[Foreign language]
Clicking on mute original audio. We should inform you this call is being recorded and will be made available on the company's IR website, ri.neoenergia.com, where the complete earnings release material is available. It is also possible to download the presentation using the link sent via chat, including in English. During the company's presentation, all participants will have their microphones muted. We will then begin the Q&A session. To ask a question, click on the Q&A icon at the bottom of your screen to join the queue. Once your name is announced, a request to turn on your microphone will appear on your screen, and you should then turn on your mic. Please ask all of your questions together.
The information contained in this presentation and statements that may be made during the call relating to Neoenergia's business prospects, projections, operating, and financial goals are beliefs and assumptions of the company's management, as well as the information currently available. Forward-looking considerations are no guarantees of performance. They involve risks, uncertainties, and assumptions as they refer to future events and therefore depend on circumstances that may or may not occur. Investors should understand that general economic conditions, market conditions, and other operating factors may affect Neoenergia's future performance and lead to results that differ materially from those expressed in such forward-looking statements. The presentation will be led by Mr. Eduardo Capelastegui, CEO of the company, and Leonardo Gadelha, CFO of the company. I will now give the floor to Mr. Eduardo Capelastegui.
[Foreign language]
Good morning. Thank you, Operator. Good morning to all. I would like to thank you for tuning in for the presentation of our first quarter of 2025 results. I'm Eduardo Capelastegui, CEO of Neoenergia. Once again, we are very proud of what we will share with you here. I am joined by Solange Ribeiro, Vice President of Regulation, Institutional Affairs, and Sustainability; Leonardo Gadelha, CFO; Giancarlo Vassão, Executive Director of Operations, COO; Juliano Pansanato, Asset Control and Planning Officer; and Renato Rocha, IR Officer. As usual, I will make a brief presentation covering the main highlights of the period, and Leonardo will present the results in more detail. We will then move on to the questions and answers, and in the end, I will make my closing remarks. To begin on slide number three, we have the highlights of our first quarter results.
Injected energy, considering distributed generation, performed very well in the concession area, growing 3.6% in this quarter versus the same period in the previous year. Operating expenses, as usual, are controlled with a 3% growth only in relation to the previous year, therefore well below the inflation. EBITDA amounted to BRL 3.7 billion, with a 6% increase in the quarter, reflecting the dynamics of a larger market, sound operating performance of assets, and controlled costs. CapEx amounted to BRL 2.2 billion in the quarter, which brought our net RAP in distributors to BRL 41 billion. On the asset rotation front, we announced the sale of 50% of the Itabapoana transmission lot, one more transaction with our partner, GIC, which generates great value for Neoenergia and its shareholders and reinforces our deleveraging strategy. On the other hand, we are also successful in the April tariff processes.
Neoenergia Coelba and Neoenergia Cosern underwent annual tariff reviews, with an increase in the parcels of 8.1% and 6.6%, respectively, driven by the high IGP-M index and, in the case of Neoenergia Coelba, by the improvement in quality customer service with Factor X. Neoenergia Pernambuco underwent a four-year tariff review, which, among other things, enabled, firstly, the full incorporation into the remuneration base of investments made over the last four years. Secondly, the increase in the regulatory WACC, which amounted to 8.6%. Thirdly, the increase of the losses coverage that went from 0.9% of tariff coverage from 15.2% to 16.1%, once again, an almost 1% increase with the highest coverage. All of these factors, in the case of Neoenergia Pernambuco, represent an increase of over BRL 300 million in the distributor's EBITDA when compared to the EBITDA of the year prior to the review.
This is a higher than 20% increase in the EBITDA of the distributor. This regulatory soundness is in line with a request made this quarter for early renewal of our four eligible distribution concessions: Neoenergia Coelba, Neoenergia Elektro, Neoenergia Cosern, and Neoenergia Pernambuco. Moving on to slide four, we can see the progress of our transmission project, starting with the lots from December 2018. The Guanabara lot with 95% physical progress. One section concluded, energized with the release of a RAP of BRL 65 million in May, while the other section is in progress, with a RAP of BRL 100 million anticipated for the third quarter this year. In the Vale do Itajaí lot, we are 87% advanced in construction and have a BRL 58 million RAP released in 2024.
Now, in the end of April, we will conclude two more sections that account for an additional BRL 90 million in additional RAP, reaching 56% of the released RAP for the lot. Finally, we will conclude the project in the second half of 2025, when we will release the remaining BRL 116 million, reaching a total RAP of around BRL 265 million in the Vale do Itajaí lot. In the Morro do Chapéu lot from the 2020 auction, the physical progress has reached 97%. We already have BRL 100 million of released RAP, almost 50% of the total amount. We will still release the remaining BRL 120 million of the RAP in the second half of 2025, concluding this lot with a RAP higher than BRL 100 million.
As for the June 2022 auction, the largest of all, lot two of Alto Parnaíba, with all of the works that have advanced 72% completed, we have in this lot BRL 7.4 million released RAP, and we will also release the remaining BRL 400 million in the second half of 2025. Therefore, throughout 2025, we will have released approximately BRL 900 million in new RAP, reaching the significant milestone of almost BRL 2.2 billion of total RAP operated by the end of 2025. We will then conclude our investment cycle in transmissions, which started in 2017, as you are all aware.
Now, turning to slide five, we will talk about the Itabapoana operation. As you heard a few days ago, we announced the sale of 50% of the Itabapoana transaction to GIC, therefore strengthening our partnership, which now has nine assets in the sub-holding with a 50% stake for each partner. GIC continues to have the right of the first offer for the assets that are under construction, and as they enter into operation, an assessment process will begin on a case-by-case basis.
Speaking now about the Itabapoana transaction, we received BRL 127 million from the 50% equity stake, and we deconsolidated the net debt in the amount of almost BRL 600 million. We have closed this operation with multiple EV/RAP, around 9.1x higher and 18% low, the real IRR for the buyer in operation that adds much value to Neoenergia and to all of the shareholders. Now, I will give the floor to our CFO, Leonardo, who will share more results on the first quarter 2025 results. Over to you, Leonardo.
[Foreign language]
Thank you, Eduardo. Good morning to all. I will look at the first quarter results on slide seven, the consolidated results for Neoenergia. The evolution of the gross margin this semester was 6% over the first quarter in 2024, reaching BRL 4.942 billion, which is explained by the distributors market. We have a strong cost control with the 3% growth only, closing the semester with BRL 1.064 billion only. EBITDA grew 6% in this quarter, and cash EBITDA had a 1% reduction, reaching BRL 2.781 billion, a result of the negative adjustment by the IGP-M in Parcel B of the distributor last year and the new contract for Termopernambuco. This was partially compensated by Neoenergia, as I mentioned.
The Networks EBITDA represented 93% of the consolidated EBITDA and the generation customers, 7%. The net income of Neoenergia in the quarter amounted to BRL 1.1 billion, with an 11% decline compared to the first quarter 2024. As for CapEx, on the next slide, we had a total of BRL 2.2 billion, therefore in pace with our investment plan for the year. As in the previous quarters, CapEx was almost fully in Networks, representing 98%. In this quarter, highlights were BRL 1.3 billion in distribution and expansion and improvement of the network quality, and BRL 869 million in transmission works progress.
On the next slide, on slide 10, we will look at the operating performance of the Networks segment. We see the variation of injected energy in our five distributors. As announced to the market, we had a solid growth in the quarter, even when compared to the first quarter in 2024, which was strong with higher temperatures. Consolidated growth was 3.6%, including DG. Total number of consumers reached 16.7 million, therefore a growth of 294,000 new customers over the past 12 months.
On slide 11, looking at losses, total losses, good evolution in the loss rate in Brasília alone, we had one particular worsening because of the rainfall. We deployed teams there to reestablish the energy supply, and we expect for this to recover throughout the year. Starting in the second quarter, we will see important gains in coverage with the adjustments of the DG and the Pernambuco review with a 0.91 percentage point increase, and we go four of the five distributors that are within the regulatory limits, therefore. On slide 12, we can see that in the first quarter of 2025, the CLD reached 146 million, therefore remaining under control in relation to previous quarters, as seen in the charts below. The collection index also had a positive trajectory in all of the distributors over the past quarters.
On the next slide, we'll look at the quality indicators, DEC and FEC in our distributors, maintaining a declining trajectory. They are perfectly within the regulatory framework. Now moving to slide 14, looking at the results of our Networks. In the first quarter, we see an evolution of 11% in gross margin, as I mentioned, which is explained by the better market scenario. Operational expenses had a 2% growth only, very good performance. Networks EBITDA grew by 12%, and cash EBITDA Networks reached BRL 2.588 billion, 5% above the first quarter 2024, despite the negative adjustment of Parcel B by the IGP-M, as mentioned. On the right-hand side chart, we see the distribution and transmission breakdown EBITDA. Cash EBITDA in distribution grew 2%, and in transmission, 168% with the new projects that came in.
Regulatory EBITDA of the transmission assets amounted to BRL 223 million, BRL 121 million in 100% Neoenergia assets and BRL 102 million with the GIC JV and the equity equivalent. On slide 16, we will see the result of our Generation and Customers business. Remember, we consolidate the segments of renewables and liberalize. In the first quarter, EBITDA for the segment was BRL 263 million, with a negative impact by Termopernambuco in the first quarter 2024, was still under the previous contract with a higher margin. On the right side, we see we break it down by business lines. EBITDA for hydro in the first quarter was BRL 136 million. The variation is explained by the deconsolidation of Baixo Iguaçu.
EBITDA for wind power, BRL 102 million, with an 8% reduction because of the higher OpEx in Chafariz since we reached the end of the guarantees assurance from the supplier. In solar, BRL 5 million EBITDA, a BRL 6 million reduction because of the lower generation in the semester because of the Luzia Complex and Termope Complex. While the EBITDA was negative in BRL 1 million, resulting from the new contract that I mentioned and the low supply, low dispatch in the semester. I will finally turn to slide 17. In the previous slide, I should also mention that customer business had a BRL 22 million EBITDA in the quarter, BRL 16 million growth in this quarter. Now on slide 17, capital structure.
We see we closed the first quarter in 2025 with a net debt of BRL 44.4 billion, BRL 1 billion above the previous quarter, roughly explained by the CapEx pace, our net debt/EBITDA ratio 3.49. If we look at the cash entry in the Baixo Iguaçu entry, this goes down to 3.41. The debt structure remains comfortable, well distributed with 5.8 years as average deadline, diversification with funds indexes, and we have a competitive spread with incentivized ventures that we settled last week in three of our distributors, amounting to BRL 2.1 billion after the swap reached rates lower below the CDI. We had a negative spread, which makes us believe in the CapEx cycle that we will conclude this year more firmly. Now I'll turn it back to the operator for the Q&A session to begin.
We will now open the Q&A session. Please remember that to ask a question, you should click on the Q&A icon at the bottom of the screen. To join the queue when your name is announced, you will be requested to open your microphone. You will then open your microphone to ask your question. Please ask all of your questions at the same time. Our first question is from Mario, outside analyst from Banco Safra. Mario, you may proceed.
[Foreign language]
Good morning, everyone. Thank you for this opportunity. I would like to ask you a question in relation to capital allocation, considering the company leveraging, which has reached control, is under controlled levels now, and that the main investments in transmission should be concluded by the end of 2025 and the 25% current payout. I would like to understand how the company sees the capital allocation from 2026, starting in 2026, if there's room for reviewing the dividend policy. Thank you.
[Foreign language]
Mario, thank you very much for your question. As mentioned, in 2025, we are concluding our investment cycle in transmission. Also, starting in 2026, we are planning to continue having organic growth in distributors. It's BRL 5 billion-BRL 6 billion annually. We do not foresee investment opportunities that are profitable in renewables, considering price curtailment, market price differences. We do not foresee appropriate returns in renewables. In the latest transmission auctions, we do not see we are competitive. We are requiring returns in realms of two digits.
Yes, these are what we foresee for 2026, focusing on organic growth and distribution, which will lead us to a leveraging process that will be gradual and will be then accelerated as these processes happen through our partnership with GIC. If all of these things will happen as foreseen, as expected, if it's different from what we expected three years ago, if things continue as expected, we will start a fast deleveraging, and we will have to think and consider what we will do next. We don't want to have money in cash. We want to continue growing organically with distribution. We will review our payout policy. More likely, when this will happen? 2025 is, an investment year. 2026 is the leveraging year, and we will try to figure what's the best possible moment to start considering these options.
It's important to mention and underscore that, yes, we are fulfilling. We've been fulfilling the plans we have disclosed in the past three years, and now Neoenergia, whether through the reduction in organic investment or through the asset rotation project that we've been conducting in the past three years with different operations that add value, these things will lead us to reducing our debt, increasing our EBITDA, and therefore having a privileged position to begin considering payout increases or also considering growth opportunities, but also underscoring those. As long as we fulfill with the capital allocation criteria, as you all know, we have two digits below actual returns of investments. Thank you.
Our next question is from Guilherme Lima, an outside analyst from Santander. Over to you, Guilherme.
[Foreign language]
Good morning, everyone. I have one short question in relation to the Termope EBITDA in the first quarter, 2025 now, under the new contract and prospects for evolution, EBITDA evolution going forward, considering this current fuel solution in the plant. Thank you.
[Foreign language]
Thank you, Guilherme, for your question. Termopernambuco, as mentioned, remember, once we had an early contract, we pushed it earlier. It's an asset that with a 0% dispatch, we will have a zero EBITDA roughly. If we hadn't anticipated this contract, our EBITDA would be negative in BRL 150 million. With zero dispatch, EBITDA should be zero. With the dispatches, we will look at BRL 50 million EBITDA increase probably. For the next quarters in 2025, considering the hydraulic situation in the country and the reservoirs scenario, we do not believe our dispatch will be very relevant. Therefore, we will probably remain with our EBITDA close to zero.
Over the past 20-25 years in Brazil, we had two or three years of calm, and then there is the year where we have a slower 6-7 months. This plant is not giving us any headache. We have the contracted. The contracts, we are waiting for the dispatch to begin. Once it begins, we will have expressively, we should have expressive results. Now, with dispatch zero, our EBITDA should also remain at zero. The first quarter, our EBITDA is slightly negative because of the maintenance that was programmed. It was scheduled, but it was a one-off, and we do not expect it to repeat. We should expect with dispatch zero, is EBITDA also close to zero or zero.
I would add the following. Starting the next quarter, this comparison will be more fair, more just. In the first quarter, now we're comparing it to the first quarter in 2024, when we had the previous contract with a higher margin. Now starting, we had a contract up until May, and now we will have the same comparison, but starting in the second quarter, it will be a more fair comparison. Starting in April- May, in May, we will have different things in Neoenergia. They all mentioned, yes, about Termopernambuco and also a positive effect of the tariff reviews in April of 7% in Neoenergia Pernambuco, almost 20%. Additionally, the market compared to 2024 should grow more because last year, the first quarter, four months, we had a very high market for temperatures. The first quarter is good.
As you could see, the numbers were robust, but we expect from the second quarter to grow, to have a double-digit growth, positive tariff reviews resulting from the comparison to 2024 with the Termopernambuco effect, and a market scenario that should grow higher than the first half. In transmissions, with operating transmissions, now almost BRL 100 million additional RAP, as I mentioned, this will happen throughout the next quarters in 2025. For the next three months and 2025, we expect to have positive results and even better than this first quarter, which, as you could see, had robust numbers, not robust figures.
Excellent. Thank you.
[Foreign language]
The Q&A session is now closed. I would like to give the floor to Mr. Eduardo Capelastegui for his closing remarks.
[Foreign language]
Once again, thank you, Operator. On slide 20, finally, I would like to say that, yes, we are reinforcing our commitment with all of Neoenergia stakeholders. Here at Neoenergia, we are continuously focusing on three leverages. Firstly, efficiency and safety in our operations. Secondly, creating value through the optimal capital allocation. Thirdly, sustainable growth in our results. We can express this through the expressive growth of cash EBITDA, which grew 120%. Additionally, we continue investing in quality customer service to the almost 17 million customers we have, and we firmly believe in the safety and predictability of the regulatory framework. We have approved the request of the renovation of the concessions of our four distributors.
The projects in construction are progressing, and in 2025, we will have the important mark of concluding the investment cycles and transmissions, delivering the last four lots. After announcing the first quarter of 2024, the sale of the Baixo Iguaçu plant, we are now having one more important operation in asset rotation with GIC, with our partnership, adding value, creating value to our shareholders and focusing on deleveraging even further to our shareholders. Thank you for your trust. Once again, I would underscore we have the right team in place. We are fully engaged and committed to delivering the results that are expected. I wish to conclude, as usual, by thanking all of our employees in Neoenergia for fulfilling the roles, surpassing challenges, delivering results, and adding value to our shareholders. Thank you very much, and I wish you all an excellent day.
[Foreign language]
The earnings release call for the first quarter 2025 results of Neoenergia is now adjourned. The IR department will be available to entertain additional questions. Thank you very much, to all of our participants. We wish you a great day.