Good morning, everyone. Thank you for joining Eneva's third quarter 2025 earnings call. We're going to start with slide number four. First of all, we're very pleased to announce good news about the EBITDA of the third quarter: record value for the fourth consecutive quarter. Our quarterly EBITDA reached the mark of BRL 1,823 million, an increase of more than 61% compared to the third quarter of 2024. This result is the product of the business plan that we have implemented over the last few years, combining the growth of our asset base with the materialization of the results of new business lines in the gas market and the various optimization and efficiency initiatives in our current operations. Much more than one-off results, this continuous progression demonstrates the consistency of our business models and their short, medium, and long-term potential, creating solid growth opportunities.
At the Sergipe hub, we've had another strong quarter: growth of BRL 206 million for EBITDA in the period. In addition to the plant's performance, we had another quarter of contribution from our gas group with recurring operations of firm and flexible gas supply in the network and opportunistic LNG operations taking advantage of the price windows and cargo availability through the period. All of this comes from the desk that is created a little bit over two years, the trade desk. In the Sergipe hub, we also got an indemnification of costs incurred at the end of last year to replace rising, with the approval of reimbursement over BRL 110 million by the insurers. On the off-grid gas front, after concluding the commissioning of Parn aiba Liquefaction Plants in the first quarter of 2025, we're still recording substantial increases.
The EBITDA showed an increase of BRL 72 million compared to the third quarter of 2024. To expand our capacity, we also advanced in the plant's expansion plan with the hiring of the main suppliers and the start of civil works for the construction of the third liquefaction train. With this expansion, we positioned the company to capture more and more opportunities in this market, which has a high potential for growth, with more attractive margins and firm revenue streams for the surplus gas reserves. In terms of efficiency, our continuous efforts in cost optimization and manageable expenses translated into nominal reduction of fixed costs and SG&A, which reduced BRL 39 million in this quarter when compared to the same period in 2024. This result highlights our commitment from the OEM and support teams from Eneva in terms of our financial discipline.
With the advancement of our current results, we have reached another historic milestone in our financial indicators: a record operating cash flow, BRL 1,965 million an increase of 54% compared to the third quarter of 2024, reflecting not only the solid operating performance but also a significant positive variation in working capital in the period with the monetization of our coal and LNG inventories. The solid results of the company throughout 2025, and particularly in the third quarter, have resulted in the reduction of leverage of 0.9x when compared to the same period in 2024 and a 2.7x net debt/EBITDA ratio. The indicators remain in the same level as the previous quarter, maintaining room in the balance sheet for the company's new growth cycle. The acceleration of the order of merit in the period also contributed to boost our results.
We offer flexible and dispatchable capacity at competitive prices and assuring reliability in the national integrated system with our portfolio, whether in a context of water scarcity or to cover for intermittence of renewable energies or to complement for peak demand. After the anticipation of PPAs confirmed in early July, we have started the regulated contracts and revenues that were expected only for 2026. The Vienna plant in Espírito Santo started in August, and contracts for Parn aiba IV and Jara Maranhão plants will come into force in October. These contracts will add an annual incremental fixed revenue stream of more than BRL 360 million to the company, in addition to the possibility of capturing variable margins in the event of dispatch. Finally, in October, we had the release of the final normative ordinance with the rules for the next reserve capacity auction scheduled for March 18, 2026.
The auction, which may be one of the largest ever organized in our country, is an important opportunity for us to recontract our assets that have their contracts expiring in the 2026 to 2031 window, in addition to enabling the contracting of new thermal projects as needed by the system. We have always believed in the need for incremental capacity and flexible generation to complement the Brazilian grid, and we've prepared ourselves for this opportunity. We created room in our balance sheet, secured critical equipment, and developed a pipeline of projects that, by integrating flexible gas supply solutions into the construction or operation of thermoelectric assets, have relevant competitive advantages to address both system needs as well as to generate long-term value to our shareholders.
We move forward, confident in our strategy, moving forward with the implementation of our strategy and preparing the company to take advantage of the new growth opportunities that our pioneering business models offer with financial discipline. I hand the floor to Marcelo Habibi, who will present the evolution of our results.
Thank you, Lino.
[Foreign language]
Thank you, Lino. Good morning, everyone. Moving on to slide five, I would like to present here the evolution of our financial performance. As Lino mentioned, we had the highest EBITDA in our history, BRL 1.823 billion in the quarter, a 61% increase compared to last year, and an annualized growth rate of 46% in the last five years. This strong performance also drove our operational cash generation to a new historical level of BRL 1.965 billion, 54% more than the same quarter last year. These milestones reflect the materialization of important growth avenues through initiatives mapped out in our strategic planning and implemented over recent years. We've grown organically, inorganically, and on commercial and operational fronts, expanding the value chains in which we operate.
In the inorganic front, the assets acquired at the end of 2024 contributed to resilient short-term results and cash flow, strengthening our balance sheet, unlocking incremental value, capturing financial and operational synergies into our portfolio. They created future optionalities such as the early start of capacity reserve contracts, which has already been conducted, and the new contractual cycles we would like to secure in the upcoming ORCAP 2026. In the organic front, we initiated the regulated contract for Parnaíba VI plant, adding 25 years of inflation-indexed fixed revenue. We launched the off-grid gas in the northeast, the LNG production, and we also developed our on-grid business model after connecting the Sergipe hub to the pipeline network. We signed supply contracts for the gas trading desk. We leveraged the opportunities in the LNG market, and we created an opportunity window to be explored.
In the first nine months, we generated an EBITDA of more than BRL 300 million through these operations. On the operational front, we implemented a series of initiatives that improved the efficiency of our assets. The best example is the Jaguatirica II plant that increased both its fixed and variable margins. We also remained focused on our financial discipline, with controlled costs and expenses and more synergy in our acquired assets, which led to more value generation in current operations. This evolution on the results demonstrates the potential of our business models, which spans different value chains to meet the market needs, allowing for the capture of significant opportunities. Also, our asset base, mostly contracted with long-term inflation-indexed fixed revenue, ensures resilience and predictability for our results. With that, I will now turn over to Marcelo Lopez, who will present more details on the gas marketing segments.
[Foreign language]
Thank you, Habibi. On slide six, I would like to highlight the on-grid and off-grid gas marketing segments. You can see the robust results that we have in the first nine months of 2025, surpassing BRL 12 billion. The off-grid marketing model includes the liquefaction plants in Parnaíba, with more than BRL 200 million in EBITDA year to date. And in the segment, revenues are still ramping up, which will gradually increase until the end of the next year. These results reflect the margins that we have monetized in our natural gas, with firm revenue streams secured by our take-or-pay terms. As Lino mentioned, we made important advances in the plant's third liquefaction train that will expand the capacity by 50%, 900,000 cubic meters per day. We did a procurement of main suppliers and began the civil works. We would like to start operations of the new unit by mid-2027.
We believe in the immense potential that will be unlocked, taking into account the growing demand of LNG as a diesel substitute for heavy road transport. We have more relevant partners engaged in investing in structuring the country's first green corridor with the LNG for the road segment. On the grid marketing front at the Sergipe hub, we have a significant contribution: more than BRL 320 million in EBITDA year to date, of which BRL 260 million resulted from structuring operations in the LNG market, optimizing cargoes to our gas desk, leveraging commodity price dynamics in the electricity sector, and the other BRL 60 million came from firm and flexible contracts for the pipeline network. The results reinforce our investment thesis when we acquired Celse to develop the Sergipe hub, and we see a relevant generation potential from the hub's remaining infrastructure.
The surplus of FSRU leased until 2044 at the hub will allow us to secure new, firmer, flexible contracts with different clients of different profiles, as well as to supply existing or new Eneva projects in a competitive manner without needing incremental CapEx. We also have an expansion project portfolio adjacent to the hub that can be developed as needed. We will continue working with focus to extract maximum value from our competencies and value chains, optimizing our assets and contracts and preparing the company to fully leverage our business potential. Now, on slide seven, I would like to tell you about the key highlights regarding the 2026 capacity reserve auction and the other opportunities that we see for the future.
Following the growing need for capacity to ensure the energy matrix that is more and more intermittent and aligned with our strategic planning, we have been developing and acquiring different projects in recent years to offer competitive solutions in the interconnected national system in generation auctions. The next auction that's been awaited for the market for nearly four years will represent an important opportunity for Eneva for recontracting existing assets and monetizing new projects in our extensive pipeline, securing fixed revenues for capacity availability as well as variable revenues associated to energy sales on dispatch opportunities. According to the normative ordinance published on October 2023, all LRCAP will be held on the 18th of March 2026 and will offer eight products with their supply starting between August 2026 and August 2031.
The auction will allow for the participation of gas and coal projects as well as the expansion of hydropower plants. Six products will be dedicated to thermal projects and two to hydro projects with no direct competition between these sources. For the thermal products, the six products from 2026 to 2031 will allow the participation of existing gas-fired projects in simple or combined cycle as well as coal-fired projects. Now, the products from 2028 to 2031 will also allow for the participation of new thermal projects, but only gas-fired, natural gas, due to the minimum operational requirements more appropriate for simple cycle. Contracts will be of 10 years for existing assets and 15 years for new projects. Thermal product, new or existing, using or not the gas grid, will compete directly and must demonstrate fuel availability for the entire contracted capacity.
Projects must also comply with operational perimeters defined by the government according to the ordinance. These requirements aim to ensure flexibility in the system operation and will favor the more flexible projects. Eneva approaches this auction with a differentiated position due to our existing thermal park as well as our diversified project pipeline. Our installed capacity from existing gas-fired plants exceeds 1.3 GW, with assets available for recontracting from 2026, and our coal-fired plants can offer more 700 MW to the system in 2028. Added to this capacity, we have a greenfield and brownfield project pipeline at different levels of competitiveness and maturity, with the potential of delivering new projects as early as 2028.
Now, our vertically integrated business models, combining flexible gas supply solutions through ENP or LNG terminals with proprietary infrastructure and power generation, will offer a structural advantage in terms of cost, timing, and supply in our portfolio. We are also preparing to take advantage of the full potential of this opportunity, pre-acquiring critical equipment and maintaining a healthy balance sheet to support the new cycle. Following what has been disclosed by the ministry, next steps will include the project registration and document submission by this Friday, the 14th of November, and the CVU and operational flexibility perimeters registration by December 12th. We expect the public consultation for the notice to be published by December, enabling the price cap release of this auction by February 2026.
Other key milestones that will affect the dynamics and competitiveness are the technical note on remaining transmission capacity that is due on January 16th, and the announcement of qualified projects expected by February, as well as the auction itself scheduled for March next year. With the LRCAP 2026, we have a concrete opportunity to extend the lifecycle of our existing asset base, as well as to initiate the next organic growth cycle for this company. This will not be the last capacity auction. Given Brazil's growing electricity demand, the increasing renewable penetration, and the limited offering of hydropower projects, we foresee recurring opportunities to contract capacity in the system. We will aim to take advantage of this opportunity to maximize value creation for our shareholders. I'll now turn back to Marcelo Habibi to present the quarter's financial highlights.
[Foreign language]
Thank you, Marcelo. We'll go to slide nine, contributed to the variation of EBITDA. So, relevant contribution of the thermal actives acquired in the fourth quarter of 2024, which added BRL 457 million to our EBITDA. The Sergipe hub also contributed expressively, with a growth of BRL 206 million in the annual comparison. This was driven especially by the one-off indemnification of the riser insurance, the improvement of the fixed margin, and the contribution of results of the on-grid gas trade. In the off-grid trading, the second quarter of full contribution from the SSLNG plant generated an increase of BRL 72 million in Jaguatirica and the Parnaíba complex. The full increase was BRL 69 million, driven by the numerical impact contributed to the margin complexly and the efficiencies in Jaguatirica.
The positive dynamics was partially compensated by the upstream due to increasing expenses due to exploration, due to the seismic campaign ongoing, and the non-recurring costs and retroactive costs with special participation accounted for the quarter. Besides, we also have a lower result on the holding, a reflex of the one-off effect of the CRCAP of Jaguar Marino. Once again, I reinforce the results are the result of the resilience and potential of our business models. On one hand, the significant fixed revenue component ensures stability at around 90% of our results. On the other hand, we are constantly increasing our asset base with attractive results and developing new business models, allowing our results to grow continuously and stably. Now, moving on to slide number 10, I present the main impacts on the financial results between quarters.
The net financial results improved an improvement of BRL 105 million of the third quarter 2025 compared to the same period 2024, totaling net expenses of BRL 373 million. The main impacts that contributed to this improvement were the higher revenues of, in addition to the effects of liability management initiatives. In the sequence of slide 18, we see the variations of the cash flow in the period. As I pointed out, the operating cash flow registered a historical level of BRL 1.965 billion, driven by record EBITDA of the levels of operation and the positive variation of working capital in the period, especially with the monetization of coal and LNG inventories. The cash flow of investments consumed BRL 1.523 billion, mainly directed towards Azulão 950, to the exploration development activities of the upstream and to the sustaining activities of the company's operating assets.
The financing cash flow recorded net cash outflow of BRL 361 million, mainly reflecting the amounts paid with amortizations, interest, and lease. The amounts paid were partially offset by the funding in the period, with emphasis of the disbursements of almost BRL 700 million with BAS and BNB for the Azulão 950 and SSLNG projects, contributing to the strengthening of the structure of the capital for the period. As a result, Eneva ended the quarter with a robust cash position of BRL 3.937 billion, representing an increase of BRL 81 million at the end of the quarter of 2025. Moving on to slide number 12, I present the updated capital structure. On the left, we show the evolution of the net debt, which concluded the third quarter at BRL 12.15 billion. Our leverage closed at 2.7x down, decreasing 0.7x compared to the same period in 2024.
Disregarding the one-off impact of the non-cash expenses and the impairment of coal, the leveraging would be 2.4x , leaving important room on our balance sheet for the future capital allocations, especially considering the recurring EBITDA levels. In the other graphs, we show the quality of our debt that concluded 5.8 years and lower cost compared to the same period in 2024. The improvement of our capital structure reflects our continuous process of liability management, in addition to new disbursements of financing with development banks on attractive terms. To the right of the slide, we see the profile of our debt, which currently has 82% of its total linked to the IPCA, ensuring the alignment between our financial obligations and the main index of our fixed revenues.
In a similar way, the balance of our CDI-based debts is compatible with our cash balance, creating a natural hedge between company's obligations and rights. Finally, we have a debt timeline that is concentrated on a long term, allowing to focus on the liquidity of our capital investments. With that, I hand the floor to Lino, who will detail the investments and the capital projects of Eneva.
[Foreign Language]
Thank you, Habibi. In slide number 14, we highlight the investments. We highlight the investments made during the quarter, which totaled BRL 1,567 million. Pardon, BRL 1 billion. The Azulão 950 complex, we had a total investment of BRL 139 million in the quarter. As highlight, BRL 639 million for the quarter.
Allocated to construction and assembly services for the power plant, UTE, BRL 630 million, gas treatment unit and substation, and BRL 149 million related to equipment receipt and maintenance, demobilization, and logistics costs.
An additional BRL 56 million was invested in support and personal activities. In upstream, investments totaled BRL 284 million, with highlights being the BRL 113 million for the new drilling rig currently drilling at Baseirado Parnaíba, BRL 71 million for the drilling of two exploratory wells and one development well, all of them at the Parnaíba, and BRL 56 million to develop Gavião Belo and Gavião Mateiro fields also in Parnaíba. Sustaining activities, we registered BRL 191 million, mainly directed to the Sergipe hub, with the activation of a rotor that has been previously recorded in inventory, one of the turbines, and Azulão Jaguaririga, mostly for turbine maintenance payments and other preventive maintenance and spare parts. Additionally, BRL 97 million were allocated to holding projects and the development of thermal projects within our pipeline, plus BRL 64 million to DNL Brazil, including the acquisition of 44 tractor units and eight support vehicles during the period.
Now, on slide 16, we will talk about different projects. First, Azulão 950. With the project's physical progress, we could advance from 67% to 78% during this quarter, the last quarter of 2025. At the UTE, at the left high hand corner, we can see the generator circuit breaker being installed. Also, we have installed the Azulão II pipe racks. At the UTG, we completed installation of the primary gas treatment equipment, such as the knockout drum at the upper right-hand corner, and the assembly of the thermal systems and electrical center. We also started cable laying for the UTG. We can see also the completed energization of Azulão substation, and we can also see the electric project for the Azulão II. We expect to commission Azulão I in the second quarter of 2026, while Azulão II is forecasted to be completed in the first quarter of 2027.
Regulator contracts will start in August 2026 for Azulão I and July 2027 for Azulão II, in line with the exceptions approved by NAL. Now, moving on to slide 17, I will share the updates and milestones for the liquefaction plant expansion project in Parnaíba. At the liquefaction unit, manufacturing has started for the main equipment by technology provider Furui, and we also finalized the contractor engagement. On site, we have concluded access roads and earthworks, and we've started civil construction, including mobilization of the site camp, materials, and equipment. I would like to highlight the completion of the first equipment batch by Furui vendor now in the fourth quarter, delivery of all plant equipment on site in the second quarter of 2026, and mechanical completion in the first quarter of 2027.
Commissioning and plant startup are expected for the second quarter of 2027, with the startup of the operations forecasted for early 2027 as well. I will now hand over to Felippe Valverde for our Q&A.
[Foreign language]
We're going to begin the Q&A session now. I want to remind you all that any questions should be sent via the Q&A function at the Zoom platform. The first couple of questions come from Danielle. First, could you please comment a bit on the outlook of the company over the auction of capacity reserves? Which product has generated more interest in assets and a priority for participation? Danielle, we've discussed the capacity auction during the presentation. First, the recontract of existing assets that have contracts expiring during the window of the auction is the first purpose. The second major objective is to expand the company's installed capacity.
We can't give you more details aside from that because it's an auction strategy, a bidding strategy, and we're going to finalize that up until the day of the auction. Thank you. Second question from Danielle. It's about the upstream. Could you please talk a bit about the increase in expenses related to upstream exploration? Besides, when can we expect a new report for reserves?
[Foreign language]
The increase on the expenses relates to the two important acquisitions, one at the Paraná and the other at the Amazonas Basin. The Paraná one was concluded in October this year, and the Amazonas Basin is now at the peak of its activity with the conclusion forecasted for the last days of December, still in 2025.
Both acquisitions were of extreme importance to determine prospects and goals and future drilling campaigns that we are planning for Amazonas in 2026, second quarter, and Paraná Basin for 2027. I will piggyback to the other part of your question, certifications. They make sense, the reserve certifications, when we develop activities in a basin that has moved on from its previous certification. Since last year, we did not conduct any drilling, no well testing activity. We had no certification. We only replicated the previous one according to the volume of the year. For this year, in the beginning of 2026, you may expect a reserve certification aligned with the activities that have been conducted at the Paraná Basin, where we drilled many wells, both for development as for appraisal and exploit. We have also conducted different testings.
We will have a new reserve certification for the Paraná Basin updated accordingly to these activities at the beginning of 2026. In the Amazonas Basin, again, this year, we had no activity, so we will only report consumption. We will have a reserve certification at the beginning of 2027 after the drilling campaign that we just talked about.
[Foreign language]
Thank you, Lino. The next two questions that we have received came from Andrés Sampaio from Santander. The first is, how does the company view the potential impact of the battery auction on demand for the thermal capacity auction? Would you be interested in participating in the battery market, Marcel?
[Foreign language]
Thank you for your question. We understand that the batteries auction is an interesting initiative from the government to bring more alternatives and to modernize the power sector.
We understand it should not influence LRCAP significantly because we believe it should be an experimental demand. The hiring should be of a volume that is not as significant. For us to test this technology, how it will interact within the power segment, we do have the intention of looking at projects. We had also been considering project alternatives, and we should participate actively both in the discussions related to this ordinance as well as in the auction itself.
[Foreign language]
Thank you, Marcelo. The second question from Andrés Sampaio. The government seeks to reduce the curtailment of renewable energies. The reduction of the inflexibility of thermal power seems to be an opportunity, interesting opportunity for this goal. How does the company see this opportunity?
[Foreign language]
Certainly, the inflexible dispatch for thermal electric at the same time that you have a renewable generation does not seem to make sense once we do have an idle resource while we are using a non-renewable resource, mistakenly. Having said that, we have long-term contracts, and they are secured by the conceding power, the grantor. We are up to debating it as long as it does not result in deteriorating the value of the company's projects, since we have invested significant amounts to fulfill said contracts. Everything is up to debate as long as it does not harm the company. It is also true that when we reduce inflexibility, there are additional volumes of gas that could be used to leverage the company business models that obviously depend on the usage of that gas molecule.
[Foreign language]
Thank you, Lino.
Now, the next two questions come from Fillipe Andrade from Itaú BBA. First, at Eneva's vision, should we expect seasonality in the natural gas commercialization contribution on grid, similar to what we had this year, more concentrated in the first semester due to the thermic dispatch dynamics?
[Foreign language]
Thank you for your question, Fillipe. Surely, if we have an opportunity to capture arbitration, the higher likelihood is for this capture to happen in the first half because the second half is more likely to require the use of gas via dispatch as it was done this year. That being said, it's not sure. It's not assured that we'll have the same type of arbitration we had in 2025 into 2026. We're going to try to capture if it comes.
[Foreign language]
To the second question from Filipe about equipment. Additionally, how has Eneva been observing the critical equipment and turbine supply chain?
The company's perception when we compare CapEx per megawatt seen in the current commercial conditions versus the last LRCAP, what was the increase?
[Foreign language]
First, it's no surprise for anyone. We have the revolution of AI in North America and the search for energy and gas generation in the Middle East, where they are seeking to replace diesel for gas. That has resulted in more market for the equipment vendors. Before talking about an increase in costs, the LRCAP of 2021, we had the possibility of getting the project on the auction and then debating with equipment vendors and maybe running a bid amongst them to acquire the equipment. Today, the situation is the opposite. If you want to get the equipment to build your project, you need to pay to reserve that space, that footprint, without even knowing if you will win that auction or not.
The production is entirely different. And then depending on the equipment and the term, because it's not only the type of equipment, but the time that you need that to be delivered, you can see an increase of 50% in the cost of said equipment.
[Foreign language]
Thank you, Lino. Okay, with this last question, we conclude our Q&A of our earnings call, the third quarter of 2025. Thank you all for participating, and we see you in our next call. Have a great day.