Good morning, ladies and gentlemen, and welcome to the audio conference call of Equatorial Energia. Thank you for standing by. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session, and instructions to participate will be given at that time. If you should require assistance during the call, please press the star key followed by zero. As a reminder, this conference is being recorded. I'd now like to turn the conference over to Mr. Eduardo Haiama, CFO. Please go ahead, sir.
Good morning, everyone. First of all, I'd like to thank you all for joining us in our second quarter conference call. As for agenda for today, I'll start the conference call describing the highlights of this quarter, then I'll comment on our operating financial results, give you an update on the development of the transmission projects, and finally, we'll open the Q&A session. First, it's important to mention that this is the first quarter we are consolidating Equatorial Alagoas results. Also, as a communication strategy to strengthen Equatorial's brand and reposition ourselves in our concessional areas, we are changing our names of all our DisCos within the group to Equatorial Distribuição, and then the name of each state. As for the highlights of this quarter, on slide three, the second quarter Equatorial consolidated EBITDA reached BRL 943 million.
This figure was mainly impacted by the consolidation of Piauí and Alagoas, both already posted positive EBITDA, but also the adoption of IFRS 16 of the transmission assets. I'll further disclose the impact on the next slide. In our DisCos, we are within the regulatory parameter for quality and FEC , given the recently acquired concessions of Piauí and Alagoas. In our most recent acquisition, Alagoas, the operational restructuring is already undergoing with the conclusion of the first voluntary layoff program, representing a significant reduction in the company's total payroll. We concluded tariff review last week, RAB went up to BRL 5 billion, and regulatory total losses increased to 27.5%. As for our sold volumes, Maranhão and Piauí kept growing, posting 1.7% and 3.1% increase in this quarter. On the other hand, despite positive growth of regulated energy, Pará and Alagoas posted drops of 2.4% and 27% respectively.
On the positive side, regulated energy grew in all our four concessions with the combined figure amounting to 3.6%. As for the transmission projects, we secured 100% of the long-term funding, having 44% of this funding already disbursed. I'd like to highlight that SPE 8 has already reached 72% of work in progress, while SPE 1 and 2 are at about 50%. In terms of EBITDA, if you were to consider only the results from the old assets, basically just Maranhão and Pará, we would have grown 20% year-on-year, reaching BRL 516 million. Moving on to slide five, consolidated volumes. Combined sales from our DisCos in the group dropped by 4.4% in the quarter, strongly influenced by Alagoas. Since this first quarter controlling this company, we've adjusted some past billings, negatively affecting volumes in the quarter.
Its impact in the quarter results is completely offset by the reverse of the delinquency provisions it was associated with. If we were to disregard the adjustment, the combined billed volume of the group would have grown by approximately 0.3%. Given our more interactive approach regarding loss coverage and collection, Pará posted a drop of 2.4% year-on-year. This negative variation was partially offset by the growth of 1.7% in Maranhão and 3.1% in Piauí, mostly fueled by the residential growth in these regions. On slide six, talking about regulated energy, the combined growth reached 3.6%. Alagoas posted the strongest growth of 7.8%, basically influenced by the lower rainfall in the period. The capital of the state, Maceió, which concentrates 47% of the load, had 23% less rain volume in the second quarter than the same quarter of last year. Maranhão also benefited from this lower rainfall, posting a 3.9% growth.
In the case of São Luís, the capital of Maranhão, had a 15% less rainfall compared to the same quarter of last year. In all DisCos, the trucker strike and this low industrial activity due to the Brazilian national team match in the World Cup last year, had a minor influence over this reported growth. We estimate it between 30 to 50 basis points. On slide seven, we show the total energy loss in our DisCos. The level of energy losses in Maranhão and Pará have been impacted by the more integrated policy of loss/coverage and collection adopted in these concessions since the second half of 2018. In Pará, after the tariff review approved last week, the regulatory level for total losses went up to 27.5%, following the increase in the level of technical losses with organizing the company's tariff structure.
In Piauí and Equatorial Alagoas, the level of losses in both companies is mainly impacted by the adjustment of the billing procedures that had to be made once we arrived in these companies. It is worth mentioning that we are still in the process of hiring and training new teams to combat losses, and we should expect improvement in the next quarters. Moving on to quality indicators, slide 8. We show the quality indicators for Maranhão and Pará continue to be well below the rest of our targets. As for Piauí, the recent increase in the recent quarters is a consequence of the adjustment in the way we measure DEC since we arrived. This change should continue to affect the indicator until fourth quarter of this year, since it's calculated using a 12-month moving period. Same thing happened in Equatorial Alagoas, but with a much smaller impact in the final 2 years.
Moving on to slide nine, in terms of the FEC indicators. We are below regulatory targets in all our DisCos, even in our recently acquired companies, Piauí and Alagoas. On slide nine, we show the evolution of management expense in our distribution companies. Maranhão posted an increase of 3.6% year-on-year, slightly above the 12-month inflation index for the same period. Whereas Pará posted another decrease in management expense in the quarter, amounting to BRL 119 million. Personnel dropped by BRL 1 million in this case, due to the reduction in headcount, and third-party services dropped by BRL 6 million due to a fair operational efficiency. In this quarter, Piauí posted a reversal of expense from previous years that were transferred to CapEx amounting to BRL 150 million. Adjusting for that, the recurring OPEX dropped by 37% compared to the same quarter last year.
Key to this reduction is the voluntary layoff program concluded in the first quarter of 2019, when 30% of the personnel left the company. In Alagoas, it's still in the very early stage of the turnaround since we took the control in March. The company already posted a 14% reduction in expense this quarter. Already adjusted for the non-recurring facts. Moving on to slide 12. The good cost control shown in the previous slide reflecting the EBITDA growth that we are posting in the DisCos. Maranhão and Pará posted very healthy growths of roughly 20% each, amounting to BRL 248 million and BRL 267 million respectively. In Piauí, following the already positive recurring EBITDA in the first quarter, the figure for the second quarter reached BRL 30 million positive. Already a strong number even before we complete one year controlling this company.
It's still before the actual net tariff review scheduled to occur in December. In Alagoas, it's the first quarter we are consolidating its results, which means the second quarter's EBITDA is strongly impacted by several non-recurring adjustments. Considering only the main of its five events, adjusted EBITDA would have reached BRL 69 million. Moving on to slide 13. We show the consolidated EBITDA for Equatorial. In the second quarter, we posted BRL 943 million adjusted EBITDA, benefit from the consolidation of transmission assets in the newly acquired DisCos. For comparison purpose, if we exclude the results from the new assets, Piauí, Alagoas, transmission assets and Intesa, consolidated EBITDA would have reached BRL 516 million, or an increase of 20% year-on-year. On slide 14, we present a maturity schedule and the leverage for the company.
Equatorial's leverage considering the full consolidation of its assets, reached 3.6 times in this quarter, following the consolidation of Piauí and Alagoas, which contributed with BRL 3.1 billion of net debt. It should be highlighted that this leverage calculation is different than the one made for the covenants of the company, as it considers the last 12 months of the results from any acquired assets when the grouping appears. Equatorial ended the quarter with almost BRL 5.5 billion in cash position, which is more than enough to cover the first two years of debt maturities. We believe we have a very comfortable debt structure to accommodate not only Piauí and Alagoas cash needs, but also the future CapEx for the transmission projects, considering that we have already secured long-term debt for the group. On slide 15, talking about CapEx.
As can be seen, investment in transmission segment has picked up in the recent quarters, now reaching BRL 687 million in the quarter, following the start of the construction of seven out of eight SPEs. Since the beginning of the development of this project, we have already spent BRL 2.2 billion. On slide 16, we show the outcome of the tariff review for Pará. On August 7th, the tariff in Pará was adjusted by 0.69%, RAB grew by 63% in the cycle, reaching BRL 5 billion, which translated into almost BRL 1.1 billion in regulatory EBITDA. Adding the regulatory effect and delinquency provision, the total portfolio after deducing the other revenues, amounts to BRL 1.8 billion. Total regulatory losses amounted to 27.5%, following the increase in the technical losses to 11.7%, it slightly decreased non-technical losses to 33.5%. This final figure should drop by 50 basis points every year until 2022.
X factor was calculated 0.08%. It's important to remember the recurring part for the 50 tax PD and no tax trajectory XP, we are fixed for the whole cycle. Considering only these two factors, X factor is 0.36%. Moving on to slide 18, talking about transmission. We have obtained all the construction licenses for the projects, except for a small part of SP7, we have already started the construction of seven out of eight lines in our portfolio. I would like to highlight that the evolution of the construction in RSP, but especially in SP8, is the second-biggest in our portfolio, and the last one we won in the auctions on 2017, that have already reached 72% work in progress. SP1 and SP2 should also be mentioned as they already have 50% completion each. On slide 19, we show the long-term funding status for each SP.
We have already secured 100% of the long-term funding at very competitive cost. That should translate to the significant boost in terms of recurring risk reduction, not only in terms of liquidity for the group, but also in terms of volatility as the long-term funding is indexed to IPCA inflation, which is the same index of our revenues. It is important to mention that this was as a result of a three-year long fundraising effort from four different sources, BNDES, BNB, BASA, and infrastructure debentures. Of the BRL 4.1 billion funding size, BRL 1.8 billion or about 44% has already been dispersed. This amount is pretty much in line with the CapEx already deployed. I believe now we can start the Q&A session. Thank you.
Ladies and gentlemen, we will now begin the question and answer session. If you have a question, please press the star key followed by the one key on your touch-tone phone now. If at any time you would like to remove yourself from the questioning queue, press star two. Our first question comes from André Sampaio with Santander.
Hi, guys. Good morning. I would like to make a quick question on the tariff revision of Cepisa. If you guys could give us more details on how the process is evolving and if you could have any new information on that. Thank you.
Thank you, André. Well, there's nothing much to disclose at this moment. The only thing that's important in terms of schedule, we are concluding the appraisal for the new RAB that we want to present to ANEEL, right? It should probably be next week. It's too early to say what's going to be the final outcome because there are lots of discussions going on right now regarding the methodologies we're going to use to have a full review of the RAB. If you remember, we have said that we asked for a full review of the RAB because we believe there are lots of assets that were not included in the past, right? That could potentially boost this number. There are many details that need to be discussed before we can say which way it's going to go.
What I can say is so far, the analysis we've made gives us confidence that the number that was presented before should be at least answerable. To say by how much and all, it's too uncertain. Right?
Sure. Thank you for the answer.
Excuse me. As a reminder, if you'd like to pose a question, please press star one. Our next question comes from Marcelo Sá with Itaú BBA.
Good morning, everyone. I have one question. You mentioned in the release the reversal of BRL 151 million in personal provisions that will now be booked as investments. I just want to confirm if this is likely to be recognized as asset-based for Cepisa. That's the first question. The other question is regarding the discussions on the regulatory WACC. So far, ANEEL has initiated the discussions on the regulatory WACC for generation and transmission, but not yet for distribution. I'd like to know if you have a view or more details on the discussions that will start on the regulatory WACC for distribution. Thank you.
Thank you, Marcelo. Starting from the last question regarding the WACC, no, we don't have yet guidance or stuff that we can say how the discussion's going to go. Then in the end, everyone saw that it was important to separate the discussions because they are different in a way. You should calculate risk and the impact on that, the spread that you should have from different segments. I believe this discussion needs to start, say, soon, so that we can have time to properly, let's say, review and have a deep discussion till year-end. Otherwise, it's going to be hard for the regulator to apply the new WACC for the next years that are reviewed.
What I can say is our expectation that this discussion should restart soon regarding the WACC. As for Piauí, yes, that's the right part of the work we are doing to prepare the upgrade. Like I said in the previous question, it's too early to say what's going to be the final number. There are many fees regarding the methodology that the regulator once showed up to have the full upgrade, or even for some of the fees that we saw, how the regulator is going to consider to say what's going to be the impact. What I can say is, what we did was trying to have similar or equal methodology in terms of how we consider CapEx when we are doing an upgrade for existing companies, Maranhão and Pará.
To say exactly what's going to be the impact in PWE at the end of the day, I think it's early. Okay.
Okay, perfect. It's very clear. If I may, I have another question regarding the discussion on the fiscal fees and VAT tax. Basically, you booked a gain in the first Q related to the discussion. I just want to confirm if you guys had a chance to talk to ANEEL, if ANEEL has a view if these gains are going to be the gains of the company, are going to have to be shared with the consumer, just to get a better understanding on how are these discussions, if you can share with us? Thank you.
Well, regarding fiscal fees, yes, I believe there's a deep discussion in the sector. Distributors already present that case to ANEEL. We are now talking about how we should proceed. In our case, specifically, we have won the case for two of the companies. We still have to have, how can I say, the final numbers approved by the Receita Federal. Before that, we cannot use the credit. In our case, it's like a waiting. As for how much we're going to share or not, there are at least two or three ways that you can have discussion. Be it regarding following strictly the law. Dealing with how you deal with consumers and suppliers. It can be the way you deal with from a regulatory perspective.
At the end of the day, it could be simply following the law regarding how long can you backtrack chart, something that related to civil contracts. It's how in the end we're going to apply. What I can say is the way we approve the assets in the liability, I believe we are in the most conservative scenario. Okay.
Okay. Do you think ANEEL can, for example, see as an alternative, consider this as other revenues, and then, let's say, let 40% be with the company, 60% with the consumer, if this is an alternative that ANEEL might be discussing?
Well, that could be a scenario, sharing the way they share other revenues, like 60% to consumers, 40% to company. That could be a scenario.
Okay. Thank you.
Thank you.
Ladies and gentlemen, as a reminder, if you'd like to pose a question, please press star one. This concludes today's question and answer session. I'd like to invite Mr. Haiama to proceed with his closing statements. Please go ahead, sir.
To sum up, we'd like to reinforce our commitment in delivering differentiated approaches to our shareholders through exceptional financial operating results. We'd also like to highlight our adherence to the highest level of transparency and proper governance, and reassure that both me and our investor relations team are available should you have any further questions. Thank you all again for taking part in our second conference call, and have a good day.
That does conclude Equatorial's audio conference for today. Thank you very much for your participation. Have a good day, and thank you for using Chorus Call.