Light wants to anticipate negotiation to renew concession – 05/15/2023 – Market

The director-president of Light SA, Octavio Pereira Lopes, said this Monday (15th), during a results conference call, that, after finding a solution for the company’s debts through judicial recovery, the company is aiming at bringing forward the renewal of the concession which it holds in Rio de Janeiro and expires in 2026.

On Friday (12), the holding company Light SA filed a request for judicial recovery, seeking a solution for a debt of R$ 11 billion, mainly on the part of its energy distribution subsidiary. The request was accepted by the Justice of Rio de Janeiro this morning.

Lopes said that, now with the protection of judicial recovery, the idea is to negotiate with its creditors before the deadline established by law. Starting next year, the company should open a dialogue on the conditions for renewing the concession, which runs until 2026.

According to Lopes, the renewal of the concession will mark a turning of the page in Light’s debt history and will allow the distributor to be healthy for the long term.

The executive stated that the request for judicial recovery was the best path found to create a healthy environment for debt renegotiation and promote the company’s financial restructuring

Lopes said that the electric company decided on RJ’s request after encountering “the belligerence of a small group of creditors” who did not want to accept the renegotiation of debts. On the contrary, these creditors even set obstacles, according to the CEO of Light, which “could endanger the distribution of energy in Rio de Janeiro”, he argued.

The executive explained that, despite the improvement in Light’s performance in the first quarter of this year, the reported numbers are not enough to provide sustainability for the next balance sheets, mainly for Light Distribuidora, which has a high level of indebtedness.

From January to March 2023, Light recorded net income of R$107.1 million, reversing the loss of R$106 million observed in the same period last year. Earnings before interest, taxes, depreciation and amortization (Ebitda) was BRL 538.4 million, up 24.9% compared to the same period in 2022.

The company’s financial result also improved from a negative result of R$ 93.3 million in the first quarter of 2022 to a negative R$ 21.7 million in the same period of this year.

Lopes emphasized in the conference call that RJ does not change Light’s commitment to remain in compliance with its financial obligations for the continuity of the concession.