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OPERATING SEGMENTS | 12 Months Ended
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Dec. 31, 2021
OPERATING SEGMENTS |
| 5. | OPERATING SEGMENTS
The operating segments of the Company reflect their management and their organizational structure, used to monitoring its results. The Company also operates in the gas market, through its subsidiary Gasmig, and in other businesses with less impact on the results of its operations. In 2021, the Executive Board started assesing the performance of the energy trading segmentseparately and to make decisions in relation to the allocation of resources to such segment. This change in the separation of details by operational segment as disclosed by the Company arises from the increased importance of the activity of this segment in the energy market for complying with and maintaining the Company’s contractual obligations, especially after the reduction of the Company’s own generation capacity. The energy trading segment, includes the purchase and sale of energy in the free and regulated markets, and the activities related to trading such energy, including transactions on the Power Trading Exchange (CCEE). In a further the results of affiliates and jointly controlled companies whose management is the responsibility of the Equity Management Board (‘CemigPar’) as a single segment, evaluating Cemig’s non-controlling shareholdings, in line with the Company’s business strategies. The main aim of separation of this segment is to monitor compliance with the targets established by these companies, to ensure sustainability and maximization of their return for the company. The results of the subsidiaries Gasmig and Cemig Sim are also included in this segment, since their management and analysis of performance, too, is linked to the CemigPar management unit (the office of the Chief Officer for Holdings). Thus, in 2021, the segment information is disclosed separately into the following 5 reportable segments: Generation: Comprise production of energy from hydroelectric and wind facilities. Transmission: Comprise construction, operation and maintenance of transmission lines and substations. Trading: Comprise commercialization of energy and provision of related services. As per Note 26(g), in the third quarter of 2021 the Company began the process of segregation of the commercialization business, with partial transfer from Cemig GT to the Company. There was no change in the Company’s corporate strategy of serving the market with the purpose of energy delivery to its clients. Distribution: Comprise provision of energy distribution services, including operation and maintenance of the related infrastructure and services. Investees: Comprise management of the equity interests in which the company does not have shareholding control, in line with the Company’s business strategies. The results of the subsidiaries Gasmig and Cemig Sim are also included in this segment, since their management, too, is linked to the CemigPar management unit (the office of the Chief Officer for Holdings). Transfer of energy from the generation activity to the trading activity comprises a transaction between segments, since it consists of obtaining of revenue from the sale of energy generated, and costs for purchase of energy to be traded — these are measured at sale prices estimated in accordance with criteria based on the Company’s model for management of these businesses, using market prices as a reference. In 2021, the Company reassessed its operating segments and started disclosing the segments of Trading, Investees and Inter-segment Transactions, as a single segment. Due to this Company’s reassessment the corresponding information from previous years are being restated. Schedule of operating revenues, costs and expenses
INFORMATION BY SEGMENT AS OF AND FOR THE YEAR ENDED DECEMBER 31, 2021
ACCOUNT/DESCRIPTION |  | ENERGY |  | INVESTEES |  | TOTAL |  | INTER SEGMENT TRANSACTIONS (1) |  | RECONCILIATION (2) (3) |  | TOTAL
|  | GENERATION |  | TRANSMISSION |  | TRADING |  | DISTRIBUTION |  |  |  |  |  |  |  |
NET REVENUE |  |  | 2,921 |  |  |  | 1,094 |  |  |  | 6,430 |  |  |  | 22,345 |  |  |  | 2,858 |  |  |  | 35,648 |  |  |  | (1,575 | ) |  |  | (427 | ) |  |  | 33,646 |
COST OF ENERGY, GAS AND CHARGES FOR USE OF THE NATIONAL GRID |  |  | (795 | ) |  |  | — |  |  |  | (5,735 | ) |  |  | (14,853 | ) |  |  | (2,011 | ) |  |  | (23,394 | ) |  |  | 1,575 |  |  |  | 370 |  |  |  | (21,449 | )
OPERATING COSTS AND EXPENSES (3) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Personnel |  |  | (149 | ) |  |  | (115 | ) |  |  | (20 | ) |  |  | (847 | ) |  |  | (109 | ) |  |  | (1,240 | ) |  |  | — |  |  |  | — |  |  |  | (1,240 | )
Employees’ and managers’ profit sharing |  |  | (14 | ) |  |  | (14 | ) |  |  | (3 | ) |  |  | (94 | ) |  |  | (9 | ) |  |  | (134 | ) |  |  | — |  |  |  | — |  |  |  | (134 | )
Post-employment obligations |  |  | (5 | ) |  |  | 3 |  |  |  | (1 | ) |  |  | 19 |  |  |  | (32 | ) |  |  | (16 | ) |  |  | — |  |  |  | — |  |  |  | (16 | )
Materials, outsourced services and others expenses (revenues) |  |  | (209 | ) |  |  | (94 | ) |  |  | (14 | ) |  |  | (1,524 | ) |  |  | (165 | ) |  |  | (2,006 | ) |  |  | — |  |  |  | 57 |  |  |  | (1,949 | )
Depreciation and amortization |  |  | (254 | ) |  |  | (3 | ) |  |  | (1 | ) |  |  | (683 | ) |  |  | (108 | ) |  |  | (1,049 | ) |  |  | — |  |  |  | — |  |  |  | (1,049 | )
Operating provisions and impairment |  |  | (20 | ) |  |  | (12 | ) |  |  | (14 | ) |  |  | (198 | ) |  |  | (120 | ) |  |  | (364 | ) |  |  | — |  |  |  | — |  |  |  | (364 | )
Construction costs |  |  | — |  |  |  | (184 | ) |  |  | — |  |  |  | (1,802 | ) |  |  | (50 | ) |  |  | (2,036 | ) |  |  | — |  |  |  | — |  |  |  | (2,036 | )
Total cost of operation |  |  | (651 | ) |  |  | (419 | ) |  |  | (53 | ) |  |  | (5,129 | ) |  |  | (593 | ) |  |  | (6,845 | ) |  |  | — |  |  |  | 57 |  |  |  | (6,788 | )
OPERATING COSTS AND EXPENSES |  |  | (1,446 | ) |  |  | (419 | ) |  |  | (5,788 | ) |  |  | (19,982 | ) |  |  | (2,604 | ) |  |  | (30,239 | ) |  |  | 1,575 |  |  |  | 427 |  |  |  | (28,237 | )
Periodic tariff review, net |  |  | — |  |  |  | 215 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 215 |  |  |  | — |  |  |  | — |  |  |  | 215 |
Renegotiation of hydrological risk (Law 14,052/20), net |  |  | 1,032 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,032 |  |  |  | — |  |  |  | — |  |  |  | 1,032 |
Gains arising from the sale of non-current asset held for sale |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 109 |  |  |  | 109 |  |  |  | — |  |  |  | — |  |  |  | 109 |
Equity in earnings of unconsolidated investees, net |  |  | 54 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 128 |  |  |  | 182 |  |  |  | — |  |  |  | — |  |  |  | 182 |
Result of business combination |  |  | — |  |  |  | 4 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 4 |  |  |  | — |  |  |  | — |  |  |  | 4 |
OPERATING INCOME BEFORE FINANCE INCOME (EXPENSES) |  |  | 2,561 |  |  |  | 894 |  |  |  | 642 |  |  |  | 2,363 |  |  |  | 491 |  |  |  | 6,951 |  |  |  | — |  |  |  | — |  |  |  | 6,951 |
Finance net income (expenses) |  |  | (758 | ) |  |  | (395 | ) |  |  | 15 |  |  |  | (7 | ) |  |  | (1,107 | ) |  |  | (2,252 | ) |  |  | — |  |  |  | — |  |  |  | (2,252 | )
INCOME BEFORE INCOME TAX AND SOCIAL CONTRIBUTION TAX |  |  | 1,803 |  |  |  | 499 |  |  |  | 657 |  |  |  | 2,356 |  |  |  | (616 | ) |  |  | 4,699 |  |  |  | — |  |  |  | — |  |  |  | 4,699 |
Income tax and social contribution tax |  |  | (409 | ) |  |  | (78 | ) |  |  | (224 | ) |  |  | (655 | ) |  |  | 420 |  |  |  | (946 | ) |  |  | — |  |  |  | — |  |  |  | (946 | )
NET INCOME FOR THE YEAR |  |  | 1,394 |  |  |  | 421 |  |  |  | 433 |  |  |  | 1,701 |  |  |  | (196 | ) |  |  | 3,753 |  |  |  | — |  |  |  | — |  |  |  | 3,753 |
Equity holders of the parent |  |  | 1,394 |  |  |  | 421 |  |  |  | 433 |  |  |  | 1,701 |  |  |  | (198 | ) |  |  | 3,751 |  |  |  | — |  |  |  | — |  |  |  | 3,751 |
Non-controlling interests |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 2 |  |  |  | 2 |  |  |  | — |  |  |  | — |  |  |  | 2 |
(1) |  | The only inter-segment transactions are from the generation to the trading segment, as explained above.
(2) |  | The reconciliation between the published amounts for the segments and the accounting information on revenue and costs indicates the transactions between the consolidated companies (eliminations).
(3) |  | The information on operational costs and expenses separated by type is segregated in accordance with the internal business model, which has immaterial differences in relation to the accounting information.
INFORMATION BY SEGMENT AS OF AND FOR THE YEAR ENDED DECEMBER 31, 2020 (RESTATED)
ACCOUNT/DESCRIPTION |  | ENERGY |  | INVESTEES |  | TOTAL |  | INTER SEGMENT TRANSACTIONS (1) |  | RECONCILIATION (2) (3) |  | TOTAL
|  | GENERATION |  | TRANSMISSION |  | TRADING (1) |  |  | DISTRIBUTION |  |  |  |  |  |  |  |  |  |  |  |  |
NET REVENUE |  |  | 2,589 |  |  |  | 778 |  |  |  | 5,382 |  |  |  | 16,512 |  |  |  | 1,673 |  |  |  | 26,934 |  |  |  | (1,324 | ) |  |  | (382 | ) |  |  | 25,228 |
COST OF ENERGY, GAS AND CHARGES FOR USE OF THE NATIONAL GRID |  |  | (528 | ) |  |  | — |  |  |  | (5,027 | ) |  |  | (9,960 | ) |  |  | (1,083 | ) |  |  | (16,598 | ) |  |  | 1,324 |  |  |  | 332 |  |  |  | (14,942 | )
OPERATING COSTS AND EXPENSES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Personnel |  |  | (170 | ) |  |  | (102 | ) |  |  | (16 | ) |  |  | (886 | ) |  |  | (102 | ) |  |  | (1,276 | ) |  |  | — |  |  |  | — |  |  |  | (1,276 | )
Employees’ and managers’ profit sharing |  |  | (16 | ) |  |  | (14 | ) |  |  | (2 | ) |  |  | (93 | ) |  |  | (17 | ) |  |  | (142 | ) |  |  | — |  |  |  | — |  |  |  | (142 | )
Post-employment obligations |  |  | (42 | ) |  |  | (38 | ) |  |  | (6 | ) |  |  | (297 | ) |  |  | (55 | ) |  |  | (438 | ) |  |  | — |  |  |  | — |  |  |  | (438 | )
Materials, outsourced services and others expenses (revenues) |  |  | (178 | ) |  |  | (65 | ) |  |  | (11 | ) |  |  | (1,327 | ) |  |  | (110 | ) |  |  | (1,691 | ) |  |  | — |  |  |  | 50 |  |  |  | (1,641 | )
Depreciation and amortization |  |  | (205 | ) |  |  | (5 | ) |  |  | (1 | ) |  |  | (668 | ) |  |  | (110 | ) |  |  | (989 | ) |  |  | — |  |  |  | — |  |  |  | (989 | )
Operating provisions and impairment |  |  | (32 | ) |  |  | 7 |  |  |  | (1 | ) |  |  | (274 | ) |  |  | (123 | ) |  |  | (423 | ) |  |  | — |  |  |  | — |  |  |  | (423 | )
Construction costs |  |  | — |  |  |  | (147 | ) |  |  | — |  |  |  | (1,384 | ) |  |  | (50 | ) |  |  | (1,581 | ) |  |  | — |  |  |  | — |  |  |  | (1,581 | )
Total cost of operation |  |  | (643 | ) |  |  | (364 | ) |  |  | (37 | ) |  |  | (4,929 | ) |  |  | (567 | ) |  |  | (6,540 | ) |  |  | — |  |  |  | 50 |  |  |  | (6,490 | )
OPERATING COSTS AND EXPENSES |  |  | (1,171 | ) |  |  | (364 | ) |  |  | (5,064 | ) |  |  | (14,889 | ) |  |  | (1,650 | ) |  |  | (23,138 | ) |  |  | 1,324 |  |  |  | 382 |  |  |  | (21,432 | )
Periodic tariff review, net |  |  | — |  |  |  | 502 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 502 |  |  |  | — |  |  |  | — |  |  |  | 502 |
Fair value of business combination |  |  | — |  |  |  | 51 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 51 |  |  |  | — |  |  |  | — |  |  |  | 51 |
Equity in earnings of unconsolidated investees, net |  |  | 11 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 346 |  |  |  | 357 |  |  |  | — |  |  |  | — |  |  |  | 357 |
OPERATING INCOME BEFORE FINANCE INCOME (EXPENSES) |  |  | 1,429 |  |  |  | 967 |  |  |  | 318 |  |  |  | 1,623 |  |  |  | 369 |  |  |  | 4,706 |  |  |  | — |  |  |  | — |  |  |  | 4,706 |
Finance expenses |  |  | (322 | ) |  |  | (152 | ) |  |  | 21 |  |  |  | 22 |  |  |  | (474 | ) |  |  | (905 | ) |  |  | — |  |  |  | — |  |  |  | (905 | )
INCOME BEFORE INCOME TAX AND SOCIAL CONTRIBUTION TAX |  |  | 1,107 |  |  |  | 815 |  |  |  | 339 |  |  |  | 1,645 |  |  |  | (105 | ) |  |  | 3,801 |  |  |  | — |  |  |  | — |  |  |  | 3,801 |
Income tax and social contribution tax |  |  | (308 | ) |  |  | (222 | ) |  |  | (81 | ) |  |  | (430 | ) |  |  | 105 |  |  |  | (936 | ) |  |  | — |  |  |  | — |  |  |  | (936 | )
NET INCOME FOR THE YEAR |  |  | 799 |  |  |  | 593 |  |  |  | 258 |  |  |  | 1,215 |  |  |  | — |  |  |  | 2,865 |  |  |  | — |  |  |  | — |  |  |  | 2,865 |
Equity holders of the parent |  |  | 799 |  |  |  | 593 |  |  |  | 258 |  |  |  | 1,215 |  |  |  | (1 | ) |  |  | 2,864 |  |  |  | — |  |  |  | — |  |  |  | 2,864 |
Non-controlling interests |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1 |  |  |  | 1 |  |  |  | — |  |  |  | — |  |  |  | 1 |
| (1) | The only inter-segment transactions are from the generation to the trading segment, as explained above.
| (2) | The reconciliation between the published amounts for the segments and the accounting information on revenue and costs indicates the transactions between the consolidated companies (eliminations).
| (3) | The information on operational costs and expenses separated by type is segregated in accordance with the internal business model, which has immaterial differences in relation to the accounting information.
INFORMATION BY SEGMENT AS OF AND FOR THE YEAR ENDED DECEMBER 31, 2019 (RESTATED)
ACCOUNT/DESCRIPTION |  | ENERGY |  | INVESTEES |  | TOTAL |  | INTER SEGMENT TRANSACTIONS (1) |  | RECONCILIATION (2) (3) |  | TOTAL
|  | GENERATION |  | TRANSMISSION |  | TRADING (1) |  |  | DISTRIBUTION |  |  |  |  |  |  |  |  |  |  |  |  |
NET REVENUE |  |  | 3,755 |  |  |  | 934 |  |  |  | 4,595 |  |  |  | 15,919 |  |  |  | 2,054 |  |  |  | 27,257 |  |  |  | (1,409 | ) |  |  | (362 | ) |  |  | 25,486 |
COST OF ENERGY AND GAS |  |  | (658 | ) |  |  | — |  |  |  | (4,801 | ) |  |  | (8,975 | ) |  |  | (1,436 | ) |  |  | (15,870 | ) |  |  | 1,409 |  |  |  | 313 |  |  |  | (14,148 | )
OPERATING COSTS AND EXPENSES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Personnel |  |  | (164 | ) |  |  | (113 | ) |  |  | (19 | ) |  |  | (869 | ) |  |  | (107 | ) |  |  | (1,272 | ) |  |  | — |  |  |  | — |  |  |  | (1,272 | )
Employees’ and managers’ profit sharing |  |  | (24 | ) |  |  | (27 | ) |  |  | (5 | ) |  |  | (183 | ) |  |  | (24 | ) |  |  | (263 | ) |  |  | — |  |  |  | — |  |  |  | (263 | )
Post-employment obligations |  |  | (34 | ) |  |  | (38 | ) |  |  | (7 | ) |  |  | (277 | ) |  |  | (52 | ) |  |  | (408 | ) |  |  | — |  |  |  | — |  |  |  | (408 | )
Materials, outsourced services and others expenses (revenues) |  |  | (170 | ) |  |  | (67 | ) |  |  | (14 | ) |  |  | (1,375 | ) |  |  | (247 | ) |  |  | (1,873 | ) |  |  | — |  |  |  | 49 |  |  |  | (1,824 | )
Depreciation and amortization |  |  | (212 | ) |  |  | (3 | ) |  |  | — |  |  |  | (652 | ) |  |  | (91 | ) |  |  | (958 | ) |  |  | — |  |  |  | — |  |  |  | (958 | )
Operating provisions and impairment |  |  | (271 | ) |  |  | (72 | ) |  |  | (10 | ) |  |  | (1,103 | ) |  |  | (945 | ) |  |  | (2,401 | ) |  |  | — |  |  |  | — |  |  |  | (2,401 | )
Construction costs |  |  | — |  |  |  | (221 | ) |  |  | — |  |  |  | (936 | ) |  |  | (43 | ) |  |  | (1,200 | ) |  |  | — |  |  |  | — |  |  |  | (1,200 | )
Total cost of operation |  |  | (875 | ) |  |  | (541 | ) |  |  | (55 | ) |  |  | (5,395 | ) |  |  | (1,509 | ) |  |  | (8,375 | ) |  |  | — |  |  |  | 49 |  |  |  | (8,326 | )
OPERATING COSTS AND EXPENSES |  |  | (1,533 | ) |  |  | (541 | ) |  |  | (4,856 | ) |  |  | (14,370 | ) |  |  | (2,945 | ) |  |  | (24,245 | ) |  |  | 1,409 |  |  |  | 362 |  |  |  | (22,474 | )
Periodic tariff review, net |  |  | 23 |  |  |  | 4 |  |  |  | — |  |  |  | — |  |  |  | 98 |  |  |  | 125 |  |  |  | — |  |  |  | — |  |  |  | 125 |
Dividends declared by investee classified as held for sale |  |  | — |  |  |  | 73 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 73 |  |  |  | — |  |  |  | — |  |  |  | 73 |
OPERATING INCOME BEFORE FINANCE INCOME (EXPENSES) |  |  | 2,245 |  |  |  | 470 |  |  |  | (261 | ) |  |  | 1,549 |  |  |  | (793 | ) |  |  | 3,210 |  |  |  | — |  |  |  | — |  |  |  | 3,210 |
Finance expenses |  |  | 113 |  |  |  | 98 |  |  |  | 10 |  |  |  | 902 |  |  |  | 237 |  |  |  | 1,360 |  |  |  | — |  |  |  | — |  |  |  | 1,360 |
INCOME BEFORE INCOME TAX AND SOCIAL CONTRIBUTION TAX |  |  | 2,358 |  |  |  | 568 |  |  |  | (251 | ) |  |  | 2,450 |  |  |  | (555 | ) |  |  | 4,570 |  |  |  | — |  |  |  | — |  |  |  | 4,570 |
Income tax and social contribution tax |  |  | (641 | ) |  |  | (112 | ) |  |  | 150 |  |  |  | (806 | ) |  |  | (191 | ) |  |  | (1,600 | ) |  |  | — |  |  |  | — |  |  |  | (1,600 | )
DISCONTINUED OPERATIONS |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net income after tax from discontinued operations |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 224 |  |  |  | 224 |  |  |  | — |  |  |  | — |  |  |  | 224 |
NET INCOME FOR THE YEAR |  |  | 1,717 |  |  |  | 456 |  |  |  | (101 | ) |  |  | 1,644 |  |  |  | (522 | ) |  |  | 3,194 |  |  |  | — |  |  |  | — |  |  |  | 3,194 |
Equity holders of the parent |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net income from continuing operations |  |  | 1,717 |  |  |  | 456 |  |  |  | (101 | ) |  |  | 1,644 |  |  |  | (747 | ) |  |  | 2,969 |  |  |  | — |  |  |  | — |  |  |  | 2,969 |
Net income from discontinued operations |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 224 |  |  |  | 224 |  |  |  | — |  |  |  | — |  |  |  | 224 |
Net income for the year attributed to equity holders of the parent |  |  | 1,717 |  |  |  | 456 |  |  |  | (101 | ) |  |  | 1,644 |  |  |  | (523 | ) |  |  | 3,193 |  |  |  | — |  |  |  | — |  |  |  | 3,193 |
Non-controlling interests |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net income from continuing operations |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1 |  |  |  | 1 |  |  |  | — |  |  |  | — |  |  |  | 1 |
(1) |  | The only inter-segment transactions are from the generation to the trading segment, as explained above.
(2) |  | The reconciliation between the published amounts for the segments and the accounting information on revenue and costs indicates the transactions between the consolidated companies (eliminations).
(3) |  | The information on operational costs and expenses separated by type is segregated in accordance with the internal business model, which has immaterial differences in relation to the accounting information.
The information for assets by segment is not presented, because this is not part of the information made available to the Company’s management.

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- Definition The entire disclosure for operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Name IFRS -Number 8 -IssueDate 2021-01-01 -Section Disclosure -URI http://eifrs.ifrs.org/eifrs/xifrs-link?type=IFRS&num=8&code=ifrs-tx-2021-en-r&doctype=Standard&dita_xref=IFRS08_g20-24_TI -URIDate 2021-03-24 + Details
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