1. Stability and predictability
We provide essential utilities and we operate in a regulated monopolistic sector, which allows for greater predictability of demand and revenue trajectories. In addition, we serve a highly dispersed customer base, mostly composed of residential clients with low delinquency rates.
The company’s portfolio is characterized by its diversification and duration, with an average maturity of 29.7 years (weighted by revenue on 12/31/2021). Notwithstanding, dependence on individual municipalities is also relatively low. Taken together, our 10 largest contracts responded for 33.6% of the Company’s revenue in 2021, which limits the financial impact in the event of contractual breaches.
2. Regulation in line with best practices
Tariff adjustments determined by the regulatory agencies have been sufficient to adequately remunerate our operating and capital expenses, with updates above the official inflation (IPCA) being determined by the most representative regulatory agencies.
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3. Growth potential
There are good reasons to anticipate sustainable revenue growth over the next years. This is because the expansion of waste water utilities, our main objective for the next decade, has a direct impact on Corsan’s revenue.
With 57 years of expertise in basic sanitation, we are ready to execute an audacious investment plan and achieve the universalization goals set by the New Sanitation Legal Framework and create value for the business.
4. Contributions to sustainable development
Corsan’s activities contribute directly to SDG 6 (Clean Water and Sanitation), and indirectly to the other 16 objectives – from Good Health and Well-Being (SDG 3) to Responsible Consumption and Production (SDG 12), including Reduced Inequalities (SDG 10). Our main objective by 2033 will be to universalize waste water collection and treatment within all served municipalities, which will allow us to return to the environment a higher-quality water than that which we obtain directly from the basins.
In the context of the transformations we are going through, we have been recognized for our contribution to the ESG agenda, and for our insertion in the green bond markets. The loan signed in 2021 with the International Finance Corporation (IFC) includes bold targets for water losses and the monitoring of greenhouse gas emissions. Last but not least, our 4th Issue of Debentures was classified as a “Sustainable Securities” (by SITAWI), and received the 2021 Project & Infrastructure Finance Award from LatinFinance (Water and Sanitation category).
5. Improved Governance
We have been aligning our Corporate Governance structure with the best practices in the market and preparing it to comply with the rules under B3’s “Novo Mercado” listing segment. In 2021, we have had 4 independent members on the Company’s Board of Directors, which represents 44% of the seats.
6. Building a culture of integrity
Ethics and transparency are part of Corsan’s corporate values. The Corsan Íntegra integrity program, launched in 2021, aims to engage employees with a culture of compliance with laws, regulations and organizational instruments. Among the main measures of Corsan Íntegra is the Independent Whistleblower Hotline, which acts autonomously to receive complaints and activate the responsible governance bodies.
7. Robust financials
In 2021, Fitch Ratings reaffirmed the “AA-(bra)” rating for both Corsan and its fourth issue of unsecured debentures. The corporate rating outlook is “stable”. In its report, Fitch highlights the low-risk profile of the water and waste water sector, which counts with resilient demand. It also points out that Corsan maintains a relevant position in the municipalities where it operates, mostly under long-term contracts, which ensures operational cash generation.