Auren Energia Posts R$32.6M Loss in 2024 Amid AES Brasil Merger and Rising Debt

Auren Energia ended 2024 with a net loss of R$32.6 million ($5.4 million), reversing the R$15.6 million ($2.6 million) profit recorded in 2023, according to financial disclosures.

The fourth quarter highlighted this shift, with a net loss of R$363.6 million ($60.6 million) compared to a R$220.2 million ($36.7 million) profit in the same period of the previous year.

Despite the losses, Auren’s revenue grew 17.7% year-over-year, reaching R$11.25 billion ($1.88 billion) in 2024. The fourth quarter alone saw a 35% increase in revenue to R$3.6 billion ($600 million) compared to the same period in 2023.

However, adjusted EBITDA fell 5% to R$3.3 billion ($550 million) for the year and dropped 12.7% to R$889.8 million ($148.3 million) in the fourth quarter.

The financial results reflect the impact of Auren’s merger with AES Brasil, completed in late 2024 but presented on a pro forma basis from January 2023 for comparison purposes. The merger created a renewable energy powerhouse with 8.8 GW of capacity but also significantly increased Auren’s financial burden.

Financial Resilience Amid Debt Challenges

The company’s net debt surged to R$18.9 billion ($3.15 billion) by the end of 2024, pushing its debt-to-EBITDA ratio to 5.7 times from just 1.6 times in the third quarter before the consolidation. Higher debt levels drove up financial expenses, contributing to the annual losses.

Mateus Ferreira, Auren’s vice president of Finance and Investor Relations, attributed the losses to acquisition-related debt but noted that combined societal profit reached R$272 million ($45.3 million) when including AES Brasil’s late-year results.

CEO Fabio Zanfelice emphasized strong cash generation, with conversion rates of 56.9% for the year and 59.3% in the fourth quarter, as evidence of Auren’s ability to reduce leverage quickly.

The company expects its debt-to-EBITDA ratio to drop significantly within two years, signaling confidence in its financial recovery strategy. Recent performance showed resilience, with third-quarter profits of R$270.8 million ($45.1 million) reversing an R$838.1 million ($139.7 million) loss from the prior year.

While challenges remain, including lower hydroelectric prices and rising costs, Auren’s growing revenue and new solar projects highlight its potential for long-term growth in Brazil’s renewable energy market.

This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error

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