Companhia Energética de Minas Gerais

If it goes away, if we lose market, this will be a defeat for us, just as all of our victories will show when people say, we want to stay with you. This is the work that our team has to do. So there is an old saying that says, if you only know who are your friends, if you eat a bag of salt with the other people. my dad used to say that it takes a long time to eat a bag of salt. So we have a long time to develop this relationship. And I think this relationship that we are going through of process improvement to have at the end that yes, from our, consumers, our clients to work with us. I think that is our job and we are doing, we are working on it. In addition to governance, team, technology and service, another topic that is really important is samega privatization. All of you know that Zema, when he was elected and then reelected, he said that he wanted to privatize the samega. This is no secret. It was openly said in his election campaign and this is a task that has part of it to be executed by the administration and another part by the state administration. And because that has to be approved, by the administration of the state. And so we have to convince the congressman that this is good for the state, good for the population. And they have to say yes to this project. And once they say yes, we have to work for that. And if they say no, we will continue being a state company and improving always. If you compare CEMEX results in the last two or three years, you see that we are in an upward trend. you know one or another indicator of non-recurring events and sometimes are not that good but you will see a history of improvements in our results in the past few years being a state-owned company so if it's not approved by results that's okay we continue working and dedicating ourselves because we know that working on a state-owned company is not dancing with my sister on the ball is to dance with the most beautiful lady of the ball but if we cannot be privatized we will be a state-owned company that is a very strong one but I do believe that we should convince them because we have arguments we have data not only objective data but the subjective argument as well why is it better so the objective data is that of course the company will have a greater value so there's your different mechanisms here we are we have companies that have been sold we have companies that we so just a part of that stock is so the market value for the state now it's around 17% and if that becomes privatized or if we increase capital it will be worth more and if the amount is will be X plus 30% or some more percent. So that is what this part that the state has will be even more valuable because it is going to be even more valuable. So we're not removing value, we're adding value to people. And on the other hand, people, the state is also part of this, people, when I say it. And also we will have agility and management. They've been a state on companies. There are several ties that a private company doesn't have because there's a lot of bureaucracy. There are a number of committees to manage state-owned companies. So I'm not criticizing it and I'm not praising it either. These are things that are there. They exist. And sometimes that takes too long. There are a lot of rules that end up taking to postponed actions, reactions that could be faster. So that's a fact. This is not only speech, you just have to look at it and you will see it. This is a subjective approach, but the objective one is that it's going to value more. The subjective arguments are there is going to be improvement in management, in agility, and the administration. We have to take that into consideration because that is important. And finally, I would like to talk about results. CEMEX results have been very good, as we have seen it. Of course, you as investors have to approve that. We're not. And so far, you have approved it because we are growing market value in a very relevant, very... Well, when... Amiga reached 31, 32 billion not long ago, and then it came down a little bit. But it came down because of the stock market, because it was 110,000 points. It's now 198,000. So that's not an excuse, yes, because have stayed, remained on the top, but we did suffer a little bit with the drop of the stock exchange. So we took 50 steps forward, two back, but that's okay. Part of us have to do with our work and also part of that has to do with the market. So our consistent, our results are consistent. More than that, they are repeatable. These are not one time off results and because they are repeatable uh that shows that the company is on the right track so uh the indexes that we have with our regulating agents are all met what was supposed to come down came down what was supposed to go up went up so we are meeting all the indicators defined by our regulating agents and there are other indicators also such as management and the companies use it and we are also doing very well in these other indicators any company in brazil with a capital cost of 15 to any percent and most of the companies are there uh in that range the level of leverage that companies have a 15 to 20 to run a project the project has to provide you 25 of return how are you going to allocate uh 15 to 20 percent of capital to have a return of 21 you should you would be crazy to do that so we need to understand that we need in fact to have that capital allocation done right in a very specific way and especially in moments of high capital costs such as now of 15 to 20% of capital costs. Right now, it's not easy to have a project that will pay off. If you take a debt to pay at this rate and to have a return that is lower than that, it wouldn't make any sense. But we have to be careful. Unless it's something needed, or the ceiling is falling and we have to fix the ceiling. So we will need to do that. But if it's not that, really, we have to choose very well where we are going to allocate the capital. make sure that the company does well in the wrong capital allocations just like cancer if if you have that I'm not a physician but anyways well we don't need to be a doctor to know that but if you have a cancer it will eat you up and when you find that out and you were dying because you would not find it out because of the swelling symptoms and this is capital allocation if allocated now In the return term of the project, if it is four years from now, in the midterm, you already know if you have done something wrong or not. So if you're not doing well, you know that you're not doing well, and you can prepare yourself. So capital allocation is a relevant art, and that's part of this final... part of this presentation of mine and to conclude here my remarks i think that this makes challenges today and this is really something from a huge challenge is to be in school people But when you take people away from a position where they are for a long time in a very comfortable way, and when you think that the person has to be reinstalled in a better place, that's an argument because you want to take people away from that place. People have to leave the place where they are comfortable installed so that they can be transferred and reinstall themselves somewhere else. But can you make someone to do that? Of course not. But we can provide a plate full of food, but we cannot make the person eat. the company really can move to where we want it to be a competitive company a company that does a great job

Well, thank you all very much. You have a nice day and a nice event. Yeah, I'm done a few minutes before the time I had on the video.

Thank you very much for your participation. Now, moving on, I would like to invite our president, our CEO, Reinaldo Passanesi Filho, and he's going to talk about