SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
For August, 2023
(Commission File No. 1-31317)
Companhia de Saneamento Básico do Estado de São Paulo - SABESP
(Exact name of registrant as specified in its charter)
Basic Sanitation Company of the State of Sao Paulo - SABESP
(Translation of Registrant's name into English)
Rua Costa Carvalho, 300
São Paulo, S.P., 05429-900
Federative Republic of Brazil
(Address of Registrant's principal executive offices)
Indicate by check mark whether the registrant files or will file
annual reports under cover Form 20-F or Form 40-F.
Form 20-F ___X___ Form 40-F ______
Indicate by check mark if the registrant is submitting the Form 6-K
in paper as permitted by Regulation S-T Rule 101(b)(1)__.
Indicate by check mark if the registrant is submitting the Form 6-K
in paper as permitted by Regulation S-T Rule 101(b)(7)__.
Indicate by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing the
information to the Commission pursuant to Rule 12g3-2(b) under
the Securities Exchange Act of 1934.
Yes ______ No ___X___
If "Yes" is marked, indicated below the file number assigned to the
registrant in connection with Rule 12g3-2(b):
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Table of Contents
Company Information |
|
Capital Breakdown |
1 |
Parent Company’s Financial Statements |
|
Statement of Financial Position – Assets |
2 |
Statement of Financial Position – Liabilities |
3 |
Income Statement |
5 |
Statement of Comprehensive Income |
7 |
Statement of Cash Flows (Indirect Method) |
8 |
Statement of Changes in Equity |
|
01/01/2023 to 06/30/2023 |
10 |
01/01/2022 to 06/30/2022 |
11 |
Statement of Value Added |
12 |
Comments on the Company’s Performance |
|
|
13 |
Notes to the Quarterly Information |
23 |
Comments on the Company’s Projections |
82 |
Other Information Deemed as Relevant by the Company |
83 |
Reports and Statements |
|
Unqualified Reports on Special Review |
85 |
Executive Officers’ Statement on the Financial Statements |
86 |
Executive Officers’ Statement on the Report of Independent Registered Public Accounting Firm |
87 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Company Information / Capital Breakdown
Number of Shares |
Current Quarter |
(Unit) |
06/30/2023 |
Paid-in Capital |
|
Common |
683,509,869 |
Preferred |
0 |
Total |
683,509,869 |
Treasury Shares |
|
Common |
0 |
Preferred |
0 |
Total |
0 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Parent Company’s Financial Statements / Statement of Financial Position - Assets
(R$ thousand)
Code |
Description |
Current Quarter |
Previous Year |
|
|
06/30/2023 |
12/31/2022 |
1 |
Total Assets |
57,453,621 |
57,207,765 |
1.01 |
Current Assets |
6,262,207 |
7,284,664 |
1.01.01 |
Cash and Cash Equivalents |
1,327,173 |
1,867,485 |
1.01.02 |
Financial Investments |
929,178 |
1,677,873 |
1.01.02.03 |
Financial Investments Valued at Amortized Cost |
929,178 |
1,677,873 |
1.01.03 |
Accounts Receivable |
3,520,517 |
3,268,367 |
1.01.03.01 |
Trade Receivables |
3,300,714 |
3,062,574 |
1.01.03.02 |
Other Receivables |
219,803 |
205,793 |
1.01.03.02.01 |
Related-Party Balances |
219,803 |
205,793 |
1.01.04 |
Inventories |
120,614 |
124,247 |
1.01.06 |
Recoverable Taxes |
244,820 |
242,906 |
1.01.06.01 |
Current Recoverable Taxes |
244,820 |
242,906 |
1.01.08 |
Other Current Assets |
119,905 |
103,786 |
1.01.08.03 |
Other |
119,905 |
103,786 |
1.01.08.03.01 |
Restricted Cash |
37,873 |
37,474 |
1.01.08.03.20 |
Other Assets |
82,032 |
66,312 |
1.02 |
Noncurrent Assets |
51,191,414 |
49,923,101 |
1.02.01 |
Long-Term Assets |
10,219,214 |
10,105,800 |
1.02.01.04 |
Accounts Receivable |
216,758 |
215,234 |
1.02.01.04.01 |
Trade Receivables |
216,758 |
215,234 |
1.02.01.09 |
Receivables from Related Parties |
951,059 |
950,950 |
1.02.01.09.03 |
Receivables from Controlling Shareholders |
951,059 |
950,950 |
1.02.01.10 |
Other Noncurrent Assets |
9,051,397 |
8,939,616 |
1.02.01.10.04 |
Escrow Deposits |
195,530 |
170,093 |
1.02.01.10.05 |
Water and Basic Sanitation National Agency – ANA |
5,138 |
9,193 |
1.02.01.10.06 |
Contract Asset |
8,674,300 |
8,613,968 |
1.02.01.10.20 |
Other Assets |
176,429 |
146,362 |
1.02.02 |
Investments |
201,609 |
157,491 |
1.02.02.01 |
Equity Interest |
154,907 |
110,765 |
1.02.02.01.03 |
Equity Interest in Jointly-Owned Subsidiaries |
122,660 |
104,666 |
1.02.02.01.04 |
Other Investments |
32,247 |
6,099 |
1.02.02.02 |
Investment Properties |
46,702 |
46,726 |
1.02.03 |
Property, Plant and Equipment |
371,209 |
338,939 |
1.02.04 |
Intangible Assets |
40,399,382 |
39,320,871 |
1.02.04.01 |
Intangible Assets |
40,399,382 |
39,320,871 |
1.02.04.01.01 |
Concession Agreements |
1,096,830 |
1,151,365 |
1.02.04.01.02 |
Program Contracts |
20,244,037 |
19,602,451 |
1.02.04.01.03 |
Service Contracts |
18,466,610 |
17,870,451 |
1.02.04.01.04 |
Software License of Use |
546,209 |
595,404 |
1.02.04.01.05 |
Right of Use |
45,696 |
75,052 |
1.02.04.01.06 |
Right of Use – Investments |
0 |
26,148 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Parent Company’s Financial Statements / Statement of Financial
Position – Liabilities
(R$ thousand)
Code |
Description |
Current Quarter |
Previous Year |
|
|
06/30/2023 |
12/31/2022 |
2 |
Total Liabilities |
57,453,621 |
57,207,765 |
2.01 |
Current Liabilities |
6,449,973 |
6,657,342 |
2.01.01 |
Social and Labor Obligations |
900,340 |
498,504 |
2.01.01.01 |
Social Obligations |
38,741 |
64,801 |
2.01.01.02 |
Labor Obligations |
861,599 |
433,703 |
2.01.02 |
Suppliers |
256,679 |
430,946 |
2.01.02.01 |
Domestic Suppliers |
256,679 |
430,946 |
2.01.03 |
Tax Obligations |
232,698 |
293,461 |
2.01.03.01 |
Federal Tax Obligations |
227,138 |
282,820 |
2.01.03.01.01 |
Income Tax and Social Contribution Payable |
112,882 |
0 |
2.01.03.01.02 |
Pis-Pasep and Cofins Payable |
22,069 |
134,624 |
2.01.03.01.03 |
INSS (Social Security Contribution) Payable |
45,371 |
44,515 |
2.01.03.01.20 |
Other Federal Taxes |
46,816 |
103,681 |
2.01.03.03 |
Municipal Tax Obligations |
5,560 |
10,641 |
2.01.04 |
Borrowings and Financing |
2,578,954 |
2,245,960 |
2.01.04.01 |
Borrowings and Financing |
1,302,238 |
1,389,864 |
2.01.04.01.01 |
In Local Currency |
1,057,778 |
1,077,277 |
2.01.04.01.02 |
In Foreign Currency |
244,460 |
312,587 |
2.01.04.02 |
Debentures |
1,181,049 |
739,534 |
2.01.04.03 |
Financing through Lease |
95,667 |
116,562 |
2.01.05 |
Other Liabilities |
1,462,216 |
2,264,433 |
2.01.05.01 |
Payables to Related Parties |
1,694 |
1,694 |
2.01.05.01.03 |
Payables to Controlling Shareholders |
1,694 |
1,694 |
2.01.05.02 |
Other |
1,460,522 |
2,262,739 |
2.01.05.02.01 |
Dividends and Interest on Capital Payable |
709 |
741,725 |
2.01.05.02.04 |
Services Payable |
588,456 |
723,242 |
2.01.05.02.05 |
Refundable Amounts |
28,358 |
30,885 |
2.01.05.02.06 |
Program Contract Commitments |
61,381 |
100,188 |
2.01.05.02.07 |
Public-Private Partnership - PPP |
207,467 |
222,413 |
2.01.05.02.09 |
Indemnities |
9,217 |
8,556 |
2.01.05.02.20 |
Other Liabilities |
564,934 |
435,730 |
2.01.06 |
Provisions |
1,019,086 |
924,038 |
2.01.06.01 |
Tax, Social Security, Labor, and Civil Provisions |
676,323 |
510,807 |
2.01.06.01.01 |
Tax Provisions |
35,905 |
34,382 |
2.01.06.01.02 |
Pension Plan and Labor Obligations |
497,074 |
385,580 |
2.01.06.01.04 |
Civil Provisions |
143,344 |
90,845 |
2.01.06.02 |
Other Provisions |
342,763 |
413,231 |
2.01.06.02.03 |
Provisions for Environmental Liabilities and Decommissioning |
3,074 |
15,289 |
2.01.06.02.04 |
Provisions for Customers |
127,361 |
141,491 |
2.01.06.02.05 |
Provisions for Suppliers |
212,328 |
256,451 |
2.02 |
Noncurrent Liabilities |
22,256,087 |
23,216,890 |
2.02.01 |
Borrowings and Financing |
16,126,235 |
16,712,711 |
2.02.01.01 |
Borrowings and Financing |
9,328,523 |
9,167,759 |
2.02.01.01.01 |
In Local Currency |
7,097,236 |
6,704,588 |
2.02.01.01.02 |
In Foreign Currency |
2,231,287 |
2,463,171 |
2.02.01.02 |
Debentures |
6,487,071 |
7,202,296 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Parent Company’s Financial Statements / Statement of Financial
Position – Liabilities
(R$ thousand)
Code |
Description |
Current Quarter |
Previous Year |
|
|
06/30/2023 |
12/31/2022 |
2.02.01.03 |
Financing through Lease |
310,641 |
342,656 |
2.02.02 |
Other Liabilities |
5,378,693 |
5,628,155 |
2.02.02.02 |
Other |
5,378,693 |
5,628,155 |
2.02.02.02.04 |
Pension Plan Obligations |
2,135,644 |
2,150,191 |
2.02.02.02.05 |
Program Contract Commitments |
12,566 |
12,197 |
2.02.02.02.06 |
Public-Private Partnership - PPP |
2,616,942 |
2,736,768 |
2.02.02.02.07 |
Indemnities |
15,932 |
17,508 |
2.02.02.02.08 |
Labor Obligations |
130,913 |
1,620 |
2.02.02.02.09 |
Deferred Cofins/Pasep |
162,591 |
159,723 |
2.02.02.02.20 |
Other Liabilities |
304,105 |
550,148 |
2.02.03 |
Deferred Taxes |
101,914 |
189,278 |
2.02.03.01 |
Deferred Income Tax and Social Contribution |
101,914 |
189,278 |
2.02.03.01.01 |
Deferred Income Tax and Social Contribution |
101,914 |
189,278 |
2.02.04 |
Provisions |
649,245 |
686,746 |
2.02.04.01 |
Tax, Social Security, Labor, and Civil Provisions |
191,074 |
291,317 |
2.02.04.01.01 |
Tax Provisions |
40,900 |
29,113 |
2.02.04.01.02 |
Pension Plan and Labor Obligations |
143,397 |
254,718 |
2.02.04.01.04 |
Civil Provisions |
6,777 |
7,486 |
2.02.04.02 |
Other Provisions |
458,171 |
395,429 |
2.02.04.02.03 |
Provisions for Environmental Liabilities and Decommissioning |
454,059 |
391,547 |
2.02.04.02.04 |
Provisions for Customers |
3,503 |
3,306 |
2.02.04.02.05 |
Provisions for Suppliers |
609 |
576 |
2.03 |
Equity |
28,747,561 |
27,333,533 |
2.03.01 |
Paid-Up Capital |
15,000,000 |
15,000,000 |
2.03.04 |
Profit Reserves |
12,078,963 |
12,155,890 |
2.03.04.01 |
Legal Reserve |
1,688,428 |
1,688,428 |
2.03.04.08 |
Additional Dividend Proposed |
0 |
76,927 |
2.03.04.10 |
Reserve for Investments |
10,390,535 |
10,390,535 |
2.03.05 |
Retained Earnings/Accumulated Losses |
1,490,955 |
0 |
2.03.06 |
Equity Valuation Adjustments |
177,643 |
177,643 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Parent Company’s Financial Statements / Income Statement
(R$ thousand)
Code |
Description |
Current Quarter |
YTD Current |
Same Quarter of the |
YTD Previous |
|
|
04/01/2023 to 06/30/2023 |
Year |
Previous Year |
Year |
|
|
|
01/01/2023 to 06/30/2023 |
04/01/2022 to 06/30/2022 |
01/01/2022 to 06/30/2022 |
3.01 |
Revenue from Sales and/or Services |
6,154,537 |
11,852,906 |
5,265,400 |
10,135,790 |
3.02 |
Cost of Sales and/or Services |
-4,210,675 |
-7,864,398 |
-3,531,903 |
-6,648,289 |
3.02.01 |
Cost of Sales and/or Services |
-2,975,843 |
-5,476,551 |
-2,402,428 |
-4,651,293 |
3.02.02 |
Construction Costs |
-1,234,832 |
-2,387,847 |
-1,129,475 |
-1,996,996 |
3.03 |
Gross Profit |
1,943,862 |
3,988,508 |
1,733,497 |
3,487,501 |
3.04 |
Operating Expenses/Income |
-872.981 |
-1,525,154 |
-819,385 |
-1,439,311 |
3.04.01 |
Selling Expenses |
-502,663 |
-891,125 |
-486,457 |
-860,738 |
3.04.01.01 |
Selling Expenses |
-285,237 |
-510,894 |
-233,525 |
-430,112 |
3.04.01.02 |
Allowance for Doubtful Accounts |
-217,426 |
-380,231 |
-252,932 |
-430,626 |
3.04.02 |
General and Administrative Expenses |
-430,852 |
-715,530 |
-341,202 |
-594,994 |
3.04.04 |
Other Operating Income |
58,609 |
78,960 |
13,562 |
23,870 |
3.04.04.01 |
Other Operating Income |
64,563 |
87,608 |
14,937 |
26,342 |
3.04.04.02 |
Cofins and Pasep |
-5,954 |
-8,648 |
-1,375 |
-2,472 |
3.04.05 |
Other Operating Expenses |
-8,122 |
-13,840 |
-11,211 |
-18,955 |
3.04.06 |
Equity Pickup |
10,047 |
16,381 |
5,923 |
11,506 |
3.05 |
Income before Financial Result and Taxes |
1,070,881 |
2,463,354 |
914,112 |
2,048,190 |
3.06 |
Financial Result |
-14,047 |
-273,576 |
-324,374 |
15,750 |
3.06.01 |
Financial Revenue |
205,173 |
424,292 |
230,160 |
429,173 |
3.06.01.01 |
Financial Revenue |
214,329 |
444,437 |
239,441 |
449,484 |
3.06.01.02 |
Exchange Variation Gains |
772 |
571 |
1,853 |
590 |
3.06.01.03 |
Cofins and Pasep |
-9,928 |
-20,716 |
-11,134 |
-20,901 |
3.06.02 |
Financial Expenses |
-219,220 |
-697,868 |
-554,534 |
-413,423 |
3.06.02.01 |
Financial Expenses |
-482,929 |
-1,045,400 |
-489,726 |
-942,744 |
3.06.02.02 |
Exchange Variation Losses |
263,709 |
347,532 |
-64,808 |
529,321 |
3.07 |
Profit before Taxes on Income |
1,056,834 |
2,189,778 |
589,738 |
2,063,940 |
3.08 |
Income Tax and Social Contribution |
-313,091 |
-698,823 |
-167,280 |
-665,943 |
3.08.01 |
Current |
-402,699 |
-786,187 |
-180,174 |
-669.679 |
3.08.02 |
Deferred |
89,608 |
87,364 |
12,894 |
3,736 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Parent Company’s Financial Statements / Income Statement
(R$ thousand)
Code |
Description |
Current Quarter |
YTD Current |
Same Quarter of the |
YTD Previous |
|
|
04/01/2023 to 06/30/2023 |
Year |
Previous Year |
Year |
|
|
|
01/01/2023 to 06/30/2023 |
04/01/2022 to 06/30/2022 |
01/01/2022 to 06/30/2022 |
3.09 |
Net Income from Continuing Operations |
743,743 |
1,490,955 |
422,458 |
1,397,997 |
3.11 |
Profit/Loss for the Period |
743,743 |
1,490,955 |
422,458 |
1,397,997 |
3.99 |
Earnings per Share - (Reais/Share) |
|
|
|
|
3.99.01 |
Basic Earnings per Share |
|
|
|
|
3.99.01.01 |
Common |
1.08812 |
2.18132 |
0.61807 |
2.04532 |
3.99.02 |
Diluted Earnings per Share |
|
|
|
|
3.99.02.01 |
Common |
1.08812 |
2.18132 |
0.61807 |
2.04532 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Parent Company’s Financial Statements / Statement of Comprehensive
Income
(R$ thousand)
Code |
Description |
Current Quarter |
YTD Current |
Same Quarter of the |
YTD Previous |
|
|
04/01/2023 to 06/30/2023 |
Year |
Previous Year |
Year |
|
|
|
01/01/2023 to 06/30/2023 |
04/01/2022 to 06/30/2022 |
01/01/2022 to 06/30/2022 |
4.01 |
Net Income for the Period |
743,743 |
1,490,955 |
422,458 |
1,397,997 |
4.03 |
Comprehensive Income for the Period |
743,743 |
1,490,955 |
422,458 |
1,397,997 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Parent Company’s Financial Statements / Statement of Cash Flows
– Indirect Method
(R$ thousand)
Code |
Description |
YTD Current
Year |
YTD Previous
Year |
|
|
01/01/2023 to 06/30/2023 |
01/01/2022 to 06/30/2022 |
6.01 |
Net Cash from Operating Activities |
1,513,027 |
1,763,870 |
6.01.01 |
Cash from Operations |
5,151,233 |
4,353,847 |
6.01.01.01 |
Profit before Income Tax and Social Contribution |
2,189,778 |
2,063,940 |
6.01.01.02 |
Provision and Inflation Adjustments on Provisions |
196,776 |
196,108 |
6.01.01.04 |
Finance Charges from Customers |
-196,290 |
-192,460 |
6.01.01.05 |
Residual Value of Property, Plant and Equipment, Intangible Assets, and Investment Properties Written-off |
5,304 |
6,132 |
6.01.01.06 |
Depreciation and Amortization |
1,327,916 |
1,187,911 |
6.01.01.07 |
Interest on Borrowings and Financing Payable |
616,940 |
467,713 |
6.01.01.08 |
Inflation Adjustment and Exchange Gains (Losses) on Borrowings and Financing |
-238,972 |
-367,162 |
6.01.01.09 |
Interest and Inflation Adjustments on Liabilities |
11,586 |
16,962 |
6.01.01.10 |
Interest and Inflation Adjustments on Assets |
-123,034 |
-23,479 |
6.01.01.11 |
Allowance for Doubtful Accounts |
380,231 |
430,626 |
6.01.01.12 |
Provision for Consent Decree (TAC) and Separation Incentive Program (PDI) |
529,245 |
-650 |
6.01.01.13 |
Equity Pickup |
-16,381 |
-11,506 |
6.01.01.14 |
Interest and Inflation Adjustment - PPP |
245,427 |
245,923 |
6.01.01.15 |
Other Adjustments |
13,816 |
7,639 |
6.01.01.16 |
Transfer to the São Paulo Municipal Government |
159,970 |
277,747 |
6.01.01.17 |
Construction Margin on Intangible Assets Arising from Concession Agreements |
-54,921 |
-45,930 |
6.01.01.18 |
Pension Plan Obligations |
103,842 |
94,333 |
6.01.02 |
Changes in Assets and Liabilities |
-2,129,560 |
-1,354,538 |
6.01.02.01 |
Trade Receivables |
-407,986 |
-430,272 |
6.01.02.02 |
Related-Party Balances and Transactions |
4,834 |
-13,148 |
6.01.02.03 |
Inventories |
3,633 |
-9,373 |
6.01.02.04 |
Recoverable Taxes |
-1,914 |
-11,109 |
6.01.02.05 |
Other Assets |
-36,865 |
-17,477 |
6.01.02.06 |
Escrow Deposits |
-17,109 |
3,418 |
6.01.02.08 |
Trade Payables and Contractors |
-411,979 |
-223.755 |
6.01.02.09 |
Social and Labor Obligations |
1,847 |
33,207 |
6.01.02.10 |
Pension Plan Obligations |
-118,389 |
-110,672 |
6.01.02.11 |
Taxes and Contributions Payable |
-240,857 |
-64,599 |
6.01.02.12 |
Services Payable |
-294,756 |
-165,337 |
6.01.02.13 |
Other Obligations |
-473,658 |
-209,921 |
6.01.02.14 |
Provisions |
-139,229 |
-136,721 |
6.01.02.15 |
Deferred Cofins/Pasep |
2,868 |
1,221 |
6.01.03 |
Other |
-1,508,646 |
-1,235,439 |
6.01.03.01 |
Interest Paid |
-902,553 |
-574,784 |
6.01.03.02 |
Income Tax and Social Contribution Paid |
-606,093 |
-660,655 |
6.02 |
Net Cash from Investing Activities |
-723,812 |
-1,077,680 |
6.02.01 |
Acquisition of Contract Asset and Intangible Assets |
-1,505,652 |
-1,494,633 |
6.02.02 |
Acquisition of Property, Plant and Equipment |
-40,286 |
-22,800 |
6.02.03 |
Investments |
-6,304 |
0 |
6.02.04 |
Restricted Cash |
-399 |
-3,125 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Parent Company’s Financial Statements / Statement of Cash Flows
– Indirect Method
(R$ thousand)
Code |
Description |
YTD Current
Year |
YTD Previous
Year |
|
|
01/01/2023 to 06/30/2023 |
01/01/2022 to 06/30/2022 |
6.02.07 |
Financial Investments |
828,829 |
442,878 |
6.03 |
Net Cash from Financing Activities |
-1,329,527 |
-760.550 |
6.03.01 |
Funding |
833,095 |
1,181,233 |
6.03.02 |
Amortization |
-917,982 |
-1,007,862 |
6.03.03 |
Payment of Interest on Capital |
-823,671 |
-603,541 |
6.03.04 |
Public-Private Partnership - PPP |
-380,199 |
-316,230 |
6.03.05 |
Program Contract Commitments |
-40,770 |
-14,150 |
6.05 |
Increase (Decrease) in Cash and Cash Equivalents |
-540,312 |
-74,360 |
6.05.01 |
Opening Balance of Cash and Cash Equivalents |
1,867,485 |
717,929 |
6.05.02 |
Closing Balance of Cash and Cash Equivalents |
1,327,173 |
643,569 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Parent Company’s Financial Statements / Statement of Changes in
Equity – 01/01/2023 to 06/30/2023
(R$ thousand)
Code |
Description |
Paid-up Capital |
Capital Reserves, Options Granted, and Treasury Shares |
Profit Reserves |
Retained Earnings/Accumulated
Losses |
Other Comprehensive
Income |
Equity |
5.01 |
Opening Balances |
15,000,000 |
0 |
12,155,890 |
0 |
177,643 |
27,333,533 |
5.03 |
Restated Opening Balances |
15,000,000 |
0 |
12,155,890 |
0 |
177,643 |
27,333,533 |
5.04 |
Capital Transactions with Partners |
0 |
0 |
-76,927 |
0 |
0 |
-76,927 |
5.04.08 |
Additional Minimum Dividends, approved |
0 |
0 |
-76,927 |
0 |
0 |
-76,927 |
5.05 |
Total Comprehensive Income |
0 |
0 |
0 |
1,490,955 |
0 |
1,490,955 |
5.05.01 |
Net Income for the Period |
0 |
0 |
0 |
1,490,955 |
0 |
1,490,955 |
5.07 |
Closing Balances |
15,000,000 |
0 |
12,078,963 |
1,490,955 |
177,643 |
28,747,561 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Parent Company’s Financial Statements / Statement of Changes in
Equity - 01/01/2022 to 06/30/2022
(R$ thousand)
Code |
Description |
Paid-up Capital |
Capital Reserves, Options Granted, and Treasury Shares |
Profit Reserves |
Retained Earnings/Accumulated
Losses |
Other Comprehensive
Income |
Equity |
5.01 |
Opening Balances |
15,000,000 |
0 |
9,885,485 |
0 |
46,374 |
24,931,859 |
5.03 |
Restated Opening Balances |
15,000,000 |
0 |
9,885,485 |
0 |
46,374 |
24,931,859 |
5.04 |
Capital Transactions with Partners |
0 |
0 |
-55,630 |
0 |
0 |
-55,630 |
5.04.08 |
Additional Minimum Dividends, approved |
0 |
0 |
-55,630 |
0 |
0 |
-55,630 |
5.05 |
Total Comprehensive Income |
0 |
0 |
0 |
1,397,997 |
0 |
1,397,997 |
5.05.01 |
Net Income for the Period |
0 |
0 |
0 |
1,397,997 |
0 |
1,397,997 |
5.07 |
Closing Balances |
15,000,000 |
0 |
9,829,855 |
1,397,997 |
46,374 |
26,274,226 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Parent Company’s Financial Statements / Statement of Value Added
(R$ thousand)
Code |
Description |
YTD Current
Year |
YTD Previous
Year |
|
|
01/01/2023 to 06/30/2023 |
01/01/2022 to 06/30/2022 |
7.01 |
Revenue |
12,251,695 |
10,388,334 |
7.01.01 |
Goods, Products, and Services Sold |
10,101,550 |
8,749,692 |
7.01.02 |
Other Revenue |
87,608 |
26,342 |
7.01.03 |
Revenue from Construction of Own Assets |
2,442,768 |
2,042,926 |
7.01.04 |
Allowance for/Reversal of Doubtful Accounts |
-380,231 |
-430,626 |
7.02 |
Inputs Acquired from Third Parties |
-5,142,514 |
-4,598,509 |
7.02.01 |
Costs of Goods, Products and Services Sold |
-4,382,630 |
-3,891,503 |
7.02.02 |
Materials, Electricity, Outsourced Services, and Others |
-746,044 |
-688,051 |
7.02.04 |
Other |
-13,840 |
-18,955 |
7.03 |
Gross Value Added |
7,109,181 |
5,789,825 |
7.04 |
Retentions |
-1,327,916 |
-1,187,911 |
7.04.01 |
Depreciation, Amortization, and Depletion |
-1,327,916 |
-1,187,911 |
7.05 |
Net Value Added Produced |
5,781,265 |
4,601,914 |
7.06 |
Value Added Received in Transfer |
461,389 |
461,580 |
7.06.01 |
Equity Pickup |
16,381 |
11,506 |
7.06.02 |
Financial Revenue |
445,008 |
450,074 |
7.07 |
Total Value Added to Distribute |
6,242,654 |
5,063,494 |
7.08 |
Value Added Distribution |
6,242,654 |
5,063,494 |
7.08.01 |
Personnel |
1,921,998 |
1,281,549 |
7.08.01.01 |
Direct Compensation |
1,496,151 |
921,256 |
7.08.01.02 |
Benefits |
348,743 |
286,789 |
7.08.01.03 |
Government Severance Indemnity Fund for Employees (FGTS) |
77,104 |
73,504 |
7.08.02 |
Taxes, Fees, and Contributions |
1,771,249 |
1,678,239 |
7.08.02.01 |
Federal |
1,651,517 |
1,564,208 |
7.08.02.02 |
State |
86,041 |
81,906 |
7.08.02.03 |
Municipal |
33,691 |
32,125 |
7.08.03 |
Value Distributed to Providers of Capital |
1,058,452 |
705,709 |
7.08.03.01 |
Interest |
1,043,692 |
693,345 |
7.08.03.02 |
Rentals |
14,760 |
12,364 |
7.08.04 |
Value Distributed to Shareholders |
1,490,955 |
1,397,997 |
7.08.04.03 |
Retained Earnings/Accumulated Losses for the Period |
1,490,955 |
1,397,997 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Comments on the Company’s Performance | |
| |
Highlights
In 2Q23, Adjusted EBITDA totaled R$ 2,220.8 million,
up by R$ 710.9 million (+47.1%) over the R$ 1,509.9 million reported in 2Q22, excluding the effects of the Separation Incentive Program
- PDI. Consequently, the EBITDA margin adjusted to the PDI reached 36.1% compared to 28.7%, and the adjusted EBITDA margin (excluding
both the PDI and the construction revenue) reached 45.4% compared to the 36.7% reported in 2Q22.
Including the effects of the PDI, adjusted EBITDA totaled
R$ 1,691.2 million, up by R$ 181.3 million (+12.0%) over the R$ 1,509.9 million reported in 2Q22.
Excluding the provision for the PDI, net income came to
R$ 1,273.3 million in 2Q23, up by R$ 850.9 million (+201%). Including the effect of the PDI, net income came to R$ 743.7 million in 2Q23,
compared to the R$ 422.4 million reported in 2Q22, an increase of R$ 321.3 million (+76.1%).
Revenue from sanitation services
Increase of R$ 740.8 million (+16.6%), impacted by (i)
an average impact of 11.9%, resulting from the tariff adjustments of 12.8% implemented since May 2022 and 9.6% implemented since May 2023;
(ii) a 2.6% increase in total billed volume; and (iii) a higher average tariff due to the increase in ranges with higher consumption in
the residential category.
Separation Incentive Program - PDI
In June 2023, the Company implemented the PDI to pacifically
reduce the workforce. The deadline for registrations in the PDI was from June 1 to 30, 2023, and had the adhesion of 1,862 employees,
whose employment terminations are being analyzed and will occur from July 1, 2023 to June 30, 2024.
In 2Q23, the Company recorded a provision of R$ 529.6 million
for the indemnity incentives of the employees who joined the PDI, with a payback slightly higher than 12 months.
Impacts from the exchange variation
In 2Q23, there was a positive exchange variation, with
a YoY impact of R$ 328.5 million, due to the depreciation of the U.S. Dollar and the Yen in 2Q23, compared to the appreciation of the
U.S. Dollar and the depreciation of the Yen in 2Q22, as shown below:
|
2Q23 |
2Q22 |
Foreign currency debt - R$ million |
2,475.7 |
2,695.1 |
Foreign currency debt as a percentage of total debt |
13.2% |
15.2% |
U.S. dollar variation in the quarter |
(5.1%) |
10.6% |
Yen variation in the quarter |
(12.8%) |
(1.1%) |
Organizational structure and bidding process of Olímpia
In the last six months, the Company underwent a restructuring
process and reorganized the boards so that decision-making considers a unified and strategic corporate vision. Management has been making
efforts towards gains in efficiency and discipline in capital allocation, including the review of the investment plan and the approval
of a Shared Services Center, which is currently being created.
In May, competing with eight other companies in a bidding
process, the Company was awarded with a contract to provide water supply and sewage services in the municipality of Olímpia for
a period of 30 years. It was the first time in history that a state-owned company won a basic sanitation bidding process in Brazil.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Comments on the Company’s Performance | |
| |
R$ million |
Comments on the Company’s Performance |
|
|
Var. |
|
|
Var. |
|
2Q23 |
2Q22 |
R$ |
% |
1H23 |
1H22 |
R$ |
% |
Revenue from sanitation services |
5,192.3 |
4,451.5 |
740.8 |
16.6 |
10,101.6 |
8,749.7 |
1,351.9 |
15.5 |
Construction revenue |
1,263.2 |
1,154.7 |
108.5 |
9.4 |
2,442.8 |
2,042.9 |
399.9 |
19.6 |
COFINS and PASEP/TRCF taxes |
(301.0) |
(340.8) |
39.8 |
(11.7) |
(691.4) |
(656.8) |
(34.6) |
5.3 |
(=) Net operating income |
6,154.5 |
5,265.4 |
889.1 |
16.9 |
11,853.0 |
10,135.8 |
1,717.2 |
16.9 |
Costs and expenses |
(3,909.4) |
(3,230.1) |
(679.3) |
21.0 |
(7,083.2) |
(6,107.0) |
(976.2) |
16.0 |
Construction costs |
(1,234.8) |
(1,129.5) |
(105.3) |
9.3 |
(2,387.8) |
(1,997.0) |
(390.8) |
19.6 |
Equity pickup |
10.0 |
5.9 |
4.1 |
69.5 |
16.4 |
11.5 |
4.9 |
42.6 |
Other operating income (expenses), net |
50.5 |
2.4 |
48.1 |
2,004.2 |
65.1 |
4.9 |
60.2 |
1,228.6 |
(=) Earnings before financial result, income tax, and social contribution |
1,070.8 |
914.1 |
156.7 |
17.1 |
2,463.5 |
2,048.2 |
415.3 |
20.3 |
Financial result |
(14.0) |
(324.4) |
310.4 |
(95.7) |
(273.6) |
15.7 |
(289.3) |
(1,842.7) |
(=) Earnings before income tax and social contribution |
1,056.8 |
589.7 |
467.1 |
79.2 |
2,189.9 |
2,063.9 |
126.0 |
6.1 |
Income tax and social contribution |
(313.1) |
(167.3) |
(145.8) |
87.1 |
(698.8) |
(665.9) |
(32.9) |
4.9 |
(=) Net income |
743.7 |
422.4 |
321.3 |
76.1 |
1491.1 |
1,398.0 |
93.1 |
6.7 |
Earnings per share (R$)* |
1.09 |
0.62 |
|
|
2.18 |
2.05 |
|
|
* Number
of shares = 683,509,869
Adjusted EBITDA Reconciliation (Non-accounting measures)
R$ million |
|
|
|
Var. |
|
|
Var. |
|
2Q23 |
2Q22 |
R$ |
% |
1H23 |
1H22 |
R$ |
% |
Net income |
743.7 |
422.4 |
321.3 |
76.1 |
1,491.1 |
1,398.0 |
93.1 |
6.7 |
PDI |
529.6 |
- |
529.6 |
- |
529.6 |
- |
529.6 |
- |
(=) Adjusted Net Income (excluding the PDI) |
1,273.3 |
422.4 |
850.9 |
201.4 |
2,020.7 |
1,398.0 |
622.7 |
44.5 |
Income tax and social contribution |
313.1 |
167.3 |
145.8 |
87.1 |
698.8 |
665.9 |
32.9 |
4.9 |
Financial result |
14.0 |
324.4 |
(310.4) |
(95.7) |
273.6 |
(15.7) |
289.3 |
(1,842.7) |
Other operating income (expenses), net |
(50.5) |
(2.4) |
(48.1) |
2,004.2 |
(65.1) |
(4.9) |
(60.2) |
1,228.6 |
Depreciation and amortization |
670.9 |
598.2 |
72.7 |
12.2 |
1,327.9 |
1,187.9 |
140.0 |
11.8 |
(=) Adjusted EBITDA (excluding PDI)** |
2,220.8 |
1,509.9 |
710.9 |
47.1 |
4,255.9 |
3,231.2 |
1,024.7 |
31.7 |
(%) Adjusted EBITDA margin (excluding PDI) |
36.1 |
28.7 |
|
|
35.9 |
31.9 |
|
|
(%) Adjusted EBITDA margin (excluding the PDI) on Net Revenue, excluding Construction |
45.4 |
36.7 |
|
|
45.2 |
39.9 |
|
|
** Adjusted
EBITDA corresponds to income before: (i) other operating income (expenses), net; (ii) financial result; (iii) income tax and social contribution;
and (iv) depreciation and amortization expenses.
The net operating revenue, which includes construction
revenue, totaled R$ 6154.5 million, an increase of 16.9% over 2Q22.
Excluding construction costs and the provision for
PDI, costs and expenses totaled R$ 3,379.8 million, an increase of R$ 149.7 million (R$ 4.6%). Considering the PDI and construction costs,
costs and expenses totaled R$ 5,144.2 million, an increase of 18.0%.
Adjusted EBIT, of R$ 1,020.3 million, increased by
11.9% over the R$ 911.7 million recorded in 2Q22.
Excluding the effects of PDI, adjusted EBITDA was
R$ 2,220.8 million in 2Q23 (R$ 8,112.3 million in the last 12 months), with an adjusted EBITDA margin of 36.1% (34.1% in the last 12 months).
Considering the PDI and the effects of revenue and
construction costs, adjusted EBITDA totaled R$ 1,691.2 million, up by 12.0% over the R$ 1,509.9 million reported in 2Q22 (R$ 7,582.7 million
in the last 12 months).
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Comments on the Company’s Performance | |
| |
Excluding the effects of revenue and construction
costs, the adjusted EBITDA margin reached 34.0% in 2Q23, compared to 36.1% in 2Q22 (40.3% in the last 12 months).
The Adjusted EBITDA margin was 27.5% in 2Q23, compared
to 28.7% in 2Q22 (31.9% in the last 12 months).
2. | Revenue from sanitation services |
The gross operating revenue from sanitation services,
which excludes construction revenue, totaled R$ 5,192.3 million in 2Q23, an increase of R$ 740.8 million (+16.6%) over the R$ 4,451.5
million recorded in 2Q22.
The main factors that led to the increase were:
| · | An average impact of 11.9%, resulting from the tariff adjustments of 12.8% implemented
since May 2022 and 9.6% implemented since May 2023; |
| · | An increase of 2.6% in the total billed volume; and |
| · | A rise in the average tariff due to the increase in ranges with higher consumption
in the residential category. |
Construction revenue increased by R$108.5 million (+9.4%),
due to higher investments made.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Comments on the Company’s Performance | |
| |
The following tables show the water and sewage billed
volumes, on a quarter-over-quarter and year-over-year basis, per customer category.
WATER AND SEWAGE BILLED VOLUME(1) PER CUSTOMER CATEGORY – million m3 |
|
Water |
Sewage |
Water + Sewage |
|
Category |
2Q23 |
2Q22 |
Var. % |
2Q23 |
2Q22 |
Var. % |
2Q23 |
2Q22 |
Var. % |
|
Residential |
476.9 |
465.9 |
2.4 |
418.7 |
406.7 |
3.0 |
895.6 |
872.6 |
2.6 |
|
Commercial |
47.7 |
46.7 |
2.1 |
45.5 |
44.8 |
1.6 |
93.2 |
91.5 |
1.9 |
|
Industrial |
8.8 |
8.7 |
1.1 |
9.6 |
9.5 |
1.1 |
18.4 |
18.2 |
1.1 |
|
Public |
12.1 |
11.7 |
3.4 |
10.9 |
10.1 |
7.9 |
23.0 |
21.8 |
5.5 |
|
Total Retail |
545.5 |
533.0 |
2.3 |
484.7 |
471.1 |
2.9 |
1,030.2 |
1,004.1 |
2.6 |
|
Wholesale (2) |
11.6 |
12.1 |
(4.1) |
5.4 |
4.1 |
31.7 |
17.0 |
16.2 |
4.9 |
|
Overall Total |
557.1 |
545.1 |
2.2 |
490.1 |
475.2 |
3.1 |
1,047.2 |
1,020.3 |
2.6 |
|
|
Water |
Sewage |
Water + Sewage |
|
Category |
1H23 |
1H22 |
Var. % |
1H23 |
1H22 |
Var. % |
1H23 |
1H22 |
Var. % |
|
Residential |
948.6 |
935.2 |
1.4 |
831.1 |
813.4 |
2.2 |
1,779.7 |
1,748.6 |
1.8 |
|
Commercial |
94.1 |
91.1 |
3.3 |
89.2 |
87.7 |
1.7 |
183.3 |
178.8 |
2.5 |
|
Industrial |
17.4 |
17.0 |
2.4 |
19.0 |
18.7 |
1.6 |
36.4 |
35.7 |
2.0 |
|
Public |
22.2 |
21.3 |
4.2 |
20.0 |
18.7 |
7.0 |
42.2 |
40.0 |
5.5 |
|
Total Retail |
1,082.3 |
1,064.6 |
1.7 |
959.3 |
938.5 |
2.2 |
2,041.6 |
2,003.1 |
1.9 |
|
Wholesale (2) |
23.8 |
24.2 |
(1.7) |
10.8 |
9.9 |
9.1 |
34.6 |
34.1 |
1.5 |
|
Overall Total |
1,106.1 |
1,088.8 |
1.6 |
970.1 |
948.4 |
2.3 |
2,076.2 |
2,037.2 |
1.9 |
|
1
Unaudited by external auditors
2
Wholesale includes volumes of reuse water and non-domestic sewage
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Comments on the Company’s Performance | |
| |
5. | Costs, administrative & selling expenses, and construction
costs |
Costs, administrative and selling expenses increased
by R$ 679.3 million in 2Q23 (+21.0%). Excluding the provision for the PDI, the increase was R$ 149.7 million (+4.6%).
Costs, administrative and selling expenses as a percentage
of net revenue (excluding construction revenue) were 79.9% in 2Q23 compared to 78.6% in 2Q22. Excluding the effects of the PDI, the share
in 2Q23 was 69.1%.
R$ million |
|
|
|
|
Var. |
|
|
Var. |
|
2Q23 |
2Q22 |
R$ |
% |
1H23 |
1H22 |
R$ |
% |
Salaries, payroll charges and benefits, and Pension plan obligations |
1,347.4 |
776.0 |
571.4 |
73.6 |
2,091.6 |
1,444.2 |
647.4 |
44.8 |
General supplies |
90.4 |
109.5 |
(19.1) |
(17.4) |
177.9 |
181.4 |
(3.5) |
(1.9) |
Treatment supplies |
138.5 |
142.5 |
(4.0) |
(2.8) |
303.4 |
289.8 |
13.6 |
4.7 |
Services |
643.1 |
599.4 |
43.7 |
7.3 |
1,268.1 |
1,111.4 |
1,56.7 |
14.1 |
Electricity |
386.8 |
376.1 |
10.7 |
2.8 |
782.6 |
788.0 |
(5.4) |
(0.7) |
General expenses |
395.6 |
356.7 |
38.9 |
10.9 |
710.4 |
635.8 |
74.6 |
11.7 |
Share of the municipal government in the collection |
207.0 |
172.3 |
34.7 |
20.1 |
393.5 |
335.2 |
58.3 |
17.4 |
Other general expenses |
188.6 |
184.4 |
4.2 |
2.3 |
316.9 |
300.6 |
16.3 |
5.4 |
Tax expenses |
19.3 |
18.8 |
0.5 |
2.7 |
41.1 |
37.9 |
3.2 |
8.4 |
Depreciation and amortization |
670.9 |
598.2 |
72.7 |
12.2 |
1,327.9 |
1,187.9 |
140.0 |
11.8 |
Allowance for doubtful accounts |
217.4 |
252.9 |
(35.5) |
(14.0) |
380.2 |
430.6 |
(50.4) |
(11.7) |
Costs, administrative & selling expenses |
3,909.4 |
3,230.1 |
679.3 |
21.0 |
7,083.2 |
6,107.0 |
976.2 |
16.0 |
% of net revenue (excluding construction revenue) |
79.9 |
78.6 |
|
|
75.3 |
75.5 |
|
|
% of net revenue (excluding construction revenue and the PDI) |
69.1 |
78.6 |
|
|
69.6 |
75.5 |
|
|
|
|
|
|
|
|
|
|
|
|
Salaries, payroll charges and benefits, and Pension
plan obligations
The R$ 571.4 million increase (+73.6%) recorded in
2Q23 was mainly due to:
| · | An increase of R$ 529.6 million, due to the provision created for employees who
joined the PDI; and |
| · | The salary adjustment of 4.9% (R$ 19.5 million) in May 2023 and the application
of 1% referring to the Career and Salary Plan in February 2023, partially offset by the 1.5% decline in the average number of employees. |
General supplies
Decrease of R$ 19.1 million (-17.4%), spread across
various items, the main ones as follows:
| · | R$ 3.3 million with fuel and lubricants; |
| · | R$ 1.9 million for the maintenance of water and sewage networks, connections,
and systems; and |
| · | R$ 1.8 million for the conservation of furniture and facilities. |
Services
Service expenses totaled R$ 643.1 million, an increase
of R$ 43.7 million (+7.3%) over the R$ 599.4 million recorded in 2Q22. The main increases were:
| · | R$ 31.8 million paid to technical services, mainly IT consulting, maintenance,
and support; and |
| · | R$ 23.1 million for the maintenance of water and sewage networks, connections,
and systems. |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Comments on the Company’s Performance | |
| |
The increases above were offset by the R$ 11.2 million
decrease in advertising services.
Electricity
Electricity expenses totaled R$ 386.8 million in
2Q23, an increase of R$ 10.7 million (+2.8%) from the R$ 376.1 million recorded in 2Q22. The main factor that contributed to this variation
was the R$ 11.3 million increase in expenses with natural gas, referring to a contract for water pumping between reservoirs. In 2Q23,
services were not used but the payment was made to fulfill the contractual obligations of the termination, which was in the “Take
or Pay” model, the only option offered by Comgás to supply the Rio Grande Taiaçupeba Raw Water Pumping Station at
the time of contracting in 1Q21.
The Free Market Tariffs (ACL) accounted for 54.3%
of total expenses in 2Q23 (49.4% in 2Q22), while the Regulated Market Tariffs (ACR) accounted for 45.7% in the same period (50.6% in 2Q22).
The variations in the ACL and ACR tariffs and consumption
were offset against each other and did not have a significant impact on total expenses.
General expenses
Increase of R$ 38.9 million (+10.9%), totaling R$
395.6 million in 2Q23, compared to the R$ 356.7 million recorded in 2Q22, mainly from the higher provision for transfer to the Municipal
Funds for Environmental Sanitation and Infrastructure, of R$ 34.7 million.
Depreciation and amortization
The R$ 72.7 million increase (+12.2%) was mainly
due to the beginning of operations of intangible assets, totaling R$ 5.9 billion.
Allowance for doubtful accounts
Decrease of R$ 35.5 million (-14.0%), from the R$
252.9 million recorded in 2Q22 to R$ 217.4 million in 2Q23, due to higher recovery from the implementation of agreements in 2Q23.
6. | Other net operating income (expenses) |
Increase of R$ 48.1 million, mainly due to a higher
application of contractual fines to suppliers in 2Q23, of R$ 44.4 million.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Comments on the Company’s Performance | |
| |
|
|
|
|
R$ million |
|
|
|
Var. |
|
2Q23 |
2Q22 |
R$ |
% |
Financial expenses, net of revenue |
(219.4) |
(157.2) |
(62.2) |
39.6 |
Monetary and exchange variations, net |
205.4 |
(167.2) |
372.6 |
(222.8) |
Financial Result |
(14.0) |
(324.4) |
310.4 |
(95.7) |
Financial expenses, net of revenue
|
|
|
|
R$ million |
|
|
|
Var. |
|
2Q23 |
2Q22 |
R$ |
% |
Financial expenses |
|
|
|
|
Interest and charges on domestic borrowings and financing |
(254.0) |
(215.8) |
(38.2) |
17.7 |
Interest and charges on international borrowings and financing |
(23.2) |
(9.8) |
(13.4) |
136.7 |
Other financial expenses |
(96.4) |
(92.7) |
(3.7) |
4.0 |
Total financial expenses |
(373.6) |
(318.3) |
(55.3) |
17.4 |
Financial revenue |
154.2 |
161.1 |
(6.9) |
(4.3) |
Financial expenses, net of revenue |
(219.4) |
(157.2) |
(62.2) |
39.6 |
The
main impacts resulted from:
| · | An increase of R$ 38.2 million in interest and charges on domestic borrowings
and financing, mainly due to (i) funding from IDB Invest 2022 and IDB Invest 2023 (in July 2022 and May 2023, respectively), with an impact
of R$ 25.4 million in interest in local currency; and (ii) an increase in the average DI rate (from 12.38% in 2Q22 to 13.65% in 2Q23); |
| · | An increase of R$ 13.4 million in interest and charges on international borrowings
and financing, mainly due to an increase in the interest rate of some contracts with IDB and IBRD, due to the variation of the SOFR rate
(from 1.5% in June 2022 to 5.1% in June 2023); and |
| · | A decrease of R$ 6.9 million in financial revenues, mainly on financial investments
in 2Q23, as a result of lower average cash. |
Monetary and exchange variations, net
|
|
|
|
R$ million |
|
|
|
Var. |
|
2Q23 |
2Q22 |
R$ |
% |
Monetary and exchange variations on liabilities |
|
|
|
|
Monetary variations on borrowings and financing |
(38.1) |
(91.3) |
53.2 |
(58.3) |
Exchange variations on borrowings and financing |
263.7 |
(64.8) |
328.5 |
(506.9) |
Other monetary variations |
(71.2) |
(80.1) |
8.9 |
(11.1) |
Total monetary and exchange variations on liabilities |
154.4 |
(236.2) |
390.6 |
(165.4) |
Monetary and exchange variations on assets |
51.0 |
69.0 |
(18.0) |
(26.1) |
Monetary and exchange variations, net |
205.4 |
(167.2) |
372.6 |
(222.8) |
The positive effect of net monetary and exchange
variations in 2Q23 was R$ 372.6 million, especially due to:
| · | A decrease of R$ 53.2 million in monetary variations on borrowings and financing,
mainly because of the decrease in the IPCA consumer price index (from 2.22% in 2Q22 to 0.76% in 2Q23); and |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Comments on the Company’s Performance | |
| |
| · | An exchange variation gain of R$ 328.5 million on borrowings and financing, the
depreciation of the U.S. Dollar and the Yen in 2Q23 (-5.14% and -12.83%, respectively), compared to the appreciation of the U.S. Dollar
and the Yen in 2Q22 (10.56% and -1.08%, respectively). |
8. | Income tax and social contribution |
The R$ 145.8 million increase in 2Q23 was mainly due to:
| · | An increase of R$ 889.1 million in net operating revenue; and |
| · | Exchange variation gains, with an impact of R$ 328.5 million. |
The factors above were mainly offset by the R$ 784.6
million increase in costs and expenses, which include a provision of R$ 529.6 million referring to the PDI and the R$ 105.3 million increase
in construction costs.
Information* |
2Q23 |
2Q22 |
% |
Water Connections1 |
10,242 |
9,916 |
3.3 |
Sewage connections1 |
8,728 |
8,500 |
2.7 |
Population directly served - water2 |
28.1 |
27.8 |
1.1 |
Population directly served - sewage2 |
24.8 |
24.6 |
0.8 |
Number of employees |
12,221 |
12,381 |
(1.3) |
Volume of water produced in the quarter 3 |
734 |
711 |
3.2 |
Volume of water produced in the first half 3 |
1,467 |
1,424 |
3.0 |
IPM - Measured Water Loss (%) 3 |
29.5 |
28.4 |
3.9 |
IPDt (liters/connection x day) 3 |
256 |
250 |
2.4 |
1. Total connections, active and inactive, in
thousand units at the end of the period. Excludes water connections in Mauá in 2Q22.
2. In million inhabitants, at the end of the
period. Does not include wholesale.
3. Millions of m3. Excludes
volumes produced in the municipalities of Aguaí, Mauá, and Tapiratiba in 2Q22.
* Unaudited by external auditors
Economic variables at the close of the quarter * |
2Q23 |
2Q22 |
Amplified Consumer Price Index (1) |
0.76 |
2.22 |
National Consumer Price Index (1) |
0.79 |
2.12 |
Consumer Price Index (1) |
0.66 |
2.33 |
DI (2) |
13.65 |
12.38 |
U.S. dollar (3) |
4.8192 |
5.2380 |
Yen (3) |
0.0334 |
0.0386 |
1. Accrued in the quarter (%)
2. Average quarterly rate (%)
.3. Ptax sale rate on the last day
* Unaudited by external auditors
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Comments on the Company’s Performance | |
| |
10. | Borrowings and financing |
On June 14, the Company executed a financing agreement
of R$ 1 billion with the International Finance Corporation - IFC, an institution of the World Bank Group. The financing is linked to annual
social goals, which characterizes it as a sustainability-linked loan. The funds are being invested in basic sanitation infrastructure
in the Metropolitan Region of São Paulo from 2021 to 2025. The investments are intended for the expansion of the sewage system
to improve water quality in the Pinheiros River, in the city of São Paulo.
In 2Q23, the Company contracted the Second Tranche
of Loan 12.676-0, totaling R$ 470 million, with the Inter-American Investment Corporation - IDB Invest. This operation is collateralized
by PROPARCO (Societé de Promotion et de Participation Pour la Cóperation Économic S.A.), which belongs to Group AFD
(Agence Française de Développement). Together with other existing financing, the funds will be used in the Fourth Stage
of the Tietê River Cleaning Project, the largest environmental sanitation program in Brazil and part of IntegraTietê.
|
|
|
|
|
|
|
|
R$ thousand |
DEBT PROFILE |
|
|
|
|
|
|
|
|
|
|
2023 |
2024 |
2025 |
2026 |
2027 |
2028 |
2029 onwards |
TOTAL |
% of total |
Local currency |
|
|
|
|
|
|
|
|
|
Debentures |
360,436 |
1,204,595 |
1,334,339 |
1,212,543 |
1,357,016 |
655,401 |
1,543,790 |
7,668,120 |
41 |
Brazilian Federal Savings Bank |
50,923 |
106,589 |
113,242 |
120,311 |
127,810 |
135,646 |
981,275 |
1,635,796 |
9 |
BNDES |
117,665 |
235,331 |
214,938 |
205,029 |
192,377 |
72,783 |
222,545 |
1,260,668 |
7 |
IDB - National |
123,444 |
249,099 |
260,899 |
330,209 |
315,069 |
420,959 |
2,357,473 |
4,057,152 |
22 |
IFC |
7,600 |
22,800 |
34,200 |
41,800 |
60,800 |
83,600 |
493,053 |
743,853 |
4 |
Leases (Concession Agreements, Program Contracts, and Contract Asset) (1) |
47,884 |
50,309 |
34,600 |
33,492 |
36,754 |
40,336 |
92,066 |
335,441 |
2 |
Leases (others) (2) |
37,476 |
17,633 |
10,550 |
4,500 |
708 |
- |
- |
70,867 |
0 |
Other |
5,505 |
2,994 |
2,760 |
142 |
- |
- |
- |
11,401 |
0 |
Interest and other charges |
438,951 |
7,193 |
- |
- |
- |
- |
- |
446,144 |
2 |
Total in local currency |
1,189,884 |
1,896,543 |
2,005,528 |
1,948,026 |
2,090,534 |
1,408,725 |
5,690,202 |
16,229,442 |
87 |
|
|
|
|
|
|
|
|
|
|
Foreign currency |
|
|
|
|
|
|
|
|
|
IDB |
24,766 |
49,532 |
62,432 |
25,799 |
25,799 |
25,799 |
377,410 |
591,537 |
3 |
IBRD |
14,650 |
29,299 |
29,299 |
29,299 |
29,299 |
29,299 |
261,176 |
422,321 |
2 |
JICA |
71,571 |
143,141 |
143,141 |
143,141 |
143,141 |
143,141 |
652,125 |
1,439,401 |
8 |
Interest and other charges |
22,488 |
- |
- |
- |
- |
- |
- |
22,488 |
0 |
Total in foreign currency |
133,475 |
221,972 |
234,872 |
198,239 |
198,239 |
198,239 |
1,290,711 |
2,475,747 |
13 |
|
|
|
|
|
|
|
|
|
|
OVERALL TOTAL |
1,323,359 |
2,118,515 |
2,240,400 |
2,146,265 |
2,288,773 |
1,606,964 |
6,980,913 |
18,705,189 |
100 |
1 Refers to work contracts signed as Assets Lease;
2 Obligations related to leasing agreements, mainly vehicle leases.
Covenants
The table below shows the most restrictive clauses
in 2Q23:
|
Covenants |
Adjusted EBITDA / Adjusted Financial Expenses |
Equal to or higher than 2.80 |
EBITDA / Financial Expenses Paid |
Equal to or higher than 2.35 |
Adjusted Net Debt / Adjusted EBITDA |
Equal to or lower than 3.80 |
Net Debt / Adjusted EBITDA |
Equal to or lower than 3.50 |
Total Adjusted Debt / Adjusted EBITDA |
Lower than 3.65 |
Other Onerous Debt 1 / Adjusted EBITDA |
Equal to or lower than 1.30 |
Adjusted Current Ratio |
Higher than 1.00 |
1 “Other Onerous Debts” correspond
to the sum of pension plan obligations and healthcare plan, installment payment of tax debts, and installment payment of debts with the
electricity supplier.
In 2Q23, the Company met the requirements of its
borrowings and financing agreements.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Comments on the Company’s Performance | |
| |
Investments totaled R$ 1,294.3 million in 2Q23, presented
as additions in the notes to the quarterly information under Contract Asset, Intangible Assets, and Property, Plant and Equipment, of
R$ 1,278.1 million, R$ 6.9 million, and R$ 9.3 million, respectively. Disbursements in 2Q23 referring to investments, including from previous
periods, totaled R$ 944.7 million.
The table below shows investments broken down by
water and sewage:
R$ million |
|
Water |
Sewage |
Total |
Investments made |
564.5 |
729.8 |
1,294.3 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
Companhia de Saneamento Básico do Estado de São Paulo
(SABESP or Company) is a mixed-capital company headquartered in the municipality of São Paulo, at Rua Costa Carvalho, 300, CEP
05429-900, controlled by the São Paulo State. The Company is engaged in the provision of basic and environmental sanitation services
in the São Paulo State, and supplies treated water and sewage services on a wholesale basis.
In addition to providing basic sanitation services in the São
Paulo State, SABESP may perform activities in other states and countries and can operate in drainage, urban cleaning, solid waste handling,
and energy markets. SABESP aims to be a world reference in the provision of sanitation services, in a sustainable, competitive, and innovative
manner, with a focus on customers.
As of June 30, 2023, the Company operated water and sewage services
in 375 municipalities of the São Paulo State, 351 of which have already signed contracts, according to Law 11,445/2007. Most of
these municipalities’ operations are based on 30-year concession, program, and service contracts, except for the municipalities
of Guarulhos, Mauá, Santo André, São Bernardo do Campo, São João da Boa Vista, and Tejupá, which
have a 40-year term.
The table below shows a summary of the contractual situation of the
municipalities served:
|
|
|
|
|
|
|
|
Total municipalities that have already signed contracts |
351 |
351 |
342 |
Balance – intangible and contract assets |
46,632,438 |
45,292,307 |
43,250,729 |
Percentage of intangible and contract assets |
95.03% |
94.49% |
93.87% |
Revenue from sanitation services (excluding construction revenue) |
9,633,209 |
17,767,561 |
8,316,280 |
Percentage of revenue from sanitation services (excluding construction revenue) |
95.36% |
95.37% |
95.05% |
|
|
|
|
Municipalities with expired contracts: |
1 |
1 |
8 |
Balance – intangible and contract assets |
11,412 |
11,519 |
216,347 |
Percentage of intangible and contract assets |
0.02% |
0.02% |
0.47% |
Revenue from sanitation services (excluding construction revenue) |
7,904 |
15,236 |
21,975 |
Percentage of revenue from sanitation services (excluding construction revenue) |
0.08% |
0.08% |
0.25% |
|
|
|
|
Municipalities with concession agreements due by 2030: |
23 |
23 |
25 |
Balance – intangible and contract assets |
1,058,162 |
1,072,138 |
1,105,098 |
Percentage of intangible and contract assets |
2.16% |
2.24% |
2.40% |
Revenue from sanitation services (excluding construction revenue) |
388,568 |
711,452 |
346,511 |
Percentage of revenue from sanitation services (excluding construction revenue) |
3.85% |
3.82% |
3.96% |
|
|
|
|
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
|
|
|
|
|
|
|
|
Municipality of São Paulo: |
|
|
|
Percentage of intangible and contract assets |
43.19% |
43.33% |
43.22% |
Percentage of revenue from sanitation services (excluding construction revenue) |
45.13% |
45.14% |
45.21% |
The Company's shares have been listed on the Novo Mercado segment
of B3 under ticker SBSP3 since April 2002 and on the New York Stock Exchange (NYSE) as Level III American Depositary Receipts (“ADRs”),
under ticker SBS, since May 2002.
Since 2008, the Company has been setting up partnerships with other
companies, which resulted in the following companies: Sesamm, Águas de Andradina, Saneaqua Mairinque, Aquapolo Ambiental, Águas
de Castilho, Attend Ambiental, Paulista Geradora de Energia, Cantareira SP Energia, FOXX URE-BA Ambiental, and Infranext Soluções
em Pavimentação. Although SABESP has no majority interest in the capital stock of these companies, the shareholders’
agreements provide for the power of veto and casting votes on certain issues jointly with associates, indicating the shared control in
the management of these investees, except for Saneaqua Mairinque, which, as of August 2020, no longer has a shared control.
• Municipality of Estância Turística
de Olímpia
In July 2023, the Municipal Government of Olímpia – SP
(“Olímpia”) approved the bidding process referring to Tender 02/2023, whose subject was the granting of a concession
for providing public water supply and sewage services for 30 years, and awarded the contract to SABESP, with a fixed concession fee of
R$ 148 million.
The municipality of Olímpia is located 430 km from the capital
city of São Paulo, has an estimated population of 56 thousand inhabitants, and universalized water and sewage coverage. The municipality
will require operational, commercial, efficiency, and water loss reduction efforts from the Company.
The concession agreement is expected to be signed on September 1,
2023, but may be extended for 60 days. As of the signing of the agreement, the transaction will be carried out by DAEMO (Departamento
de Água e Esgoto do Município de Olímpia) and assisted by the Concessionaire for 60 days. After this period, the
entire operation will be carried out by the Concessionary and the Concession term will begin.
As established by the Bid Notice, the winning bidder must create,
before the signing of the agreement, a special purpose entity to execute the terms of the Concession Agreement. The contract value estimated
in the Bid Notice is R$ 1,182,495 (base date of August 2022), corresponding to the Granting Authority’s estimate of the cumulative
concession revenues, while estimated investments amount to R$ 81,112 (base date of August 2022) for the entire duration of the concession.
The fixed concession fee of R$ 148 million will be paid by Sabesp
in two installments, where 50% upon signing the agreement and 50%, duly adjusted by the IPCA, within 365 days after the payment of the
first installment.
A monthly variable concession fee will be paid by the 10th day of
the subsequent month, corresponding to 1% of the net tariff revenue.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
The Concessionaire’s subscribed capital, at the time of its
creation, must be at least R$ 8,111,208,00 (eight million, one hundred and eleven thousand, two hundred and eight reais), as defined by
the bid notice.
To ensure faithful compliance with the obligations to be assumed by
the Concessionaire, upon the signing of the agreement, proof of guarantee of the contractual obligations must be presented to the granting
authority, in an amount corresponding to 5% of the estimated investment value.
The Company is still analyzing all the accounting impacts related
to the assumption of Olímpia.
Management expects that the funds raised with the improved water security
from the works carried out, the generation of operational cash, and credit lines available for investments, will be sufficient to meet
the Company’s commitments and not compromise the necessary investments.
Approvals
The quarterly information was approved by the Board of Directors on
August 10, 2023.
2 | Basis of preparation and presentation of
the quarterly information |
Presentation of the Quarterly Information
The quarterly information as of June 30, 2023, was prepared based
on the provisions of CPC 21 (R1) – Interim Financial Information and the international standard IAS 34 – Interim Financial
Reporting, issued by the International Accounting Standards Board (IASB), applicable to the preparation of the Quarterly Information Form
– ITR, and is fairly presented consistent with the rules issued by the Brazilian Securities and Exchange Commission (CVM). Accordingly,
this Quarterly Information takes into consideration the Official Letter CVM/SNC/SEP 003 of April 28, 2011, which allows the entities to
present selected notes to the financial statements in cases of redundant information already disclosed in the Annual Financial Statements.
Therefore, the quarterly information as of June 30, 2023, does not include all the notes and reporting required by the standards for the
annual financial statements, and accordingly, shall be read jointly with the Annual Financial Statements as of December 31, 2022, prepared
under the International Financial Reporting Standards – IFRS, issued by the International Accounting Standards Board – IASB,
and the accounting practices adopted in Brazil, which observe the pronouncements issued by the Brazilian Accounting Pronouncements Committee
- CPC. Therefore, in this quarterly information, the notes below were either not presented or are not as detailed as and/or have the same
references as those in the annual financial statements (according to numerical references):
| i. | Summary of significant accounting policies (Note
3); |
| ii. | Changes in accounting practices and disclosures
(Note 4); |
| iii. | Risk management – Financial instruments
(Note 5.4); |
| iv. | Key accounting estimates and judgments (Note
6); |
| v. | Related-party balances and transactions (Note
11); |
| vi. | Investments (Note 12); |
| vii. | Intangible assets (Note 15); |
| viii. | Borrowings and financing (Note 17); |
| ix. | Deferred taxes and contributions (Note 19); |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
| xi. | Pension plan obligations (Note 22); |
| xiii. | Insurance (Note 27); |
All material information related to the quarterly information, and
this information alone, is being disclosed and corresponds to the information used by the Company’s Management in its administration.
The amounts disclosed in the Notes to the quarterly information are
in thousands of Brazilian reais, unless otherwise stated.
3 | Summary of significant accounting policies |
The significant accounting policies used in the preparation of the
quarterly information as of June 30, 2023, are consistent with those used to prepare the Annual Financial Statements for the year ended
December 31, 2022, disclosed in Note 3 of such financial statements.
4.1 | Financial Risk Management |
Financial risk factors
The Company's activities are affected by the Brazilian economic scenario,
making it exposed to market risk (exchange rate and interest rate), credit risk, and liquidity risk. Financial risk management is focused
on the unpredictability of financial markets and seeks to minimize potential adverse effects on financial performance.
The Company has not utilized derivative instruments in any of the
reported periods.
Foreign currency risk
Foreign currency exposure implies market risks associated with currency
fluctuations since the Company has foreign currency-denominated liabilities, arising from long-term funding, in development institutions,
at more attractive interest rates, in U.S. dollars and Yen.
The management of currency exposure considers several current and
projected economic factors, besides market conditions.
This risk arises from the possibility that the Company may incur losses
due to exchange rate fluctuations that would impact liability balances of foreign currency-denominated borrowings and financing and related
financial expenses. The Company does not maintain hedge or swap contracts or any derivative financial instrument to hedge against this
risk.
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| |
Notes to the Quarterly Information | |
| |
Part of the financial debt, totaling R$ 2,512,769 as of June 30, 2023
(R$ 2,809,441 as of December 31, 2022), is indexed to the U.S. dollar and Yen. The exposure to exchange risk is as follows:
|
June 30, 2023 |
December 31, 2022 |
|
Foreign currency
(in thousands)
|
R$ |
Foreign currency
(in thousands)
|
R$ |
|
|
|
|
|
Borrowings and financing – US$ |
217,533 |
1,048,335 |
191,022 |
996,695 |
Borrowings and financing – Yen |
43,223,787 |
1,441,946 |
45,369,189 |
1,795,259 |
Interest and charges from borrowings and financing – US$ |
|
14,268 |
|
6,985 |
Interest and charges from borrowings and financing – Yen |
|
8,220 |
|
10,502 |
Total exposure |
|
2,512,769 |
|
2,809,441 |
Borrowing cost – US$ |
|
(34,479) |
|
(31,037) |
Borrowing cost – Yen |
|
(2,543) |
|
(2,646) |
Total foreign currency-denominated borrowings (Note 16) |
|
2,475,747 |
|
2,775,758 |
The 10.8% decrease in the balance of the foreign currency-denominated
debt as of June 30, 2023 compared to December 31, 2022 was mainly impacted by the depreciations of the US dollar and the Yen against the
Brazilian real. The table below shows the prices and exchange variations in the period:
|
June 30, 2023 |
December 31, 2022 |
Variation |
US$ |
R$ 4.8192 |
R$ 5.2177 |
-7.6% |
Yen |
R$ 0.03336 |
R$ 0.03957 |
-15.7% |
Borrowings and financing fell by R$ 347,534 from January to June
2023 (a decrease of R$ 528,639 from January to June 2022), due to exchange rate changes. See Note 16 (ii). As of June 30, 2023, if
the Brazilian real had depreciated or appreciated by 10 percentage points, in addition to the impacts already mentioned above, against
the US dollar and Yen with all other variables held constant, the effects on results before taxes on the six-month period ended June 30,
2023 would have been R$ 251,277 (R$ 272,474 for the six-month period ended June 30, 2022), lower or higher.
The probable scenario below presents the effect on the income statements
for the next 12 months, considering the projected rates of the U.S. dollar and Yen.
The Company understands that the scenario presented is reasonable,
given the instability of the Brazilian real against the U.S. dollar and the Yen.
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| |
Notes to the Quarterly Information | |
| |
|
Probable scenario |
|
(*) |
Net currency exposure as of June 30, 2023 in US$ - Liabilities |
217,533 |
|
|
US$ rate as of June 30, 2023 |
4.8192 |
Exchange rate estimated according to the scenario |
5.0000 |
Difference between the rates |
(0.1808) |
|
|
Effect on the net financial result R$ - (loss) |
(39,330) |
|
|
Net currency exposure as of June 30, 2023, in ¥ - Liabilities |
43,223,787 |
|
|
Yen rate as of June 30, 2023 |
0.03336 |
Exchange rate estimated according to the scenario |
0.03504 |
Difference between the rates |
(0.00168) |
|
|
Effect on the net financial result R$ - (loss) |
(72,616) |
|
|
Total effect on the net financial result in R$ - (loss) |
(111,946) |
|
|
(*) For the probable scenario in U.S. dollars and Yen, the exchange rates estimated for June 30, 2024 were used, according to the BACEN-Focus report and B3’s Benchmark Rate report, of June 30, 2023, respectively. |
Interest rate risk
This risk arises from the possibility that the Company could incur
losses due to fluctuations in interest rates, increasing the financial expenses related to borrowings and financing.
The Company has not entered into any derivative contract to hedge
against this risk; however, it continually monitors market interest rates, to evaluate the possible need to replace its debt.
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| |
Notes to the Quarterly Information | |
| |
The table below provides the borrowings and financing subject to variable
interest rates:
|
June 30, 2023 |
|
December 31, 2022 |
CDI (i) |
9,397,156 |
|
9,251,150 |
TR (ii) |
1,726,745 |
|
1,635,587 |
IPCA (iii) |
3,030,622 |
|
3,073,435 |
TJLP (iv) |
1,303,313 |
|
1,433,029 |
SOFR (v) |
1,048,337 |
|
996,697 |
Interest and charges |
460,405 |
|
424,856 |
Total |
16,966,578 |
|
16,814,754 |
(i) |
CDI - (Certificado de Depósito Interbancário), an interbank deposit certificate |
(ii) |
TR – Interest Benchmark Rate |
(iii) |
IPCA - (Índice Nacional de Preços ao Consumidor Amplo), a consumer price
index |
(iv) |
TJLP - (Taxa de Juros a Longo Prazo), a long-term interest rate index |
(v) |
SOFR - Secured Overnight Financing Rate |
Another risk to which the Company is exposed is the mismatch of inflation
adjustment indices of its debts with those of its service revenues. Tariff adjustments of services provided do not necessarily follow
the increases in the inflation indexes to adjust borrowings, financing, and interest rates affecting indebtedness.
As of June 30, 2023, if interest rates on borrowings and financing
had been 1 percentage point higher or lower with all other variables held constant, the effects on profit before taxes for the six-month
period ended June 30, 2023, would have been R$ 169,666 (R$ 155,036 for the six-month period ended June 30, 2022), lower or higher, mainly
as a result of lower or higher interest expense on floating rate borrowings and financing.
Credit risk is related to cash and cash equivalents, financial investments,
as well as credit exposures of customers, including accounts receivable, restricted cash, and accounts receivable from related parties.
Credit risk exposure to customers is mitigated by sales to a dispersed base.
The maximum exposure to credit risk as of June 30, 2023, is the carrying
amount of instruments classified as cash and cash equivalents, financial investments, restricted cash, trade receivables, and accounts
receivable from related parties on the reporting date of this quarterly information. See Notes 6, 7, 8, 9, and 10.
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| |
Notes to the Quarterly Information | |
| |
Regarding the financial assets held with financial institutions, the
credit quality was assessed by reference to external credit ratings (if available) or historical information about the bank’s default
rates. For the credit quality of the banks, such as deposits and financial investments, the Company assesses the rating published by three
main international agencies (Fitch, Moody's and S&P), as follows:
Banks |
Fitch |
Moody's |
Standard Poor's |
Banco do Brasil S/A |
AA(bra) |
AAA.br |
- |
Banco Santander Brasil S/A |
- |
AAA.br |
brAAA |
Brazilian Federal Savings Bank |
AA(bra) |
AAA.br |
brAAA |
Banco Bradesco S/A |
AAA(bra) |
AAA.br |
brAAA |
Banco Itaú Unibanco S/A |
AAA(bra) |
AAA.br |
- |
Banco BV |
- |
AA.br |
brAAA |
Banco BTG Pactual S/A |
AA(bra) |
AAA.br |
brAAA |
The rating assessment disclosed by Fitch for deposit transactions
and financial investments in local currency is as follows:
|
June 30, 2023 |
December 31, 2022 |
Cash and cash equivalents and financial investments |
|
|
AA(bra) |
1,323,596 |
2,237,629 |
AAA(bra) |
617,143 |
1,011,685 |
Others (*) |
315,612 |
296,044 |
|
2,256,351 |
3,545,358 |
(*) As of June 30, 2023, this category includes R$ 306,063 (R$ 289,908
as of December 31, 2022) referring to Banco BV, current accounts, and financial investments, which are not rated by Fitch.
Liquidity is primarily reliant upon cash provided by operating activities
and borrowings and financing obtained in the local and international capital markets, as well as the payment of debts. The management
of this risk considers the assessment of its liquidity requirements to ensure it has sufficient cash to meet its operating and capital
expenditure requirements.
The funds held are invested in interest-bearing current accounts,
time deposits, and securities, with instruments with appropriate maturity or liquidity sufficient to provide margin as determined by the
projections mentioned above.
The table below shows the financial liabilities, by maturity, including
the installments of principal and future interest. For agreements with floating interest rates, the interest rates used correspond to
the base date of June 30, 2023.
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| |
Notes to the Quarterly Information | |
| |
|
July to December 2023 |
2024 |
2025 |
2026 |
2027 |
2028 onwards |
Total |
As of June 30, 2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
Borrowings and financing |
1,842,450 |
3,814,905 |
3,742,343 |
3,391,978 |
3,279,864 |
11,888,859 |
27,960,399 |
Trade payables and contractors |
256,679 |
- |
- |
- |
- |
- |
256,679 |
Services payable |
588,456 |
- |
- |
- |
- |
- |
588,456 |
Public-Private Partnership - PPP |
250,897 |
459,887 |
419,401 |
419,401 |
419,401 |
3,637,608 |
5,606,595 |
Program Contract Commitments |
60,706 |
1,206 |
1,206 |
1,206 |
1,206 |
12,668 |
78,198 |
Total |
2,999,188 |
4,275,998 |
4,162,950 |
3,812,585 |
3,700,471 |
15,539,135 |
34,490,327 |
Cross default
The Company has borrowings and financing agreements including cross-default
clauses, i.e., the early maturity of any debt may imply the early maturity of these agreements. The indicators are continuously monitored
to avoid the execution of these clauses, and the most restrictive ones are shown in Note 16 (c).
(d) | Sensitivity analysis on interest rate risk |
The table below shows the sensitivity analysis of the financial instruments,
prepared under CPC 40 (R1) to evidence the balances of main financial assets and liabilities, calculated at a rate projected for the twelve-month
period after June 30, 2023, or until the final settlement of each contract, whichever occurs first, considering a probable scenario.
The purpose of the sensitivity analysis is to measure the impact of
changes in the market on the financial instruments, considering constant all other variables. At the time of settlement, the amounts may
be different from those presented, due to the estimates used in the measurement.
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| |
Notes to the Quarterly Information | |
| |
June 30, 2023 |
Indicators |
Exposure |
Probable scenario |
|
|
|
Assets |
|
|
CDI |
1,358,150 |
11.6900%(**) |
Financial income |
|
158,768 |
|
|
|
Liabilities |
|
|
CDI |
(9,397,156) |
11.6900%(**) |
Interest to be incurred |
|
(1,098,528) |
|
|
|
CDI net exposure |
(8,039,006) |
(939,760) |
|
|
|
Liabilities |
|
|
TR |
(1,726,745) |
0.0099%(**) |
Expenses to be incurred |
|
(171) |
|
|
|
IPCA |
(3,030,622) |
4.2200%(*) |
Expenses to be incurred |
|
(127,892) |
|
|
|
TJLP |
(1,303,313) |
6.4000%(*) |
Interest to be incurred |
|
(83,412) |
|
|
|
SOFR (***) |
(1,048,337) |
5.3925%(**) |
Interest to be incurred |
|
(56,532) |
|
|
|
Total expenses to be incurred, net |
|
(1,207,767) |
|
|
|
(*) Source: BACEN as of June 30, 2023 |
(**) Source: B3 as of June 30, 2023 |
(***) Source: Bloomberg |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
The Company’s objectives when managing capital are to ensure
its ability to increase investments in infrastructure, provide returns for shareholders and benefits for other stakeholders, and maintain
an optimal capital structure to reduce the cost of capital.
Capital is monitored based on the leverage ratio, which corresponds
to net debt divided by total capital (shareholders and providers of capital). Net debt corresponds to total borrowings and financing less
cash and cash equivalents and financial investments. Total capital is calculated as total equity plus net debt, as shown in the statement
of financial position.
|
June 30, 2023 |
December 31, 2022 |
|
|
|
Total borrowings and financing (Note 16) |
18,705,189 |
18,958,671 |
(-) Cash and cash equivalents (Note 6) |
(1,327,173) |
(1,867,485) |
(-) Financial investments (Note 7) |
(929,178) |
(1,677,873) |
|
|
|
Net debt |
16,448,838 |
15,413,313 |
Total equity |
28,747,561 |
27,333,533 |
|
|
|
Total (shareholders plus providers of capital) |
45,196,399 |
42,746,846 |
|
|
|
Leverage ratio |
36% |
36% |
The Company considers that balances from trade receivables (current)
and trade payables by carrying amount less impairment approximate their fair values, considering the short maturity. Long-term trade receivables
also approximate their fair values, as they will be adjusted by inflation and/or will bear contractual interest rates over time.
The Company did not have financial assets classified as fair value
through other comprehensive income and fair value through profit or loss. The financial instruments included in the amortized cost category
comprise cash and cash equivalents, financial investments, restricted cash, trade receivables, balances with related parties, other assets
and balances receivable from the Water National Agency (ANA), accounts payable to suppliers, borrowings and financing, services payable,
balances payable deriving from the Public-Private Partnership (PPP) and program contract commitments, which are non-derivative financial
assets and liabilities with fixed or determinable payments, not quoted in an active market, except for cash equivalents and financial
investments.
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| |
Notes to the Quarterly Information | |
| |
The estimated fair values of the financial instruments are as follows:
Financial Assets
|
June 30, 2023 |
December 31, 2022 |
|
Carrying amount |
Fair value |
Carrying amount |
Fair value |
Cash and cash equivalents |
1,327,173 |
1,327,173 |
1,867,485 |
1,867,485 |
Financial investments |
929,178 |
929,178 |
1,677,873 |
1,677,873 |
Restricted cash |
37,873 |
37,873 |
37,474 |
37,474 |
Trade receivables |
3,517,472 |
3,517,472 |
3,277,808 |
3,277,808 |
ANA |
5,138 |
5,138 |
9,193 |
9,193 |
Other assets |
258,461 |
258,461 |
212,674 |
212,674 |
Additionally, SABESP has financial assets receivable from related
parties, totaling R$ 1,170,862 as of June 30, 2023 (R$ 1,156,743 as of December 31, 2022), which were calculated under the conditions
negotiated between the related parties. The conditions and additional information related to these financial instruments are disclosed
in Note 10. Part of this balance, totaling R$ 1,061,230 (R$ 1,060,040 as of December 31, 2022), refers to reimbursement of additional
retirement and pension plan - G0, indexed by IPCA plus simple interest of 0.5% p.m. On the transaction date, this interest rate approximated
that of National Treasury Notes (NTN-b), with a term similar to the terms of related-party transactions.
Financial Liabilities
|
June 30, 2023 |
December 31, 2022 |
|
Carrying amount |
Fair value |
Carrying amount |
Fair value |
Borrowings and financing |
18,705,189 |
18,959,605 |
18,958,671 |
19,260,133 |
Trade payables and contractors |
256,679 |
256,679 |
430,946 |
430,946 |
Services payable |
588,456 |
588,456 |
723,242 |
723,242 |
Program Contract Commitment |
73,947 |
73,947 |
112,385 |
112,385 |
Public-Private Partnership - PPP |
2,824,409 |
2,824,409 |
2,959,181 |
2,959,181 |
The criteria adopted to obtain the fair values of borrowings and financing,
in preparing the quarterly information as of June 30, 2023, are consistent with those used in the preparation of the Annual Financial
Statements for the fiscal year ended December 31, 2022.
Financial instruments referring to financial investments and borrowings
and financing are classified as Level 2 in the fair value hierarchy.
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| |
Notes to the Quarterly Information | |
| |
Considering the nature of other financial instruments, assets and
liabilities, the balances recognized in the statement of financial position approximate the fair values, except for borrowings and financing,
considering the maturities close to the end of the reporting date of this quarterly information, comparison of contractual interest rates
with market rates in similar operations at the end of the reporting period, their nature, and maturity terms.
5 | Key accounting estimates and judgments |
The preparation of the quarterly information requires Management to
disclose judgments (except for those that involve estimates) that have a significant impact on the amounts recognized based on experience
and other factors deemed as relevant, which affect the values of assets and liabilities and present results that may differ from the actual
results.
The Company establishes estimates and assumptions regarding the future,
which are reviewed on a timely basis. Such accounting estimates, by definition, may differ from the actual results. The effects arising
from the reviews of the accounting estimates are recognized in the period in which the estimates are reviewed.
The Company assessed the main accounting policies that involve judgments,
except for those that involve estimates, and concluded that none of them have a significant effect.
The areas that require a higher level of judgment and greater complexity,
as well as assumptions and estimates that are significant for the quarterly information, are (i) allowance for doubtful accounts; (ii)
intangible assets arising from concession agreements and program contracts; (iii) pension plan obligations; (iv) deferred income tax and
social contribution; (v) provisions; and (vi) unbilled revenue.
6 | Cash and cash equivalents |
|
June 30, 2023 |
December 31, 2022 |
|
|
|
Cash and banks |
119,698 |
139,844 |
Cash equivalents |
1,207,475 |
1,727,641 |
Total |
1,327,173 |
1,867,485 |
Cash and cash equivalents include cash, bank deposits, and high-liquidity
short-term financial investments, mainly represented by repurchase agreements, fund shares (accruing CDI interest rates), and CDBs, whose
original maturities or intention of realization are lower than three months, which are convertible into a cash amount and subject to an
insignificant risk of change in value.
As of June 30, 2023, the average yield of cash equivalents corresponded
to 99.23% of CDI (95.69% as of December 31, 2022).
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
The Company has financial investments in CDB, with daily liquidity,
which it does not intend to use in the next three months, as shown below:
|
June 30, 2023 |
December 31, 2022 |
Banco BV |
306,062 |
289,909 |
Banco Itaú Unibanco S/A |
- |
403,732 |
Banco Bradesco S/A |
194,827 |
578,752 |
Banco BTG Pactual S/A |
427,113 |
404,363 |
Banco do Brasil S/A |
1,176 |
1,117 |
|
929,178 |
1,677,873 |
As of June 30, 2023, the average yield of the financial investments corresponded to 103.30%
of CDI (102.90% as of December 31, 2022).
|
June 30, 2023 |
December 31, 2022 |
|
|
|
Agreement with the São Paulo Municipal Government (i) |
30,778 |
30,231 |
Brazilian Federal Savings Bank – escrow deposits |
594 |
433 |
Other |
6,501 |
6,810 |
|
37,873 |
37,474 |
| (i) | Refers to the amount deducted from the transfer of 7.5% of the revenue earned in the municipality to the
Municipal Fund for Environmental Sanitation and Infrastructure, corresponding to eventual amounts unpaid by direct management bodies,
foundations, and government agencies, as established in the agreement entered into with São Paulo Municipal Government (PMSP). |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
(a) | Statement of financial position details |
|
June 30, 2023 |
December 31, 2022 |
Private sector: |
|
|
General (i) and special customers (ii) |
2,543,951 |
2,287,782 |
Agreements (iii) |
431,425 |
416,550 |
|
|
|
|
2,975,376 |
2,704,332 |
Government entities: |
|
|
Municipal |
633,057 |
609,731 |
Federal |
4,914 |
10,644 |
Agreements (iii) |
361,800 |
372,943 |
|
|
|
|
999,771 |
993,318 |
Wholesale customers – Municipal governments: (iv) |
|
|
Mogi das Cruzes |
3,916 |
4,048 |
São Caetano do Sul |
45,694 |
45,367 |
|
|
|
Total wholesale customers – Municipal governments |
49,610 |
49,415 |
|
|
|
Unbilled supply |
969,462 |
959,260 |
|
|
|
Subtotal |
4,994,219 |
4,706,325 |
Allowance for doubtful accounts |
(1,476,747) |
(1,428,517) |
|
|
|
Total |
3,517,472 |
3,277,808 |
|
|
|
Current |
3,300,714 |
3,062,574 |
Noncurrent |
216,758 |
215,234 |
|
|
|
Total |
3,517,472 |
3,277,808 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
| (i) | General customers - residential and small and mid-sized companies; |
| (ii) | Special customers – large consumers, commercial industries, condominiums, and special billing customers
(fixed demand agreements, industrial waste, wells, among others); |
| (iii) | Agreements - installment payments of past-due receivables, plus inflation adjustment and interest, according
to the agreements; and |
| (iv) | Wholesale basis customers - municipal governments. This balance refers to the sale of treated water to
municipalities, which are responsible for distributing to, billing, and charging final customers. |
(b) | The aging of trade receivables is as follows: |
|
June 30, 2023 |
December 31, 2022 |
|
|
|
Current |
2,447,029 |
2,244,754 |
Past-due: |
|
|
Up to 30 days |
567,775 |
489,709 |
From 31 to 60 days |
254,190 |
248,128 |
From 61 to 90 days |
180,229 |
165,306 |
From 91 to 120 days |
156,536 |
150,941 |
From 121 to 180 days |
312,242 |
281,530 |
From 181 to 360 days |
92,337 |
58,702 |
Over 360 days |
983,881 |
1,067,255 |
|
|
|
Total past-due |
2,547,190 |
2,461,571 |
|
|
|
Total |
4,994,219 |
4,706,325 |
(c) | Allowance for doubtful accounts |
Changes in assets |
January to June 2023 |
January to June 2022 |
|
|
|
Balance at the beginning of the period |
1,428,517 |
1,280,088 |
Losses |
77,671 |
23,397 |
Recoveries |
(29,441) |
(28,840) |
|
|
|
Balance at the end of the period |
1,476,747 |
1,274,645 |
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| |
Notes to the Quarterly Information | |
| |
Reconciliation of estimated/historical losses at the result |
|
|
|
|
|
|
|
|
|
Write-offs |
(141,296) |
(331,434) |
(229,371) |
(434,440) |
(Losses)/reversal with state entities – related parties |
175 |
(567) |
(223) |
(1,629) |
(Losses) with the private sector/government entities |
(86,119) |
(77,671) |
(33,913) |
(23,397) |
Recoveries |
9,814 |
29,441 |
10,575 |
28,840 |
|
|
|
|
|
Amount recorded as expense (Note 27) |
(217,426) |
(380,231) |
(252,932) |
(430,626) |
The Company does not have customers individually representing 10%
or more of its total revenues.
As of June 30, 2023, the Company has registered warrants issued in
its favor, currently totaling R$ 2,892,906
(R$ 2,807,318 as of December 31, 2022), which are not recognized in the Financial Statements because of the difficulty to obtain a reasonable
estimate to measure such assets, due to uncertainties related to the beginning and end of their realization. Register
warrants are recognized upon the beginning of their receipt or when they are traded.
Debtor |
June 30, 2023 |
December 31, 2022 |
Municipality of São Paulo |
2,738,628 |
2,656,113 |
Municipality of Cotia |
105,845 |
103,729 |
Municipality of Cachoeira Paulista |
14,536 |
13,672 |
Other |
33,897 |
33,804 |
Total |
2,892,906 |
2,807,318 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
10 | Related-party balances and transactions |
(i)
Accounts receivable, interest on capital, revenue, and expenses
|
June 30, 2023 |
December 31, 2022 |
Accounts receivable |
|
|
Current: |
|
|
Sanitation services |
158,433 |
144,937 |
Allowance for losses |
(50,162) |
(49,595) |
Reimbursement of additional retirement and pension benefits paid (G0): |
|
|
- Monthly flow |
9,301 |
13,376 |
- GESP Agreement – 2015 |
102,231 |
97,075 |
|
|
|
Total current |
219,803 |
205,793 |
|
|
|
Noncurrent: |
|
|
Agreement for the installment payment of sanitation services |
1,361 |
1,361 |
Reimbursement of additional retirement and pension benefits paid (G0): |
|
|
- GESP Agreement – 2015 |
949,698 |
949,589 |
|
|
|
Total noncurrent |
951,059 |
950,950 |
|
|
|
Total receivables |
1,170,862 |
1,156,743 |
|
|
|
Assets: |
|
|
Sanitation services |
109,632 |
96,703 |
Reimbursement of additional retirement and pension benefits paid (G0) |
1,061,230 |
1,060,040 |
|
|
|
Total |
1,170,862 |
1,156,743 |
|
|
|
Liabilities: |
|
|
Interest on capital payable |
- |
372,550 |
|
|
|
|
|
|
|
|
|
|
Revenue from sanitation services |
198,678 |
361,781 |
191,641 |
335,340 |
Payments from related parties |
(175,577) |
(343,189) |
(148,103) |
(279,404) |
|
|
|
|
|
Payment received from reimbursement referring to Law 4,819/1958 |
(51,359) |
(103,952) |
(44,780) |
(81,412) |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
As of June 30, 2023 and December 31, 2022, the disputed amounts between
SABESP and the São Paulo State, referring to additional retirement and pension benefits paid (Law 4,819/1958), totaled R$ 1,528,996
and R$ 1,482,140, respectively, for which allowances for doubtful accounts were created for the total amount.
The Company recognized an actuarial liability corresponding to additional
retirement and pension benefits paid to employees, retired employees, and pensioners of the G0 Plan. As of June 30, 2023, and December
31, 2022, the amounts corresponding to such actuarial liability totaled R$ 2,016,778 and R$ 2,002,075, respectively. For detailed information
on additional retirement and pension benefits, see Note 21.
(b) | Use of Reservoirs – EMAE |
Empresa Metropolitana de Águas e Energia S.A. (EMAE) planned
to receive the credit and obtain financial compensation for alleged past and future losses in electricity generation arising from water
collection, and compensation for costs already incurred and to be incurred with the operation, maintenance, and inspection of the Guarapiranga
and Billings reservoirs used by SABESP in its operations.
As of October 28, 2016, the Company entered into an agreement based
on a Private Transaction Agreement and Other Covenants to fully and completely settle the disputes and SABESP will continue using the
reservoirs.
As of June 30, 2023, the balance of the agreement totaled R$ 9,082
and R$ 103,662 (R$ 8,456 and R$ 95,033 as of December 31, 2022), recorded in Other liabilities, under current and noncurrent liabilities,
respectively.
(c)
Agreements with reduced tariffs for State Entities that join the Rational
Water Use Program (PURA)
The Company has agreements with government entities related to the
São Paulo State Government that benefit them with a 25% discount on water supply and sewage services tariffs when they are not
in default. These agreements provide for the implementation of the rational water use program, which provides for water consumption reduction.
The São Paulo State provides guarantees for some of the Company’s
borrowings and financing and does not charge any related fees. See Note 16.
(e)
Personnel assignment agreement among entities related to the São
Paulo State Government
The Company has personnel assignment agreements with entities related
to the State Government, whose expenses are fully charged.
From April to June and from January to June 2023, expenses with employees
assigned to other state entities totaled R$ 1,925 and R$ 2,597 (R$ 176 and R$ 341 from April to June and from January to June 2022), respectively.
No expenses with employees from other entities assigned to the Company
were recorded from April to June and from January to June 2023 and in the same periods in 2022.
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| |
Notes to the Quarterly Information | |
| |
As of June 30, 2023 and December 31, 2022, the Company’s land
and lent structures totaled R$ 3,613.
The Company sponsors a defined benefit plan (G1 Plan), which is operated
and administered by SABESPREV. The net actuarial liability recognized until June 30, 2023, totaled R$ 118,866 (R$ 148,116 as of December
31, 2022). See Note 21.
(h)
Compensation of the Fiscal Council and Management Key Personnel
From April to June and from January to June 2023, expenses related
to the compensation of Management and members of the Fiscal Council appointed by the controlling shareholder totaled R$ 2,132 and
R$ 3,790 (R$ 1,610 and R$ 3,207 from April to June and from January to June 2022), respectively.
From April to June and from January to June 2023, additional amounts
of R$ 584 and R$ 869 (R$ 380 and R$ 740 from April to June and from January to June 2022), respectively, from the management bonus program
were recorded.
(i) | Loan agreement through credit facility |
The Company holds interest in certain Special Purpose Entities (SPEs),
in which it does not hold the majority interest but has cast vote and power of veto in some matters but cannot use such power of veto
in a way to affect the returns of its investments. Therefore, these SPEs are considered for accounting purposes as joint arrangements.
Aquapolo Ambiental
The Company entered into a loan agreement through a credit facility
with SPE Aquapolo Ambiental S/A to finance the operations of that company, until the borrowings and financing requested with financial
institutions are granted.
As of June 30, 2023, the balance of principal and interest of this
agreement totaled R$ 1,520 recorded in current assets under “Other assets” (R$ 12,953 as of December 31, 2022), at CDI + 1.2%
p.a.
The loan originally matured on April 30, 2015, but was extended to
October 30, 2015. On November 25, 2015, a new amendment changed the payment schedule for three annual installments, the first of which
matured on December 30, 2021, and the last will mature on December 30, 2023.
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| |
Notes to the Quarterly Information | |
| |
Águas de Andradina
The Company entered into a loan agreement through a credit facility
with SPE Águas de Andradina S/A to finance the operations of that company.
As of June 30, 2023, the balance of principal and interest of this
agreement totaled R$ 443 and R$ 2,814, which was recorded in “Other assets” under current and noncurrent assets (R$ 242 and
R$ 2,814, respectively, as of December 31, 2022), at CDI + 3% p.a.
This agreement was executed on August 17, 2021. The amount of principal,
adjustment, accrued interest, and any other taxes must be paid in full by August 31, 2025.
The Company has financing agreements under the State Fund for Water
Resources (FEHIDRO). These funds will be aimed at the execution of works and sewage services. As of June 30, 2023, the balance of these
financings totaled
R$ 5,570 (R$ 5,108 as of December 31, 2022).
The Company holds interest in certain Special Purpose Entities (SPE).
Although SABESP has no majority shares of its investees, the shareholders’ agreement provides for the power of veto in certain management
matters, however, it cannot use such power of veto in a way to affect the returns over the investments, implying a mutually shared control
(joint venture – CPC 19 (R2)).
The Company holds equity interest valued by the equity accounting
in the following investees:
|
Equity |
Contribution |
Dividends distributed |
Profit (loss) for the period |
|
|
|
|
|
|
(*) |
|
|
|
|
|
|
|
|
|
Sesamm |
56,989 |
59,371 |
- |
(13,516) |
11,134 |
- |
5,864 |
Águas de Andradina |
31,927 |
30,777 |
- |
- |
1,150 |
- |
499 |
Águas de Castilho |
11,806 |
10,787 |
- |
- |
1,019 |
- |
589 |
Attend Ambiental |
41,789 |
29,729 |
- |
- |
12,060 |
- |
4,205 |
Aquapolo Ambiental |
91,371 |
73,926 |
- |
- |
17,445 |
- |
14,778 |
Paulista Geradora de Energia - PGE (**) |
25,642 |
10,486 |
15,233 |
- |
(77) |
- |
(260) |
Cantareira SP Energia (***) |
6,087 |
1,000 |
5,453 |
- |
(366) |
- |
- |
FOXX URE-BA Ambiental |
66,441 |
69,258 |
4,325 |
- |
(715) |
(6,427) |
- |
Infranext Soluções em Pavimentação (****) |
5,658 |
7,050 |
- |
- |
(1,392) |
- |
- |
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| |
Notes to the Quarterly Information | |
| |
(*) The amount presented refers to changes in the equity of
the investee, as its financial statements for the year ended December 31, 2022 were issued after the disclosure of SABESP’s financial
statements.
(**) In October 2022,
it was agreed at the Extraordinary Meeting a capital contribution of R$ 20,310 thousand, and SABESP paid R$ 5,077 in December
2022, corresponding to 25%. Servtec and Tecniplan paid R$ 15,233 in June 2023, corresponding to 75%.
(***) SABESP contributed
R$ 5,439 as of January 2023, corresponding to 49% of the interest in Cantareira SP Energia. As of June 30, 2023, Pacto SP Energia
had an outstanding payable amount of R$ 5,647 related to the remaining interest of 51% in Cantareira.
(****) Infranext’s share capital will be
R$ 12,000. As of June 30, 2023, SABESP had an outstanding payable amount of R$ 4,950.
|
Investments |
Contribution |
Dividends distributed |
Reclassification (***) |
Equity accounting |
Interest percentage |
|
|
|
|
|
|
|
(*) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sesamm |
20,516 |
21,374 |
- |
(4,867) |
- |
4,009 |
- |
2,111 |
36% |
36% |
Águas de Andradina |
9,577 |
9,233 |
- |
- |
- |
344 |
- |
150 |
30% |
30% |
Águas de Castilho |
3,542 |
3,236 |
- |
- |
- |
306 |
- |
177 |
30% |
30% |
Attend Ambiental |
18,806 |
13,379 |
- |
- |
- |
5,427 |
- |
1,892 |
45% |
45% |
Aquapolo Ambiental |
44,771 |
36,223 |
- |
- |
- |
8,548 |
- |
7,241 |
49% |
49% |
Paulista Geradora de Energia |
6,410 |
6,429 |
- |
- |
- |
(19) |
- |
(65) |
25% |
25% |
Cantareira SP Energia |
5,750 |
490 |
5,439 |
- |
- |
(179) |
- |
- |
49% |
49% |
FOXX URE-BA Ambiental |
13,288 |
13,852 |
865 |
- |
- |
(143) |
(1,286) |
- |
20% |
20% |
Infranext Soluções em Pavimentação |
- |
450 |
- |
- |
176 |
(626) |
- |
- |
45% |
45% |
Total |
122,660 |
104,666 |
6,304 |
(4,867) |
176 |
17,667 |
(1,286) |
11,506 |
|
|
FOXX URE-BA Ambiental – Fair value (**) |
26,148 |
- |
|
|
|
|
|
|
|
|
Other investments |
6,099 |
6,099 |
|
|
|
|
|
|
|
|
Overall total |
154,907 |
110,765 |
|
|
|
|
|
|
|
|
(*) Refers to changes
in the equity of investees, as their financial statements for the year ended December 31, 2022 were issued after the disclosure of SABESP’s
financial statements.
(**) The amount presented
refers to the fair value adjustment in the acquisition of FOXX URE-BA in 2022.
(***) The amount of
the investee’s loss exceeding the investment was reclassified to Noncurrent Liabilities, according to item 39 of NBCTG 18.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
|
December 31, 2022 |
Depreciation |
June 30, 2023 |
|
|
|
|
Investment properties |
46,726 |
(24) |
46,702 |
|
December 31, 2021 |
Depreciation |
June 30, 2022 |
|
|
|
|
Investment properties |
46,126 |
(24) |
46,102 |
As of June 30, 2023, the market value of these properties was approximately
R$ 393,600 (R$ 386,000 as of December 31, 2022).
|
December 31, 2022 |
Additions (i) |
Transfers |
Transfers of works to intangible
assets (ii) |
June 30, 2023 (iii) |
|
|
|
|
|
|
Total contract asset |
8,613,968 |
2,482,886 |
380 |
(2,422,934) |
8,674,300 |
|
December 31, 2021 |
Additions |
Transfers |
Transfers of works to intangible
assets |
June 30, 2022 |
|
|
|
|
|
|
Total contract asset |
8,550,102 |
2,171,183 |
406 |
(1,714,055) |
9,007,636 |
| (i) | The largest additions of the period are located
in the municipalities of São Paulo, Guarulhos, and São Bernardo do Campo, totaling R$ 1,008 million, R$ 140 million, and
R$ 64 million, respectively. |
| (ii) | The largest transfers of the period are located
in the municipalities of São Paulo, Franca, and São Bernardo do Campo, totaling R$ 1,138 million, R$ 279 million, and R$
128 million, respectively. |
| (iii) | The largest works are located in the municipalities
of São Paulo, Francisco Morato, and Itanhaém, totaling R$ 2,700 million, R$ 234 million, and R$ 234 million, respectively. |
As of June 30, 2023, the contract
asset did not include any amounts recorded as a lease (R$ 276,893 as of December 31, 2022).
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| |
Notes to the Quarterly Information | |
| |
(a)
Capitalization of interest and other finance charges
The Company capitalizes interest, inflation adjustments, and exchange
rate changes in the contract asset during the construction period. From January to June 2023, the Company capitalized R$ 345,824
(R$ 279,922 from January to June 2022).
The Company is primarily responsible for the construction and installation
of the concession infrastructure, either by using its employees or contracting third parties, and is significantly exposed to its risks
and benefits. Accordingly, the Company recognizes revenue from construction services corresponding to construction costs increased by
gross margin.
Constructions related to the concessions are usually performed by
third parties. In such a case, the margin is lower to cover administration costs and the assumption of responsibility for primary risks.
As of June 30, 2023 and 2022, the margin was 2.3%.
From April to June and from January to June 2023, the construction
margins were R$ 28,402 and R$ 54,921 (R$ 25,245 and R$ 45,930 from April to June and from January to June 2022), respectively.
As a result of the construction of priority projects related to water
and sewage systems, the Company was required to expropriate third-party properties, whose owners will be compensated either amicably or
through court.
The costs of such expropriations are recorded in the contract asset
during the execution of the works. From April to June and from January to June 2023, expropriations totaled R$ 40,708 and R$ 44,723
(R$ 17,159 and R$ 47,022 from April to June and from January to June 2022).
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
(a) | Statement of financial position details |
|
June 30, 2023 |
December 31, 2022 |
|
Cost |
Accumulated amortization |
Net |
Cost |
Accumulated amortization |
Net |
Intangible right arising from: |
|
|
|
|
|
|
Concession agreements – equity value |
732,237 |
(232,184) |
500,053 |
722,730 |
(223,404) |
499,326 |
Concession agreements – economic value |
1,576,562 |
(979,785) |
596,777 |
1,585,271 |
(933,232) |
652,039 |
Program contracts |
28,025,785 |
(9,020,257) |
19,005,528 |
26,875,408 |
(8,537,949) |
18,337,459 |
Program contracts – commitments |
1,709,757 |
(471,248) |
1,238,509 |
1,709,757 |
(444,765) |
1,264,992 |
Service contracts – São Paulo |
26,775,415 |
(8,308,805) |
18,466,610 |
25,584,703 |
(7,714,252) |
17,870,451 |
Software license of use |
1,267,468 |
(721,259) |
546,209 |
1,249,881 |
(654,477) |
595,404 |
Right of use – Other assets |
163,985 |
(118,289) |
45,696 |
170,921 |
(95,869) |
75,052 |
Right of use – Investments |
- |
- |
- |
26,148 |
- |
26,148 |
Total |
60,251,209 |
(19,851,827) |
40,399,382 |
57,924,819 |
(18,603,948) |
39,320,871 |
|
|
Additions |
Transfer of contract asset |
Transfers |
Write-offs and disposals |
Amortization |
|
Intangible right arising from: |
|
|
|
|
|
|
|
Concession agreements – equity value (*) |
499,326 |
- |
11,488 |
(705) |
(260) |
(9,796) |
500,053 |
Concession agreements – economic value |
652,039 |
- |
6,014 |
41 |
(99) |
(61,218) |
596,777 |
Program contracts (*) |
18,337,459 |
348 |
1,182,297 |
846 |
(3,270) |
(512,152) |
19,005,528 |
Program contracts – commitments |
1,264,992 |
- |
- |
- |
- |
(26,483) |
1,238,509 |
Service contracts – São Paulo |
17,870,451 |
4,859 |
1,205,548 |
(7,742) |
(1,203) |
(605,303) |
18,466,610 |
Software license of use |
595,404 |
- |
17,587 |
- |
- |
(66,782) |
546,209 |
Right of use – Other assets |
75,052 |
2,078 |
- |
- |
(31) |
(31,403) |
45,696 |
Right of use – Investments |
26,148 |
- |
- |
(26,148) |
- |
- |
- |
Total |
39,320,871 |
7,285 |
2,422,934 |
(33,708) |
(4,863) |
(1,313,137) |
40,399,382 |
(*) As of June 30, 2023, Concession agreements – equity value,
and Program contracts included leases totaling R$ 49,028 and R$ 336,043 (R$ 54,356 and R$ 168,216 as of December 31, 2022), respectively.
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| |
Notes to the Quarterly Information | |
| |
|
|
Additions |
Transfer of contract asset |
Transfers |
Write-offs and disposals |
Amortization |
|
Intangible right arising from: |
|
|
|
|
|
|
|
Concession agreements - equity value (*) |
491,057 |
- |
4,423 |
(681) |
(59) |
(9,343) |
485,397 |
Concession agreements – economic value |
681,441 |
1 |
17,289 |
238 |
(7) |
(54,160) |
644,802 |
Program contracts (*) |
17,152,021 |
10,187 |
960,962 |
1,766 |
(1,508) |
(469,053) |
17,654,375 |
Program contracts – commitments |
1,317,957 |
- |
- |
- |
- |
(26,482) |
1,291,475 |
Service contracts – São Paulo |
16,158,771 |
208 |
685,775 |
1,674 |
(4,197) |
(523,772) |
16,318,459 |
Software license of use |
598,734 |
- |
45,606 |
- |
- |
(56,358) |
587,982 |
Right of use – Other assets |
103,853 |
16,550 |
- |
- |
(54) |
(35,700) |
84,649 |
Total |
36,503,834 |
26,946 |
1,714,055 |
2,997 |
(5,825) |
(1,174,868) |
37,067,139 |
(*) As of June 30, 2022, Concession agreements – equity value,
and Program contracts included leases in the amounts of R$ 59,684 and R$ 174,444 (R$ 65,012 and R$ 180,669 as of December 31, 2021), respectively.
As of June 30, 2020, a contract was signed for the provision of treatment
services and final disposal of solid waste and collection of garbage tax in the Municipality of Diadema for 40 years. To reach the best
operationalization format, treatment services and final disposal of solid waste are in the study phase and, based on the contractual provision,
are subject to a partnership between SABESP and a private party, which will occur through a public call.
(c)
Intangible right arising from concession agreements
As of June 30, 2023, the amounts not yet disbursed were recorded in
“Program contract commitments” under current and noncurrent liabilities, totaling R$ 61,381 and R$ 12,566 (R$ 100,188
and R$ 12,197 as of December 31, 2022), respectively.
(d) | Public-Private Partnership - PPP |
SABESP carries out operations related to the PPPs mentioned below.
These operations and their respective guarantees are supported by agreements executed according to Law 11,079/2004.
The amounts recorded in intangible assets are as follows:
|
June 30, 2023 |
December 31, 2022 |
Alto Tietê |
243,389 |
251,545 |
São Lourenço |
2,640,951 |
2,725,900 |
Total |
2,884,340 |
2,977,445 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
The obligations assumed by the Company are as follows:
|
June 30, 2023 |
December 31, 2022 |
|
Current liabilities |
Noncurrent liabilities |
Total liabilities |
Current liabilities |
Noncurrent liabilities |
Total liabilities |
|
|
|
|
|
|
|
Alto Tietê |
80,078 |
- |
80,078 |
91,782 |
36,645 |
128,427 |
São Lourenço |
127,389 |
2,616,942 |
2,744,331 |
130,631 |
2,700,123 |
2,830,754 |
Total |
207,467 |
2,616,942 |
2,824,409 |
222,413 |
2,736,768 |
2,959,181 |
(e) | Amortization of Intangible Assets |
The average amortization rate totaled 4.9% and 4.8% as of June 30,
2023 and 2022, respectively.
Nature |
|
|
|
|
|
Leases - Contract asset |
- |
276,893 |
|
|
|
Leases - Concession and Program Contract |
|
|
Cost |
580,576 |
405,431 |
Accumulated amortization |
(195,505) |
(182,859) |
(=) Net |
385,071 |
222,572 |
|
|
|
Other assets (*) |
|
|
Vehicles |
151,821 |
153,384 |
Properties |
12,000 |
11,711 |
Equipment |
164 |
5,826 |
Accumulated amortization |
(118,289) |
(95,869) |
(=) Net |
45,696 |
75,052 |
|
|
|
Right of use |
430,767 |
574,517 |
The lease liability corresponds to total future fixed lease payments,
adjusted to present value, considering an incremental rate on borrowings. For further information, see Note 16.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
The table below shows the impact on the Company’s result:
Impact on the result |
|
|
|
|
|
|
Right of use amortization |
(44,048) |
(47,242) |
Financial result – interest expense and inflation adjustment |
(36,464) |
(35,664) |
Expenses of short-term leases with low value |
(14,447) |
(12,200) |
Reduction of profit for the period |
(94,959) |
(95,106) |
(g) | Performance Agreements |
As of June 30, 2023, the accounting balances of the agreements in
force recorded in contract asset and intangible assets were R$ 72,841 and R$ 2,453,858 (R$ 138,550 and R$ 2,126,106 as of December 31,
2022), respectively.
15 | Property, plant and equipment |
(a) | Statement of financial position details |
|
June 30, 2023 |
December 31, 2022 |
|
Cost |
Accumulated depreciation |
Net |
Annual average depreciation
rate |
Cost |
Accumulated depreciation |
Net |
Annual average depreciation
rate |
Land |
94,228 |
- |
94,228 |
- |
94,228 |
- |
94,228 |
- |
Buildings |
93,056 |
(42,935) |
50,121 |
2.1% |
90,311 |
(42,343) |
47,968 |
2.1% |
Equipment |
434,216 |
(299,242) |
134,974 |
14.3% |
412,828 |
(291,963) |
120,865 |
15.3% |
Transportation equipment |
14,708 |
(10,304) |
4,404 |
9.9% |
12,578 |
(10,083) |
2,495 |
9.9% |
Furniture and fixtures |
42,971 |
(15,347) |
27,624 |
6.7% |
38,528 |
(15,032) |
23,496 |
6.7% |
Other |
60,199 |
(341) |
59,858 |
5.0% |
50,189 |
(302) |
49,887 |
5.0% |
Total |
739,378 |
(368,169) |
371,209 |
11.2% |
698,662 |
(359,723) |
338,939 |
11.2% |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
|
December 31, 2022 |
Additions |
Transfers |
Write-offs and disposals |
Depreciation |
|
Land |
94,228 |
- |
- |
- |
- |
94,228 |
Buildings |
47,968 |
2,287 |
459 |
- |
(593) |
50,121 |
Equipment |
120,865 |
23,680 |
3,820 |
(387) |
(13,004) |
134,974 |
Transportation equipment |
2,495 |
- |
2,241 |
- |
(332) |
4,404 |
Furniture and fixtures |
23,496 |
4,308 |
660 |
(54) |
(786) |
27,624 |
Other |
49,887 |
10,011 |
- |
- |
(40) |
59,858 |
Total |
338,939 |
40,286 |
7,180 |
(441) |
(14,755) |
371,209 |
|
December 31, 2021 |
Additions |
Transfers |
Write-offs and disposals |
Depreciation |
|
Land |
94,213 |
- |
- |
- |
- |
94,213 |
Buildings |
45,498 |
829 |
(92) |
(45) |
(580) |
45,610 |
Equipment |
115,154 |
14,054 |
(2,601) |
(208) |
(11,392) |
115,007 |
Transportation equipment |
2,472 |
- |
(81) |
- |
(289) |
2,102 |
Furniture and fixtures |
22,079 |
1,118 |
(724) |
(54) |
(714) |
21,705 |
Other |
11,741 |
6,799 |
95 |
- |
(44) |
18,591 |
Total |
291,157 |
22,800 |
(3,403) |
(307) |
(13,019) |
297,228 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
16 | Borrowings and financing |
Borrowings and financing outstanding balance |
June 30, 2023 |
December 31, 2022 |
Financial institution |
|
Noncurrent |
|
|
Noncurrent |
|
Local currency |
|
|
|
|
|
|
12th issue debentures |
45,450 |
45,032 |
90,482 |
45,450 |
67,681 |
113,131 |
17th issue debentures |
- |
- |
- |
144,632 |
- |
144,632 |
18th issue debentures |
50,955 |
33,587 |
84,542 |
49,937 |
45,649 |
95,586 |
22nd issue debentures |
169,113 |
168,726 |
337,839 |
199,901 |
326,433 |
526,334 |
23rd issue debentures |
490,753 |
374,236 |
864,989 |
- |
864,910 |
864,910 |
24th issue debentures |
- |
506,110 |
506,110 |
- |
488,478 |
488,478 |
26th issue debentures |
- |
1,285,721 |
1,285,721 |
- |
1,239,645 |
1,239,645 |
27th issue debentures |
299,778 |
698,477 |
998,255 |
299,614 |
698,339 |
997,953 |
28th issue debentures |
- |
1,197,948 |
1,197,948 |
- |
1,197,756 |
1,197,756 |
29th issue debentures |
- |
1,304,064 |
1,304,064 |
- |
1,275,295 |
1,275,295 |
30th issue debentures |
125,000 |
873,170 |
998,170 |
- |
998,110 |
998,110 |
Brazilian Federal Savings Bank |
103,412 |
1,532,384 |
1,635,796 |
99,767 |
1,422,145 |
1,521,912 |
Brazilian Development Bank - BNDES PAC |
- |
- |
- |
6,736 |
- |
6,736 |
Brazilian Development Bank - BNDES PAC II 9751 |
7,259 |
19,873 |
27,132 |
7,214 |
23,344 |
30,558 |
Brazilian Development Bank - BNDES PAC II 9752 |
4,918 |
13,525 |
18,443 |
4,887 |
15,884 |
20,771 |
Brazilian Development Bank - BNDES ONDA LIMPA |
27,118 |
20,284 |
47,402 |
26,949 |
33,617 |
60,566 |
Brazilian Development Bank – BNDES TIETÊ III |
155,404 |
582,678 |
738,082 |
154,437 |
656,264 |
810,701 |
Brazilian Development Bank - BNDES 2015 |
34,019 |
375,627 |
409,646 |
33,807 |
390,127 |
423,934 |
Brazilian Development Bank - BNDES 2014 |
6,613 |
13,350 |
19,963 |
6,572 |
16,525 |
23,097 |
Inter-American Development Bank – IDB 2202 |
181,349 |
2,073,812 |
2,255,161 |
181,349 |
2,164,009 |
2,345,358 |
Inter-American Development Bank – IDB INVEST |
37,340 |
835,388 |
872,728 |
37,340 |
853,725 |
891,065 |
Inter-American Development Bank – IDB Invest 2022 |
14,100 |
445,163 |
459,263 |
14,100 |
452,085 |
466,185 |
Inter-American Development Bank – IDB Invest 2023 |
14,100 |
455,900 |
470,000 |
- |
- |
- |
International Finance Corporation - IFC |
19,000 |
724,853 |
743,853 |
80,000 |
670,996 |
750,996 |
Leases (Concession Agreements, Program Contracts, and Contract Asset) |
47,884 |
287,557 |
335,441 |
44,453 |
313,391 |
357,844 |
Leases (others) |
47,783 |
23,084 |
70,867 |
72,109 |
29,265 |
101,374 |
Other |
7,002 |
4,399 |
11,401 |
6,241 |
5,867 |
12,108 |
Interest and other charges |
446,144 |
- |
446,144 |
417,878 |
- |
417,878 |
Total in local currency |
2,334,494 |
13,894,948 |
16,229,442 |
1,933,373 |
14,249,540 |
16,182,913 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
Borrowings and financing outstanding balance |
June 30, 2023
|
December 31, 2022 |
Financial institution |
|
Noncurrent |
|
|
Noncurrent |
|
Foreign currency |
|
|
|
|
|
|
Inter-American Development Bank - IDB 1212 – US$ 25,695 thousand (US$ 30,834 thousand in December 2022) |
49,532 |
74,298 |
123,830 |
53,628 |
107,256 |
160,884 |
Inter-American Development Bank - IDB 4623 – US$ 101,715 thousand (US$ 74,299 thousand in December 2022) |
- |
467,707 |
467,707 |
- |
367,441 |
367,441 |
International Bank for Reconstruction and Development (IBRD) – IBRDs 7662 and 8916 - US$ 90,123 thousand (US$ 78,197 thousand in December 2022) |
29,299 |
393,022 |
422,321 |
31,722 |
365,648 |
397,370 |
JICA 15 – ¥ 7,490,795 thousand (¥ 8,067,010 thousand in December 2022) |
38,445 |
211,448 |
249,893 |
45,602 |
273,610 |
319,212 |
JICA 18 – ¥ 6,735,040 thousand (¥ 7,253,120 thousand in December 2022) |
34,566 |
189,985 |
224,551 |
41,001 |
245,865 |
286,866 |
JICA 17 – ¥ 3,608,700 thousand (¥ 3,753,048 thousand in December 2022) |
9,631 |
109,931 |
119,562 |
11,424 |
136,227 |
147,651 |
JICA 19 – ¥ 25,389,252 thousand (¥ 26,296,011 thousand in December 2022) |
60,499 |
784,896 |
845,395 |
71,761 |
967,124 |
1,038,885 |
IDB 1983AB – (US$ 7,692 thousand in December 2022) |
- |
- |
- |
39,962 |
- |
39,962 |
Interest and other charges |
22,488 |
- |
22,488 |
17,487 |
- |
17,487 |
Total in foreign currency |
244,460 |
2,231,287 |
2,475,747 |
312,587 |
2,463,171 |
2,775,758 |
|
|
|
|
|
|
|
Total borrowings and financing |
2,578,954 |
16,126,235 |
18,705,189 |
2,245,960 |
16,712,711 |
18,958,671 |
Exchange rates as of June 30, 2023: US$ 4.8192; ¥ 0.03336 (as of December
31, 2022: US$ 5.2177; ¥ 0.03957).
As of June 30, 2023, the Company did not have balances of borrowings and financing
raised during the year, maturing within 12 months. |
|
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
Local currency |
Guarantees |
Maturity |
Annual interest rate |
Inflation adjustment |
|
|
|
|
|
12th issue debentures |
Own funds |
2025 |
TR + 9.5% |
|
17th issue debentures |
Own funds |
2023 |
CDI + 0.75% (series 1), 4.5% (series 2), and 4.75% (series 3) |
IPCA (series 2 and 3) |
18th issue debentures |
Own funds |
2024 |
TJLP + 1.92 % (series 1 and 3) and 8.25% (series 2) |
IPCA (series 2) |
22nd issue debentures |
Own funds |
2025 |
CDI + 0.58% (series 1) and CDI+ 0.90% (series 2) and 6.0% (series 3) |
IPCA (series 3) |
23rd issue debentures |
Own funds |
2027 |
CDI + 0.49% (series 1) and CDI+ 0.63% (series 2) |
|
24th issue debentures |
Own funds |
2029 |
3.20% (series 1) and 3.37% (series 2) |
IPCA (series 1 and 2) |
26th issue debentures |
Own funds |
2030 |
4.65% (series 1) and 4.95% (series 2) |
IPCA (series 1 and 2) |
27th issue debentures |
Own funds |
2027 |
CDI + 1.60% (series 1) and CDI+ 1.80% (series 2) and 2.25% (series 3) |
|
28th issue debentures |
Own funds |
2028 |
CDI + 1.20% (series 1) and CDI+ 1.44% (series 2) and
1.60% (series 3) |
|
29th issue debentures |
Own funds |
2036 |
CDI + 1.29% (series 1), 5.3058% (series 2), and
5.4478% (series 3) |
IPCA (series 2 and 3) |
30th issue debentures |
Own funds |
2029 |
CDI + 1.30% (series 1) and CDI+ 1.58% (series 2) |
|
Brazilian Federal Savings Bank |
Own funds |
2023/2042 |
5% to 9.5% |
TR |
Brazilian Development Bank - BNDES PAC |
Own funds |
2023 |
TJLP + 1.82% |
|
Brazilian Development Bank - BNDES PAC II 9751 |
Own funds |
2027 |
TJLP + 1.72% |
|
Brazilian Development Bank - BNDES PAC II 9752 |
Own funds |
2027 |
TJLP + 1.72% |
|
Brazilian Development Bank - BNDES ONDA LIMPA |
Own funds |
2025 |
TJLP + 1.92% |
|
Brazilian Development Bank – BNDES TIETÊ III |
Own funds |
2028 |
TJLP + 1.66% |
|
Brazilian Development Bank - BNDES 2015 |
Own funds |
2035 |
TJLP + 2.18% |
|
Brazilian Development Bank - BNDES 2014 |
Own funds |
2026 |
TJLP + 1.76% |
|
Inter-American Development Bank – IDB 2202 |
Government |
2035 |
CDI + 0.86% |
|
Inter-American Development Bank – IDB INVEST |
Own funds |
2034 |
CDI+ 1.90% and CDI 2.70% |
|
Inter-American Development Bank – IDB Invest 2022 |
Own funds |
2036 |
CDI + 2.50% |
|
Inter-American Development Bank – IDB Invest 2023 |
Own funds |
2036 |
CDI + 0.50% |
|
International Finance Corporation - IFC |
Own funds |
2032 |
CDI + 2.00% |
|
Leases (Concession Agreements, Program Contracts, and Contract Asset) |
|
2035 |
7.73% to 10.12% |
IPC |
Leases (others) |
|
2027 |
5.20% to 15.39% |
|
Other |
Own funds |
2025 |
3% (FEHIDRO) TJLP + 1.5% (FINEP) |
|
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
Foreign currency |
Guarantees |
Maturity |
Annual interest rate |
Exchange variation |
|
|
|
|
|
Inter-American Development Bank - IDB 1212 – US$ 25,695 thousand |
Government |
2025 |
4.03% (*) |
US$ |
Inter-American Development Bank - IDB 4623 – US$ 101,715 thousand |
Government |
2044 |
6.14% (*) |
US$ |
International Bank for Reconstruction and Development (IBRD) – IBRDs 7662 and 8916 - US$ 90,123 thousand |
Government |
2034 |
5.36% and 6.46% (*) |
US$ |
JICA 15 – ¥ 7,490,795 thousand |
Government |
2029 |
1.8% and 2.5% |
Yen |
JICA 18 – ¥ 6,735,040 thousand |
Government |
2029 |
1.8% and 2.5% |
Yen |
JICA 17 – ¥ 3,608,700 thousand |
Government |
2035 |
1.2% and 0.01% |
Yen |
JICA 19 – ¥ 25,389,252 thousand |
Government |
2037 |
1.7% and 0.01% |
Yen |
|
|
|
|
|
(*) Rates comprising SOFR + contractually defined spread.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
(i) Payment schedule – accounting balances
as of June 30, 2023
|
2023 |
2024 |
2025 |
2026 |
2027 |
2028 |
2029 to 2044 |
TOTAL |
LOCAL CURRENCY |
|
|
|
|
|
|
|
|
Debentures |
360,436 |
1,204,595 |
1,334,339 |
1,212,543 |
1,357,016 |
655,401 |
1,543,790 |
7,668,120 |
Brazilian Federal Savings Bank |
50,923 |
106,589 |
113,242 |
120,311 |
127,810 |
135,646 |
981,275 |
1,635,796 |
BNDES |
117,665 |
235,331 |
214,938 |
205,029 |
192,377 |
72,783 |
222,545 |
1,260,668 |
IDB - National |
123,444 |
249,099 |
260,899 |
330,209 |
315,069 |
420,959 |
2,357,473 |
4,057,152 |
IFC |
7,600 |
22,800 |
34,200 |
41,800 |
60,800 |
83,600 |
493,053 |
743,853 |
Leases (Concession Agreements, Program Contracts, and Contract Asset) |
47,884 |
50,309 |
34,600 |
33,492 |
36,754 |
40,336 |
92,066 |
335,441 |
Leases (others) |
37,476 |
17,633 |
10,550 |
4,500 |
708 |
- |
- |
70,867 |
Other |
5,505 |
2,994 |
2,760 |
142 |
- |
- |
- |
11,401 |
Interest and other charges |
438,951 |
7,193 |
- |
- |
- |
- |
- |
446,144 |
TOTAL IN LOCAL CURRENCY |
1,189,884 |
1,896,543 |
2,005,528 |
1,948,026 |
2,090,534 |
1,408,725 |
5,690,202 |
16,229,442 |
FOREIGN CURRENCY |
|
|
|
|
|
|
|
|
IDB |
24,766 |
49,532 |
62,432 |
25,799 |
25,799 |
25,799 |
377,410 |
591,537 |
IBRD |
14,650 |
29,299 |
29,299 |
29,299 |
29,299 |
29,299 |
261,176 |
422,321 |
JICA |
71,571 |
143,141 |
143,141 |
143,141 |
143,141 |
143,141 |
652,125 |
1,439,401 |
Interest and other charges |
22,488 |
- |
- |
- |
- |
- |
- |
22,488 |
TOTAL IN FOREIGN CURRENCY |
133,475 |
221,972 |
234,872 |
198,239 |
198,239 |
198,239 |
1,290,711 |
2,475,747 |
Total |
1,323,359 |
2,118,515 |
2,240,400 |
2,146,265 |
2,288,773 |
1,606,964 |
6,980,913 |
18,705,189 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
(II) Changes
|
|
Addition (lease) |
Funding |
Borrowing costs |
Inflation adjustment
and exchange rate change |
Inflation adjustment
/ exchange rate change and incorporated interest- Capitalized |
Interest paid |
Amortization |
Accrued interest |
Provision for interest
and fees - Capitalized |
Expenses with borrowing
costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LOCAL CURRENCY |
|
|
|
|
|
|
|
|
|
|
|
|
Debentures |
8,166,366 |
- |
- |
(1,031) |
89,878 |
12,850 |
(378,829) |
(380,984) |
320,880 |
90,200 |
5,577 |
7,924,907 |
Brazilian Federal Savings Bank |
1,526,185 |
- |
154,222 |
- |
12038 |
3,325 |
(59,920) |
(55,702) |
47,245 |
12,984 |
- |
1,640,377 |
BNDES |
1,380,993 |
- |
- |
- |
6,605 |
1,643 |
(50,962) |
(124,074) |
40,564 |
9,746 |
130 |
1,264,645 |
IDB 2202 |
2,450,550 |
- |
- |
- |
- |
- |
(165,514) |
(90,674) |
51,130 |
111,630 |
478 |
2,357,600 |
IDB INVEST |
943,619 |
- |
- |
- |
- |
- |
(71,521) |
(18,670) |
22,661 |
45,548 |
333 |
921,970 |
IFC |
774,525 |
- |
- |
- |
- |
- |
(57,794) |
(7,600) |
- |
57,104 |
457 |
766,692 |
IDB INVEST 2022 |
469,327 |
- |
- |
- |
- |
- |
(36,662) |
(7050) |
36,615 |
- |
128 |
462,358 |
IDB INVEST 2023 |
- |
- |
470,000 |
- |
- |
- |
(4,484) |
- |
7,626 |
- |
- |
473,142 |
Leases (Concession Agreements, Program Contracts, and Contract Asset) |
357,844 |
- |
- |
- |
- |
- |
(27,338) |
(22,403) |
27,338 |
- |
- |
335,441 |
Leases (others) |
101,374 |
2,078 |
- |
- |
- |
- |
(9,127) |
(41,711) |
18,253 |
- |
- |
70,867 |
Other |
12,130 |
- |
3,629 |
- |
41 |
- |
(331) |
(4,376) |
344 |
6 |
- |
11,443 |
TOTAL IN LOCAL CURRENCY |
16,182,913 |
2,078 |
627,851 |
(1,031) |
108,562 |
17,818 |
(862,482) |
(753,244) |
572,656 |
327,218 |
7,103 |
16,229,442 |
|
|
|
|
|
|
|
|
|
|
|
|
|
FOREIGN CURRENCY |
|
|
|
|
|
|
|
|
|
|
|
|
IDB |
532,693 |
- |
136,523 |
(2,736) |
(44,715) |
- |
(13,838) |
(26,343) |
17,482 |
- |
485 |
599,551 |
IBRD |
399,762 |
- |
74,076 |
(1,588) |
(31,751) |
- |
(10,061) |
(16,014) |
13,870 |
56 |
228 |
428,578 |
JICA |
1,803,109 |
- |
- |
- |
(269,255) |
- |
(14,725) |
(84,058) |
12,023 |
421 |
103 |
1,447,618 |
IDB 1983AB |
40,194 |
- |
- |
- |
(1,813) |
- |
(1,447) |
(38,323) |
909 |
311 |
169 |
- |
TOTAL IN FOREIGN CURRENCY |
2,775,758 |
- |
210,599 |
(4,324) |
(347,534) |
- |
(40,071) |
(164,738) |
44,284 |
788 |
985 |
2,475,747 |
Total |
18,958,671 |
2,078 |
838,450 |
(5,355) |
(238,972) |
17,818 |
(902,553) |
(917,982) |
616,940 |
328,006 |
8,088 |
18,705,189 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
|
|
Addition (lease) |
Funding |
Borrowing costs |
Inflation adjustment and
exchange rate changes |
Inflation adjustment /
exchange rate change and incorporated interest- Capitalized |
Interest paid |
Amortization |
Accrued interest |
Provision for interest
and fees - Capitalized |
Expenses with borrowing
costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LOCAL CURRENCY |
|
|
|
|
|
|
|
|
|
|
|
|
Debentures |
7,467,968 |
- |
1,000,000 |
(3,260) |
155,490 |
- |
(251,420) |
(503,957) |
239,385 |
124,882 |
5,578 |
8,234,666 |
Brazilian Federal Savings Bank |
1,483,113 |
- |
71,596 |
- |
5,011 |
2,770 |
(58,108) |
(49,170) |
36,194 |
21,999 |
- |
1,513,405 |
BNDES |
1,392,844 |
- |
- |
- |
1,535 |
1,238 |
(51,301) |
(104,982) |
26,414 |
24,431 |
129 |
1,290,308 |
IDB 2202 |
2,589,442 |
- |
- |
- |
- |
- |
(108,419) |
(90,674) |
43,471 |
101,549 |
478 |
2,535,847 |
IDB INVEST |
956,942 |
- |
- |
- |
- |
- |
(44,803) |
(16,130) |
59,502 |
- |
333 |
955,844 |
Leases (Concession Agreements, Program Contracts, and Contract Asset) |
397,311 |
- |
- |
- |
- |
- |
(27,292) |
(18,636) |
27,292 |
- |
- |
378,675 |
Leases (others) |
125,969 |
16,550 |
- |
- |
- |
- |
(8,372) |
(43,157) |
16,745 |
- |
- |
107,735 |
Other |
14,094 |
- |
3,654 |
- |
18 |
- |
(403) |
(2,702) |
376 |
31 |
- |
15,068 |
TOTAL IN LOCAL CURRENCY |
14,427,683 |
16,550 |
1,075,250 |
(3,260) |
162,054 |
4,008 |
(550,118) |
(829,408) |
449,379 |
272,892 |
6,518 |
15,031,548 |
|
|
|
|
|
|
|
|
|
|
|
|
|
FOREIGN CURRENCY |
|
|
|
|
|
|
|
|
|
|
|
|
IDB |
387,837 |
- |
95,847 |
(3,444) |
(18,922) |
- |
(4,398) |
(28,316) |
4,165 |
- |
161 |
432,930 |
IBRD |
420,881 |
- |
2,841 |
(1,547) |
(26,884) |
61 |
(944) |
(15,215) |
886 |
2 |
167 |
380,248 |
JICA |
2,401,887 |
- |
15,546 |
- |
(477,964) |
516 |
(18,272) |
(94,808) |
12,673 |
2,149 |
103 |
1,841,830 |
IDB 1983AB |
85,548 |
- |
- |
- |
(5,446) |
- |
(1052) |
(40,115) |
610 |
294 |
209 |
40,048 |
TOTAL IN FOREIGN CURRENCY |
3,296,153 |
- |
114,234 |
(4,991) |
(529,216) |
577 |
(24,666) |
(178,454) |
18,334 |
2,445 |
640 |
2,695,056 |
Total |
17,723,836 |
16,550 |
1,189,484 |
(8,251) |
(367,162) |
4,585 |
(574,784) |
(1,007,862) |
467,713 |
275,337 |
7,158 |
17,726,604 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
| (a) | Main events in the six-month period ended
June 30, 2023 |
Debentures
In the first quarter of 2023, the Company paid the final amortization
of the 17th issue debentures, totaling R$ 152,157, of which R$ 145,284 in principal and R$ 6,873 in interest.
In the first quarter of 2023, the Company paid the final amortization
of the 2nd series of the 22nd issue debentures, totaling R$ 214,404, of which R$ 200,000 in principal and R$ 14,404 in
interest.
IDB INVEST 2023
In the second quarter of 2023, the Company raised R$ 470.0 million
with the Inter-American Investment Corporation (IDB INVEST).
The proceeds from this contract will be used to partially finance
the Company’s investments related to the 4th Stage of the Tietê River Cleaning Project.
The principal will be amortized in semi-annual payments in December
and June, starting in December 2023 and ending in December 2036. Interests mature semi-annually in June and December, starting in June
2023 and ending in December 2036, at CDI + 0.5% p.a.
The loan is collateralized by Société de Promotion et
de Participation pour la Coopération Economique (PROPARCO). Interests mature semi-annually in June and December, starting in June
2023 and ending in December 2036, at CDI + 2.0% p.a.
| · | The covenants agreed upon for IDB INVEST 2023
are: |
Calculated every quarter, when disclosing the quarterly
information or annual financial statements:
- Net debt/adjusted EBITDA equal to or lower than 3.50;
- Adjusted EBITDA/paid financial expenses equal to or
higher than 2.35;
They should be maintained for two (2) consecutive quarters
or not, for any four (4) consecutive quarters.
IDB 1983AB
In the second quarter of 2023, the Company paid the final amortization
of IDB 1983AB, totaling R$ 39.7 million, of which R$ 38.3 million in principal and R$ 1.4 million in interest.
BNDES PAC 2008
In the second quarter of 2023, the Company paid the final amortization
of BNDES PAC 2008, totaling R$ 1.1 million.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
IFC 2023
In the second quarter of 2023, the Company contracted financing of
R$ 1.0 billion with the International Finance Corporation (IFC), which is expected to be received by September 2023. The proceeds
raised from this contract will be exclusively used to cover the costs of the New Pinheiros Project.
The principal will be amortized in semi-annual payments in October
and April, starting in October 2025 and ending in April 2033. Interests mature semi-annually in October and April, starting in October
2023 and ending in April 2033, at CDI + 1.7% p.a. SABESP must also pay to IFC a commitment fee of 1% p.a. on the portion that has not
been disbursed or canceled.
| · | The covenants agreed upon for IFC 2023 are: |
Calculated every quarter, when disclosing the quarterly
information or annual financial statements:
- Net debt/adjusted EBITDA equal to or lower than 3.50;
- Adjusted EBITDA/paid financial expenses equal to or
higher than 2.35;
They should be maintained for two (2) consecutive quarters
or not, for any four (4) consecutive quarters.
The Company has lease agreements
signed as Assets Lease. During the construction period, work costs are capitalized to contract assets, and the lease amount is recorded
in the same proportion.
After startup, the lease payment
period starts (240 monthly installments), and the amount is periodically restated by the contracted price index.
The amounts payable for the right
of use of assets are also recorded in this line. See Note 14 (f).
The table below shows the more restrictive
covenants as of June 30, 2023.
|
Covenants |
Adjusted EBITDA / Adjusted Financial Expenses |
Equal to or higher than 2.80 |
EBITDA / Financial Expenses Paid |
Equal to or higher than 2.35 |
Adjusted Net Debt / Adjusted EBITDA |
Equal to or lower than 3.80 |
Net Debt / Adjusted EBITDA |
Equal to or lower than 3.50 |
Other Onerous Debt (1) / Adjusted EBITDA |
Equal to or lower than 1.30 |
Adjusted Current Ratio |
Higher than 1.00 |
(1) The contractual definition of “Other Onerous Debts” corresponds to the sum of pension plan obligations and healthcare plan, installment payments of tax debts, and installment payments of debts with the electricity supplier. |
As of June 30, 2023, and December
31, 2022, the Company met the requirements set forth by its borrowings and financing agreements.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
| (d) | Borrowings and financing – Credit limited |
Agent |
|
June 30, 2023 |
|
|
(in millions of reais (*)) |
Brazilian Federal Savings Bank |
|
940 |
Brazilian Development Bank (BNDES) |
|
219 |
Inter-American Development Bank (IDB) |
|
956 |
International Bank for Reconstruction and Development (IBRD) |
|
2,093 |
Other |
|
14 |
TOTAL |
|
4,222 |
(*) Brazilian Central Bank’s exchange rate as of June 30, 2023
(US$ 1.00 = R$ 4.8192; ¥ 1.00 = R$ 0.03336).
Financing resources contracted have specific purposes and are released
for the execution of their respective investments, according to the progress of the works.
17 | Taxes and contributions |
|
June 30, 2023 |
December 31, 2022 |
Recoverable taxes |
|
|
Income tax and social contribution |
221,808 |
206,517 |
Withheld income tax (IRRF) on financial investments |
9,329 |
33,283 |
Other federal taxes |
13,683 |
3,106 |
Total |
244,820 |
242,906 |
|
June 30, 2023 |
December 31, 2022 |
Taxes and contributions payable |
|
|
Income tax and social contribution |
112,882 |
- |
Cofins and Pasep |
22,069 |
134,624 |
INSS (social security contribution) |
45,371 |
44,515 |
IRRF (withholding income tax) |
6,584 |
63,361 |
Others |
45,792 |
50,961 |
Total |
232,698 |
293,461 |
On February 08, 2023, the Federal Supreme Court (STF) unanimously
decided that a final decision favorable to companies on taxes paid on a continuous base would lose its effects if the STF later rules
against it.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
The Company analyzed the matter judged in this decision, which covers
Social Contribution on Net Profit, as well as other taxes that fit into the decision granted, and did not identify any impact on the Financial
Statements.
18 | Deferred taxes and contributions |
(a) | Statement of financial position details |
|
June 30, 2023 |
December 31, 2022 |
Deferred income tax assets |
|
|
Provisions |
598,202 |
560,404 |
Pension plan obligations - G1 |
132,059 |
141,606 |
Donations of underlying assets on concession agreements |
45,710 |
46,088 |
Allowance for doubtful accounts |
217,761 |
199,363 |
Other |
212,969 |
171,798 |
Total deferred tax asset |
1,206,701 |
1,119,259 |
|
|
|
Deferred income tax liabilities |
|
|
Temporary difference on concession of intangible asset |
(346,822) |
(353,817) |
Capitalization of borrowing costs |
(471,264) |
(457,669) |
Profit on supply to government entities |
(343,901) |
(346,650) |
Actuarial gain – G1 Plan |
(93,561) |
(93,561) |
Construction margin |
(41,951) |
(43,323) |
Borrowing costs |
(11,116) |
(13,517) |
Total deferred tax liabilities |
(1,308,615) |
(1,308,537) |
|
|
|
Deferred tax liability, net |
(101,914) |
(189,278) |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
Deferred income tax assets |
|
|
|
Provisions |
560,404 |
37,798 |
598,202 |
Pension plan obligations - G1 |
141,606 |
(9,547) |
132,059 |
Donations of underlying assets on concession agreements |
46,088 |
(378) |
45,710 |
Allowance for doubtful accounts |
199,363 |
18,398 |
217,761 |
Other |
171,798 |
41,171 |
212,969 |
Total |
1,119,259 |
87,442 |
1,206,701 |
|
|
|
|
Deferred income tax liabilities |
|
|
|
Temporary difference on concession of intangible asset |
(353,817) |
6,995 |
(346,822) |
Capitalization of borrowing costs |
(457,669) |
(13,595) |
(471,264) |
Profit on supply to government entities |
(346,650) |
2,749 |
(343,901) |
Actuarial gain – G1 |
(93,561) |
- |
(93561) |
Construction margin |
(43,323) |
1,372 |
(41,951) |
Borrowing costs |
(13,517) |
2,401 |
(11,116) |
Total |
(1,308,537) |
(78) |
(1,308,615) |
|
|
|
|
Deferred tax liability, net |
(189,278) |
87,364 |
(101,914) |
Deferred income tax assets |
|
|
|
Provisions |
503,374 |
22,939 |
526,313 |
Pension plan obligations - G1 |
150,577 |
(4,384) |
146,193 |
Donations of underlying assets on concession agreements |
47,589 |
(524) |
47,065 |
Allowance for doubtful accounts |
183,963 |
(401) |
183,562 |
Other |
127,092 |
(4,112) |
122,980 |
Total |
1,012,595 |
13,518 |
1,026,113 |
|
|
|
|
Deferred income tax liabilities |
|
|
|
Temporary difference on concession of intangible asset |
(368,235) |
7,517 |
(360,718) |
Capitalization of borrowing costs |
(404,931) |
(24,432) |
(429,363) |
Profit on supply to government entities |
(353,262) |
3,749 |
(349,513) |
Actuarial gain – G1 |
(109,271) |
- |
(109,271) |
Construction margin |
(46,079) |
1,381 |
(44,698) |
Borrowing costs |
(14,556) |
2,003 |
(12,553) |
Total |
(1,296,334) |
(9,782) |
(1,306,116) |
|
|
|
|
Deferred tax liability, net |
(283,739) |
3,736 |
(280,003) |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
(c) | Reconciliation of the effective tax rate |
The amounts recorded as income tax and social contribution expenses
in the financial statements are reconciled to the statutory rates, as shown below:
|
|
|
|
|
|
|
|
|
|
Profit before income taxes |
1,056,834 |
2,189,778 |
589,738 |
2,063,940 |
Statutory rate |
34% |
34% |
34% |
34% |
|
|
|
|
|
Estimated expense at statutory rate |
(359,323) |
(744,525) |
(200,511) |
(701,740) |
Tax benefit of interest on capital |
44,492 |
44,492 |
32,878 |
32,878 |
Permanent differences: |
|
|
|
|
Provision Law 4,819/1958 – G0 (i) |
(10,158) |
(20,930) |
(7,013) |
(14,985) |
Donations |
(3,406) |
(4,472) |
(2,505) |
(4,881) |
Other differences |
15,304 |
26,612 |
9,871 |
22,785 |
|
|
|
|
|
Income tax and social contribution |
(313,091) |
(698,823) |
(167,280) |
(665,943) |
|
|
|
|
|
Current income tax and social contribution |
(402,699) |
(786,187) |
(180,174) |
(669,679) |
Deferred income tax and social contribution |
89,608 |
87,364 |
12,894 |
3,736 |
Effective rate |
30% |
32% |
28% |
32% |
(i) Permanent difference related to the provision
for the actuarial liability. See Note 21 (ii) and (v).
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
(a) | Lawsuits and proceedings that resulted in
provisions |
| (I) | Statement of financial position details |
The Company is a party to several legal claims and administrative
proceedings arising from the normal course of business, including civil, tax, labor, and environmental matters. Management recognizes
provisions consistently with the recognition and measurement criteria established in Note 3.15 to the Annual Financial Statements as of
December 31, 2022. The terms and payment amounts are defined based on the outcome of these lawsuits.
|
June 30, 2023 |
|
December 31, 2022 |
|
Provisions |
Escrow deposits |
Provisions net of deposits |
|
Provisions |
Escrow deposits |
Provisions net of deposits |
Customer claims (i) |
137,309 |
(6,445) |
130,864 |
|
151,023 |
(6,226) |
144,797 |
Supplier claims (ii) |
265,238 |
(52,301) |
212,937 |
|
257,080 |
(53) |
257,027 |
Other civil claims (iii) |
151,467 |
(1,345) |
150,122 |
|
99,462 |
(1,131) |
98,331 |
Tax claims (iv) |
93,408 |
(16,603) |
76,805 |
|
79,532 |
(16,037) |
63,495 |
Labor claims (v) |
654,816 |
(14,345) |
640,471 |
|
654,277 |
(13,979) |
640,298 |
Environmental claims (vi) |
457,180 |
(48) |
457,132 |
|
406,872 |
(36) |
406,836 |
Total |
1,759,418 |
(91,087) |
1,668,331 |
|
1,648,246 |
(37,462) |
1,610,784 |
|
|
|
|
|
|
|
|
Current |
1,019,086 |
- |
1,019,086 |
|
924,038 |
- |
924,038 |
Noncurrent |
740,332 |
(91,087) |
649,245 |
|
724,208 |
(37,462) |
686,746 |
|
|
Additional provisions |
Interest and inflation adjustment |
Use of the accrual |
Amounts not used
(reversal)
|
|
Customer claims (i) |
151,023 |
3,077 |
7,493 |
(22,863) |
(1,421) |
137,309 |
Supplier claims (ii) |
257,080 |
29,476 |
10,223 |
(31,401) |
(140) |
265,238 |
Other civil claims (iii) |
99,462 |
59,599 |
15,352 |
(10,292) |
(12,654) |
151,467 |
Tax claims (iv) |
79,532 |
11,788 |
3,176 |
(277) |
(811) |
93,408 |
Labor claims (v) |
654,277 |
24,654 |
27,181 |
(20,713) |
(30,583) |
654,816 |
Environmental claims (vi) |
406,872 |
31,776 |
32,739 |
- |
(14,207) |
457,180 |
Subtotal |
1,648,246 |
160,370 |
96,164 |
(85,546) |
(59,816) |
1,759,418 |
Escrow deposits |
(37,462) |
(55,112) |
(1,488) |
1,429 |
1,546 |
(91,087) |
Total |
1,610,784 |
105,258 |
94,676 |
(84,117) |
(58,270) |
1,668,331 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
|
|
Additional provisions |
Interest and inflation adjustment |
Use of the accrual |
Amounts not used
(reversal)
|
|
Customer claims (i) |
168,258 |
9,664 |
15,952 |
(26,261) |
(10,521) |
157,092 |
Supplier claims (ii) |
477,854 |
18,969 |
29,131 |
(74,768) |
(211) |
450,975 |
Other civil claims (iii) |
95,601 |
7,996 |
9,427 |
(5,461) |
(3,010) |
104,553 |
Tax claims (iv) |
57,509 |
13,209 |
5,965 |
(925) |
(293) |
75,465 |
Labor claims (v) |
349,962 |
53,825 |
17,561 |
(22,322) |
(23,557) |
375,469 |
Environmental claims (vi) |
331,326 |
19,901 |
33,599 |
(300) |
(101) |
384,425 |
Subtotal |
1,480,510 |
123,564 |
111,635 |
(130,037) |
(37,693) |
1,547,979 |
Escrow deposits |
(32,017) |
(15,007) |
(4,382) |
8,323 |
2,984 |
(40,099) |
Total |
1,448,493 |
108,557 |
107,253 |
(121,714) |
(34,709) |
1,507,880 |
(b) | Lawsuits deemed as contingent liabilities |
The Company is a party to lawsuits and administrative proceedings
relating to environmental, tax, civil, and labor claims, which are assessed as contingent liabilities in the financial statements, since
it either does not expect outflows to be required or the amount of the obligations cannot be reliably measured. Contingent liabilities,
net of deposits, are represented as follows:
|
June 30, 2023 |
December 31, 2022 |
Customer claims (i) |
207,192 |
200,966 |
Supplier claims (ii) |
1,196,948 |
1,147,606 |
Other civil claims (iii) |
1,167,508 |
1,146,048 |
Tax claims (iv) |
2,025,286 |
1,869,583 |
Labor claims (v) |
2,728,955 |
1,471,423 |
Environmental claims (vi) |
3,999,812 |
3,302,843 |
Total |
11,325,701 |
9,138,469 |
(c) | Explanation of the nature of main classes
of lawsuits |
Refer mainly to lawsuits from customers claiming that their tariffs
should be equal to those of other consumer categories, lawsuits for reduction of sewage tariff due to system losses, consequently requiring
the refund of amounts charged by the Company, and lawsuits for reduction of tariff for being eligible to the Social Welfare Entity category.
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| |
Notes to the Quarterly Information | |
| |
Include lawsuits filed by some suppliers alleging underpayment of
inflation adjustments and economic and financial imbalance of the agreements, and are in progress at different courts.
Refer mainly to indemnities for property damage, pain and suffering,
and loss of profits allegedly caused to third parties, such as vehicle accidents, claims, and challenges on the methodology to collect
tariffs, among others, filed at different court levels.
Tax claims refer mainly to tax collections and fines in general challenged
due to disagreements regarding notification or differences in the interpretation of legislation by the Company's Management.
The Company is a party to several labor lawsuits, involving issues
such as overtime, shift schedule, health hazard premium, hazardous duty premium, prior notice, change of function, salary equalization,
service outsourcing, and others, which are at various court levels.
These refer to several administrative proceedings and lawsuits filed
by government entities, including Companhia Ambiental do Estado de São Paulo (CETESB) and the Public Prosecution Office of the
São Paulo State, which aim at certain obligations to do and not to do, with the provision of fines for non-compliance and imposition
of compensation for environmental damages allegedly caused by the Company.
The main objects in which the Company is involved are: a) blame SABESP
for discharging or releasing sewage without proper treatment; b) invest in the water and sewage treatment system of the municipality,
under penalty of paying a fine; c) pay compensation for environmental damages; amongst others.
As of May 25, 2023, the Company executed an agreement effective for
one year for the issue of policies under several types of guarantee insurance. The limit that can be used is R$ 600 million. The guarantee
insurance for escrow deposit is used in legal claims, where instead of immediately disbursing cash, the Company uses the guarantee provided
by the insurance until the end of these proceedings, limited to up to five years. As of June 30, 2023,
R$ 597.3 million was available for use.
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| |
Notes to the Quarterly Information | |
| |
20 | Labor liabilities and pension plan obligations |
|
June 30, 2023 |
December 31, 2022 |
Salaries and payroll charges |
44,484 |
70,089 |
Provision for vacation |
268,917 |
254,469 |
Provision for Christmas bonus |
56,212 |
- |
Healthcare plan (i) |
73,409 |
70,136 |
Provision for profit sharing (ii) |
50,052 |
96,227 |
Separation Incentive Program - PDI (iii) |
400,357 |
- |
Consent Decree (TAC) |
5,666 |
6,114 |
Knowledge Retention Program (PRC) |
1,243 |
1,469 |
Total |
900,340 |
498,504 |
Benefits granted are paid after the event, free of choice, and are
sponsored by the contributions of SABESP and the employees. In the second quarter of 2023, the Company contributed 8.4%, on average, of
gross payroll, totaling
R$ 69,305 (8.2% in the second quarter of 2022, totaling R$ 65,345).
Based on an agreement with the labor union, the Profit Sharing Program
corresponds to up to one month’s salary for each employee, depending on the achievement of the goals established, from January to
December, and should be paid in the subsequent year.
| (iii) | Separation Incentive Program - PDI |
In June 2023, the Company implemented the Separation Incentive Program
(PDI or Program) to pacifically reduce the workforce and provide gains in efficiency, increase of competitiveness, and optimization of
costs.
The deadline for registrations in the Program was from June 1 to 30,
2023, and the employment terminations will occur from July 1, 2023 to June 30, 2024. The PDI received registrations from 1,862 employees.
For all Program participants, compliance with the clauses contained
in the Collective Bargaining Agreement effective on the date of termination is guaranteed, and the following indemnity incentives will
be granted:
| a. | half of the indemnified advance notice, proportional
to the service time at SABESP, equivalent to the percentage of the FGTS balance for termination purposes on the date of termination (according
to the table below); |
| b. | indemnity incentive proportional to the service
time at SABESP based on the base salary + function bonus, for each complete year of work (according to the table below); and |
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| |
Notes to the Quarterly Information | |
| |
| c. | health plan: starting from the subsequent month
of termination, the health plan will be the responsibility of the policyholder and SABESP will reimburse the monthly fee up to an individual
amount of
R$ 1,878.30/month for the policyholder and his/her spouse, for 24 consecutive and uninterrupted months. If the policyholder chooses a
health plan with a monthly fee lower than the reimbursable amount, he/she will not be entitled to any difference, thus not generating
any credit or balance to be offset against future installments over the course of the 24 consecutive and uninterrupted months. |
Service time at SABESP (years) |
% of the FGTS balance |
% of the compensation for
each complete year of work |
> 15 |
20% |
20% |
11 - 15 |
12.5% |
12.5% |
6 - 10 |
5% |
5% |
0 - 5 |
2.5% |
2.5% |
As of June 30, 2023, R$ 529,612 was recorded due to the provision
for employee indemnity incentives, of which R$ 400,357 in current liabilities and R$ 129,255 in noncurrent liabilities under
“Labor Obligations”.
21 | Pension plan obligations |
The Company has Post-Employment Benefit Plans in the following modalities:
Defined Benefit (BD) – G1 (i) and G0 (ii); and Defined Contribution (CD) – Sabesprev Mais (iii) and VIVEST (iv), whereby only
the latter is open for new adhesions. See the reconciliation of expenses with such plans in item (v).
Defined benefit plans
Summary of pension plan obligations- Liabilities
|
G1 Plan |
G0 Plan |
Total |
Pension plan obligations as of December 31, 2022 |
(148,116) |
(2,002,075) |
(2,150,191) |
(Expenses) / revenues recognized in 2023 |
8,768 |
(112,610) |
(103,842) |
Payments made in 2023 |
20,482 |
97,907 |
118,389 |
Pension plan obligations as of June 30, 2023 |
(118,866) |
(2,016,778) |
(2,135,644) |
|
G1 Plan |
G0 Plan |
Total |
Pension plan obligations as of December 31, 2021 |
(129,600) |
(2,192,062) |
(2,321,662) |
(Expenses) recognized in 2022 |
(5,857) |
(88,476) |
(94,333) |
Payments made in 2022 |
19,376 |
91,296 |
110,672 |
Pension plan obligations as of June 30, 2022 |
(116,081) |
(2,189,242) |
(2,305,323) |
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| |
Notes to the Quarterly Information | |
| |
The defined benefit plan (“G1 Plan”) managed
by SABESPREV receives similar contributions established in a plan of subsidy of actuarial study of SABESPREV, as follows:
| · | 0.99% of the portion of the salary of participation
up to 20 salaries; and |
| · | 8.39% of the surplus, if any, of the portion
of the salary of participation over 20 salaries. |
According to State Law 4,819/1958, employees who started
providing services before May 1974 acquired a legal right to receive supplemental pension payments, which rights are referred to as "G0
Plan". The Company pays supplemental retirement and pension amounts on behalf of the São Paulo State and seeks reimbursements
of such amounts, which are recorded in the “Balances with related parties” line, limited to the amounts considered virtually
certain to be reimbursed by the São Paulo State.
Managed by SABESPREV, the sponsor's contributions correspond
to the result obtained by applying a percentage of 100% to the basic contribution made by the participant.
Managed by VIVEST, the sponsor's contributions correspond
to the result obtained by applying a percentage of 100% to the basic contribution made by the participant.
| (v) | Reconciliation of expenditures with pension plan obligations |
|
|
|
|
|
|
|
|
|
|
G1 Plan (i) |
(4,384) |
(8,768) |
2,922 |
5,857 |
G0 Plan (ii) |
56,305 |
112,610 |
44,238 |
88,476 |
Sabesprev Mais Plan (iii) |
7,068 |
13,561 |
6,429 |
12,307 |
VIVEST Plan (iv) |
152 |
234 |
73 |
131 |
Subtotal |
59,141 |
117,637 |
53,662 |
106,771 |
Capitalized |
(614) |
(1,378) |
(823) |
(1,594) |
Reimbursement of additional retirement and pension benefits paid (G0) |
(26,429) |
(51,051) |
(23,611) |
(44,402) |
Other |
1,495 |
3,048 |
1,338 |
2,583 |
Pension plan obligations (Note 27) |
33,593 |
68,256 |
30,566 |
63,358 |
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| |
Notes to the Quarterly Information | |
| |
This line records the balances payable, mainly from services received
from third parties, such as the supply of electric power, reading of hydrometers and delivery of water and sewage bills, cleaning, surveillance
and security services, collection, legal counsel services, audit, marketing, and advertising and consulting services, among others. The
amounts payable to the municipal governments related to transfers provided for in the concession agreements are also recorded. The balances
as of June 30, 2023, and December 31, 2022, were R$ 588,456 and R$ 723,242, respectively.
As of June 30, 2023, and December 31, 2022, the authorized, subscribed,
and paid-in capital, totaling R$ 15,000,000, was composed of 683,509,869 registered, book-entry common shares with no par value, as follows:
|
June 30, 2023 |
December 31, 2022 |
|
Number of shares |
% |
Number of shares |
% |
São Paulo State |
343,506,664 |
50.3 |
343,506,664 |
50.3 |
Other shareholders |
|
|
|
|
In Brazil (1) |
252,594,432 |
36.9 |
257,339,417 |
37.6 |
Abroad (2) |
87,408,773 |
12.8 |
82,663,788 |
12.1 |
|
|
|
|
|
Total |
683,509,869 |
100.0 |
683,509,869 |
100.0 |
(1) | As of June 30, 2023, the common shares traded
in Brazil were held by 31,477 shareholders. It includes six shares held by Cia Paulista de Parcerias – CPP, a company controlled
by the São Paulo State Government. |
(2) | Shares traded as American Depositary Receipts
(ADR) on the New York Stock Exchange, through The Bank New York Mellon, the depositary bank of the Company’s ADRs. |
The Annual Shareholders' Meeting held on April 28, 2023, approved
the distribution of dividends as interest on capital totaling R$ 741,301, corresponding to minimum mandatory dividends and R$ 130,857
as supplementary minimum dividends, totaling R$ 872,158, which was paid on June 26, 2023.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
Basic and diluted
Basic earnings per share are calculated by dividing the equity attributable
to owners by the weighted average number of outstanding common shares during the period. The Company does not have potentially dilutive
common shares outstanding or debts convertible into common shares. Accordingly, basic and diluted earnings per share are equal.
|
|
|
|
|
|
|
|
|
|
Profit attributable to the Company’s owners |
743,743 |
1,490,955 |
422,458 |
1,397,997 |
Weighted average number of common shares issued |
683,509,869 |
683,509,869 |
683,509,869 |
683,509,869 |
|
|
|
|
|
Basic and diluted earnings per share (reais per share) |
1.08812 |
2.18132 |
0.61807 |
2.04532 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
25 | Operating segment information |
The Company’s Management, composed of the Board of Directors
and the Executive Board, has determined the operating segment used to make strategic decisions, such as sanitation services.
Result
|
April to June 2023 |
|
Sanitation (i) |
Reconciliation to the income
statement (ii) |
Balance according to the
financial statements |
Gross operating revenue |
5,192,276 |
1,263,234 |
6,455,510 |
Gross sales deductions |
(300,973) |
- |
(300,973) |
Net operating revenue |
4,891,303 |
1,263,234 |
6,154,537 |
Costs, selling, general, and administrative expenses |
(3,909,358) |
(1,234,832) |
(5,144,190) |
Income from operations before other operating expenses, net and equity accounting |
981,945 |
28,402 |
1,010,347 |
Other operating income (expenses), net |
|
|
50,487 |
Equity accounting |
|
|
10,047 |
Financial result, net |
|
|
(14,047) |
Income from operations before taxes |
|
|
1,056,834 |
Depreciation and amortization |
(670,772) |
- |
(670,772) |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
|
January to June 2023 |
|
Sanitation (i) |
Reconciliation to the income
statement (ii) |
Balance according to the
financial statements |
Gross operating revenue |
10,101,550 |
2,442,768 |
12,544,318 |
Gross sales deductions |
(691,412) |
- |
(691,412) |
Net operating revenue |
9,410,138 |
2,442,768 |
11,852,906 |
Costs, selling, general, and administrative expenses |
(7,083,206) |
(2,387,847) |
(9,471,053) |
Income from operations before other operating expenses, net and equity accounting |
2,326,932 |
54,921 |
2,381,853 |
Other operating income (expenses), net |
|
|
65,120 |
Equity accounting |
|
|
16,381 |
Financial result, net |
|
|
(273,576) |
Income from operations before taxes |
|
|
2,189,778 |
Depreciation and amortization |
(1,327,916) |
- |
(1,327,916) |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
|
April to June 2022 |
|
Sanitation (i) |
Reconciliation to the income
statement (ii) |
Balance according to the
financial statements |
Gross operating revenue |
4,451,472 |
1,154,720 |
5,606,192 |
Gross sales deductions |
(340,792) |
- |
(340,792) |
Net operating revenue |
4,110,680 |
1,154,720 |
5,265,400 |
Costs, selling, general, and administrative expenses |
(3,230,087) |
(1,129,475) |
(4,359,562) |
Income from operations before other operating expenses, net and equity accounting |
880,593 |
25,245 |
905,838 |
Other operating income (expenses), net |
|
|
2,351 |
Equity accounting |
|
|
5,923 |
Financial result, net |
|
|
(324,374) |
Income from operations before taxes |
|
|
589,738 |
Depreciation and amortization |
(598,165) |
- |
(598,165) |
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| |
Notes to the Quarterly Information | |
| |
|
January to June 2022 |
|
Sanitation (i) |
Reconciliation to the income
statement (ii) |
Balance according to the
financial statements |
Gross operating revenue |
8,749,692 |
2,042,926 |
10,792,618 |
Gross sales deductions |
(656,828) |
- |
(656,828) |
Net operating revenue |
8,092,864 |
2,042,926 |
10,135,790 |
Costs, selling, general, and administrative expenses |
(6,107,025) |
(1,996,996) |
(8,104,021) |
Income from operations before other operating expenses, net and equity accounting |
1,985,839 |
45,930 |
2,031,769 |
Other operating income (expenses), net |
|
|
4,915 |
Equity accounting |
|
|
11,506 |
Financial result, net |
|
|
15,750 |
Income from operations before taxes |
|
|
2,063,940 |
Depreciation and amortization |
(1,187,911) |
- |
(1,187,911) |
| (i) | See Note 31 for further information about non-cash items, other than depreciation and amortization that
impact segment results, and for additional information on long-lived assets. |
| (ii) | Construction revenue and related costs are not reported to the CODM. Revenue from construction is recognized
under ICPC 01 (R1) / IFRIC 12 (Concession Agreements) and CPC 47/IFRS 15 (Revenue from Contracts with Customers), as all performance obligations
are met over time. See Note 13 (b) for further information. |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
(a) | Revenue from sanitation services: |
|
|
|
|
|
|
|
|
|
|
Metropolitan Region of São Paulo |
3,732,487 |
7,208,157 |
3,225,891 |
6,274,744 |
Regional Systems |
1,459,789 |
2,893,393 |
1,225,581 |
2,474,948 |
Total |
5,192,276 |
10,101,550 |
4,451,472 |
8,749,692 |
(b)
Reconciliation from gross operating income to net operating income:
|
|
|
|
|
|
|
|
|
|
Revenue from sanitation services (i) |
5,192,276 |
10,101,550 |
4,451,472 |
8,749,692 |
Construction revenue |
1,263,234 |
2,442,768 |
1,154,720 |
2,042,926 |
Sales tax |
(278,821) |
(649,119) |
(322,341) |
(619,926) |
Regulation, Control and Oversight Fee (TRCF) |
(22,152) |
(42,293) |
(18,451) |
(36,902) |
Net revenue |
6,154,537 |
11,852,906 |
5,265,400 |
10,135,790 |
(i) Includes R$ 25,734 and R$ 49,754 referring
to the TRCF charged from customers from April to June and from January to June 2023 (R$ 22,573 and R$ 43,534 from April to June
and from January to June 2022), respectively, referring to the municipalities regulated by ARSESP.
27 | Operating costs and expenses |
|
|
|
|
|
Operating costs |
|
|
|
|
Salaries, payroll charges, and benefits |
(1,023,410) |
(1,607,266) |
(591,821) |
(1,100,694) |
Pension plan obligations |
(2,185) |
(3,841) |
(7,489) |
(14,546) |
Construction costs (Note 25) |
(1,234,832) |
(2,387,847) |
(1,129,475) |
(1,996,996) |
General supplies |
(85,782) |
(171,613) |
(95,925) |
(162,415) |
Treatment supplies |
(138,538) |
(303,437) |
(142,491) |
(289,799) |
Outsourced services |
(480,652) |
(916,136) |
(431,808) |
(797,700) |
Electricity |
(385,990) |
(781,016) |
(375,361) |
(786,445) |
General expenses |
(239,827) |
(466,995) |
(206,033) |
(404,659) |
Depreciation and amortization |
(619,459) |
(1,226,247) |
(551,500) |
(1,095,035) |
|
(4,210,675) |
(7,864,398) |
(3,531,903) |
(6,648,289) |
|
|
|
|
|
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
|
|
|
|
|
Selling expenses |
|
|
|
|
Salaries, payroll charges, and benefits |
(135,845) |
(206,363) |
(80,464) |
(148,373) |
Pension plan obligations |
(252) |
(437) |
(1,010) |
(1,969) |
General supplies |
(2,027) |
(3,094) |
(2,149) |
(3,279) |
Outsourced services |
(102,617) |
(211,793) |
(106,353) |
(190,716) |
Electricity |
(186) |
(377) |
(271) |
(685) |
General expenses |
(27,424) |
(55,050) |
(26,561) |
(51,688) |
Depreciation and amortization |
(16,886) |
(33,780) |
(16,717) |
(33,402) |
|
(285,237) |
(510,894) |
(233,525) |
(430,112) |
|
|
|
|
|
Bad debt expense, net of recoveries (Note 9 (c)) |
(217,426) |
(380,231) |
(252,932) |
(430,626) |
|
|
|
|
|
Administrative expenses |
|
|
|
|
Salaries, payroll charges, and benefits |
(154,587) |
(209,728) |
(73,217) |
(131,738) |
Pension plan obligations |
(31,156) |
(63,978) |
(22,067) |
(46,843) |
General supplies |
(2,556) |
(3,158) |
(11,402) |
(15,701) |
Outsourced services |
(59,877) |
(140,144) |
(61,196) |
(123,029) |
Electricity |
(597) |
(1,181) |
(460) |
(905) |
General expenses |
(128,337) |
(188,348) |
(124,066) |
(179,453) |
Depreciation and amortization |
(34,427) |
(67,889) |
(29,948) |
(59,474) |
Tax expenses |
(19,315) |
(41,104) |
(18,846) |
(37,851) |
|
(430,852) |
(715,530) |
(341,202) |
(594,994) |
|
|
|
|
|
Operating costs and expenses |
|
|
|
|
Salaries, payroll charges, and benefits |
(1,313,842) |
(2,023,357) |
(745,502) |
(1,380,805) |
Pension plan obligations (Note 21 (v)) |
(33,593) |
(68,256) |
(30,566) |
(63,358) |
Construction costs (Note 25) |
(1,234,832) |
(2,387,847) |
(1,129,475) |
(1,996,996) |
General supplies |
(90,365) |
(177,865) |
(109,476) |
(181,395) |
Treatment supplies |
(138,538) |
(303,437) |
(142,491) |
(289,799) |
Outsourced services |
(643,146) |
(1,268,073) |
(599,357) |
(1,111,445) |
Electricity |
(386,773) |
(782,574) |
(376,092) |
(788,035) |
General expenses |
(395,588) |
(710,393) |
(356,660) |
(635,800) |
Depreciation and amortization |
(670,772) |
(1,327,916) |
(598,165) |
(1,187,911) |
Tax expenses |
(19,315) |
(41,104) |
(18,846) |
(37,851) |
Bad debt expense, net of recoveries (Note 9 (c)) |
(217,426) |
(380,231) |
(252,932) |
(430,626) |
|
(5,144,190) |
(9,471,053) |
(4,359,562) |
(8,104,021) |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
28 | Financial income (expenses) |
|
|
|
|
|
Financial Expenses |
|
|
|
|
Interest and charges on borrowings and financing – local currency |
(253,960) |
(527,066) |
(215,789) |
(405,342) |
Interest and charges on borrowings and financing – foreign currency |
(23,235) |
(44,284) |
(9,778) |
(18,334) |
Other financial expenses |
(77,925) |
(179,656) |
(72,705) |
(163,949) |
Inflation adjustment on borrowings and financing |
(38,054) |
(108,562) |
(91,336) |
(162,054) |
Other inflation adjustments |
(45,404) |
(95,867) |
(50,790) |
(99,155) |
Interest and inflation adjustment on provisions |
(44,351) |
(89,965) |
(49,328) |
(93,910) |
Total financial expenses |
(482,929) |
(1,045,400) |
(489,726) |
(942,744) |
|
|
|
|
|
Financial revenue |
|
|
|
|
Inflation adjustment gains |
50,194 |
110,508 |
67,181 |
126,865 |
Income on financial investments |
95,348 |
198,565 |
101,339 |
181,001 |
Interest income |
68,787 |
135,347 |
70,920 |
141,604 |
Cofins and Pasep |
(9,928) |
(20,716) |
(11,134) |
(20,901) |
Other |
- |
17 |
1 |
14 |
Total financial income |
204,401 |
423,721 |
228,307 |
428,583 |
|
|
|
|
|
Financial income (expenses), net of exchange rate changes |
(278,528) |
(621,679) |
(261,419) |
(514,161) |
|
|
|
|
|
Exchange gain (losses) |
|
|
|
|
Exchange rate changes on borrowings and financing |
263,709 |
347,534 |
(64,814) |
529,216 |
Exchange rate changes on assets |
772 |
571 |
1,853 |
590 |
Other exchange rate changes |
- |
(2) |
6 |
105 |
Exchange rate changes, net |
264,481 |
348,103 |
(62,955) |
529,911 |
|
|
|
|
|
Financial income (expenses), net |
(14,047) |
(273,576) |
(324,374) |
15,750 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
29 | Other operating income (expenses), net |
|
|
|
|
|
|
|
|
|
|
Other operating income, net |
58,609 |
78,960 |
13,562 |
23,870 |
Other operating expenses |
(8,122) |
(13,840) |
(11,211) |
(18,955) |
|
|
|
|
|
Other operating income (expenses), net |
50,487 |
65,120 |
2,351 |
4,915 |
Other operating income includes revenue from the sale of property,
plant and equipment, contracts awarded in public bids, right to sell electricity, indemnities and reimbursement of expenses, fines and
guarantees, property leases, reuse water, PURA projects and services, net of Cofins and Pasep.
Other operating expenses usually record the derecognition of concession
assets due to obsolescence, discontinued construction works, unproductive wells, projects considered economically unfeasible, losses on
property, plant and equipment, estimated losses, and operational assets indemnification.
The Company has agreements to manage and maintain its activities,
as well as to build new projects aiming at achieving the objectives proposed in its target plan. The main unrecognized committed amounts
as of June 30, 2023 are as follows:
|
1 year |
1-3 years |
3-5 years |
|
Total |
Contractual obligations – Expenses |
1,297,296 |
1,466,094 |
290,952 |
631,110 |
3,685,452 |
Contractual obligations - Investments |
3,594,002 |
3,746,447 |
2,176,953 |
135,496 |
9,652,898 |
Total |
4,891,298 |
5,212,541 |
2,467,905 |
766,606 |
13,338,350 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Notes to the Quarterly Information | |
| |
31 | Supplemental cash flow information |
|
January to June 2023 |
January to June 2022 |
|
|
|
Total additions to contract assets (Note 13) |
2,482,886 |
2,171,183 |
Total additions to intangible assets (Note 14 (b)) |
7,285 |
26,946 |
|
|
|
Items not affecting cash (see breakdown below) |
(984,519) |
(703,496) |
|
|
|
Total additions to intangible and contract assets according to the statement of cash flows |
1,505,652 |
1,494,633 |
|
|
|
Investments and financing operations affecting intangible assets but not cash: |
|
|
Interest capitalized in the period (Note 13 (a)) |
345,824 |
279,922 |
Contractors payable |
237,712 |
298,729 |
Performance agreements |
343,984 |
62,365 |
Right of use |
2,078 |
16,550 |
Construction margin (Note 25) |
54,921 |
45,930 |
Total |
984,519 |
703,496 |
32 | Events after the reporting period |
· Guidelines
of SABESP’s Privatization Model
On July 31, 2023, at a meeting
of the Board of the State Privatization Program (CDPED), the main guidelines of SABESP’s privatization model were discussed, and
the main benefits highlighted in the first phase of the studies include (i) the addition and acceleration of investments to achieve universalization
goals; and (ii) tariff reduction through the use of a portion of the proceeds generated in the transaction.
Regarding the privatization
model chosen, there was an agreement to hold a public offering of shares, and the continuation of the next phase of specialized studies
for a more in-depth detailing of the model chosen was approved, which is under the responsibility of the Investment Partnerships Secretariat.
It was also recommended that the matter be brought back to CDPED after the conclusion of the next phase for analysis and decision regarding
the next steps.
Regarding investments, the data used by the IFC were
based on studies to prove the Company’s economic and financial capacity and submitted to the São Paulo State Utility Services
Regulatory Agency (ARSESP) in December 2021. At the time, the required investment until 2033 for the universalization of basic sanitation
services, covering 99% of the population with drinking water and 90% with sewage collection and treatment, totaled R$ 47.5 billion.
This amount, updated by the IPCA and already considering investments made until 2022, currently totals R$ 56 billion.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Comments on the Company’s Projections
Comments on the Company’s Projections
The projections presented in the Reference Form
are annual and not on a quarterly basis. Therefore, the quarterly comparison between information disclosed in the Reference Form with
quarterly results shall not apply.
Projections are monitored every year and disclosed in
the Reference Form.
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Other Information Deemed as Relevant by the Company
1.
CHANGES IN INTEREST HELD BY THE CONTROLLING SHAREHOLDER, BOARD MEMBERS, AND EXECUTIVE
OFFICERS
CONSOLIDATED SHAREHOLDING POSITION OF CONTROLLING
SHAREHOLDERS AND MANAGEMENT, AND OUTSTANDING SHARES
Position as of 06/30/2023 |
Shareholder |
Number of Common Shares (units) |
% |
Total Number of Shares
(units) |
% |
Controlling Shareholder |
|
|
|
|
Treasury Department |
343,506,664 |
50.3% |
343,506,664 |
50.3% |
Companhia Paulista de Parcerias
- CPP |
6 |
0% |
6 |
0% |
Management |
|
|
|
|
Board of Directors |
100 |
0% |
100 |
0% |
Executive Board |
1,300 |
0% |
1,300 |
0% |
|
|
|
|
|
Fiscal Council |
110 |
0% |
110 |
0% |
|
|
|
|
|
Treasury Shares |
- |
- |
- |
- |
|
|
|
|
|
Other Shareholders |
|
|
|
|
|
|
|
|
|
Total |
343,508,180 |
50.3% |
343,508,180 |
50.3% |
|
|
|
|
|
|
|
|
|
|
Outstanding Shares |
340,001,689 |
49.7% |
340,001,689 |
49.7% |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Other Information Deemed as Relevant by the Company
CONSOLIDATED SHAREHOLDING POSITION OF CONTROLLING
SHAREHOLDERS AND MANAGEMENT, AND OUTSTANDING SHARES
Position as of 06/30/2022 |
Shareholder |
Number of Common Shares (units) |
% |
Total Number of Shares
(units) |
% |
Controlling Shareholder |
|
|
|
|
Treasury Department |
343,506,664 |
50.3% |
343,506,664 |
50.3% |
Companhia Paulista de Parcerias
- CPP |
6 |
0% |
6 |
0% |
Management |
|
|
|
|
Board of Directors |
- |
- |
- |
- |
Executive Board |
100 |
0.0% |
100 |
0.0% |
|
|
|
|
|
Fiscal Council |
- |
- |
- |
- |
|
|
|
|
|
Treasury Shares |
- |
- |
- |
- |
|
|
|
|
|
Other Shareholders |
- |
- |
- |
- |
|
|
|
|
|
Total |
343,506,770 |
50.3% |
343,506,770 |
50.3% |
|
|
|
|
|
|
|
|
|
|
Outstanding Shares |
340,003,099 |
49.7% |
340,003,099 |
49.7% |
SHAREHOLDING POSITION OF HOLDERS OF MORE THAN 5% OF EACH TYPE AND CLASS OF COMPANY SHARES, UP TO THE INDIVIDUAL LEVEL |
Company:
CIA SANEAMENTO BÁSICO ESTADO SÃO PAULO |
Position as of 06/30/2023 (number of shares) |
|
Common Shares |
Total |
Shareholder |
Number of Shares |
% |
Number of Shares |
% |
Treasury Department |
343,506,664 |
50.3 |
343,506,664 |
50.3 |
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Reports and Statements / Unqualified Report on Special Review
(Free translation from the original issued in Portuguese. In the event of any
discrepancies, the Portuguese language version shall prevail.)
Report on Review of Interim Financial Information
To the Shareholders, Directors and Management
of
Companhia de Saneamento Básico
do Estado de São Paulo – SABESP
São Paulo – SP
Introduction
We have reviewed the accompanying interim financial
information of Companhia de Saneamento Básico do Estado de São Paulo (“Company”), included in the Interim Financial
Information Form (ITR) for the quarter ended June 30, 2023, which comprises the Statement of financial position as of June 30, 2023 and
the related income statement and statement of comprehensive income for the three and six months then ended and the statements of changes
in equity and cash flows for the six months then ended, including a summary of significant accounting policies and other explanatory notes.
Management is responsible for the preparation of the
interim financial information in accordance with Technical Pronouncement NBC TG - 21- Interim Financial Reporting and IAS 34 - Interim
Financial Reporting, issued by the International Accounting Standards Board (IASB), as well as for the presentation of such information
in accordance with the standards issued by the Brazilian Securities and Exchange Commission (CVM) applicable to the preparation of Interim
Financial Information (ITR). Our responsibility is to express a conclusion on this interim financial information based on our review.
Scope of Review
We conducted our review in accordance with Brazilian
and international standards on review of interim financial information (NBC TR 2410 and ISRE 2410 - Review of Interim Financial Information
Performed by the Independent Auditor of the Entity). A review of interim financial information consists of making inquiries, primarily
of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially
less in scope than an audit conducted in accordance with the standards on auditing and consequently does not enable us to obtain assurance
that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion on the interim
financial information
Based on our review, nothing has come to our attention
that causes us to believe that the accompanying interim financial information included in the Interim Financial Information Form (ITR)
referred to above is not prepared, in all material respects, in accordance with NBC TG – 21 and IAS 34 applicable to the preparation
of interim financial information and presented in accordance with the standards issued by the Brazilian Securities and Exchange Commission
(CVM).
Other matters
Statement of value added
The quarterly information referred to above includes
statements of value added for the period of six months ended June 30, 2023, prepared under the responsibility of the Company's management
and presented as supplementary information for the purposes of IAS 34. These statements were submitted to the same review procedures in
conjunction with the review of the Company's interim financial information in the order to conclude they are reconciliated to the interim
financial information and to the accounting records, as applicable, and whether the structure and content are in accordance with the criteria
established in the NBC TG 09 - Statement of Value Added. Based on our review, nothing has come to our attention that causes us to believe
that the accompanying statements of value added were not prepared, in all material respects, in accordance with the interim financial
information taken as a whole.
São Paulo, August 10, 2023
Grant Thornton Auditores Independentes Ltda.
CRC 2SP-025.583/O-1
Élica Daniela da Silva Martins
Accountant CRC 1SP-223.766/O-0
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Reports and Statements / Executive Officers’ Statement on the Report of Independent
Registered Public Accounting Firm
Executive Officers’ Statement
on the Quarterly Information
STATEMENT
The Executive
Officers of Companhia de Saneamento Básico do Estado de São Paulo - SABESP, with Corporate Taxpayers’ ID (CNPJ/MF)
number 43.776.517/0001-80, headquartered at Rua Costa Carvalho, nº 300, Pinheiros, São Paulo, declare that, according to paragraph
1 of article 27, item VI of CVM Resolution 80, of March 29, 2022, that:
They reviewed,
discussed, and agreed with the quarterly information for the period ended June 30, 2023.
São Paulo, August 10, 2023.
Companhia de Saneamento Básico
do Estado de São Paulo - SABESP
André Gustavo Salcedo Teixeira
Mendes
CEO
Catia Cristina Teixeira Pereira
Chief Economic, Financial, and Investor
Relations Officer
Sabrina de Menezes Correa Furstenau
Sabino
People and Corporate Management Officer
Paula Alessandra Bonin Costa Violante
Engineering and Innovation Officer
Roberval Tavares de Souza
Operations and Maintenance Officer
Bruno Magalhães D'Abadia
Regulation and New Businesses Officer
ITR - Quarterly Information Form - 06/30/2023 - CIA SANEAMENTO BASICO EST SAO PAULO | Version: 1 |
| |
Reports and Statements / Executive Officers’ Statement on the Report of Independent
Registered Public Accounting Firm
Executive Officers’ Statement
on the Report of Independent Registered Public Accounting Firm
STATEMENT
The Executive
Officers of Companhia de Saneamento Básico do Estado de São Paulo - SABESP, with Corporate Taxpayers’ ID (CNPJ/MF)
number 43.776.517/0001-80, headquartered at Rua Costa Carvalho, nº 300, Pinheiros, São Paulo, declare that, according to paragraph
1 of article 27, item V of CVM Resolution 80, of March 29, 2022, that:
They reviewed,
discussed, and agreed with the Report of Independent Registered Public Accounting Firm on the quarterly information for the period ended
June 30, 2023.
São Paulo, August 10, 2023.
Companhia de Saneamento Básico
do Estado de São Paulo - SABESP
André Gustavo Salcedo Teixeira
Mendes
CEO
Catia Cristina Teixeira Pereira
Chief Economic, Financial, and Investor
Relations Officer
Sabrina de Menezes Correa Furstenau
Sabino
People and Corporate Management Officer
Paula Alessandra Bonin Costa Violante
Engineering and Innovation Officer
Roberval Tavares de Souza
Operations and Maintenance Officer
Bruno Magalhães D'Abadia
Regulation and New Businesses Officer
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the city São Paulo, Brazil.
Date: August 25, 2023
Companhia de Saneamento Básico do Estado de São Paulo - SABESP |
|
|
|
By: |
/s/ Catia Cristina Teixeira Pereira
|
|
|
Name: Catia Cristina Teixeira Pereira
Title: Chief Financial Officer and Investor Relations Officer |
|
FORWARD-LOOKING STATEMENTS
This press release may contain forward-looking statements. These statements are statements that are not historical facts, and are based on management's current view and estimates of future economic circumstances, industry conditions, company performance and financial results. The words "anticipates", "believes", "estimates", "expects", "plans" and similar expressions, as they relate to the company, are intended to identify forward-looking statements. Statements regarding the declaration or payment of dividends, the implementation of principal operating and financing strategies and capital expenditure plans, the direction of future operations and the factors or trends affecting financial condition, liquidity or results of operations are examples of forward-looking statements. Such statements reflect the current views of management and are subject to a number of risks and uncertainties. There is no guarantee that the expected events, trends or results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations.
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