Morning, ladies and gentlemen. Welcome to Auren's conference to discuss results regarding the first quarter of 2024. This conference has been recorded, and the replay can be accessed on the company's IR website, ri.aurenenergia.com.br. The presentation is also available for download. We would like to inform that all participants after the presentation will have the Q&A session. Further instructions will then be provided at the start of the Q&A. Before proceeding, I would like to clarify that any forward-looking statements are based on the beliefs and assumptions of Auren's management and current information available to the company. These statements may involve risks and uncertainties as they relate to future events and, therefore, depend on circumstances that may or may not occur.
Investors, analysts, and journalists must understand that events related to the macroeconomic environment, industry, and other factors could cause results to differ materially from those expressed in the respective forward-looking statements. Here with us at this conference are Mr. Fábio Zanfelice, Auren's CEO, and Mr. Mário Bertoncini, CFO and IRO. The investor relations team is also here with us. I would now like to turn the call over to Mr. Fábio Zanfelice, who will start the presentation. You may proceed, sir. Good morning, ladies and gentlemen. It's an honor to have you here with us again. Thank you very much for attending this event and for taking the time to listen to the discussion of the results of the first quarter of 2024.
As we have done in the previous quarter, we'll talk about the highlights, the energy market, our operating and financial performance, the social and environmental performance, and closing remarks. Now, moving on to the quarter's highlight, we start with the growth of the company. In this quarter, we started the commercial operation of the hybrid project Sol do Piauí, adding 58 MW-peak of installed capacity to the company's portfolio. We are evolving the construction of Sol de Jaíba solar project of 500 MW of installed capacity, and we are halfway down for the entry of operation of the commercial dimension. It's a large-sized solar project, and we are halfway down the project.
From the viewpoint of operation and commercial areas, the hydroelectric generation was very much in line with what we reported in 2023, and we have a very recessive hydrological scenario, as we can see in the results. Wind generation was one of the worst performances that we've ever had in the history of the company, and all of our complexes amounting to 22% below the same quarter when we compare the periods due to meteorological effects. And as for the commercialization in this quarter, we increased nearly 477 MW average of commercialized energy. And considering the good moment of the market that we have been facing in the first quarter of 2024, we also traded a very large volume of energy for 2026 and 2027, with average prices of BRL 150 and BRL 160 reais. We are going to discuss more about it during the presentation.
As to the financial aspect, we had a reduction of PMSO for BRL 12 million, an actual reduction of 9% when compared to the first quarter of 2023. Adjusted EBITDA amounted to BRL 360 million, a reduction of 9% when compared to the first quarter of 2024 as a result of the renewal of long-term agreements for the company that expired last year, and they were replaced by other agreements as of this year at lower prices aligned with the market prices. And this is a result of the seasonality of what we see in the period. But when we look at the EBITDA of the company, we can see that the EBITDA for the quarter was much higher than that of the first quarter of 2023. We ended BRL 600 million against BRL 258 million, an increase of BRL 148 million.
This was driven by what we saw in the third bullet of this first page, which was the gain of MTM. Along the second half of the year, we realized some of the positions, and that generated an additional value of MTM of BRL 248 million. So this was a very important offset of the Adjusted EBITDA that was driven by the favorable operation of the operation. So net profit amounted to BRL 253 million, a 10% increase in comparison to the same period of the previous year, and a payment of BRL 400 million in dividends in March 2024, BRL 0.40 per share in March of this year. So now talking about the energy market, we would like to discuss the Affluent Natural Energy, different from 2022 and 2023.
This was a very recessive, rainy season, and it was much below the 105% that was observed in the first quarter of 2023. We could say that March was a good period for us when the affluent was much better than February, and these are months of very important affluent. March was very positive and helped the storage levels at 5% and 60%. We reached 71% of storage level. March gave us a very positive result. However, the period was much below what we expected, and we have a deficit of 38 average MW in this first quarter. This can be seen on the graph on the right when we see that the recovery was lower in terms of reservoirs when we compare to the previous period. We had one-third of recovery. This is what we observed when we compared 2022 and 2023.
It's still the storage level is still comfortable, but of course, it shows that we are going to have a less favorable year when we compare to 2023 in terms of storage levels. On the next page, we see the demand, which was very strong this quarter. We reached the peak of 8.4% of growth in relation to January 2023. On average, demand was higher, 7.4% higher. This was driven by high temperatures that had already been observed in September last year, and temperatures were very high this half of the year, and also because the rainfall levels were below average. Especially in the Southeast and South Region, the temperatures were very high. So we can see that there was a growth in the consumer class, and we see that this is very well connected with the demand as a result of the need for refrigeration.
On the right, we can see that the temperatures were very high or higher than the historical level in all regions. In the following slide, when we talk about commercialization and trading activities, we see that the contracting level continues to be very high, reaching 91%. We'd like to remind you that this is the total physical guarantee of the company. We did not disregard the effect of the hydroelectric GSF dislodging. When we talked about the average price, we had many businesses made for 2022 and 2027 and taking advantage of the good moment in terms of long-term prices. As we had mentioned before, it was a quarter when we had very strong activity and when we increased in 477% of commercial level in comparison to the similar period of 2023.
The contracting level continues to be very high at around 63% in terms of resources of the company. On the next slide, we're going to discuss the operating performance. As we had mentioned, our main asset, which is Porto Primavera, and we observed an increase of the affluent in terms of MLT, and it was just a little bit lower in relation to the production of energy. Porto Primavera is a dam that accumulates the water of Paraná River, and this is one of the competitive advantages of having a downgradient asset. GSF for the period, for the first quarter, was 90%. We would like to talk about the availability in relation to a new record at 97%. So it operated nearly close to its full operation capacity. In the next slide, and this is the highlight for the quarter, which was not so positive.
In fact, wind generation for this quarter in the consolidated of all the assets performed 18% below the P90 for the certification and below 23% of P50. In the release, you are going to find the explanation for this phenomenon. Our meteorologists made the right explanation, which was a change in the suppression and that it is positioned more to the coast of the Southeast Region, and that considers all the events that occurred in the continent and also on the surface temperature of the Atlantic Ocean. This high pressure was distant from the coast, and that caused an impact in the wind regime in the northeastern wind regime when we have our complexes in Piauí. 5.2 per second was the average wind speed below what we observed in the same period of last year.
From the graph, as we see here, we see that the first quarter is the quarter where we expect the lowest generation for the year. When this happens, the impact is higher on the production of wind energy because of the characteristic of the generation of the WTGs. This is what we bring in terms of information on the next slide. As we usually do, we bring information about the performance of our wind farms. In terms of the availability of the equipment on the left, we can see clearly that the performance of the equipment is very aligned with the performance of the design, especially the wind turbines. What impacted the results was the wind resources, which was lower than expected. On the right, we can see what happened that affected this quarter.
So we can see a permanence curve of the wind over time. In the x-axis, we can see the wind speed. And in the other x-axis, we see the permanence of the wind. We can see that there are low winds in this period of the year reaching 9% of the permanence curve. In this period, it reached 12.5%. And this zone of wind up to 3 meters per second does not allow the WTG to operate. So there is a lack of availability because we do not have the wind resource to make it activated. And due to the low speed that was concentrated in this region in the period caused an impact in the wind generation, and that affected the performance of the quarter.
The range of operation is as of 3 meters per second, and we can see that the last half of the year was much better than what we observed in this quarter, as we explained in the previous quarter. 0.7% was the limitation due to curtailment, which was very aligned with our wind farms. And that affected 0.5% in the average generation in terms of P50. The result was marginal for this quarter in this area. In the following slide, we talk about the growth and our solar assets. Sol do Piauí has been operating at full capacity. It performed very well, very much in line with the certified physical guarantee for the first quarter and Sol de Jaíba. It's our farm that is going to be installed at 500 MWac.
We had in March 2031, up to May 6th, yesterday, we had 250 MW in commercial operation and 40 MW AC in test operation. We can see the dynamics for when this park is going to start operating. We nearly doubled the capacity of commercial installation in the first days of May. Very well. On the following slide, we can see the financial performance. I'll pass the floor to Mário so that he can discuss the numbers for the quarter. Thank you, Fábio. Good morning, everyone. On page 15, we ended the first quarter of 2024 with net revenue of BRL 1.897 billion, very much in line with the first quarter of last year. There are two vectors to be mentioned. The first vector, there was some reduction of net revenue, which has to do with the average price of the contract.
It's just natural, as time goes by, we replace some contracts, some old contracts expire, and we execute new contracts. In that case, that was an adjustment of average prices, and it was a bit below. And this was offset by an increase in the volume of energy that was traded in the period in order to offset the revenue. In terms of Adjusted EBITDA, as Fábio mentioned, we ended the quarter with BRL 306 million in the Adjusted EBITDA. Basically, this adjusted, which was lower, lower EBITDA has to do with the average price that I referred to in the revenue, and also due to some seasonality of the agreements, the contracts. The profile of the seasonality of the agreements is not comparable to those of 2023. And some mismatch will not be really a loss, but the relocation for the quarters to come because of seasonality.
I would also like to draw your attention in relation to EBITDA that are evaluation, the improvement in PMSO, as you probably have been monitoring. We have a very important campaign to discipline our expenses whose result was very clear for this quarter with a reduction of 5% and a 10% decrease in actual terms in terms of personnel, services, and other expenses. In addition, as we have already mentioned, and it was not included in the adjusted EBITDA, is the MTM evolution, which is connected with the trading of energy, as Fábio has already mentioned previously. On page 16, for this quarter, we bring you a more detailed vision of the PMSO and all the expenses that I have just mentioned.
We ended the first quarter of 2023 last year with expenses, PMSO amounting to BRL 137 million that evolved to BRL 131 million in the first quarter of 2024. The main effect of this reduction has to do with lower expenses with personnel, headcount, especially expenses connected to the integration, the organization of Auren with some disconnection of some of our team and expenses related to labor compensation and also expenses related to minor services, which are also related to the 12 months that come after the integration of Auren that started in April last year. So we can still have the effect of the expenses that we made previously. And this explains the reduction in PMSO. On the right of the page, we can discuss, and I would like to draw your attention to aspects. The first one has to do with the generation and PMSO.
What we did here was to consider the expenses of total PMSO, the consolidated amount, and accept the PMSO of the commercialization of energy. So the graph that we see here on the right of the page is the PMSO of all the segments of generation plus the holding, except for the trading area. When we compare it to the megawatt of the physical guarantee, which was the megawatt that was actually generated, we can see that there was an evolution of BRL 39 reais in the first quarter of 2023 to BRL 35 reais per megawatt hour. Now, in the first quarter of 2024, this was a very important evolution, BRL 35 reais when we compare with the universe of the other peers also operating at B3. We can see that this expense level is very efficient when we compare to our peers.
If we want to move ahead and also accept the expenses related to M&A, due diligence, growth, etc., we can see that those PMSO expenses per megawatt hour would come to BRL 33, even lower than the BRL 35 that we mentioned. What is outside the PMSO is the trading, energy trading, as I mentioned. And what we bring in the final bullet on the right, we make a comparison with our EBITDA of the energy trading, the capacity to generate margin in the energy trading. And in the sense, I can say that we have been consistently generating margins close to three times the PMSO. This is what we did in 2023, and this is what we always see in the first quarter of 2024.
In consolidated terms, even though the PMSO is a bit higher that is connected to the energy trading, it generates an extraordinary margin in terms of results that more than offsets the PMSO that was described. On the next page, we can see the capital structure as well, some cash flow considerations. In terms of net debt and leverage, we ended the first quarter of 2024 with a net debt of BRL 3.4 billion and a leverage of 1.9 times. Net debt over leverage, our gross debt is BRL 6.5 billion. 50% of this debt is associated with BNDES and the others with resources of debentures and BNDES. So this gross debt has to do with investment institutes below the market levels, and 44% has to do with the resources that were captured by debentures.
At the end of the first quarter, Auren has 48% of the gross debt in our cash position. We ended with a cash position of BRL 3.1 billion. That is half of the gross debt. And the maturity, as you already know, exerts no pressures in terms of maturity in the next years to come. In terms of free cash flow, an indicator that we always describe to the market is the cash conversion ratio that was very high among the highest in the series. Our conversion ratio in the first quarter was 91% out of the BRL 360 million of Adjusted EBITDA, 91% or BRL 329 million converted into cash before three events, before the payment of the dividends that was paid, BRL 400 million, and before the expansion CapEx, and also before the debt service, which had already been considered and was already deducted from the 91%.
So this conversion rate is very high. I would like to turn the call back to Fábio to continue the call. Thank you. So let's talk about the social and environmental performance of the company. And we would like to invite everyone to access our annual report of 2023. You can use the QR code on the right lower side of your page. And this report is the main document of the company that describes our culture, the way we are as a company. The main information of this report is connected to the environment, the clean energy that we generated last year, and the protection of natural biome, and our activities related to GHG.
Our priority in hiring local professionals in the places where we are building our new projects, our capacity, especially Sol do Piauí, Ventos do Piauí, and also Jaíba, and also the program of young apprentices that is very important in relation to inclusion and diversity. We have been evolving our practices, which are very in line with what IBGC establishes. The company is now part of the corporate sustainability index of B3. It's probably the company that may be the youngest company to have been incorporated into this index. So I would like to invite you to read our report. There's a lot of information, important information, interesting information about our company. Then let's move on to the final remarks. As we have already mentioned, in terms of initiative and growth, we continue evolving our installed capacity with the commercial operation of Sol do Piauí.
We continue with our excellence in operating performance when the assets and other assets have had high availability. In April, from the viewpoint of wind resources, the generation has reached P50 in April. So we understand that this meteorological effect that affected the first quarter is no longer so strong. And this is something we noticed in April. And lastly, I would like to draw your attention to our discipline in capital allocation when we are always focusing on the generative value to our shareholders with the payment of dividends. So this is the main information, and this is what we would like to have shared with you. And we are now available for the Q&A session. We are now going to start the Q&A session for investors and analysts. If you wish to ask a question, please click and raise hand.
If your question is answered, you can leave the queue by clicking on lower hand. Our first question comes from Filipe Andrade with Itaú BBA. You may proceed, Sir.
Good morning. Good morning, everyone. Thank you very much for taking my question. I would like to listen about two topics. First is about the capacity reserve auction. Has there been any discussion in this regard? And does the company expect the calendar to be kept as we saw in the third quarter? And also talking about the energy balance of the company, we can see that Auren has been selling relevant volumes, especially in 2026 and 2027. And when we look back, we see that it locked some positions since we saw some increasing prices. And the long-term contracted was also something that attracted our attention. What made this volume to increase?
And was the company interested in developing the assets, or were there other impacts? Thank you. Felipe, thank you for the question. In relation to capacity, we continue very engaged. It's a very good opportunity for the company to make investments. And especially an asset that would generate fixed assets. So in our risk return studies, and if we make a comparison, it's nearly a transmission activity. So we are looking at this with a lot of care. So it's the first transmission because we would have fixed income for a very important using a very important CapEx to an asset which is very dear to us. We believe that the discussions have been progressing. We have been discussing the calendar for the third quarter. I don't think we'll have any changes in relation to the calendar.
In relation to energy contracting, this movement made by the company is part of the commercialization strategy of the company. The company has been doing important movements in relation to the trading itself. Back in 2022, we observed that the market could be very favorable. We locked our portfolio for the following three years. We also saw along the second half of last year that there were opportunities to hire cheap energy because at the time, we didn't believe in the prices that we saw. We always believed that the prices would be higher. It's just natural that we would acquire energy and then trade the energy. This is what happened along the quarter when we observed what would happen. What we saw in March with the better conditions, we could have a long-term reduction, but it would be temporary.
We took the opportunity to sell the energy for 2026 and 2027, locking the margin of cheap energy that we bought in 2023. This is the strategy that we adopted. I think they were very successful. This is aligned with the thesis of the energy trading. I would also like to mention that this is related to a very detailed and cautious risk management. We are not going to trade very high levels because we have this balance that should bring comfort to the shareholders so that we can hedge the results of the company. In relation to the energy balance, I'm going to turn the floor to Mário, who can provide more details about those details. This information. Only to add in relation to Felipe's question, he mentioned the long-term margins. Yes, he's right.
Felipe, in those activities, in those movements, and when because when the long curve also went up, we accelerated in executing some contracts with high margins. For those who are interested in the topic, you can go to page 25 of our release, and you will see the evolution of the long-term margins and with a very important increase in relation to the previous quarter. Felipe, this is what you had observed in the margins, and we have been managed to have better margins in those periods. Okay, perfect. Thank you very much. Only to complete, we have impact of high production contracts in the PPA agreements that you executed. Is that right? Yes, that's right. Okay, perfect. Thank you. Our next question comes from João Pimentel with BTG. You may proceed, sir. Good morning, everyone. Only to add in relation to Felipe's question about energy balance.
In the beginning of the year, there was an event when you said that if prices reached BRL 150 or BRL 160, it would make sense to trade energy at this level. Obviously, you made wonderful contracting for 2026 and 2027. However, there's still uncontracted energy. And I understand this is part of the strategy of the company to leave some energy without being contracted as a strategy of the company. What is not contracted in terms of energy? Is it related to the commercialization strategy? You prefer to allow this energy to be discontracted, or is it related to the liquidity, or the liquidity finished before you made the sales? I want to understand the liquidity position that you saw when these prices were reached. Oh, thank you very much for the question. So this was part of the strategy. This is aligned with our portfolio management.
We actually allocated what we wanted in terms of volume. When we look into the future, we believe that the price will undergo an appreciation for the next months or the next year. And this is the reason why we lock the first years so that we can have the strategy for the following years. So we are going to take advantage of the windows that we see now. So we see windows of opportunities now, and we have been observing them since the beginning of Auren. And this finally materialized. And this is totally aligned both to our commercialization strategy and our policy to manage our portfolio and risk management. Would you like to add anything? Yes. And in relation to liquidity, it was not related to liquidity restrictions.
When we saw those following frustrations of hydrological maps that we saw since the end of last year and the prices went up in February and March, first, the highest liquidity comes from brokers. They zero some positions. So the brokers are the ones that provide the highest liquidity of the market. But still in the second fortnight of March, and we can see that customers go back to the market, medium size, small size. So we see that the market nowadays has a very high level of liquidity. What we did is to follow our trading strategy. Okay, very clear. Thank you. Our next question comes from André Sampaio with Santander. You may proceed, Sir. Good morning, everyone. I'm going to have a follow-up on the discussion of energy balance. I would like to confirm on the amount of BRL 150-160 reais. This is incentivized energy.
Was it regular energy? Was it a mix? So that I can understand how much above the market you managed to reach the prices. And something else that you referred to at the end of the call, you said that there was a recovery of wind speed in April. So I would like to understand what you expect for the years to come and how the winds can impact the results. This is the price of conventional energy. So these are the prices that were traded. And a large part of the energy we purchased at values which were lower. So this was a strategy of not believing in the pricing of the market. The market was very vocal saying that the price was very low, and we do not actually believe in this strategy.
When we saw the prices at 100 or 110, so we took the position, and now we made a sale. In relation to the wind speed, normalcy indicates that we are likely to have a reversal to the average levels. Both wind and generation, everything will revert to the average levels. So everything indicates that we are going to have a normal year in terms of wind generation. We haven't seen any climate event that will put any pressure on the winds as we have observed recently. So we expect to go back to normal levels according to the numbers expected in the certifications of our projects. Okay, thank you. Our next question comes from Bruno Oliveira with AGF Análise. You may proceed, sir. Bruno, seu microfone está aberto. Pode prosseguir. Bruno, your line is open. You may proceed, sir. Thank you very much for the opportunity.
I have two questions on my side. At first, I would like to understand the possibility of a new policy of dividends, as was mentioned last year. Is there any estimate in relation to this policy? And the second question is in relation to how you see the share of the commercialization in relation to the portfolio as a whole. Is there a target? Is there a balance? You want to strike according to strategy. Are we far from this? So I would like to understand the strategy of the company in relation to the revenues. Thank you for the question, Bruno. In relation to the dividend policy, our strategy has always been we created Auren in March 2022. So our strategy has been twofold: growth and payment of dividends.
We continue going after the growth of the company, and greenfield has been leading to organic growth such as Ventos do Piauí and Sol do Piauí. So our company is focused on growth. That doesn't mean that we are going to disregard the payment of dividends. And so much so that the payment of dividends was very strong. And if the company does not find or does not come across brownfield growth that is aligned with the expectation of shareholders' return, the company will rethink the dividend policy and may present a different policy that provides more detailed drivers than those that we have today because our dividend payment is based on the percentage of the income. So if we do not have any M&A event this year, in the beginning of next year, we are going to open for conversations and discussions with the shareholders.
In terms of the energy trading results, the participation of the energy trading reaches 14%. This is a number based on the adjusted EBITDA of the company as a whole. If we look at the results and the shares, we can see that the energy trading causes this impact. Our expectation is to increase this EBITDA of the energy trading along the time based on the strategies that we have adopted, taking positions and anticipating the market movements. This would be an area of the company, a business of the company that may add more value on a recurring basis as we notice the volatility of the market. This result will be as good as what we observe in terms of volatility of the market in the years to come.
I would say that today the company is fully prepared with all its capacity, with all its human capacity to take advantage of those market opportunities as they come up. Thank you. The Q&A session has come to an end. We would like to give the floor back to Mr. Zanfelice for his final remarks. Ladies and gentlemen, thank you very much for another earnings results conference call. Thank you very much for taking the time to listen to the discussions of our numbers. Thank you very much for the questions. All those questions help us reflect on the strategies of the company. I wish you have a very good day, and I hope to have your presence in the next quarter. Thank you very much, and have a good day, everyone. Auren's conference call has been completed.
We would like to thank you for your participation and have a nice day.