UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of August 2007
EMPRESA DISTRIBUIDORA Y COMERCIALIZADORA NORTE S.A. (EDENOR)
(DISTRIBUTION AND MARKETING COMPANY OF THE NORTH )
(Translation of Registrant’s Name Into English)
Argentina
(Jurisdiction of incorporation or organization)
Azopardo 1025
Buenos Aires C1107ADQ
Argentina
(Address of principal executive offices)
(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)
Form 20-F X Form 40-F
(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, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- .)
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EDENOR S.A. |
Balance Sheets as of June 30, 2007 and December 31, 2006 Statements of Income for the six-month periods ended June 30, 2007 and 2006 Statements of Changes in Shareholders’ Equity for the six-month periods ended June 30, 2007 and 2006 Statements of Cash Flows for the six-month periods ended June 30, 2007 and 2006 Notes to the Financial Statements as of June 30, 2007 and 2006 and December 31, 2006 |
Alejandro Macfarlane | |
VICE CHAIRMAN: | Marcos Marcelo Mindlin |
DIRECTORS: | Damián Miguel Mindlin |
Gustavo Mariani | |
Luis Pablo Rogelio Pagano | |
Gustavo María Giugale | |
Alfredo Mac Laughlin | |
Henri Joseph Lafontaine (*) | |
Edouard Dahome | |
Edgardo Alberto Volosín | |
Ignacio Raúl Chojo Ortiz | |
Osvaldo Oscar Ramini (*) | |
ALTERNATE DIRECTORS: | Jorge Grecco |
Javier Douer | |
Pablo Díaz | |
Damián Burgio | |
Brian Henderson | |
Martín Alejandro Mittelman | |
Ricardo Torres | |
Jaques Andries (*) | |
José Carlos Cueva (*) | |
Alejandro Mindlin | |
Carlos Florencio Correa Urquiza | |
Domingo Antonio Sia (*) |
MEMBERS: | Diego Martín Salaverri |
José Daniel Abelovich | |
Roberto Horacio Crouzel (*) | |
ALTERNATE MEMBERS: | Javier Errecondo |
Marcelo Héctor Fuxman | |
Rafael Marcelo Lobos (*) |
Class of shares | Subscribed and paid-in | |
Common, book-entry shares, face value 1 and 1 vote per share | ||
Class A | 462,292,111 | |
Class B | 442,210,385 | |
Class C | 1,952,604 | |
906,455,100 |
2007 | 2006 | ||||||
CURRENT ASSETS | |||||||
Cash and banks | 4,390 | 481 | |||||
Investments (Exhibit D) | 141,822 | 32,192 | |||||
Trade receivables (Note 4) | 353,138 | 270,938 | |||||
Other receivables (Note 5) | 18,503 | 30,221 | |||||
Supplies | 9,695 | 13,635 | |||||
Total Current Assets | 527,548 | 347,467 | |||||
NON-CURRENT ASSETS | |||||||
Trade receivables (Note 4) | 117,593 | 0 | |||||
Other receivables (Note 5) | 167,371 | 256,475 | |||||
Investments in other companies (Exhibit C) | 432 | 378 | |||||
Supplies | 11,058 | 4,921 | |||||
Property, plant and equipment (Exhibit A) | 2,932,816 | 2,925,422 | |||||
Total Non-current Assets | 3,229,270 | 3,187,196 | |||||
Total Assets | 3,756,818 | 3,534,663 | |||||
CURRENT LIABILITIES | |||||||
Trade accounts payable (Note 6) | 243,494 | 267,640 | |||||
Loans (Note 7) | 16,134 | 2,029 | |||||
Salaries and social security taxes (Note 8) | 43,666 | 51,446 | |||||
Taxes (Note 9) | 87,344 | 62,192 | |||||
Other liabilities (Note 10) | 11,157 | 26,380 | |||||
Accrued litigation (Exhibit E) | 30,165 | 25,914 | |||||
Total Current Liabilities | 431,960 | 435,601 | |||||
NON-CURRENT LIABILITIES | |||||||
Trade accounts payable (Note 6) | 33,390 | 31,250 | |||||
Loans (Note 7) | 1,009,273 | 1,095,490 | |||||
Salaries and social security taxes (Note 8) | 22,010 | 20,287 | |||||
Other liabilities (Note 10) | 251,469 | 241,079 | |||||
Accrued litigation (Exhibit E) | 41,776 | 40,606 | |||||
Total Non-Current Liabilities | 1,357,918 | 1,428,712 | |||||
Total Liabilities | 1,789,878 | 1,864,313 | |||||
SHAREHOLDERS' EQUITY (as per related statements) | 1,966,940 | 1,670,350 | |||||
Total Liabilities and Shareholders' Equity | 3,756,818 | 3,534,663 |
2007 | 2006 | ||||||
Net sales ( Note 11) | 1,066,013 | 669,829 | |||||
Electric power purchases | (443,264 | ) | (383,200 | ) | |||
Gross margin | 622,749 | 286,629 | |||||
Transmission and distribution expenses ( Exhibit H) | (204,136 | ) | (174,448 | ) | |||
Administrative expenses (Exhibit H) | (53,661 | ) | (45,921 | ) | |||
Selling expenses (Exhibit H) | (42,246 | ) | (46,377 | ) | |||
Net operating income | 322,706 | 19,883 | |||||
Financial income (expenses) and holding gains (losses) | |||||||
Generated by assets | |||||||
Exchange difference | (616 | ) | 2,980 | ||||
Interest | 4,625 | 7,421 | |||||
Holding results | 28 | (9 | ) | ||||
Generated by liabilities | |||||||
Financial expenses (*) | (5,242 | ) | (15,554 | ) | |||
Exchange difference | (11,559 | ) | (22,979 | ) | |||
Interest ( **) | (27,387 | ) | (34,769 | ) | |||
Adjustment to present value of the retroactive tariff increase arising from the application of the new electricity rate schedule and of the Payment Plan Agreement with the Province of Bs.As. (Notes 13 and 17.b) | (36,687 | ) | 0 | ||||
Gain on extinguishment of former debt (Note 3.k) | 0 | 174,917 | |||||
Adjustment to present value of notes ( Note 3.k) | (27,839 | ) | 91,890 | ||||
Loss from the repurchase of notes ( Notes 3.k and 14) | (1,456 | ) | 0 | ||||
Adjustment to present value of repurchased notes | (2,703 | ) | 0 | ||||
Other (expense) income, net (Note 12) | (9,112 | ) | (8,768 | ) | |||
Income before taxes | 204,758 | 215,012 | |||||
Income tax (Note 3.n) | (89,941 | ) | 189,165 | ||||
Net income for the period | |||||||
114,817 | 404,177 |
Earnings per common share | 0.127 | 0.486 |
(*) | The breakdown of financial expenses is as follows: |
Fees related to the Corporate Notes Issuance Program (Note 24) | (2,067 | ) | 0 | ||||
Fees related to the initial public offering of capital stock (Note 23) | 0 | (10,012 | ) | ||||
Financial assistance Electricidad Argentina S.A. ( Note 15) | (3,073 | ) | (4,793 | ) | |||
Withholdings income tax and others financial expenses | (102 | ) | (749 | ) | |||
Total | (5,242 | ) | (15,554 | ) |
(**) | Includes 271 as of June 30, 2006 with Related Parties ( Note 15) . |
2007 | 2006 | |||||||||||||||||||||||||
Shareholders' contributions | Retained earnings | |||||||||||||||||||||||||
Appropriated Retained Earnings | Unappropriated Retained Earnings | |||||||||||||||||||||||||
Nominal Value (Note 16.a) | Additional Paid in Capital | Additional Paid in Capital | Total | Legal Reserve | Accumulated Deficit | Total | Total | |||||||||||||||||||
Balance at beginning of year | 831,610 | 996,489 | - | 1,828,099 | 53,320 | (211,069 | ) | 1,670,350 | 1,377,284 | |||||||||||||||||
Capital increase resolved by the Board of Directors meeting dated June 14, 2007, as per the powers granted by the Shareholders' Meeting held on June 7, 2006 (Note 23) | 74,845 | - | 106,928 | 181,773 | - | - | 181,773 | - | ||||||||||||||||||
Net income for the period | - | - | - | - | - | 114,817 | 114,817 | 404,177 | ||||||||||||||||||
Balance at end of period | 906,455 | 996,489 | 106,928 | 2,009,872 | 53,320 | (96,252 | ) | 1,966,940 | 1,781,461 |
2007 | 2006 | ||||||
Changes in cash and cash equivalents | |||||||
Cash and cash equivalents at beginning of year | 32,673 | 308,139 | |||||
Cash and cash equivalents at end of period | 146,212 | 7,373 | |||||
Net increase (decrease) in cash and cash equivalents | 113,539 | (300,766 | ) | ||||
Cash flows from operating activities | 114,817 | 404,177 | |||||
Net income for the period | |||||||
Adjustments to reconcile net income to net cash flows provided by operating activities | |||||||
Depreciation of property, plant and equipment (Exhibit A) | 89,519 | 90,064 | |||||
Retirement of property, plant and equipment (Exhibit A) | 154 | 0 | |||||
Gain from investments in related parties | (54 | ) | (11 | ) | |||
Gain on extinguishment of former debt (Note 3.k) | 0 | (174,917 | ) | ||||
Adjustment to present value of notes (Note 3.k) | 27,839 | (91,890 | ) | ||||
Adjustment to present value of note repurchases | 2,703 | 0 | |||||
Exchange difference, interest and penalties on loans | 25,551 | 43,836 | |||||
Supplies recovered from third parties | 0 | (5,782 | ) | ||||
Income tax (Note 3.n) | 89,941 | (189,165 | ) | ||||
Adjustment to present value of the retroactive tariff increase arising from the application of the new electricity rate schedule and of the Payment Plan Agreement with the Province of Bs.As. (Note 17.b) | 36,687 | 0 | |||||
Changes in assets and liabilities: | |||||||
Net (increase) in trade receivables | (238,048 | ) | (23,185 | ) | |||
Net decrease (increase) in other receivables | 10,881 | (7,995 | ) | ||||
Increase in supplies | (2,197 | ) | (4,568 | ) | |||
(Decrease) Increase in trade accounts payable | (22,006 | ) | 24,545 | ||||
(Decrease) Increase in salaries and social security taxes | (6,057 | ) | 2,929 | ||||
Increase (Decrease) in taxes | 25,152 | (4,629 | ) | ||||
(Decrease) Increase in other liabilities | (4,833 | ) | 26,551 | ||||
Net increase in accrued litigation | 5,421 | 2,989 | |||||
Financial interest paid (net of interest capitalized) (Note 18.b) | (17,289 | ) | (14,998 | ) | |||
Financial interest collected (Note 18.b) | 1,568 | 1,482 | |||||
Net cash flows provided by operating activities | 139,749 | 79,433 | |||||
Cash flows from investing activities | |||||||
Additions of property, plant and equipment | (97,067 | ) | (69,405 | ) | |||
Net cash flows used in investing activities | (97,067 | ) | (69,405 | ) | |||
Cash flows from financing activities | |||||||
(Decrease) in loans | (110,916 | ) | (310,794 | ) | |||
Capital increase (Note 16) | 181,773 | 0 | |||||
Net cash flows provided by (used in) financing activities | 70,857 | (310,794 | ) | ||||
Net Increase (Decrease) in Cash and Cash Equivalents | 113,539 | (300,766 | ) |
Year | Effect on deferred tax result Nominal value | |||
2007 (six months) | 13,771 | |||
2008 | 27,541 | |||
2009 | 26,396 | |||
2010 | 25,011 | |||
2011 – 2015 | 111,174 | |||
2016 – 2020 | 92,321 | |||
Remainder | 157,391 | |||
Total | 453,605 |
Cost | 563 | |||
Interest | 1,436 | |||
Amortization of recognized net actuarial loss | 380 | |||
2,379 |
Payment obligations under the personnel benefits plan at the beginning of the year | 15,352 | |||
Cost | 563 | |||
Interest | 1,436 | |||
Actuarial loss | 0 | |||
Benefits paid to participating employees | (262 | ) | ||
Payment obligations under the personnel benefits plan at the end of the period | 17,089 | |||
Payment obligations under the personnel benefits plan at the end of the period | 17,089 | |||
Unrecognized net actuarial loss | (5,334 | ) | ||
Total personnel benefits plan (pension plan) (Note 8) | 11,755 |
Discount rate | 19 | % | ||
Salary increase | 15 | % | ||
Inflation | 12 | % |
- | In local currency: at nominal value. |
- | In foreign currency: at the exchange rate in effect as of the end of the period/year. The corresponding detail is disclosed in Exhibit G. |
- | Time deposits, which include the portion of interest income accrued through the end of the period/year; those denominated in foreign currency have been valued at the rate of exchange in effect as of the end of the period/year, and |
- | Money market funds, which have been valued at the prevailing market price as of the end of the period/year. |
- | Services rendered and billed but not collected, and services rendered but unbilled as of the end of the period/year, at nominal value; |
- | In local currency: at nominal value. |
- | In foreign currency: at the exchange rate in effect as of the end of the period/year (Exhibit G). |
· | for doubtful accounts: it has been recorded to adjust the valuation of trade receivables up to their estimated recoverable value. The amount of the allowance has been determined based on the historical series of collections for services billed through the end of the period/year and collections subsequent thereto. |
· | for impairment of value of deferred tax assets: as of June 30, 2007 and December 31, 2006 the Company has partially reversed out the valuation allowance. (Note 3.n) |
· | for impairment of value of Municipal Bonds: due to impairment indicators, as of December 31, 2006 the Company recorded an allowance to reduce the value of such bonds to their expected recoverable amount (Note 3.e). |
- | The accounts that accumulate monetary transactions as of June 30, 2007 and 2006 have been disclosed at their nominal values. |
- | The charges for non-monetary assets consumed have been valued at cost restated to reflect the effects of inflation on the basis of the date of acquisition of such assets, as indicated in Note 2. |
- | Financial income (expense) and holding gains (losses) have been disclosed separately under income (expense) generated by assets and by liabilities. |
- | The adjustment to present value of the notes is stated at their nominal value. |
- | The gain on extinguishment of former debt as of June 30, 2006 is stated at nominal value. |
- | The adjustments to present value of trade receivables related to both the application of the retroactive tariff increase agreed upon in the Adjustment Agreement and the payment plan agreement signed with the Province of Buenos Aires for amounts deriving from the Framework Agreement as of June 30, 2007 are stated at their nominal value. |
- | The adjustment to present value of repurchased notes as of June 30, 2007 is stated at nominal value. |
2007 | 2006 | ||||||
Income tax calculated at tax rate in effect on the income before taxes | 71,665 | 75,254 | |||||
Permanent differences | |||||||
Adjustment for inflation of property, plant and equipment | 16,127 | 16,840 | |||||
Accruals and other | 1,688 | 10,348 | |||||
Income tax | 89,480 | 102,442 | |||||
Increase (Decrease) in the allowance for impairment of value of deferred tax assets | 461 | (291,607 | ) | ||||
Income tax benefit for the period | 89,941 | 189,165 |
Allowance for impairment of value of deferred tax assets | |||||||
Balance at beginning of year | 32,261 | 312,187 | |||||
Increase (Decrease) in the allowance for impairment of value of deferred tax assets | 461 | (291,607 | ) | ||||
Balance at end of period | 32,722 | 20,580 |
2007 | 2006 | ||||||
Non-current deferred tax assets | |||||||
Tax-loss carry forward | 83,447 | 143,886 | |||||
Allowance for doubtful accounts | 6,663 | 6,426 | |||||
Accruals | 34,466 | 93,179 | |||||
Adjustment to present value of the retroactive tariff increase arising from the application of the new electricity rate schedule and other trade receivables | 12,841 | 0 | |||||
Supplies valuation | 15 | 159 | |||||
137,432 | 243,650 | ||||||
Non-current deferred tax liabilities | |||||||
Property, plant and equipment | ( 17,215 | ) | (24,209 | ) | |||
Adjustment to present value of the notes | ( 10,255 | ) | (19,998 | ) | |||
(27,470 | ) | (44,207 | ) | ||||
Net deferred tax assets before allowance | 109,962 | 199,443 | |||||
Allowance for impairment of value of deferred tax assets | (32,722 | ) | (32,261 | ) | |||
Net deferred tax assets | 77,240 | 167,182 |
Amount | Tax rate 35% | Year expiring | ||||||||
Tax loss carry forward 2002 | 214,659 | 75,131 | 2007 | |||||||
Tax loss carry forward 2005 | 23,761 | 8,316 | 2010 | |||||||
Total tax losses as of June 30, 2007 | 238,420 | 83,447 |
2007 | 1,488 | |||
2008 | 1,122 | |||
2009 | 211 | |||
2010 | 147 | |||
2011 | 147 | |||
2012 | 147 | |||
Total minimum lease payments | 3,262 |
2007 | 2006 | ||||||
Total rental expenses | 1,445 | 1,297 |
2007 | 3,536 | |||
2008 | 987 | |||
2009 | 62 | |||
2010 | 0 | |||
2011 | 0 | |||
Total minimum lease collections | 4,585 |
2007 | 2006 | ||||||
Total rental income | 5,110 | 6,622 |
- | for supplementary benefits of paid leave of absence derived from accumulated vacation, |
- | for seniority-based bonus to be granted to employees with a specified number of years of employment, as stipulated in collective bargaining agreements in effect (as of June 30, 2007 and December 31, 2006, the accrual for such bonuses amounted to 5,153 and 4,847 respectively), and |
- | for other personnel benefits (pension plan) to be granted to employees upon retirement, as stipulated in collective bargaining agreements in effect (as of June 30, 2007 and December 31, 2006, the accrual for these benefits amounted to 11,755 and 9,638 respectively). |
1. | When the power supply is requested and the user is unable to provide evidence of his legal ownership of the premises; |
2. | When service has been suspended more than once in one-year period; |
3. | When the power supply is reconnected and the Company is able to verify the illegal use of the service (fraud). |
4. | When the customer is undergoing liquidated bankruptcy or reorganization proceedings. |
2007 | 2006 | ||||||
Current: | |||||||
Receivables from sales of electricity: | |||||||
Billed | 161,132 | 112,706 | |||||
Unbilled | |||||||
Sales of electricity | 113,408 | 92,803 | |||||
Retroactive tariff increase arising from the application of the new electricity rate schedule (Note 17.b item d) | 46,971 | 0 | |||||
Adjustment to present value of the retroactive tariff increase arising from the application of the new electricity rate schedule (Note 3.c) | (2,427 | ) | 0 | ||||
Framework Agreement (Note 13) | 7,579 | 45,552 | |||||
Framework Agreement - Payment plan with the Province of Bs. As. (Note 13) | 18,076 | 0 | |||||
Adjustment to present value of the Framework Agreement - Payment plan with the Province of Bs. As. (Note 3.c) | (827 | ) | 0 | ||||
National Fund of Electricity (Note 17.a) | 9,688 | 23,015 | |||||
Cannon payable for the expansion of the network, transportation and others (Note 17.b) | 12,996 | 11,882 | |||||
In litigation | 10,259 | 10,603 | |||||
Subtotal | 376,855 | 296,561 | |||||
Less: | |||||||
Allowance for doubtful accounts (Exhibit E) | (23,717 | ) | (25,623 | ) | |||
353,138 | 270,938 |
2007 | 2006 | ||||||
Non-Current: | |||||||
Receivables from sales of electricity: | |||||||
Unbilled | |||||||
Retroactive tariff increase arising from the application of the new electricity rate schedule (Note 17.b item d) | 151,026 | 0 | |||||
Adjustment to present value of the retroactive tariff increase arising from the application of the new electricity rate schedule (Note 3.c) | (33,433 | ) | 0 | ||||
117,593 | 0 |
2007 | 2006 | ||||||
Current: | |||||||
Prepaid expenses (1) | 1,610 | 1,305 | |||||
Advances to suppliers | 609 | 1,082 | |||||
Advances to personnel | 125 | 238 | |||||
Related parties (2) (Note 15) | 1,806 | 4,877 | |||||
Preliminary attachments - ENRE - (Note 17.a) | 59 | 67 | |||||
Municipal Bonds (Notes 3.e) | 0 | 11,836 | |||||
Allowance for impairment of value of Municipal Bonds ( Exhibit E) | 0 | (5,918 | ) | ||||
Other debtors (3) | 14,129 | 15,175 | |||||
Allowance for other doubtful accounts (Exhibit E) | (2,600 | ) | (2,300 | ) | |||
Other (4) | 2,765 | 3,859 | |||||
18,503 | 30,221 |
2007 | 2006 | ||||||
Non-current: | |||||||
Other debtors (Note 16.c) | 0 | 3,077 | |||||
Tax credit on minimum presumed income (Note 3.n) | 90,124 | 86,031 | |||||
Net deferred tax assets (Note 3.n) | 109,962 | 199,443 | |||||
Allowance for impairment of value of deferred tax assets (Exhibit E) | (32,722 | ) | (32,261 | ) | |||
Other | 7 | 185 | |||||
167,371 | 256,475 |
(1) | Includes 101 in foreign currency (Exhibit G) as of June 30, 2007 and December 31, 2006. |
(2) | Includes 1,358 and 4,429 in foreign currency (Exhibit G) as of June 30, 2007 and December 31, 2006, respectively. |
(3) | Includes 1,270 and 4,338 in foreign currency (Exhibit G) as of June 30, 2007 and December 31, 2006, respectively. |
(4) | Includes 752 and 754 in foreign currency (Exhibit G) as of June 30, 2007 and December 31, 2006, respectively. |
2007 | 2006 | ||||||
Current: | |||||||
Payables for purchase of electricity and other purchases (1) | 133,870 | 158,371 | |||||
Unbilled electric power purchases | 95,926 | 92,877 | |||||
Customer contributions (Note 3.p) | 13,065 | 16,123 | |||||
Other | 633 | 269 | |||||
243,494 | 267,640 | ||||||
Non-Current: | |||||||
Customer deposits (Note 3.p) | 33,390 | 31,250 |
(1) | Includes 20,342 and 16,271 in foreign currency (Exhibit G) as of June 30, 2007 and December 31, 2006, respectively. Also, includes balances with SACME S.A. for 661 and 676 as of June 30, 2007 and December 31, 2006, respectively and balances with Errecondo, Salaverri, Dellatorre, Gonazalez & Burgio for 3,240 and 16 as of June 30, 2007 and December 31, 2006, respectively. |
2007 | 2006 | ||||||
Current: | |||||||
Notes: | |||||||
In foreign currency (Exhibit G and Note 14) | |||||||
Fixed and Incremental Rate Discount Notes – Class A | 10,697 | 0 | |||||
Fixed and Incremental Rate Discount Notes – Class B | 5,077 | 0 | |||||
Interest (Note 14) | 1,756 | 2,029 | |||||
Subtotal | 17,530 | 2,029 | |||||
Adjustment to present value of notes | (1,396 | ) | 0 | ||||
Notes at present value | 16,134 | 2,029 | |||||
Non-Current: | |||||||
Notes: | |||||||
In foreign currency (Exhibit G and Note 14) | |||||||
Fixed and Incremental Rate Par Notes – Class A | 227,289 | 225,009 | |||||
Fixed and Incremental Rate Par Notes – Class B | 155,544 | 153,986 | |||||
Floating Rate Par Notes – Class A | 39,145 | 38,753 | |||||
Fixed and Incremental Rate Discount Notes – Class A | 417,170 | 466,409 | |||||
Fixed and Incremental Rate Discount Notes – Class B | 198,028 | 268,471 | |||||
Subtotal | 1,037,176 | 1,152,628 | |||||
Adjustment to present value of notes | (27,903 | ) | (57,138 | ) | |||
Notes at present value | 1,009,273 | 1,095,490 |
2007 | 2006 | ||||||
Current: | |||||||
Salaries payable and accruals | 36,214 | 44,423 | |||||
Social Security (ANSES) | 4,993 | 4,703 | |||||
Early retirements payable (Note 3.o) | 2,459 | 2,320 | |||||
43,666 | 51,446 | ||||||
Non-Current (Note 3.o): | |||||||
Other personnel benefits (Note 2) | 11,755 | 9,638 | |||||
Seniority-based bonus | 5,153 | 4,847 | |||||
Early retirements payable | 5,102 | 5,802 | |||||
22,010 | 20,287 |
2007 | 2006 | ||||||
Current: | |||||||
Provincial, municipal and federal contributions and taxes | 27,202 | 19,568 | |||||
Value Added Tax (VAT) | 25,735 | 11,935 | |||||
Tax on minimum presumed income | 4,663 | 6,507 | |||||
Withholdings | 5,493 | 4,894 | |||||
Municipal taxes | 19,920 | 15,044 | |||||
Other | 4,331 | 4,244 | |||||
87,344 | 62,192 |
2007 | 2006 | ||||||
Current: | |||||||
Technical Assistance (1) (Note 15) | 1,379 | 4,465 | |||||
Fees related to the initial public offering of capital stock (2) | 5,633 | 3,820 | |||||
Fees related to debt restructuring (Exhibit G) | 0 | 7,299 | |||||
Fees related to the issuance of Corporate Notes (Note 24 and Exhibit G) | 1,949 | 0 | |||||
Program for the Rational Use of Electric Power (PUREE) | 91 | 6,926 | |||||
Other (3) | 2,105 | 3,870 | |||||
11,157 | 26,380 | ||||||
Non-current: | |||||||
ENRE penalties (Note 17 a and b) | 251,469 | 241,079 |
(1) | Includes 1,357 and 4,465 in foreign currency (Exhibit G) as of June 30, 2007 and December 31, 2006, respectively. |
(2) | Includes 5,633 and 3,764 in foreign currency (Exhibit G) as of June 30, 2007 and December 31, 2006, respectively. |
(3) | Includes 691 and 2,435 in foreign currency (Exhibit G) as of June 30, 2007 and December 31, 2006, respectively. Also, includes balances with Errecondo, Salaverri, Dellatorre Gonzalez & Burgio for 309 and 208 as of June 30, 2007 and December 31, 2006, respectively (Note 15). |
2007 | 2006 | ||||||
Sales of electricity (1) | 1,050,349 | 654,942 | |||||
Late payment charges | 8,174 | 6,133 | |||||
Pole leases | 5,110 | 6,622 | |||||
Connection charges | 1,778 | 1,322 | |||||
Reconnection charges | 602 | 810 | |||||
1,066,013 | 669,829 |
2007 | 2006 | ||||||
Non operating income | 1,035 | 795 | |||||
Commissions on municipal taxes collection | 866 | 764 | |||||
Net income (expense) from technical services | (901 | ) | 1,891 | ||||
Voluntary retirements and terminations | (2,717 | ) | (9,858 | ) | |||
Severance paid | (2,273 | ) | (1,757 | ) | |||
Accrued litigation | (6,000 | ) | (6,000 | ) | |||
Supplies recovered from third parties | 0 | 5,782 | |||||
Disposal of property, plant and equipment | (154 | ) | 0 | ||||
Other | 1,032 | (385 | ) | ||||
(9,112 | ) | (8,768 | ) |
· | If creditors holding at least 66% but less than 93% of the aggregate outstanding amount give their consent to the Restructuring, the Company, the Supporting Creditors and the APE Representative, on behalf of Consenting Creditors, will promptly execute the Restructuring Agreement, and the Company may, at its own option, either proceed with a Mandatory Exchange through the APE or an In-APE Exchange on the Consummation Date or on the In-APE Exchange Date, respectively, subject in each case to the fulfillment of the Conditions to the APE Restructuring Alternatives; |
· | If creditors holding at least 93% but less than 98% of the aggregate outstanding amount give their consent to the Restructuring, the Company may, at its own option, either proceed with an In-APE Exchange (subject to the fulfillment of the Conditions to the APE Restructuring Alternatives) on the In-APE Exchange Date or carry out the Voluntary Exchange Offer (subject to the fulfillment of the Conditions to the Voluntary Exchange Offer) on the Voluntary Exchange Date; or |
· | If creditors holding at least 98% of the aggregate outstanding amount give their consent to the Restructuring, the Company will carry out the Voluntary Exchange Offer (subject to the fulfillment of the Conditions to the Voluntary Exchange Offer) on the Voluntary Exchange Date. |
· | The Fixed Rate Par Option: For each US$ 1,000 principal amount of outstanding financial debt, creditors received Fixed Rate Par Notes for a nominal value of US$ 1,000. The amount of Fixed Rate Par Notes issued under the Restructuring was not subject to a maximum amount. Interest on Fixed Rate Par Notes will be payable semiannually in arrears at an annual fixed rate, as detailed in the table below, and principal will be due and payable in semiannual installments based on the amortization schedule detailed in the table below: |
Year | Annual Interest Rate on Fixed Rate Par Notes | Annually Scheduled Amortization | ||
1 | 3.0% | 0.0% | ||
2 | 4.0% | 0.0% | ||
3 | 5.0% | 0.0% | ||
4 | 6.0% | 0.0% | ||
5 | 8.0% | 0.0% | ||
6 | 9.0% | 10.0% | ||
7 | 9.5% | 10.0% | ||
8 through 11 | 10.0% | 10.0%, 10.0%, 10.0%, 50.0% |
· | The Floating Rate Par Option: For each US$ 1,000 principal amount of outstanding financial debt, creditors received Floating Rate Par Notes for a nominal value equal to (i) US$ 1,000 plus (ii) any accrued and unpaid interest as of December 31, 2005 (excluding penalty interest and additional amounts, if any) in respect of such US$ 1,000 principal amount of outstanding financial debt (or, in the case of Gain Trust Notes, any accrued and unpaid interest as of December 31, 2005 (excluding any penalty interest and additional amounts, if any) in respect of such US$ 1,000 principal amount of Gain Trust Notes). A maximum of US$ 50 million principal amount of outstanding financial debt could be exchanged under this option. Interest on Floating Rate Par Notes will be payable semiannually in arrears at an annual rate equal to LIBOR plus a spread, and principal will be due and payable in semiannual installments based on the amortization schedule detailed in the table below: |
Year | Annual Spread Floating Rate Par Notes | Annually Scheduled Amortization | ||
1 | 0.0% | 0.0% | ||
2 | 0.0% | 0.0% | ||
3 | 1.0% | 0.0% | ||
4 through 6 | 1.5% | 0.0%, 0.0%, 5.0% | ||
7 through 14 | 2.0% | 5.0%, 5.0%, 5.0%, 5.0%, 5.0%, 10.0%, 10.0%, 50.0% |
· | The Combination Option: For each US$ 1,000 principal amount of outstanding financial debt, creditors received (i) a cash payment of US$ 283 and (ii) Discount Notes for a nominal value of US$ 667. A fixed amount of US$ 360 million principal amount of outstanding financial debt could be exchanged under this option. Interest on Discount Notes will be payable semiannually in arrears at an annual fixed rate, and principal will be due and payable in semiannual installments based on the amortization schedule detailed in the table below: |
Year | Discount Applicable to Annual Interest Rate | Annually Scheduled Amortization | ||
1 | 3.0% | 0.0% | ||
2 | 3.5% | 0.0% | ||
3 | 10.0% | 5.0% | ||
4 | 11.0% | 5.0% | ||
5 through 9 | 12.0% | 5.0%, 5.0%, 10.0%, 10.0%, 60.0% |
Balance as of | |||||||||||||||||||||||||
Debt structure | Post-repurchase | June 30, 2007 | |||||||||||||||||||||||
in thousands | Debt repurchase - in thousands of US$ | debt structure | (Note 7) | ||||||||||||||||||||||
Type | Class | of US$ | 2/5/2007 | 3/5/2007 | 7/5/2007 | 05/21/2007 | in thousands of US$ | in thousands of $ | |||||||||||||||||
Fixed Rate Par Note | A | 73,485 | 73,485 | 227,289 | |||||||||||||||||||||
B | 50,289 | 50,289 | 155,544 | ||||||||||||||||||||||
Floating Rate Par Note | A | 12,656 | 12,656 | 39,145 | |||||||||||||||||||||
Discount Note | A | 152,322 | (13,988 | ) | 138,334 | 427,867 | |||||||||||||||||||
B | 87,678 | (6,682 | ) | (4,750 | ) | (580 | ) | (10,000 | ) | 65,666 | 203,105 | ||||||||||||||
Total | 376,430 | (20,670 | ) | (4,750 | ) | (580 | ) | (10,000 | ) | 340,430 | 1,052,950 |
Year | Amount in thousands of US$ | |||
2008 | 10,200 | |||
2009 | 10,200 | |||
2010 | 10,200 | |||
2011 | 23,210 | |||
2012 | 33,410 | |||
2013 | 33,410 | |||
2014 | 135,410 | |||
2015 | 13,010 | |||
2016 | 62,520 | |||
2017 | 1,266 | |||
2018 | 1,266 | |||
2019 | 6,328 | |||
340,430 |
- | Based on the level of excess cash (leverage ratio) and subject to maintaining an established minimum cash balance of US$ 15 million, the Company will be subject to the following conditions: |
- | The Company may make permitted capital expenditures up to an agreed-upon annual amount. |
- | Upon the occurrence of an Adverse Event, EDENOR, at its discretion, may elect to defer, reschedule and capitalize up to one year of principal amortization payments and one year of interest payments on any or all series of notes by written notice to the holders on each payment date or prior thereto. This provision may be invoked only once in respect of both an Adverse Cash Flow Event and an Adverse Devaluation Event during the term of the Notes. |
- | The Company may incur additional indebtedness subject to certain conditions that are described in the trust agreement for the issuance of the corporate notes. |
- | Restricted Payments: No dividends shall be paid until April 24, 2008 or until such time when the Company’s Leverage Ratio is lower than 2.5, whichever occurs first. Fees payable under the technical assistance agreement shall not exceed US$ 2 million. Payments to EASA shall not exceed US$ 2.5 million in any fiscal year. |
- | The Company may suspend compliance with any covenants provided that its leverage ratio is equal to or lower than 2.5. |
- | In the case that the Company carries out a primary equity public offering and as long as the Company’s Leverage ratio is higher than 2.5, the Company shall be required to apply 25% of the net cash proceeds of the base offering amount to purchase notes through market purchases, taking into account that the Company shall have a two-year period to make the aforementioned purchases of notes through market purchases and the Company shall have no obligation to make the aforementioned purchases of notes at a price greater than the nominal value of the Notes. |
2007 | 2006 | ||||||
Other receivables (Note 5) | |||||||
Electricidad Argentina S.A. (*) | 1,358 | 4,429 | |||||
SACME S.A. | 448 | 448 | |||||
Total | 1,806 | 4,877 | |||||
Trade accounts payable (Note 6) | |||||||
Errecondo, Salaverri, Dellatorre, Gonzalez & Burgio | (3,240 | ) | (16 | ) | |||
SACME S.A. | (661 | ) | (676 | ) | |||
Total | (3,901 | ) | (692 | ) | |||
Other liabilities (Note 10) | |||||||
Electricidad Argentina S.A. | (1,379 | ) | (4,465 | ) | |||
Errecondo, Salaverri, Dellatorre, Gonzalez & Burgio | (309 | ) | (208 | ) | |||
Total | (1,688 | ) | (4,673 | ) |
2007 | 2006 | ||||||
Other Income | |||||||
Electricidad Argentina S.A. | 4 | 0 | |||||
Total | 4 | 0 | |||||
Expenses from services | |||||||
SACME S.A. | (1,664 | ) | (1,155 | ) | |||
Electricidad Argentina S.A. | (119 | ) | 0 | ||||
EDF International | (3,727 | ) | (3,043 | ) | |||
Total | (5,510 | ) | (4,198 | ) | |||
Financial expenses, interest and penalties | |||||||
EDF International | 0 | (271 | ) | ||||
Electricidad Argentina S.A. | (3,073 | ) | (4,793 | ) | |||
Errecondo, Salaverri, Dellatorre, Gonzalez & Burgio | (309 | ) | 0 | ||||
Total | (3,382 | ) | (5,064 | ) | |||
Financial debt restructuring result | |||||||
EDF International | 0 | 38,114 | |||||
Adjustment to present value of notes | |||||||
EDF International | 0 | 14,926 |
1. | Deviation from quality levels of technical product, as measured by voltage levels and network variations; |
2. | Deviation from quality levels of technical service, as measured by the average interruption frequency per Kilovatios (KVA) and total interruption time per KVA; |
3. | Deviation from quality levels of commercial service, as measured by the number of claims and complaints made by customers, service connection times, the number of estimated bills and billing mistakes; |
4. | Failure to comply with information gathering and processing requirements so as to evaluate the quality of both the technical product and the technical service; |
5. | Failure to comply with public safety regulations. |
i) | the implementation of a Temporary Tariff Regime (RTT) effective as from November 1, 2005, including a 23% average increase in the distribution margin, which may not result in an increase in the average tariff of more than 15%, and an additional 5% average increase in the value added distribution (VAD), allocated to certain specified capital expenditures; |
ii) | the requirement that during the term of said temporary tariff regime, dividend payment be subject to the approval of the regulatory authority; |
iii) | the establishment of a “social tariff” for the needy and the levels of quality of the service to be rendered; |
iv) | the suspension of the claims and legal actions filed by the Company and its shareholders in national or foreign courts due to the effects caused by the Economic Emergency Law (Note 26); |
v) | the carrying out of a Revision of the Company Tariff Structure (RTI) which will result in a new tariff regime that will go into effect on a gradual basis and remain in effect for the following 5 years. In accordance with the provisions of Law N° 24,065, the National Electric Power Regulatory Authority will be in charge of such review; |
vi) | the implementation of a minimum investment plan in the electric network for an amount of 178.8 million to be fulfilled by EDENOR during 2006, plus an additional investment of 25.5 million should it be required (item f below); |
vii) | the adjustment of the penalties imposed by the ENRE that are payable to customers as discounts, which were notified by such regulatory agency prior to January 6, 2002 as well as of those that have been notified, or whose cause or origin has arisen in the period between January 6, 2002 and the date on which the Adjustment Agreement goes into effect; |
viii) | the waiver of the penalties imposed by the ENRE that are payable to the Argentine State, which have been notified, or their cause or origin has arisen in the period between January 6, 2002 and the date on which the Adjustment Agreement goes into effect; |
ix) | the payment of the penalties imposed by the ENRE, which are described in paragraph vii above, in fourteen semiannual installments, which represent approximately two-thirds of the penalties imposed by the ENRE before January 6, 2002 as well as of those that have been notified, or whose cause or origin has arisen in the period between January 6, 2002 and the date on which the Adjustment Agreement goes into effect, subject to compliance with certain requirements. |
a) | A 23% average increase in distribution costs, service connection costs and service reconnection costs in effect which the Company collects as the holder of the concession of the public service of electric power distribution, except for the residential tariffs; |
b) | Implementation of an additional 5% average increase in distribution costs, to be applied to the execution of the works and infrastructure plan detailed in Appendix II of the Adjustment Agreement. In this regard, the Company has set up the required fund, which as of June 30, 2007 amounts to 14,417; |
c) | Implementation of the Cost Monitoring Mechanism (MMC) contemplated in Appendix I of the Adjustment Agreement, which for the six-month period beginning November 1, 2005 and ending April 30, 2006, shows a percentage of 8.032%. This percentage will be applied to non-residential consumption recorded from May 1, 2006 through January 31, 2007; |
d) | Invoicing in 55 equal and consecutive monthly installments of the differences arising from the application of the new electricity rate schedule for non-residential consumption recorded from November 1, 2005 through January 31, 2007 (items i) and ii) above) and from May 1, 2006 through January 31, 2007 (item iii) above); |
e) | Invoicing of the differences corresponding to deviations between foreseen physical transactions and those effectively carried out and of other concepts related to the Wholesale Electric Power Market (MEM), such as the Specific fee payable for the expansion of the network, Transportation and Others, included in Trade Receivables under Receivables from sales of electricity as Unbilled (Note 4); |
f) | Presentation, within a period of 45 calendar days from the issuance of this resolution, of an adjusted annual investment plan, in physical and monetary values, in compliance with the requirements of the Adjustment Agreement. |
As of June 30, 2007 | As of December 31, 2006 | As of June 30, 2006 | As of December 31, 2005 | ||||||||||
Cash and Banks | 4,390 | 481 | 2,322 | 11,659 | |||||||||
Time deposits | 127,093 | 1,360 | 3,701 | 278,238 | |||||||||
Money market funds | 14,729 | 30,832 | 1,350 | 18,242 | |||||||||
Total cash and cash equivalents in the Statement of Cash Flows | 146,212 | 32,673 | 7,373 | 308,139 |
For the six-month periods ended June 30, | |||||||
2007 | 2006 | ||||||
Interest paid during the period | (21,201 | ) | (19,384 | ) | |||
Interest collected during the period | 1,568 | 1,482 |
Risk covered | Amount insured | ||
Comprehensive (1) | US$ | 417,516,597 | |
Mandatory life insurance | $ | 17,361,000 | |
Theft of securities | US$ | 100,000 | |
Vehicles (theft, third party liability and damages) | $ | 6,768,400 | |
Special equipment | US$ | 610,637 | |
Land freight | US$ | 2,000,000 | |
Imports freight | $ | 2,250,000 |
(1) | Includes: fire, partial theft, tornado, hurricane, earthquake, earth tremors, flooding and debris removal from facilities on facilities providing actual service, except for high, medium and low voltage networks. |
a) | Fixed interest rate with maximum maturity in 2017. |
b) | Maturity date up to a maximum of 10 years to commence as from issuance date. |
c) | Issuance and payment currency: dollars. |
d) | Full amortization at maturity date. |
e) | Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months and will be paid semiannually in arrears. The notes will accrue interest at a fixed rate. |
f) | Penalty interest on past-due interest payments will be paid at a rate of 2% per annum. |
g) | Interest will be paid in January and June of each year at a date to be determined. |
h) | The corporate notes will be direct, unconditional, unsubordinated and secured obligations of the Company and will at all times rank equally among themselves and be given equal or superior treatment with respect to any other present or future unsecured indebtedness, unless such other indebtedness were regarded as a preferred debt by mandatory legal regulations or were a subordinated debt in accordance with stipulated terms. |
i) | To the extent permitted by the applicable law, the Company will be allowed to repurchase Corporate Notes at any time and periodically. |
25. | BREAKDOWN OF TEMPORARY INVESTMENTS, RECEIVABLES AND LIABILITIES BY COLLECTION AND PAYMENT TERMS |
Term | Time Deposits and Money Market Funds | Receivables (1) | Loans | Other payables (2) | |||||||||
With no explicit due date | 14,729 | 0 | 0 | 251,469 | |||||||||
With due date | |||||||||||||
Past due: | |||||||||||||
Up to three months | 0 | 52,496 | 0 | 0 | |||||||||
From three to six months | 0 | 6,119 | 0 | 0 | |||||||||
From six to nine months | 0 | 6,919 | 0 | 0 | |||||||||
From nine to twelve months | 0 | 7,985 | 0 | 0 | |||||||||
Over one year | 0 | 72,485 | 0 | 0 | |||||||||
Total past due | 0 | 146,004 | 0 | 0 | |||||||||
To become due: | |||||||||||||
Up to three months | 127,093 | 249,012 | 1,756 | 363,443 | |||||||||
From three to six months | 0 | 1,017 | 0 | 13,042 | |||||||||
From six to nine months | 0 | 882 | 0 | 4,588 | |||||||||
From nine to twelve months | 0 | 1,043 | 14,378 | 4,588 | |||||||||
Over one year | 0 | 317,686 | 1,009,273 | 55,400 | |||||||||
Total to become due | 127,093 | 569,640 | 1,025,407 | 441,061 | |||||||||
Total with due date | 127,093 | 715,644 | 1,025,407 | 441,061 | |||||||||
Total | 141,822 | 715,644 | 1,025,407 | 692,530 |
26. | EFFECTS OF THE DEVALUATION OF THE ARGENTINE PESO AND OF OTHER CHANGES TO THE ECONOMIC RULES |
a) | the conversion into pesos of public works contracts and privatized utility rates with adjustment clauses in US dollars at the rate of ARS 1 per US dollar. |
The impossibility of applying the tariff adjustment mechanisms stipulated in the concession agreement. |
b) | the renegotiation of the concession agreement, whose process was declared open by Law N° 25,561 and regulated by Decrees N° 370/02 and 311/03 of the Federal Executive Power. The period for the completion of the aforementioned process has been extended by Law N° 25,972 until December 31, 2005, by Law N° 26,077 until December 31, 2006 and subsequently until December 31, 2007 by Law N° 26,204. |
Original value | Depreciation | ||||||||||||||||||||||||||||||||||||
MAIN ACCOUNT | At beginning of year | Additions | Retirements | Transfers | At end of period | At beginning of year | Retirements | For the period | Annual rate | At end of period | Net book value 2007 | Net book value 2006 | |||||||||||||||||||||||||
FACILITIES IN SERVICE | |||||||||||||||||||||||||||||||||||||
Substations | 849,840 | 0 | 0 | 22,725 | 872,565 | 284,103 | 0 | 12,995 | 3 - 4 | % | 297,098 | 575,467 | 565,737 | ||||||||||||||||||||||||
High voltage networks | 343,107 | 0 | 0 | 38,650 | 381,757 | 122,853 | 0 | 5,632 | 3 - 4 | % | 128,485 | 253,272 | 220,254 | ||||||||||||||||||||||||
Medium voltage networks | 748,656 | 0 | (24 | ) | 14,740 | 763,372 | 275,357 | (20 | ) | 12,069 | 3 - 4 | % | 287,406 | 475,966 | 473,299 | ||||||||||||||||||||||
Low voltage networks | 1,628,179 | 0 | (281 | ) | 16,723 | 1,644,621 | 878,202 | (131 | ) | 31,817 | 4 - 5 | % | 909,888 | 734,733 | 749,977 | ||||||||||||||||||||||
Transformation chambers and platforms | 460,791 | 0 | 0 | 16,217 | 477,008 | 175,334 | 0 | 7,937 | 3-4 | % | 183,271 | 293,737 | 285,457 | ||||||||||||||||||||||||
Meters | 546,887 | 0 | 0 | 19,925 | 566,812 | 211,057 | 0 | 11,836 | 4 - 5 | % | 222,893 | 343,919 | 335,830 | ||||||||||||||||||||||||
Buildings | 76,215 | 0 | 0 | 756 | 76,971 | 19,955 | 0 | 549 | 2 - 3 | % | 20,504 | 56,467 | 56,260 | ||||||||||||||||||||||||
Communications network and facilities | 83,637 | 0 | 0 | 586 | 84,223 | 48,273 | 0 | 2,105 | 4 - 5 | % | 50,378 | 33,845 | 35,364 | ||||||||||||||||||||||||
Total facilities in service | 4,737,312 | 0 | (305 | ) | 130,322 | 4,867,329 | 2,015,134 | (151 | ) | 84,940 | 2 ,099,923 | 2,767,406 | 2,722,178 | ||||||||||||||||||||||||
FURNITURE, TOOLS AND EQUIPMENT | |||||||||||||||||||||||||||||||||||||
Furniture, equipment and software projects | 161,913 | 5,816 | 0 | 0 | 167,729 | 151,031 | 0 | 3,558 | 12 -13 | % | 154,589 | 13,140 | 10,882 | ||||||||||||||||||||||||
Tools and other | 44,922 | 65 | 0 | 0 | 44,987 | 41,213 | 0 | 744 | 10 -11 | % | 41,957 | 3,030 | 3,709 | ||||||||||||||||||||||||
Transportation equipment | 15,066 | 664 | 0 | 0 | 15,730 | 13,376 | 0 | 277 | 20 | % | 13,653 | 2,077 | 1,690 | ||||||||||||||||||||||||
Total furniture, tools and equipment | 221,901 | 6,545 | 0 | 0 | 228,446 | 205,620 | 0 | 4,579 | 210,199 | 18,247 | 16,281 | ||||||||||||||||||||||||||
Total assets subject to depreciation | 4,959,213 | 6,545 | (305 | ) | 130,322 | 5,095,775 | 2,220,754 | (151 | ) | 89,519 | 2,310,122 | 2,785,653 | 2,738,459 | ||||||||||||||||||||||||
CONSTRUCTION IN PROCESS | |||||||||||||||||||||||||||||||||||||
Transmission | 114,270 | 30,393 | 0 | (61,375 | ) | 83,288 | 0 | 0 | 0 | 0 | 83,288 | 114,270 | |||||||||||||||||||||||||
Distribution and other | 72,693 | 60,129 | 0 | (68,947 | ) | 63,875 | 0 | 0 | 0 | 0 | 63,875 | 72,693 | |||||||||||||||||||||||||
Total construction in process | 186,963 | 90,522 | 0 | (130,322 | ) | 147,163 | 0 | 0 | 0 | 0 | 147,163 | 186,963 | |||||||||||||||||||||||||
Total 2007 | 5,146,176 | 97,067 | (305 | ) | 0 | 5,242,938 | 2,220,754 | (151 | ) | 89,519 | 2,310,122 | 2,932,816 | 0 | ||||||||||||||||||||||||
Total 2006 | 4,932,424 | 215,782 | (2,030 | ) | 0 | 5,146,176 | 2,043,154 | (1,380 | ) | 178,980 | 2 ,220,754 | 0 | 2,925,422 |
Information on Issuer | ||||||||||||||||||||||||||||||||||||||||
Last financial statements issued | ||||||||||||||||||||||||||||||||||||||||
Name and features of securities | Class | Face Value | Number | Adjusted cost | Value on equity method | Net book value 06/30/07 | Main activity | Date | Capital | Income for the year | Equity | % interest in capital stock | Net book value 12/31/06 | |||||||||||||||||||||||||||
NON-CURRENT INVESTMENTS | ||||||||||||||||||||||||||||||||||||||||
Art. 33 Law No. 19,550 | ||||||||||||||||||||||||||||||||||||||||
-Companies- | ||||||||||||||||||||||||||||||||||||||||
Related Company: | ||||||||||||||||||||||||||||||||||||||||
SACME S.A. | common non-endorsable | $ | 1 | 6 ,000 | 15 | 432 | 432 | Electric power services | 6/30/2007 | 28 | 0 | 864 | 50 | 378 | ||||||||||||||||||||||||||
Total | ||||||||||||||||||||||||||||||||||||||||
432 | 378 |
Net book value | |||||||
MAIN ACCOUNT | 2007 | 2006 | |||||
CURRENT INVESTMENTS | |||||||
Time deposits | |||||||
in foreign currency (Exhibit G) | 78,873 | 1,360 | |||||
in local currency | 48,220 | 0 | |||||
Money market funds | |||||||
in local currency | 14,729 | 30,832 | |||||
Total | 141,822 | 32,192 |
2007 | 2006 | |||||||||||||||
MAIN ACCOUNT | At beginning of year | Additions | Retirements | At end of period | At end of year | |||||||||||
Deducted from current assets | ||||||||||||||||
For doubtful accounts | 25,623 | 60 | (1,966 | ) | 23,717 | 25,623 | ||||||||||
For other doubtful accounts | 2,300 | 300 | 0 | 2,600 | 2,300 | |||||||||||
For impairment of value of Municipal bonds | 5,918 | 0 | (5,918 | ) | 0 | 5,918 | ||||||||||
Deducted from non-current assets | ||||||||||||||||
For impairment of value of deferred tax assets | 32,261 | 461 | 0 | 32,722 | 32,261 | |||||||||||
Included in current liabilities | ||||||||||||||||
Accrued litigation | 25,914 | 6,000 | (1,749 | ) | 30,165 | 25,914 | ||||||||||
Included in non-current liabilities | ||||||||||||||||
Accrued litigation | 40,606 | 1,170 | 0 | 41,776 | 40,606 |
2007 | 2006 | ||||||||||||||||
Account | Foreign currency type and amount (2) | Exchange rate (1) | Booked amount in thousands of pesos | Foreign currency type and amount (2) | Booked amount in thousands of pesos | ||||||||||||
Current Assets | |||||||||||||||||
Cash and banks | US$ | 41,261 | 3.0530 | 126 | U$S | 61,953 | 187 | ||||||||||
ECU | 34,695 | 4.1298 | 143 | ECU | 31,288 | 125 | |||||||||||
Investments | |||||||||||||||||
Time deposits | US$ | 25,834,711 | 3.0530 | 78,873 | U$S | 450,184 | 1,360 | ||||||||||
Other receivables | |||||||||||||||||
Prepaid expenses | US$ | 32,929 | 3.0530 | 101 | U$S | 33,450 | 101 | ||||||||||
Related companies | US$ | 444,789 | 3.0530 | 1,358 | U$S | 1,465,585 | 4,429 | ||||||||||
Other debtors | US$ | 415,867 | 3.0530 | 1,270 | U$S | 1,435,544 | 4,338 | ||||||||||
Other | US$ | 246,374 | 3.0530 | 752 | U$S | 249,637 | 754 | ||||||||||
Total Current Assets | 82,623 | 11,294 | |||||||||||||||
Total Assets | 82,623 | 11,294 | |||||||||||||||
Current Liabilities | |||||||||||||||||
Trade accounts payable | US$ | 6,157,334 | 3.0930 | 19,045 | U$S | 5,050,196 | 15,464 | ||||||||||
ECU | 309,917 | 4.1842 | 1,297 | ECU | 199,772 | 807 | |||||||||||
Loans notes | US$ | 5,667,749 | 3.0930 | 17,530 | U$S | 662,494 | 2,029 | ||||||||||
Other liabilities | |||||||||||||||||
Technical assistance - Operator's compensation | US$ | 438,889 | 3.0930 | 1,357 | U$S | 1,458,322 | 4,465 | ||||||||||
Fees related to the initial public offering of capital stock | US$ | 1,821,290 | 3.0930 | 5,633 | U$S | 1,229,162 | 3,764 | ||||||||||
Fees related to debt restructuring | US$ | 0 | 3.0930 | 0 | U$S | 2,383,781 | 7,299 | ||||||||||
Fees related to corporate notes issuance program | US$ | 630,000 | 3.0930 | 1,949 | U$S | 0 | 0 | ||||||||||
Other | US$ | 168,919 | 3.0930 | 522 | U$S | 738,336 | 2,261 | ||||||||||
ECU | 40,383 | 4.1842 | 169 | ECU | 42,986 | 174 | |||||||||||
Total Current Liabilities | 47,502 | 36,263 | |||||||||||||||
Non-Current Liabilities | |||||||||||||||||
Loans notes | US$ | 335,329,705 | 3.0930 | 1,037,176 | U$S | 376,429,657 | 1,152,628 | ||||||||||
Total Non-Current Liabilities | 1,037,176 | 1,152,628 | |||||||||||||||
Total Liabilities | 1,084,678 | 1,188,891 |
2007 | 2006 | |||||||||||||||
Description | Transmission and Distribution Expenses | Administrative Expenses | Selling Expenses | Total | Total | |||||||||||
Salaries and social security taxes | 57,162 | 16,691 | 11,419 | 85,272 | 66,546 | |||||||||||
Postage and telephone | 549 | 670 | 3,768 | 4,987 | 4,799 | |||||||||||
Bank commissions | 0 | 0 | 3,581 | 3,581 | 3,247 | |||||||||||
Allowance for doubtful accounts | 0 | 0 | 360 | 360 | 11,290 | |||||||||||
Supplies consumption | 15,332 | 784 | 367 | 16,483 | 12,118 | |||||||||||
Work by third parties | 34,650 | 2,341 | 13,028 | 50,019 | 37,847 | |||||||||||
Rent and insurance | 1,082 | 1,387 | 281 | 2,750 | 2,178 | |||||||||||
Security service | 1,800 | 288 | 68 | 2,156 | 2,007 | |||||||||||
Fees | 692 | 1,303 | 73 | 2,068 | 2,434 | |||||||||||
Advertising | 0 | 8,253 | 0 | 8,253 | 3,274 | |||||||||||
Reimbursements to personnel | 2,690 | 630 | 559 | 3,879 | 3,508 | |||||||||||
Temporary personnel | 141 | 117 | 781 | 1,039 | 781 | |||||||||||
Depreciation of property, plant and equipment | 86,241 | 2,151 | 1,127 | 89,519 | 90,064 | |||||||||||
Technical assistance - Operator's compensation | 3,727 | 0 | 0 | 3,727 | 3,043 | |||||||||||
Directors and Supervisory Committee members' fees | 0 | 497 | 0 | 497 | 426 | |||||||||||
Tax on financial transactions | 0 | 11,486 | 0 | 11,486 | 9,773 | |||||||||||
Taxes and charges | 0 | 630 | 5,395 | 6,025 | 5,397 | |||||||||||
Other | 55 | 732 | 18 | 805 | 1,230 | |||||||||||
Total 2007 | 204,136 | 53,661 | 42,246 | 300,043 | - | |||||||||||
Total 2006 | 174,448 | 45,921 | 46,377 | - | 266,746 |
ACCOUNTS | 06.30.2007 | 06.30.2006 | 06.30.2005 | 06.30.2004 | 06.30.2003 | |||||||||||
527,548 | 300,676 | 504,044 | 476,004 | 401,735 | ||||||||||||
3,229,270 | 3,183,573 | 2,984,693 | 3,000,749 | 3,063,663 | ||||||||||||
Total Assets | 3,756,818 | 3,484,249 | 3,488,737 | 3,476,753 | 3,465,398 | |||||||||||
Current Liabilities | 431,960 | 365,096 | 1,916,532 | 1,838,581 | 1,284,481 | |||||||||||
Non-Current Liabilities | 1,357,918 | 1,337,692 | 74,348 | 71,310 | 480,500 | |||||||||||
Total Liabilities | 1,789,878 | 1,702,788 | 1,990,880 | 1,909,891 | 1,764,981 | |||||||||||
Shareholders’ Equity | 1,966,940 | 1,781,461 | 1,497,857 | 1,566,862 | 1,700,417 | |||||||||||
Total Liabilities and Shareholders’ Equity | 3,756,818 | 3,484,249 | 3,488,737 | 3,476,753 | 3,465,398 |
ACCOUNTS | 06.30.2007 | 06.30.2006 | 06.30.2005 | 06.30.2004 | 06.30.2003 | |||||||||||
Net operating income (loss) | 322,706 | 19,883 | (14,123 | ) | 23,267 | 37,780 | ||||||||||
(108,836 | ) | 203,897 | (12,511 | ) | (64,542 | ) | 259,982 | |||||||||
(9,112 | ) | (8,768 | ) | (2,394 | ) | (8,687 | ) | (3,517 | ) | |||||||
Income (loss) before taxes | 204,758 | 215,012 | (29,028 | ) | (49,962 | ) | 294,245 | |||||||||
Income tax | (89,941 | ) | 189,165 | 0 | 0 | 0 | ||||||||||
Net Income (Loss) for the Period | 114,817 | 404,177 | (29,028 | ) | (49,962 | ) | 294,245 | |||||||||
CONCEPT | UNIT | 06.30.2007 | 06.30.2006 | 06.30.2005 | 06.30.2004 | 06.30.2003 | |||||||||||||
Sales of electricity (1) | GWh | 8,892 | 8,115 | 7,680 | 7,366 | 6,736 | |||||||||||||
Electricity purchases (1) | GWh | 9,987 | 9,108 | 8,616 | 8,325 | 7,532 | |||||||||||||
RATIOS | 06.30.2007 | 06.30.2006 | 06.30.2005 | 06.30.2004 | 06.30.2003 | |
Current | Current assets | 1.22 | 0.82 | 0.26 | 0.26 | 0.31 |
Current liabilities | ||||||
Solvency | Shareholders’ Equity | 1.10 | 1.05 | 0.75 | 0.82 | 0.96 |
Total liabilities | ||||||
Fixed assets | Non-current assets | 0.86 | 0.91 | 0.86 | 0.86 | 0.88 |
Total assets | ||||||
Income (loss) before taxes | Income (Loss) before taxes | 11.06% | 15.61% | (1.90)% | (3.09)% | 20.93% |
Shareholders’ Equity excluding income (loss) for the period |
ALEJANDRO MACFARLANE |
Chairman |
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Deloitte & Co. S.R.L. Florida 234, Piso 5° C1005AAF Ciudad Autónoma de Buenos Aires Argentina Tel: (54-11) 4320-2700 Fax: (54-11) 4325-8081/4326-7340 www.deloitte.com |
a) | Our unqualified auditors’ report on the financial statements for the year ended December 31, 2006 was issued on February 21, 2007. |
b) | Our limited review report related to the six-month period ended June 30, 2006 was issued on August 8, 2006 and was subject to the resolution of the uncertainties described in such report in the explanatory paragraph. These uncertainties have been solved with the completion of the restructuring of the financial debt, as it is described in Note 14 and with the ratification of the Adjustment Agreement and the approval of the new electricity rate schedule, as it is described in Note 17 b). |
DELOITTE & Co. S.R.L. |
Daniel H. Recanatini |
(Partner) |
a) | Their unqualified report on the financial statements for the year ended December 31, 2006 dated February 21, 2007. |
b) | Their limited review report on the financial statements for the six-month period ended June 30, 2006, dated August 8, 2006, which was subject to the resolution of the uncertainties described in such report in the explanatory paragraph. These uncertainties have been solved with the completion of the financial debt restructuring, as described in note 14, and the ratification of the Adjustment Agreement by the Federal Executive Power and the issuance of the new electricity rate schedule, as described in note 17 b). |
By the Supervisory Committee |
José Daniel Abelovich Member |
MINUTES OF THE MEETING OF EDENOR S.A. SUPERVISORY COMMITTEE
In the City of Buenos Aires, on August 7, 2007, the undersigned members of the Supervisory Committee meet on the 17th floor of the corporate domicile of EMPRESA DISTRIBUIDORA Y COMERCIALIZADORA NORTE SOCIEDAD ANONIMA (EDENOR S.A.), located at 1025 Azopardo Street. At 10 a.m., the legally and statutorily required quorum being present, Dr. Daniel Abelovich, member and president of the Supervisory Committee proposes to open the meeting and deal with the first item of the Agenda: 1) Consideration of the financial statements for the second quarter of the current fiscal year ended June 30, 2007. Dr. Abelovich calls the meeting to order and states that as all Supervisory Committee members have been duly provided with the documentation relating to the fiscal year subject to consideration, together with the external auditors’ report, this Committee has examined all the documentation, including the supporting documentation of the work performed by said auditors, with whom working meetings have been held and whose criteria are shared by this Committee. As a result of the analysis performed by this Supervisory Committee, and given the knowledge all its members possess concerning the documentation and the actions taken by the corporate bodies, he suggests that all the documentation be approved and that he be expressly empowered as President of the Supervisory Committee to sign all the documentation once it is approved. Upon extensive discussion, the motion is unanimously approved. The President then puts under consideration the second item of the Agenda: 2) Supervisory Committee’s Report and other related documentation and appointment of a member for the signing thereof. Dr. Abelovich states that it is necessary to express an opinion on the Committee’s Report and puts under consideration of those present a draft version of the report that has been previously distributed. Immediately afterwards, upon consideration and discussion, said report is unanimously approved and Dr. Abelovich is authorized to sign as President and in the name of the Supervisory Committee, the report as well as the rest of the aforementioned documentation whose transcription is thereupon ordered:
SUPERVISORY COMMITTEE’S REPORT
To the Shareholders of
EMPRESA DISTRIBUIDORA Y COMERCIALIZADORA NORTE
SOCIEDAD ANONIMA (EDENOR S.A.)
1.- In our capacity as members of the Supervisory Committee and as required by section 63 clause b of the Buenos Aires Stock Exchange Regulations, we have performed a limited review of the balance sheet of Empresa Distribuidora y Comercializadora Norte Sociedad Anónima (Edenor S.A.) (hereinafter, “Edenor S.A.” or the “Company”) as of June 30, 2007 and the related statements of income, changes in shareholders’ equity and cash flows for the six-month period then ended, with their notes 1 through 28 and supplemental exhibits A, C, D, E, G and H thereto. The preparation and issuance of the financial statements are the responsibility of the Company.
2.- We have performed our review in accordance with current regulations established in Technical Resolution No. 15 of the Argentine Federation of Professional Councils in Economic Sciences. Those regulations require that the documents detailed in item 1 be examined in accordance with generally accepted auditing standards for the limited review of financial statements for interim periods and that such review include verification of the consistency of the documents subject to the review with the information on corporate decisions laid down in the minutes and whether such decisions comply with the law and the Company's by-laws as to their formal and documentary aspects. In conducting our review of the documents detailed in item I, we have taken into account the limited review performed by the external auditors, Deloitte & Co. S.R.L., who issued their Report dated August 8, 2007, in accordance with auditing standards generally accepted in Argentina for the limited review of financial statements for interim periods. Our review included the work planning, nature, scope and opportunity of the review procedures applied as well as the conclusions of the limited review performed by said auditors. A limited review consists principally of applying analytical procedures to financial data and of making inquiries to Company personnel responsible for financial and accounting matters. A limited review is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is to express an opinion on the financial statements taken as a whole. Accordingly, we do not express such an opinion. Our review did not include management, marketing or operating criteria applied by the Company, which are the responsibility of the Company's Board of Directors.
3.- Based on our review, performed with the scope described in item 2, which did not include all the procedures necessary to enable us to express an opinion on the financial statements subject to the review, we are able to report that the financial statements of EMPRESA DISTRIBUIDORA Y COMERCIALIZADORA NORTE SOCIEDAD ANONIMA (EDENOR S.A.) as of June 30, 2007
referred to in item 1 of this report take into account all material facts and circumstances of which we have become aware, and we have no further observations to make in relation to such financial statements.
4.- With regard to the figures for the year ended December 31, 2006 and for the six-month period ended June 30, 2006, which are presented for comparative purposes, we have verified that they agree with those included in the financial statements as of those dates based on which the Supervisory Committee has issued:
| a) | Their unqualified report on the financial statements for the year ended December 31, 2006 dated February 21, 2007. |
| b) | Their limited review report on the financial statements for the six-month period ended June 30, 2006, dated August 8, 2006, which was subject to the resolution of the uncertainties described in such report in the explanatory paragraph. These uncertainties have been solved with the completion of the financial debt restructuring, as described in note 14, and the ratification of the Adjustment Agreement by the Federal Executive Power and the issuance of the new electricity rate schedule, as described in note 17 b). |
5.- The provisions of section 294 of the Argentine Business Organizations Law have been complied with.
City of Buenos Aires, August ___, 2007
By the Supervisory Committee |
José Daniel Abelovich Member |
Afterwards, the President puts under consideration of Supervisory Committee members the third item of the Agenda: 3) Miscellaneous. There being no further business to come before the meeting, and at the motion of Dr. Abelovich, the meeting is adjourned at 11.00 a.m.
Respectfully submitted,
| Diego Salaverri | Rafael M. Lobos | Daniel Abelovich |
SIGNATURES
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.
Empresa Distribuidora y Comercializadora Norte S.A.
By: /s/ Rogelio Pagano
Rogelio Pagano
Chief Financial Officer
Date: August 10, 2007