Good morning, and welcome to the Engie Brasil Energia's second quarter 2026 earnings result video conference. I am Adriana Wagner, Investor Relations Analyst at the company, and I would like to make a few announcements before we begin the video conference. At this moment, the people connected are in listener mode. Ensuing this, when we open the Q&A session, participants can send their questions through the Zoom Q&A option. Please keep in mind that this video conference is being recorded. We have made available on our website, www.engie.com.br/investors, the results, presentation, and the earnings release, besides the complete interim financial statement and other documents filed at the CVM. Analysis of financial statements, operational results, ESG indicators, among other highlights for the period. Before proceeding, we would like to clarify that all the statements made during this video conference regarding business outlook of the company should be treated as forecasts.
Depending on the country, macroeconomic conditions, the performance and regulation of the electric sector, besides other variables, they are subject to changes. We remind you that journalists who wish to ask questions can do so by email, sending them to the company's press office. To present Engie Brasil Energia's performance in the second quarter, we have here with us Mr. Eduardo Sattamini, Chief Executive Officer, Mr. Gustavo Labanca, Director of Power Networks, Mr. Gabriel Mann, Chief Regulation and Strategy Officer, and Mr. Leonardo Depiné, Investor Relations Manager. I will now turn the floor over to Mr. Sattamini.
Good morning. I was opening my microphone. It is a pleasure to be with you another quarter to present the results of the second quarter of this year. It has a very interesting feature. You all know that we have the controlling company that has developed hydropower plants.
The last one developed was Jirau, and in this last quarter, after years of enhancements in operational conditions at the plant, we have been able to bring this asset into Engie Brasil Energia's portfolio. There's a significant capital movement here in the electrical sector. This has always been the case, and the additional resources to the Jirau asset have been used to anticipate payments of the concession for the public asset use. And this, of course, with excellent results. The acquisition of the asset had a return of 10% real return. Excellent for this asset contracted for the long term. It's a hydroelectric asset. It will add a great deal to the company's portfolio. And on the other hand, we have anticipated some payments which also bring about interesting return for shareholders with a payback of three years or something similar.
These are excellent opportunities, therefore, to create value for our shareholders. Additionally to these two events, recently at the general extraordinary meeting, we had the merger of CEJA, the energy company of CEJA, with operational gains and operational simplifications. This company had already been acquired from another player two years ago, if I'm not mistaken. And this will enable us to simplify our organizational structure and gain efficiency. Another highlight, of course, is a discussion on interim dividends. We will begin paying them beginning on August 21st, and the payment date, as you know, is defined by our executive board based on what we have in cash. On the next slide, our financial highlights, our growth strategies. You can see we have a growth of adjusted EBITDA of almost 17% quarter-on-quarter and 13% as a whole.
These are the projects we put into operation last year and today represent a growth of cash generation for the company. Net income, we have a non-recurring event of the public asset use. Of course, this from the expansion of concession, but we also have significant adjusted growth quarter-on-quarter. We have different allocation strategies as well as other components, but this is a very reasonable gain of about 2%-7%. We're still undergoing a period of very high interest rates, and what is of interest here, of course, is our net results. We have a lucrative and very interesting operation indeed. Which are the main drivers of this result? We have the generation segment with a growth of the segment, thanks to the investments carried out. The same holds true for transmission because of the growth.
This quarter, this is somewhat lower because of the results that we had with TAG. We go on to the next slide. To speak about our ESG KPIs. We have reduced the intensity of emissions in our portfolio, growing ever more in renewable energy. This goes against what we see in the sector that is increasing its emissions because of thermal dispatch. We have been reducing our emissions intensity. Health and safety, we have a specific reduction in some accidents, minor accidents in the operational area, and this has hampered our indicator some, but we will redress this during the year and go back to our target of 0.9% in the frequency rate. Gender distribution, we have had evolution, perhaps less evolution that we wanted vis-à-vis last year because of the assets we have in Amapá.
We have a great deal of male participation in the works there because of the type of work, and because of that, we were not able to increase this KPI as we wanted. Investments in innovation continue to be stable. We invest in innovation, especially when it's geared to the enhancement of our assets. Social responsibility investments, we have a certain seasonality here, and in the second half of this year, we should have considerably more incentivized resources allocated because of the extraordinary profit we have had with the public asset use strategy. In terms of engagements, we have a high rate. It continues on, and this points to our main interest in our stakeholders, of course. Next slide, please. Generating and transmission uptime. We continue to have a growing uptime in our assets.
When we acquire an asset, we always perceive the possibility of operational enhancements, and this is what we have done. We have acquired solar and wind assets. We have acquired hydroelectric assets, and as we acquire them, we implement continuous enhancement activities, allowing for the uptime of generating and transmission assets to always follow a growing curve. Next slide, please. Energy generation. We have an increase in solar energy. This is basically organic growth because of the Açu Sol plant. In wind energy, this is also higher than in the second quarter of 2025. We perceive this through the GSF that you will see to the graph to the left. In terms of generation, we have had a good moment at this complex. Let's continue on. I will now give the floor to Mr. Depiné, who will speak about the curtailment issue.
We continue to suffer from this. We will have a reimbursement for this, but we would like to further detail the figures. We have some technologies with improvements, other technologies with a slowdown. Depiné, you have the floor.
You can see that in the second quarter, the total curtailment of Engie reached 20%. Wind and solar energy, very similar to the system we had that was 19%, higher than last year, where they reached 15% and 16%. During that period, the total generation reported was 7%, which is the 20% allocated throughout our portfolio. Solar, very close, 26% compared to 27%. The difference is in wind. That went from 12%- 17%. We do have important regulatory news here, published in Provisional Measure 1304, that will allow for the compensation of past curtailment between September of 2023 until November of 2025.
This was published only 15 years ago, we have a certain term to manifest our interest. This is non-binding interest, and this will continue on for some quarters until mid-2027, until it is reserved. When we speak about the energy commercial strategy, no great surprises. We have a great deal contracted in the short term. The price fluctuation is going downward, but we're protected against these effects. In the long term, we are able to capture price increases, which we see through time, especially in the prices contracted for longer terms. If you look at 2026, only 1% is uncontracted. It goes up to 5% in 2027, 11% and almost 37% in 2029 and 2030. Evolution in the number of free customers and consumer units. This is part of our commercial strategy. 43% of consumers or almost 22% growth in consumer units served.
Let's go on with greater details in our financial performance. Our net operating revenue had a change of 14% during the period, a growth, of course. All of the lines, price and sales volume, free energy and others that are part of the generation segment, as well as trading. A slight decrease in transmission because of an accounting effect, a margin on the revenue of construction for Asa Branca. We have less CapEx and the construction revenue is somewhat lower, almost 14% for the period increase, as you can see. If we speak about the results of TAG in detail, last year they had a bit more than BRL 1 billion in profit. This year, BRL 743. You can see that TAG is undergoing a process of tariff review. This process should be concluded until the end of the year, perhaps this year. All of this depends on the regulator.
When this process is over, TAG will review their tariffs and probably have a different result if compared to what we see at present. Finally, the EBITDA evolution. We have a growth of 16% for adjusted EBITDA, when we carry out a new cycle of adjustment because of IFRS, we have a sound growth of 13%, especially for generation and trading, especially generation, and TAG with a negative contribution this quarter, but with robust results of 13% when we look at this from a regulatory perspective. Before we get to our profit, the prepayment of the public asset use, we began this operation last year. At the end of June, the balance represented BRL 4.2 billion. We prepaid BRL 2.2 billion. This generated capital gain of approximately BRL 2 billion.
BRL 0.7 billion went to taxes, BRL 1.3 billion to the net gain, which you will see in the adjustment on the next slide. Until the second quarter, we had six concessions with public asset use. They would total BRL 773 million per year. This payment has been settled through this operation. We continue to pay Cana Brava and Cachoeira BRL 105 million a year. The cash flow of those BRL 773 million is something we will only see as of the third quarter. Not only the cash flow, but interest rates and service on the liabilities. This operation will begin to appear in the third and fourth quarters. With this, it's easier to explain this slide. Nominal change going from BRL 567 to almost BRL 2 billion. Once again, thanks to that operation of the public asset use.
We have a robust growth of 23% thanks to the increase in EBITDA, offset by depreciation of assets, financial results, of course, coming to BRL 694 million adjusted net income for the quarter. With this, our debt continues that trajectory of remaining at 3x with a minor drop. We were at 3.2x last year at 3.3x. We are now at 3.1 x total debt of BRL 25 billion without major surprises. Of course, we continue at an appropriate level of leverage for the company. On the following slide, we see the debt profile. You can see it is quite soft, an average term of somewhat more than seven years. Very similar to last year and other quarters. Presently, we're at 40% of CDI and 54% of IPCA, plus something and a small part of IPCA. A debt of 11% nominally.
We go on to our last slide to show you our dividend policy. While our leverage is close to 3, we continue with a minimum payout of 55%. We have several cycles of investment. In this first quarter, we have BRL 0.54, 50% of distributable profit for the first half. The extraordinary profit of the public asset use will not be distributed, we stand at BRL 0.54. Let's speak a bit about expansion. Simply, we see the conclusion of the Jirau process that has been thoroughly disclosed. The general assembly was held on July 2nd, held only by majority shareholders, the pricing. This process is concluded. It was concluded on our part. On the next slide, you can see the figures of the Jirau hydro plant. The concession term was extended until 2047. I think this happened on July 14th, a few weeks ago.
It's working very well. The growth generation for the plant is growing. Engie Brasil Energia is a shareholder since July 17th. Hydro plants. Okay. I'm sorry, I had a freeze. I'm back. The capacity reserve auction for Jaguara to conclude our slides on hydro plants. The only highlight here refers to executive activities. We're going to follow up on this project for the next three or four years. No additional novelties for the time being. Let's speak a bit about transmission. I will turn the floor over to Gustavo Mann. Gustavo Labanca.
I'm sorry. Well, good morning, everybody. Here we show you the evolution of our projects of Asa Branca and Graúna. Asa Branca, as a highlight, has the first sector already energized. It corresponds to one-third of the total project and the revenues as well.
We're speaking of BRL 100 million that are already operational, therefore, with a significant RAP. The second and third sectors, we have obtained the environmental license in April, and work is underway according to what was scheduled, advancing in a positive way. We're quite optimistic when it comes to the results. When it comes to Graúna, to the right of the slide, we have had a very good evolution. This is all very recent. The main point today, differently from Asa Branca, we're concluding two or three sectors. For Asa Branca and Graúna, this has been delegated to the state. Minas Gerais has not been included here because last year we were able to obtain the license for that sector in Minas Gerais. For the case of Santa Catarina, we have a prior license, and we're working on the request for installation.
In the case of Paraná, we have a preliminary license as well, and we're awaiting the installation. Part of this is already under operation, the part that we obtained at the auction. What is important to underscore here is that once all of these projects are operating, and I will speak about the asset we obtained in March, we will have BRL 1.6 billion of RAP, BRL 600 million for the construction, and BRL 170 under operation. The asset Colibri is a project we acquired in the auction in March. There's a part in the south of Brazil, Lot 2, and a part in the northeast. The part in the south, it's worthwhile reinforcing the issue of synergies with our project. It connects to the Ponta Grossa substation, Gralha Azul.
It's 100% parallel to a line that is also under our ownership, and it will bring some synergies with the implementation of the Graúna project, and we're managing this project in the south. Presently, we're in the contracting phase. It is advancing very well. If we think about the budget in general, if we look at the contracted part and the promised part, we're getting to 80%-90%. For the part in the south, we are at two-thirds of our budget. Everything is moving ahead positively according to what we had imagined in our schedule. As I mentioned, as soon as this project comes into operation, we will be adding BRL 123 million in revenues to the Engie Brasil portfolio. Very well. With this, we conclude our presentation. I thank you for your attention. Well, thank you, everybody.
We will now go on to the question-and-answer session. Should you wish to pose a question, please send it through the Q&A icon of this video conference. Our first question comes from William Hamos, an investor. He asks, "Good morning. Your projection of profit per share after Jirau seems to have dropped significantly. I would like to know when we will recover the former levels before this asset is incorporated. Thank you."
I will begin by responding here. While we can't give you guidance for our profitability, the profitability will be recovered. What we can say is that Jirau, since the 17th of July, has begun to contribute to Engie's results. As a consequence, of course, we will have increases, and as of July, we will have all of the positive effects of the prepayment. We have BRL 4.2 billion in liabilities that cease to exist.
They were at a cost of 10% plus depreciation, 14%-15% IPCA per year. All of this ceases to exist and will generate higher profits going forward. This is something we will observe as of the third quarter and subsequent quarters.
Perhaps I can complement here, and remind you that during the acquisition process for Jirau, we carried out all of the analysis, and the forecast was that the profit per share would have an evolution. Of course, I think it's important to await the profitability of Jirau for this to materialize so that we can pay our dividends, and we will add these dividends to the total gains we have. With this, we could have a higher gain per share. It's simply a matter of time. There's this limited cost for shares.
All of this will be reflected in the future of the company according to our calculations. It will be a positive result, even for those who have not accompanied our capital gains. Very good.
Thank you. Our second question comes from Ricardo Bello, a sell-side analyst from Safra. Which is your forecast in terms of capital going forward, and transmission and batteries, are they still interesting? Which are the opportunities to look for, and what is happening with competition? Which is the margin update that we should expect because of all of these assets?
Well, I will answer the first part. The first part is, yes, with this operation of Jirau and the restructuring of capital, we have gained some steps to be able to carry out new acquisitions.
Yes, we're still interested in the batteries, of course, obviously, with the traditional financial discipline that characterizes us, but we are focused on that possibility for growth as part of the new capital structure, but with financial responsibility and discipline. Depiné.
Very well regarding costs and the normalization of margins. We have carried out several acquisition and construction movements during the last quarters. This quarter, for the second and third quarter of the year, these will be more normalized quarters. In January, we had Cachoeira, Açu Sol, fully operational. In the transmission companies, we have no forecast for a new transmission company, only next year, perhaps. Jirau will cut down on costs. It comes in as equity. In the third and fourth quarter, our results will be more marginalized in terms of margins.
If you allow me to add to the transmission part, we do have an auction already set up for October. With the team, we're defining the lots that would be of interest for us and competition. That was part of the question. Well, of course, competition is very harsh. There are several players participating in the growth of this segment. This is a sector that needs to grow with major growth in the coming years. We need to have expansion in energy research because of this, and we have to work more on the growth of energy. Of course, we're interested in participating in the auction, but we will follow our financial rules, continue to be competitive when it comes to acquiring assets.
When it comes to the batteries, if I could add a bit, yes, of course, we're concerned in having more projects enrolled than the installed capacity of the country, we need to await a few more weeks for the approval. I think this holds true for everything. The situation has been consolidated for those that are competing. There is one project or another, I think we have to wait to see for the results.
To conclude this, I thank you, Gustavo, for the explanation. As we don't have Guilherme Feghali here, our director. When it comes to batteries, this is a novel market, of course, there's an enormous appetite of the market, as Gustavo has underscored. These projects have no consistency. They will fall out during time. Yes, it is important. What we can offer is our global experience.
If you research with artificial intelligence on battery systems throughout the world, you will find the mention of Engie. Engie perhaps is one of the greatest companies operating in Brazil in this realm. It is important for us. We have a global scale in terms of batteries. We have broad experience in Latin America and Chile, in North America. Yes, of course, we're interested in this, we can contribute with our engineering experience and interesting experience in this field. If the proposals are rational, what this means, we have a significant opportunity of continuing and going forward in this. T hank you.
We are now ending the question- and- answer session. I would like to return the floor to Mr. Sattamini and other directors for their closing remarks.
Well, I would like to thank all of you for your attendance today.
We are evolving in our main issues and problems, resolving challenges of the past. That's one of our features of resolving that issue of Jirau. We spent 10 years speaking about this on our quarterly calls. This capital has added value to the company, will allow us the room for profitable growth. We continue to focus our strategy on renewables. Brazil is a country that needs to resolve regulatory issues. This, of course, is complex, there will be a solution. This is one more opportunity for the coming government, we always attempt to offer contributions so that the electrical sector can be a healthy one, can be an effective one, when providing competitive energy for the Brazilian industry. We have great expectations. It is an electoral year. It is time to offer our contributions for the future governments to enhance the electrical sector. I thank you very much.
We would like to thank all the executive directors for their attendance. We would like to thank all participants. The Engie Brasil call ends. We would like to wish all of you a good afternoon.