By Jeffrey T. Lewis
Brazilian power company CPFL Energia SA said profit rose in the third quarter after a steep drop in tax payments and an improvement in the company's distribution and renewable generation operations.
The holding company, which owns stakes in generation, distribution and commercialization businesses, said Thursday evening that net income rose 80.8% from the third quarter of 2019 to 1.4 billion reais, the equivalent of $257 million. Earnings before interest, taxes, depreciation and amortization rose 20.8% to 2 billion reais and net operating revenue rose 0.4% to 7.8 billion reais.
The company said it has started to see clear signs of an economic recovery following the gradual easing of social distancing measures intended to slow the spread of the coronavirus, with power use by residential clients up because of the increase in people working from home. Businesses and industry also are showing signs of recovery, though power use by those segments remains below last year's levels for the quarter, CPFL said.
Consumption in homes, representing 31.5% of the company's sales, rose 8.8% in the quarter from a year earlier. Sales to industry, 37% of sales, fell 3% from a year earlier, and use by commercial clients, with 14.4% of sales, fell 8% in the period, the company said.
CPFL benefited from tax credits generated mainly by its renewables unit, which reduced the company's income and social contribution payment by 91% to 29 million reais.
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(END) Dow Jones Newswires