Good morning, and thank you for waiting. Welcome to Companhia Paranaense de Energia - COPEL Earnings Call to discuss the results of the third quarter of 2020. All participants are in listen-only mode during the company's presentation. Later, we will hold a Q&A session when further instructions will be given. . Before proceeding, we inform that forward-looking statements that might be made during this conference call related to Copel business outlook, projections, operating and financial projections and goals are based on beliefs and assumptions of the company's management as well as on information currently available to the company.

Good morning, everyone. I would like to thank you very much for your participation in this conference call. I hope that all of you are doing well and healthy, considering that most of you will probably – all of you have read in the release that we published yesterday, me and Moura would like to bring to you a shorter presentation, so that we have more time for questions and answers about the results and future prospectives of Copel. It is with great satisfaction that I start this call mentioning the most relevant fact of the recent history of the company, which is the sale of Copel Telecom. This is a process that we are building since the beginning of our management and this week's result was an important landmark, R$1 billion of goodwill over the minimum price, around 15 times the adjusted EBITDA. These are figures very significant. And that amount, as we understand it, is thanks to a well-structured process, both internally as well as externally. I especially thank Wendell Oliveira, Telecom's CEO; Eloir Joakinson, CFO of Telecom; and Cassio Santana, New Business Officer. And the three of them have been at the head of this process, and on behalf of them, all the employees that worked on the project. Also, I would like to praise the work of Rothschild Bank and for their important support throughout this period of time. It's important to say that this movement is in line with our strategic planning, which is to focus in our energy core business. And the main question is, what do we intend to do with these proceeds? First, we wanted to increase our investments in Copel distribution. Second, we aim to look for opportunities in generation and transmission and we should focus on brownfield projects. But also, we are going to look at opportunities in auctions for the next month and years, always being very strict in terms of capital allocation. And third, to implement a dividend policy that is more adjusted to the new reality of the company.

Thank you very much, Daniel. Good morning, everyone. I also would like to thank you all the participation in our call and I hope you all are doing well. Before we talk about the results of the third quarter, obviously, I would like to say that I'm very happy about the auctions result and the last day on the last month where we have reached another relevant target in our strategic agenda. With a lot of responsibility and discipline in the capital allocation, we will more than ever analyze all improvement opportunities of our capital structure, aiming the continuation of sustainable projects as well as a dividend policy that can provide a long-term view towards shareholders with clear and more objective rules, always based on the best practices in the market. This now is probably the most important subject in our strategic agenda in addition to what has already mentioned by Daniel and approved by the board of directors. Yesterday, the implementation of a bonus program was an important improvement in governance. So, this is a great positive agenda that will be fruitful to our shareholders. Turning to the next slide. I think it's self-explanatory, but I highlighted that the results here continue to be sound and consistent and they do reflect a full alignment of all the businesses under the Copel Group with a clear strategy of efficiency improvement in all areas. This continued search for profitability and efficiency improvements in each one of our businesses continue being part of our agenda and only increases our responsibility because we know that great results in the past are not guarantee of great results in the future.

. Our first question is from Carolina Carneiro, Credit Suisse.

My question is about the new dividend policy. You mentioned in the beginning of the call that you could announce it soon. And you already mentioned in a few meetings that you would be considering that. Can you give us more color on it? When can we expect that what you were thinking about it? And if you allow me a second question, with this migration process, the unitization process actually going to the Level 2 of Bovespa, are you also considering to review your bylaws and each type of changes there. Thank you very much.

Yes, that's exactly -- these are our next steps, what you said in your second question. Yesterday, the model was approved, as we said, and now we are working and concluding the review works and the modernization of our bylaws as well. And here, we will include governance improvements, the committees, the statutory committees, sustainable development, ESG. So, that reorganization and improvement considering the best practices, the best cases in the market, and that's what we are going to be doing in the next few weeks or months. And that – the dividend policy will be included in this package. We are already discussing this. I think the figures and the low leverage at 1.3 brings us to that, but we want to offer that. And when it has approved it, everything is going to be under the same package to be submitted to the board of directors. So, I would say that this is going to happen in 60 days, probably, at the most or 60 or 80 days. I would say very soon this package will be available with all the information. But we are working on it, so that it meets the company's expectations as well as obviously of our shareholders and stakeholders.

Next question from Mr. Marcelo Sa, Itaú.

Congratulations on the results. Well, picking up on Carol's question on dividends policy, I think your leverage is very low. And you were successful with the sale of Copel Telecom? Can you comment what is going to be the use of proceeds, if this is going to be used to pay more dividends, if you're going to use that to grow? We talked to before and it probably – there is a possibility that the focus and growth can be M&A. Can you comment on that? And also, about the concession because of the GSF agreement, I know that you probably will try to concentrate this extension in something specific, and this is going to be a decision of the companies. And it's not something that you have to divide by all the plans as ANEEL had proposed. Do you have room to work on that? Did you move forward in that discussion?

I'm going to separate the first part and I will start backwards about the GSF and the concession extension. And then we talk about the telecom, the investments and then, Wendell, I would like you to give him an overview for the next steps because these funds will take some time to come to us. We expect it to happen by May or June of next year. So, Marcelo, the second question, and I'm starting by the second question, this is what we have. This R$834 million that we have in the previous calculations of CCEE, we believe that we have the cost of capital included there. This is something that Copel was working on and other companies in the sector. is ahead of that. And there is an expectation on our side because this is the understanding on the law that this cost of capital needs to be contemplated. And that would also improve the figures. Second, we've also said it, it is part of our strategy and of our understanding that the regulatory asset is of the concessionaire not of the plants. But you could allocate them on the plants. But our strategy, if there's understanding, is the one that rules. And because there is this history in the past of Copel, in the past, and the reserve auction, the energy reserve auction, we had provisions for two different purposes and it allocated only in one plant. So, this is not rectified yet. We are talking to other board members and to assistants. And we believe this is going to be the final decision. But we are not sure that this is going to come out in the final regulation. We are working with this possibility. We will advocate for this. Because then we can have this available for the plants, maybe in the future, and so that we can execute our GVM plan in which we already have the company in March, we already hired financial and legal systems to help us in that operation. So, this would be happening in the second half of next year. That's how we are working. Now about the first question before turning the floor to Wendell, I would like to say that the funds, when they come in by the end of the first half of next year, they will already be reinforcing our cash structure. And they will be following that sequence that I mentioned in the beginning of the call. Our priority is to invest on Copel distribution to improve the network. And that's how we worked to improve the regulatory base of this year. And we understand that these investments because Copel has a history of its 100% investments being considered prudent for ANEEL and this is very positive for the company. And that reduces costs, improves service to consumers and increases our base. And anyway, we are already looking at opportunities in brownfield. Some of the projects that were available in the beginning of the year that have been removed because of COVID, when we have information coming from our financial assistants, that they tend to come back to the market, either by the end of the year or the beginning of next year. And we look at that and we'll prospect that actively, but always with full responsibility in terms of our capital allocation because we see a lot of competitive opportunities. We have seen discounts in transmission lines or the market knows about it. And these are very aggressive. And so, we do not intend to do anything that is not going to generate value for the company and ANEEL. And, Wendell, if you can now give us an overview of the next two steps from now up to the closing and transition process.

So, on November 9, we were successful in the auction. And right now, we are analyzing documents, so that we can have the approval of the bidder of this auction. There is a period of time that should be respected. And this is the normal statutory process. And we expected to have the contract signed by the mid of January. And this is an important moment. That's the period that we got signing. And after that, we can submit the process to Anatel and our antitrust agency, so that they can evaluate the whole transaction and give us the approval for the final signing of the contract, the transfer shares and payment. Let's wait. If that happens in January, there is a period of time for these two agencies that it takes more or less three months. So we believe that, by June, July at the most, the whole process will be concluded and then the shares will be transferred to the new buyer and Copel will receive their money and then we can still offer a service of operation and maintenance, this new service, or the system to the new buyer. That's it.

If you allow me a final question, I think it's relevant to be discussed. Last week, ANEEL has published a proposal discussing the new methodology for operating costs. Actually, I would like to understand your impressions about this document. What drew my attention was the average efficiency rate. ANEEL was checking the data reported by the companies and their calculations. And now, they are determining arrival number as the – efficiency maximum was 20. So, your average efficiency has to be 83, so that you can get to that amount. And it seems to me a little bit dangerous because before it was based on data and now there's a discretionary definition by ANEEL. And there are other discretions on new measurements. How do you measure loss, quality, and even labor lawsuits in the model? I would like to hear from you because probably this was a positive change for you, Copel gained more efficiency when you compare them to 2018. Copel gained 15 percentage points. And according to ANEEL's ranking, it's at 89.3 and the average efficiency is at 83. So, can you comment on that? I would appreciate.

Yes, really. This resolution was published. We have seen some reports and also reactions coming from the market and the companies themselves. We have a critical understanding, but we have not an analyzed it deeply to come to a consolidated and public position. What we see is that we have to award those that are doing their homework based on real data. This is the principle of regulations from ANEEL. And that cannot be lost by – cannot be lost in estimates. But we do not have a position yet. Our teams are, under Max's supervision, working to have a detailed analysis on it. Max, I don't know if you want to comment on it.

The analysis is still in the very beginning. We need to go deeper on that Yes, that's what we need to do. And also, highlight possible improvement points, so that we did not hinder. And also, this consider a company such as ours who are knowing their homework and we are doing our homework and all investments. And next week, we will hold a huge event here in the states. The minister will be here and other ANEEL's authorities will be here as well, which is the smart grid. And also, we will have micro networks. These are consistent investments in technology that improve service and reduce cost. This is only in the smart grid program. We will have R$720 million in the first stage with equipment that is the top – state of the art, entirely interconnected. This is a pioneer project. Not only a pioneer project, but it is the largest in the sector. So, these initiatives always aim to improve efficiency and operating costs.

Next question from Mr. Gabriel Francisco, XP Investments.

Congratulations on the excellent results. You are doing a great job. I have a question about Compagás. We have seen after the auction, the governor mentioned other possibilities. And he did mention Compagás. I know some things go through Copel. And also, there are other items that are under the legislative area. So, if you can give us an update on that, if you see any progress that turns this operation feasible. And also, yeah, I would like to understand – it's happening at the same time, the divestment of Gaspetro in Petrobras. That's my question.

I think the governor was very clear and precise on B3 because he talked about his state understanding and he listed some projects that he understands as important for the state, which are highway auctions over 4,000 kilometers with the Ministry of Infrastructure, airports, and so on. This is an agenda he announced. Regarding ourselves, he also talked about Compagás. And he set challenging goals, so that we can move forward with the process. In the current stage, really, we are renewing the concession. So, the executive power already submitted a bill of law to solve the legal problem of this concession if it would end in 2024 or 2029 or 2019. The government understood it was 2019. And we went to court and we were – we got the concession up to 2024. The second then is the renewal of this concession. So, the government is concluding studies for that process. And we understand that, over the first half of the year, and this was his main topic here, the conditions will be there to renew the concession. So, it is based on that that we intend to work to be able to conclude the process and to sell that asset over the second half of 2021. We don't know the month yet. But it's going to be over the second half of 2021. And then, it goes with your other question, how Gaspetro is going to be sold. It's good that it works more or less like that because Gaspetro process should end in the first quarter of 2021. And then, there will be a 30-day period for Copel to be able to have that preferred rights. And I can tell everyone that is hearing us that we do not know which will be the terms, but we intend to see that option of the 24.5 that we'll see – that we'll have there. If that doesn't happen, we know that – we have information that they also have someone to sell the process. I think that if we have a higher percentage there in the company – of shares of our company, there, it probably will appreciate in the second half of the year. So, we'll be watching it and working on it, so that everything is concluded by the end of next year.

. If there are no further questions from participants, we now turn the floor back to the management for their final remarks.

Once again, I would like to thank you very much for your participation. And if there are no further questions, I believe the main topics and the main subjects have already been tackled. And once again, I would like to say that we have had great process with Telecom. We had a goodwill with . And as the governor said on Monday, this was the first privatization in the State of Parana after 20 years. So, this is symbolic. It is very representative. But what matters is that, in this case, for us, is that we are executing our strategic plan, which is to focus in energy generation, transmission, selling and distribution of energy. And we will continue working on our strategy, which we consider a coherence between what we say and what we do. And this is what all of us are doing. My colleagues here are fully committed to the continuous process of value generation for the company. We are very happy. Thank you very much. We did have a great reaction in the market. And above it all, we are very happy or very excited about this new strategy, about the path we are moving through and the opportunities of new businesses, expansion in the renewable and wind sectors, solar, also gas market, opening to the free market. And also, we know we'll have challenges for next year, but we have a full agenda. But we are very happy about Copel's prospectives for the next years. Thank you all very much and have a nice weekend.

Ladies and gentlemen, Copel's conference call for the results of the third quarter of 2020 has ended. Thank you.