023.3 | (135.1) | (13.2) | |
| COFINS and PASEP/TRCF taxes | (316.0) | (283.1) | (32.9) | 11.6 | |
| (=) | Net operating income | 4,870.4 | 4,677.4 | 193.0 | 4.1 |
| Costs and expenses | (2,876.9) | (2,590.9) | (286.0) | 11.0 | |
| Construction costs | (867.5) | (1,000.3) | 132.8 | (13.3) | |
| Equity result | 5.6 | 8.1 | (2.5) | (30.9) | |
| Other operating income (expenses), net | 2.6 | 10.7 | (8.1) | (75.7) | |
| (=) | Earnings before financial result, income tax, and social contribution | 1,134.2 | 1,105.0 | 29.2 | 2.6 |
| Financial result | 340.1 | (354.4) | 694.5 | (196.0) | |
| (=) | Earnings before income tax and social contribution | 1,474.3 | 750.6 | 723.7 | 96.4 |
| Income tax and social contribution | (498.7) | (253.8) | (244.9) | 96.5 | |
| (=) | Net income | 975.6 | 496.8 | 478.8 | 96.4 |
| Earnings per share (R$)* | 1.43 | 0.73 |
* Total shares = 683,509,869
Adjusted EBITDA Reconciliation (Non-accounting measures)
| R$ million | |||||
| 1Q22 | 1Q21 | Var. (R$) | % | ||
| Net income | 975.6 | 496.8 | 478.8 | 96.4 | |
| Income tax and social contribution | 498.7 | 253.8 | 244.9 | 96.5 | |
| Financial result | (340.1) | 354.4 | (694.5) | (196.0) | |
| Other operating income (expenses), net | (2.6) | (10.7) | 8.1 | (75.7) | |
| (=) | Adjusted EBIT* | 1,131.6 | 1,094.3 | 37.3 | 3.4 |
| Depreciation and amortization | 589.7 | 542.1 | 47.6 | 8.8 | |
| (=) | Adjusted EBITDA** | 1,721.3 | 1,636.4 | 84.9 | 5.2 |
| (%) Adjusted EBITDA margin | 35.3 | 35.0 |
* Adjusted EBIT corresponds to income before: (i) other operating income (expenses), net; (ii) financial result; and (iii) income tax and social contribution.
** Adjusted EBITDA corresponds to income before: (i) other operating income (expenses), net; (ii) financial result; (iii) income tax and social contribution; and (iv) depreciation and amortization expenses.
The net operating revenue, which considers construction revenue, totaled R$ 4,870.4 million in 1Q22, up by 4.1% over 1Q21.
Costs and expenses, which consider construction costs, totaled R$ 3,744.4 million, up by 4.3% over 1Q21.
Adjusted EBIT, of R$ 1,131.6 million, increased by 3.4% over the R$ 1,094.3 million recorded in 1Q21.
Adjusted EBITDA, of R$ 1,721.3 million, increased by 5.2% over the R$ 1,636.4 million recorded in 1Q21 (R$ 6,457.6 million in the last 12 months).
Adjusted EBITDA margin was 35.3% in 1Q22, compared to 35.0% in 1Q21 (32.8% in the last 12 months).
Excluding the effects of revenue and construction costs, the adjusted EBITDA margin reached 42.7% in 1Q22, compared to 44.2% in 1Q21 (41.2% in the last 12 months).
The Company recorded a net income of R$ 975.6 million in 1Q22, compared to R$ 496.8 million in 1Q21.
| 3 |
Earnings Results 1Q22 | |
| 2. | Revenue from sanitation services |
The gross operating revenue from sanitation services, which excludes construction revenue, totaled R$ 4,298.2 million in 1Q22, an increase of R$ 361.0 million (+9.2%) over the R$ 3,937.2 million recorded in 1Q21.
Among others, the main factors that led to the increase were:
| · | Average tariff adjustment of 7.0% since May 2021; |
| · | Higher average tariff due to the increase in the billed volume in the Commercial and Public categories; and |
| · | Decrease of 0.4% in the total billed volume. |
| 3. | Construction revenue |
Construction revenue fell by R$ 135.1 million (-13.2%) in 1Q22, due to lower investments made.
| 4. | Billed volume |
The following tables show the water and sewage billed volumes, on a quarter-over-quarter basis, per customer category and region.
| WATER AND SEWAGE BILLED VOLUME(1) PER CUSTOMER CATEGORY - million m3 | |||||||||
| Water | Sewage | Water + Sewage | |||||||
| Category | 1Q22 | 1Q21 | % | 1Q22 | 1Q21 | % | 1Q22 | 1Q21 | % |
| Residential | 472.6 | 478.0 | (1.1) | 409.5 | 410.8 | (0.3) | 882.1 | 888.8 | (0.8) |
| Commercial | 41.4 | 41.5 | (0.2) | 40.3 | 39.2 | 2.8 | 81.7 | 80.7 | 1.2 |
| Industrial | 8.1 | 8.5 | (4.7) | 9.1 | 9.5 | (4.2) | 17.2 | 18.0 | (4.4) |
| Public | 9.5 | 8.0 | 18.8 | 8.5 | 7.9 | 7.6 | 18.0 | 15.9 | 13.2 |
| Total retail | 531.6 | 536.0 | (0.8) | 467.4 | 467.4 | - | 999.0 | 1,003.4 | (0.4) |
| Wholesale(3) | 11.9 | 13.1 | (9.2) | 5.8 | 4.0 | 45.0 | 17.7 | 17.1 | 3.5 |
| Total | 543.5 | 549.1 | (1.0) | 473.2 | 471.4 | 0.4 | 1,016.7 | 1,020.5 | (0.4) |
| WATER AND SEWAGE BILLED VOLUME(1) PER REGION - million m3 | |||||||||
| Water | Sewage | Water + Sewage | |||||||
| Region | 1Q22 | 1Q21 | % | 1Q22 | 1Q21 | % | 1Q22 | 1Q21 | % |
| Metropolitan | 354.3 | 358.5 | (1.2) | 311.0 | 312.0 | (0.3) | 665.3 | 670.5 | (0.8) |
| Regional(2) | 177.3 | 177.5 | (0.1) | 156.4 | 155.4 | 0.6 | 333.7 | 332.9 | 0.2 |
| Total retail | 531.6 | 536.0 | (0.8) | 467.4 | 467.4 | - | 999.0 | 1,003.4 | (0.4) |
| Wholesale(3) | 11.9 | 13.1 | (9.2) | 5.8 | 4.0 | 45.0 | 17.7 | 17.1 | 3.5 |
| Total | 543.5 | 549.1 | (1.0) | 473.2 | 471.4 | 0.4 | 1,016.7 | 1,020.5 | (0.4) |
| 1. | Unaudited by external auditors |
| 2. | Including coastal and interior regions |
| 3. | Wholesale includes volumes of reuse water and non-domestic sewage |
| 5. | Costs, administrative & selling expenses and construction costs |
Costs, administrative and selling expenses, and construction costs increased by R$ 153.2 million in 1Q22 (+4.3%). Excluding construction costs, the increase was R$ 286.0 million (+11.0%).
| 4 |
Earnings Results 1Q22 | |
Costs, administrative and selling expenses, and construction costs as a percentage of net revenue were 76.9% in 1Q22, compared to 76.8% in 1Q21.
| R$ million | ||||
| 1Q22 | 1Q21 | Var. (R$) | % | |
| Salaries, payroll charges and benefits, and Pension plan obligations | 668.1 | 621.4 | 46.7 | 7.5 |
| General supplies | 71.9 | 68.3 | 3.6 | 5.3 |
| Treatment supplies | 147.3 | 98.9 | 48.4 | 48.9 |
| Services | 512.1 | 503.9 | 8.2 | 1.6 |
| Electricity | 412.0 | 358.9 | 53.1 | 14.8 |
| General expenses | 279.1 | 258.9 | 20.2 | 7.8 |
| Tax expenses | 19.0 | 17.4 | 1.6 | 9.2 |
| Subtotal | 2,109.5 | 1,927.7 | 181.8 | 9.4 |
| Depreciation and amortization | 589.7 | 542.1 | 47.6 | 8.8 |
| Allowance for doubtful accounts | 177.7 | 121.1 | 56.6 | 46.7 |
| Subtotal | 767.4 | 663.2 | 104.2 | 15.7 |
| Costs, administrative & selling expenses | 2,876.9 | 2,590.9 | 286.0 | 11.0 |
| Construction costs | 867.5 | 1,000.3 | (132.8) | (13.3) |
| Costs, adm & selling expenses, and construction costs | 3,744.4 | 3,591.2 | 153.2 | 4.3 |
| % of net revenue | 76.9 | 76.8 |
Salaries and payroll charges and Pension plan obligations
Increase of R$ 46.7 million (+7.5%) in 1Q22, mainly due to the 7.8% salary adjustment in May 2021 and the application of 1% referring to the Career and Salary Plan in February 2022, partially offset by the 2.3% decline in the average number of employees; with a net effect of R$ 51.6 million.
Treatment supplies
Increase of R$ 48.4 million (+48.9%), mainly due to the higher use of algaecides, coagulants, and disinfectants in several Water Treatment Stations to maintain the quality of raw water, as well as to the increase in product prices.
Services
Service expenses totaled R$ 512.1 million, an increase of R$ 8.2 million (+1.6%) over the R$ 503.9 million recorded in 1Q21. The main increases were:
| · | R$ 15.5 million with technical services, especially with IT technical support; |
| · | R$ 14.1 million with surveillance; |
| · | R$ 11.0 million with customer service channels; and |
| · | R$ 9.6 million with advertising. |
The increases above were offset by the main decreases:
| · | R$ 25.0 million with the maintenance of water and sewage connections and networks; and |
| · | R$ 20.9 million with paving and replacing of sidewalks. |
| 5 |
Earnings Results 1Q22 | |
Electricity
Electricity expenses totaled R$ 412.0 million in 1Q22, up by R$ 53.1 million (+14.8%) over the R$ 358.9 million recorded in 1Q21. In 1Q22, the Free Market Tariffs (ACL) accounted for 52.0% of total expenses (51.5% in 1Q21) while the Regulated Market Tariffs (ACR) accounted for 48.0% (48.5% in 1Q21).
The main factors that contributed to this variation were:
| · | Average increase of 1.7% in ACL prices (includes Grid Market Tariffs - TUSD), with a 0.8% rise in consumption; and |
| · | Average increase of 37.9% in ACR tariffs, with a 6.9% decrease in consumption. |
General expenses
Increase of R$ 20.2 million (+7.8%), totaling R$ 279.1 million in 1Q22, compared to the R$ 258.9 million recorded in 1Q21, mainly from the higher provision for transfer to the Municipal Funds for Environmental Sanitation and Infrastructure, of R$ 14.2 million, resulting from the increase in revenue and the number of municipalities with expected transfers.
Expenses with municipal transfers totaled R$ 163.0 million in 1Q22, compared to the R$ 148.8 million reported in 1Q21.
Depreciation and amortization
The R$ 47.6 million increase (+8.8%) was due to the beginning of operations of intangible assets, totaling R$ 4.4 billion.
Allowance for doubtful accounts
Increase of R$ 56.6 million (+46.7%), due to the higher delinquency recorded in 1Q22.
| 6. | Financial result |
| R$ million | ||||
| 1Q22 | 1Q21 | Var. (R$) | % | |
| Financial expenses, net of income | (171.9) | (158.6) | (13.3) | 8.4 |
| Monetary and exchange variations, net | 512.0 | (195.8) | 707.8 | (361.5) |
| Financial Result | 340.1 | (354.4) | 694.5 | (196.0) |
Financial expenses, net of revenue
| R$ million | ||||
| 1Q22 | 1Q21 | Var. (R$) | % | |
| Financial expenses | ||||
| Interest and charges on domestic borrowings and financing | (189.6) | (104.6) | (85.0) | 81.3 |
| Interest and charges on international borrowings and financing | (8.6) | (12.5) | 3.9 | (31.2) |
| Other financial expenses | (114.3) | (101.3) | (13.0) | 12.8 |
| Total financial expenses | (312.5) | (218.4) | (94.1) | 43.1 |
| Financial revenue | 140.6 | 59.8 | 80.8 | 135.1 |
| Financial expenses, net of revenue | (171.9) | (158.6) | (13.3) | 8.4 |
| 6 |
Earnings Results 1Q22 | |
The main impacts in the “financial expenses, net of income” line resulted from:
| · | Increase of R$ 85.0 million in interest and charges on domestic borrowings and financing, mainly due to: (i) higher interest on debentures, of R$ 52.0 million, mainly from the proceeds of the 28th, 29th, and 30th issuances; and (ii) rise in the average DI rate (from 2.02% in 1Q21 to 10.27% in 1Q22), which impacted interest on several domestic borrowings; |
| · | Increase of R$ 13.0 million in other financial expenses, mainly due to the adjusted present value of receivables and Performance Contracts; and |
| · | Increase of R$ 80.8 million in financial revenues, mainly on financial investments in 1Q22, as a result of the increase in the amount invested and the average DI rate. |
Monetary and exchange variation, net
| R$ million | ||||
| 1Q22 | 1Q21 | Var. (R$) | % | |
| Monetary and exchange variations on liabilities | ||||
| Monetary variations on borrowings and financing | (70.7) | (52.4) | (18.3) | 34.9 |
| Exchange variations on borrowings and financing | 594.2 | (137.6) | 731.8 | (531.8) |
| Other monetary variations | (69.9) | (57.4) | (12.5) | 21.8 |
| Total monetary and exchange variations on liabilities | 453.6 | (247.4) | 701.0 | (283.3) |
| Monetary and exchange variations on assets | 58.4 | 51.6 | 6.8 | 13.2 |
| Monetary and exchange variations, net | 512.0 | (195.8) | 707.8 | (361.5) |
The effect of net monetary and exchange variations in 1Q22 was R$ 707.8 million, lower than the amount reported in 1Q21, especially due to:
| · | R$ 18.3 million increase in monetary variations on borrowings and financing, due to the rise in the Amplified Consumer Price Index (IPCA) (from 2.05% in 1Q21 to 3.20% in 1Q22), and the 29th debenture issuance; |
| · | R$ 731.8 million decrease in exchange variations on borrowings and financing, due to the: (i) depreciation of the U.S. dollar and Yen against the Real in 1Q22 (-15.1% and -19.5%, respectively), when compared to the appreciations recorded in 1Q21 (9.6% and 2.2%, respectively); |
| · | R$ 12.5 million increase in other monetary variations, due to: (i) higher monetary variation on asset leases (Leases), of R$ 6.1 million, due to the rise in the quarter in the Consumer Price Index (IPC); and (ii) higher monetary variation on lawsuits, of R$ 6.3 million; and |
| · | R$ 6.8 million increase in monetary and exchange variation gains, mainly due to higher adjustments on the agreement with the São Paulo State Government - GESP, of R$ 6.1 million, given the rise in the IPCA. |
| 7. | Income tax and social contribution |
The R$ 244.9 million increase in 1Q22 was mainly due to:
| · | Higher net operating revenue, of R$ 193.0 million; |
| · | Positive exchange variation, of R$ 731.8 million, from an expense of R$ 137.6 million in 1Q21 to a revenue of R$ 594.2 million in 1Q22; and |
| · | Higher costs and expenses, of R$ 286.0 million. |
| 7 |
Earnings Results 1Q22 | |
| 8. | Indicators |
| a) | Operating |
| Operating indicators* | 1Q22 | 1Q21 | % |
| Water connections(1) | 9,872 | 10,133 | (2.6) |
| Sewage connections(1) | 8,451 | 8,566 | (1.3) |
| Population directly served - water(2) | 27.8 | 27.6 | 0.7 |
| Population directly served - sewage(2) | 24.6 | 24.4 | 0.8 |
| Number of employees | 12,435 | 12,742 | (2.4) |
| Water volume produced in the quarter(3) | 714.5 | 728.0 | (1.9) |
| 1. | Total connections, active and inactive, in thousand units at the end of the period. Excludes Mauá |
| 2. | In million inhabitants, at the end of the periodo. Excludes wholesale |
| 3. | In millions of m³. Excludes Aguaí, Tapiratiba e Tejupá |
* Not reviewed by external auditors
| b) | Economic |
| Economic variables at the end of the quarter(*) | 1Q22 | 1Q21 |
| Amplified Consumer Price Index(1) | 3.20 | 2.05 |
| National Consumer Price Index(1) | 3.42 | 1.96 |
| Consumer Price Index(1) | 2.95 | 1.81 |
| Interbank Deposit Certificate(2) | 10.27 | 2.02 |
| U.S. dollar(3) | 4.7378 | 5.6973 |
| Yen(3) | 0.03902 | 0.05152 |
| 1. | Accrued in the year (%) |
| 2. | Average annual rate |
| 3. | Ptax sale rate on the last day |
* Not reviewed by external auditors
| 8 |
Earnings Results 1Q22 | |
| 9. | Loans and financing |
| R$ thousand | |||||||||
| DEBT PROFILE | |||||||||
| INSTITUTION | 2022 | 2023 | 2024 | 2025 | 2026 | 2027 | 2028 onwards | TOTAL | % of total |
| Local Currency | |||||||||
| Debentures | 251,570 | 734,429 | 1,068,081 | 1,198,750 | 1,088,854 | 1,685,967 | 2,062,920 | 8,090,571 | 46 |
| Caixa Econômica Federal | 75,242 | 95,594 | 94,949 | 100,886 | 107,197 | 113,891 | 908,431 | 1,496,190 | 8 |
| BNDES | 157,401 | 203,143 | 196,472 | 176,313 | 166,507 | 154,061 | 282,262 | 1,336,159 | 8 |
| IDB 2202 | 90,674 | 181,349 | 181,349 | 181,349 | 181,349 | 181,349 | 1,437,897 | 2,435,316 | 14 |
| IDB INVEST | 18,670 | 37,340 | 39,550 | 44,300 | 106,390 | 108,728 | 554,258 | 909,236 | 5 |
| Leases (Concession Contracts, Program Contracts and Contract Asset)(1) | 40,175 | 42,915 | 45,143 | 40,409 | 30,632 | 33,616 | 153,587 | 386,477 | 2 |
| Leases (others)(2) | 52,597 | 44,333 | 11,470 | 6,585 | 2,093 | 198 | - | 117,276 | 1 |
| Others | 4,301 | 5,656 | 2,393 | 2,162 | - | - | - | 14,512 | 0 |
| Interest and other charges | 238,634 | - | - | - | - | - | - | 238,634 | 1 |
| Total in Local Currency | 929,264 | 1,344,759 | 1,639,407 | 1,750,754 | 1,683,022 | 2,277,810 | 5,399,355 | 15,024,371 | 85 |
| Foreign Currency | |||||||||
| IDB | 24,348 | 48,696 | 48,696 | 53,225 | 9,059 | 9,059 | 135,468 | 328,551 | 2 |
| IBRD | 14,402 | 28,804 | 28,804 | 28,804 | 28,804 | 28,804 | 181,313 | 339,735 | 2 |
| JICA | 89,346 | 167,427 | 167,427 | 167,427 | 167,427 | 167,427 | 930,375 | 1,856,856 | 11 |
| IDB 1983AB | 36,445 | 35,958 | - | - | - | - | - | 72,403 | 0 |
| Interest and other charges | 6,174 | - | - | - | - | - | - | 6,174 | 0 |
| Total in Foreign Currency | 170,715 | 280,885 | 244,927 | 249,456 | 205,290 | 205,290 | 1,247,156 | 2,603,719 | 15 |
| Total | 1,099,979 | 1,625,644 | 1,884,334 | 2,000,210 | 1,888,312 | 2,483,100 | 6,646,511 | 17,628,090 | 100 |
| 1. | Refers to work contracts signed as assets lease |
| 2. | Obligations related to leasing agreements, mainly vehicle leases |
Covenants
The table below shows the most restrictive clauses in 1Q22:
| Covenants | |
| Adjusted EBITDA / Adjusted Financial Expenses | Equal to or higher than 2.80 |
| EBITDA / Financial Expenses Paid | Equal to or higher than 2.35 |
| Adjusted Net Debt / Adjusted EBITDA | Equal to or lower than 3.80 |
| Net Debt / Adjusted EBITDA | Equal to or lower than 3.50 |
| Total Adjusted Debt / Adjusted EBITDA | Lower than 3.65 |
| Other Onerous Debt(1) / Adjusted EBITDA | Equal to or lower than 1.30 |
| Adjusted Current Ratio | Higher than 1.00 |
| 1. | “Other Onerous Debt” corresponds to the sum of pension plan obligations, healthcare plan, installment payment of tax debts, and installment payment of debts with the electricity supplier. |
As of March 31, 2022, the Company had met the requirements of its borrowings and financing agreements.
| 9 |
Earnings Results 1Q22 | |
| 10. | CAPEX |
Investments totaled R$ 980.8 million in 1Q22, presented as additions in the notes to the quarterly information under Contract Asset, Intangible Assets, and Property, Plant and Equipment, of R$ 958.1 million, R$ 14.1 million, and R$ 8.6 million, respectively. Cash disbursed in 1Q22 referring to the Company’s investments, including from previous periods, totaled R$ 660.2 million.
The table below shows investments broken down by water, sewage, and region:
| R$ million | |||
| Investment – January – March/22 | Water | Sewage | Total |
| Metropolitan Region | 149.1 | 529.3 | 678.4 |
| Regional Systems | 138.4 | 164.0 | 302.4 |
| Total | 287.5 | 693.3 | 980.8 |
| 10 |
Earnings Results 1Q22 | |
|
For more information, please contact:
Mario Arruda Sampaio Head of Capital Markets and Investor Relations Phone:(55 11) 3388-8664 E-mail: maasampaio@sabesp.com.br
Angela Beatriz Airoldi Investor Relations Manager Phone:(55 11) 3388-8793 E-mail: abairoldi@sabesp.com.br
Juliana P. S. Jardim IR Analyst Phone:(55 11) 3388-9267 E-mail: jpsjardim@sabesp.com.br
Statements contained in this press release may contain information that is forward-looking and reflects management's current view and estimates of future economic circumstances, industry conditions, SABESP performance, and financial results. Any statements, expectations, capabilities, plans and assumptions contained in this press release that do not describe historical facts, such as statements regarding the declaration or payment of dividends, the direction of future operations, the implementation of principal operating and financing strategies and capital expenditure plans, the factors or trends affecting financial condition, liquidity or results of operations are forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and involve a number of risks and uncertainties. There is no guarantee that these results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations. |
| 11 |
Earnings Results 1Q22 | |
Income Statement
| Brazilian Corporate Law | R$ '000 | |
| 1Q22 | 1Q21 | |
| Net Operating Income | 4,870,390 | 4,677,417 |
| Operating Costs | (3,116,386) | (3,048,043) |
| Gross Profit | 1,754,004 | 1,629,374 |
| Operating Expenses | ||
| Selling | (196,587) | (194,793) |
| Estimated losses with doubtful accounts | (177,694) | (121,051) |
| Administrative expenses | (253,792) | (227,275) |
| Other operating revenue (expenses), net | 2,564 | 10,676 |
| Operating Income Before Shareholdings | 1,128,495 | 1,096,931 |
| Equity Result | 5,583 | 8,054 |
| Earnings Before Financial Results, net | 1,134,078 | 1,104,985 |
| Financial, net | (252,742) | (217,238) |
| Exchange gain (loss), net | 592,866 | (137,132) |
| Earnings before Income Tax and Social Contribution | 1,474,202 | 750,615 |
| Income Tax and Social Contribution | ||
| Current | (489,505) | (283,483) |
| Deferred | (9,158) | 29,726 |
| Net Income for the period | 975,539 | 496,858 |
| Registered common shares ('000) | 683,509 | 683,509 |
| Earnings per shares - R$ (per share) | 1.43 | 0.73 |
| Depreciation and Amortization | (589,746) | (542,052) |
| Adjusted EBITDA | 1,721,260 | 1,636,361 |
| % over net revenue | 35.3% | 35.0% |
| 12 |
Earnings Results 1Q22 | |
Balance Sheet
| Brazilian Corporate Law | R$ '000 | |
| ASSETS | 03/31/2022 | 12/31/2021 |
| Current assets | ||
| Cash and cash equivalents | 491,492 | 717,929 |
| Financial investments | 2,915,206 | 2,433,385 |
| Trade receivables | 2,890,105 | 2,695,077 |
| Related parties and transactions | 191,081 | 173,657 |
| Inventories | 117,506 | 113,506 |
| Restricted cash | 27,206 | 28,467 |
| Currrent recoverable taxes | 263,126 | 276,104 |
| Other assets | 104,280 | 64,873 |
| Total current assets | 7,000,002 | 6,502,998 |
| Noncurrent assets | ||
| Trade receivables | 237,257 | 223,234 |
| Related parties and transactions | 650,076 | 644,895 |
| Escrow deposits | 162,770 | 141,667 |
| National Water and Sanitation Agency – ANA | 20,084 | 20,666 |
| Other assets | 159,534 | 161,369 |
| Equity investments | 85,020 | 79,437 |
| Investment properties | 46,114 | 46,126 |
| Contract assets | 8,534,381 | 8,550,102 |
| Intangible assets | 36,910,080 | 36,503,834 |
| Property, plant and equipment | 289,228 | 291,157 |
| Total noncurrent assets | 47,094,544 | 46,662,487 |
| Total assets | 54,094,546 | 53,165,485 |
| LIABILITIES AND EQUITY | 03/31/2022 | 12/31/2021 |
| Current liabilities | ||
| Trade payables | 252,052 | 236,763 |
| Borrowings and financing | 1,777,935 | 1,830,617 |
| Accrued payroll and related charges | 352,718 | 426,616 |
| Taxes and contributions | 383,064 | 257,130 |
| Dividends and interest on capital payable | 548,006 | 548,006 |
| Provisions | 835,647 | 809,821 |
| Services payable | 548,425 | 469,027 |
| Public-Private Partnership – PPP | 172,781 | 142,757 |
| Program Contract Commitments | 104,980 | 77,652 |
| Other liabilities | 239,050 | 294,538 |
| Total current liabilities | 5,214,658 | 5,092,927 |
| Noncurrent liabilities | ||
| Borrowings and financing | 15,850,155 | 15,893,219 |
| Deferred income tax and social contribution | 292,897 | 283,739 |
| 13 |
Earnings Results 1Q22 | |
| Deferred Cofins and Pasep | 159,591 | 159,456 |
| Provisions | 604,951 | 638,672 |
| Pension obligations | 2,315,359 | 2,321,662 |
| Public-Private Partnership – PPP | 2,853,190 | 2,917,428 |
| Program Contract Commitments | 12,302 | 44,995 |
| Other liabilities | 884,045 | 881,528 |
| Total noncurrent liabilities | 22,972,490 | 23,140,699 |
| Total liabilities | 28,187,148 | 28,233,626 |
| Equity | ||
| Paid-up capital | 15,000,000 | 15,000,000 |
| Profit reserve | 9,885,485 | 9,885,485 |
| Other comprehensive income | 46,374 | 46,374 |
| Retained earnings | 975,539 | - |
| Total equity | 25,907,398 | 24,931,859 |
| Total equity and liabilities | 54,094,546 | 53,165,485 |
| 14 |
Earnings Results 1Q22 | |
Cash Flow
| Brazilian Corporate Law | R$ '000 | ||
| Jan-Mar 2022 |
Jan-Mar 2021 | ||
| Cash flow from operating activities | |||
| Profit before income tax and social contribution | 1,474,202 | 750,615 | |
| Adjustment for Net income reconciliation: | |||
| Depreciation and amortization | 589,746 | 542,052 | |
| Residual value of property, plant and equipment and intangible assets written-off | 2,406 | 2,938 | |
| Allowance for doubtful accounts | 177,694 | 121,051 | |
| Provision and inflation adjustment | 78,415 | 55,284 | |
| Interest calculated on loans and financing payable | 219,454 | 148,608 | |
| Inflation adjustment and foreign exchange gains (losses) on loans and financing | (523,312) | 189,970 | |
| Interest and inflation adjustment losses | 7,604 | 10,361 | |
| Interest and inflation adjustment gains | (63,518) | (33,753) | |
| Financial charges from customers | (81,830) | (99,148) | |
| Margin on intangible assets arising from concession | (20,685) | (23,007) | |
| Provision for Consent Decree (TAC) and Knowledge retention program (KRP) | (743) | 3,095 | |
| Equity result | (5,583) | (8,054) | |
| Interest and inflation adjustment (Public-Private Partnership) | 122,150 | 114,662 | |
| Provision from São Paulo agreement | 134,962 | 41,153 | |
| Pension obligations | 47,173 | 45,365 | |
| Other adjustments | 3,451 | (32,956) | |
| 2,161,586 | 1,828,236 | ||
| Changes in assets | |||
| Trade accounts receivable | (299,418) | (103,667) | |
| Accounts receivable from related parties | (10,415) | 13,678 | |
| Inventories | (4,000) | (1,086) | |
| Recoverable taxes | 12,978 | (320,069) | |
| Escrow deposits | (13,378) | 16,760 | |
| Other assets | (36,990) | (9,332) | |
| Changes in liabilities | |||
| Trade payables and contractors | (218,600) | (142,979) | |
| Services payable | (55,564) | 122,810 | |
| Accrued payroll and related charges | (73,155) | (75,683) | |
| Taxes and contributions payable | (64,184) | 281,307 | |
| Deferred Cofins/Pasep | 135 | 2,909 | |
| Provisions | (86,310) | (32,064) | |
| Pension obligations | (53,476) | (48,764) | |
| Other liabilities | 4,652 | 747 | |
| Cash generated from operations | 1,263,861 | 1,532,803 | |
| Interest paid | (347,631) | (195,181) | |
| Income tax and contribution paid | (299,387) | (293,109) | |
| Net cash generated from operating activities | 616,843 | 1,044,513 | |
| Cash flows from investing activities | |||
| 15 |
Earnings Results 1Q22 | |
| Acquisition of contract assets and intangible assets | (651,660) | (650,920) | |
| Restricted cash | 1,261 | (349) | |
| Financial investments | (443,715) | 781,543 | |
| Purchases of tangible assets | (8,566) | (8,335) | |
| Net cash used in investing activities | (1,102,680) | 121,939 | |
| Cash flow from financing activities | |||
| Loans and financing | |||
| Proceeds from loans | 1,084,506 | 57,511 | |
| Repayments of loans | (661,268) | (568,349) | |
| Public-Private Partnership – PPP | (156,364) | (143,610) | |
| Program Contract Commitments | (7,474) | (43,923) | |
| Net cash used in financing activities | 259,400 | (698,371) | |
| Increase/(decrease) in cash and cash equivalents | (226,437) | 468,081 | |
| Represented by: | |||
| Cash and cash equivalents at beginning of the year | 717,929 | 396,401 | |
| Cash and cash equivalents at end of the year | 491,492 | 864,482 | |
| Increase/(decrease) in cash and cash equivalents | (226,437) | 468,081 | |
| 16 |
|
Companhia de Saneamento Básico do Estado de São Paulo - SABESP | ||
| By: | /s/ Osvaldo Garcia
|
|
|
Name: Osvaldo Garcia
Title: Chief Financial Officer and Investor Relations Officer |
||
This press release may contain forward-looking statements. These statements are statements that are not historical facts, and are based on management's current view and estimates of future economic circumstances, industry conditions, company performance and financial results. The words "anticipates", "believes", "estimates", "expects", "plans" and similar expressions, as they relate to the company, are intended to identify forward-looking statements. Statements regarding the declaration or payment of dividends, the implementation of principal operating and financing strategies and capital expenditure plans, the direction of future operations and the factors or trends affecting financial condition, liquidity or results of operations are examples of forward-looking statements. Such statements reflect the current views of management and are subject to a number of risks and uncertainties. There is no guarantee that the expected events, trends or results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations.
