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FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of March, 2003
Commission File Number: 333-03390
Empresa Electrica Pehuenche S.A.
PEHUENCHE ELECTRICITY CO INC
(Translation of Registrant's Name into English)
Santa Rosa 76
Santiago, Chile
(562-6309000)
(Address of principal executive office)
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 if the registrant is submitting the Form 6-K
in paper as permitted by Regulation S-T Rule 101(b)(1):
Yes | | No |X|
Indicate by check mark if the registrant is submitting the Form 6-K
in paper as permitted by Regulation S-T Rule 101(b)(7):
Yes | | No |X|
Indicate by check mark whether by furnishing the information
contained in this Form, the Registrant 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): N/A
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EMPRESA ELECTRICA PEHUENCHE S.A.
FINANCIAL STATEMENTS
DECEMBER 31, 2002 AND 2001
Contents:
Balance Sheet
Income Statement
Statement of Cash Flow
Management Analysis of the Financial Statements as of December 31, 2002
Ch$ : Chilean pesos
ThUS$: Thousand of United States dollars
Exchange rate: US$ 1 = Ch$ 718.61
EMPRESA ELECTRICA PEHUENCHE S.A.
BALANCE SHEETS
DEC. 31, 2002 DEC. 31, 2001
TH US$ TH US$
------------- -------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents 4.8 13.9
Time deposits 0.0 0.0
Trade account receivables 9,806.2 10,381.3
Other receivables 18.8 19.2
Account and notes receivables from related companies 80,358.9 80,484.8
Recoverable taxes 5.1 5.1
Prepaid expenses 709.8 368.1
Deferred Income Taxes 0.0 0.0
Other Current Assets 183.4 0.0
---------- ----------
TOTAL CURRENT ASSETS 91,087.0 91,272.4
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PROPERTY, PLANT AND EQUIPMENT
Land 1,159.8 1,159.8
Plant and facilities 636,805.9 636,805.9
Equipment and machinery 2,485.3 2,622.0
Other fixed assets 563.6 178.0
Less accumulated depreciation (185,067.9) (168,454.1)
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NET PROPERTY, PLANT AND EQUIPMENT 455,946.6 472,311.5
---------- ----------
OTHER ASSETS
Investment in related companies 13.2 12.9
Investments in other companies 77.6 53.2
Intangibles 140.1 140.1
Amortization (17.5) (14.0)
Other assets 37.2 1,038.2
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TOTAL OTHER ASSETS 250.6 1,230.5
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TOTAL ASSETS 547,284.2 564,814.5
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EMPRESA ELECTRICA PEHUENCHE S.A.
BALANCE SHEETS
DEC. 31, 2002 DEC. 31, 2001
TH CH$ TH CH$
------------- -------------
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Notes payable to banks and financial institutions
short-term 0.0 0.0
Notes payable to banks and financial institutions long-term 10,700.2 38,229.8
Bonds payable 172,068.3 1,941.2
Current installments of long-term debt 0.0 0.0
Dividends payable 8,279.6 3.3
Accounts payable 2,038.8 2,366.7
Other creditors 9,469.3 8.4
Accounts payable to related companies 403.1 10,814.9
Provisions 142.5 136.1
Withholdings 1,115.1 1,389.3
Income tax provision 0.0 0.0
Other current liabilities 270.9 0.0
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TOTAL CURRENT LIABILITIES 204,487.8 54,889.8
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LONG-TERM LIABILITIES
Notes payable to banks and financial institutions 85,106.4 89,236.0
Bonds payable 0.0 159,549.3
Other creditors 0.0 8,394.0
Provisions long-term 0.4 0.0
Deferred income taxes 3,048.6 0.0
Accounts payable to related companies 0.0 0.0
Other long-term liabilities 119.8 5,114.5
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TOTAL LONG-TERM LIABILITIES 88,275.2 262,293.8
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SHAREHOLDERS' EQUITY
Common stock 217,653.7 215,085.2
Equity revaluation reserve 0.0 0.0
Additional paid-in capital 25,488.3 25,488.3
Retained earnings 163.6 150.2
Net income for the current period 27,848.4 6,907.2
Provisional dividends (16,632.8) 0.0
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TOTAL SHAREHOLDERS' EQUITY 254,521.2 247,630.9
--------- ---------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 547,284.2 564,814.5
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EMPRESA ELECTRICA PEHUENCHE S.A.
INCOME STATEMENTS
DEC. 31, 2002 DEC. 31, 2001
TH CH$ TH CH$
------------- ------------
OPERATING INCOME
Operating revenues 94,097.3 106,285.5
Operating expenses (33,333.3) (63,077.0)
OPERATING MARGIN 60,764.0 43,208.5
Selling and administrative costs (257.8) (536.4)
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OPERATING INCOME 60,506.3 42,672.1
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NON-OPERATING RESULTS
Interest income 4,195.9 892.3
Income on investments in related companies 4.5 1.4
Other non-operating income 2,325.7 28.3
Interest expense (23,452.6) (24,922.7)
Other non-operating expenses (3,842.0) (380.6)
Price level restatement (1,392.7) 1,794.4
Exchange differences (6,181.1) (12,586.6)
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NON OPERATING RESULTS (28,342.2) (35,173.4)
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Income before income taxes 32,164.0 7,498.6
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Income taxes (4,315.6) (591.4)
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NET INCOME (LOSS) 27,848.4 6,907.2
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EMPRESA ELECTRICA PEHUENCHE S.A.
STATEMENTS OF CASH FLOWS
FOR THE PERIOD FROM JANUARY 1 THROUGH DECEMBER 31, 2002 AND 2001
DEC. 31, 2002 DEC. 31, 2001
TH US$ TH US$
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CASH FLOW FROM OPERATING ACTIVITIES
NET INCOME (LOSS) FOR THE PERIOD 27,848.4 6,907.2
(GAIN) LOSS ON SALE OF FIXED ASSETS (4.0) (5.1)
CHARGES (CREDITS) TO INCOME NOT AFFECTING CASH FLOW 29,126.7 28,798.5
Depreciation 16,730.5 16,978.2
Intangibles amortization 490.1 497.1
Income on investments in related companies (4.5) (1.4)
Net price-level restatement 1,392.7 (1,794.4)
Exchange differences 6,181.1 12,586.6
Other credits not representing cash flow 0.0 0.0
Other charges not representing cash flow 4,336.9 532.4
DECREASE ( INCREASE ) IN CURRENT ASSETS 929.6 (4,607.0)
Accounts receivables for sales 1,931.4 (4,351.4)
Other assets (1,001.8) (255.5)
INCREASE ( DECREASE ) IN CURRENT LIABILITIES (10,378.9) 8,034.9
Accounts payable related to operating income (10,723.0) 8,147.0
Interests payable 566.7 (377.8)
Other accounts payable related to non operating results 0.0 0.0
Other taxes payable (222.6) 265.7
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NET POSITIVE (NEGATIVE) CASH FLOW
FROM OPERATING ACTIVITIES 47,521.8 39,128.6
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DEC. 31, 2002 DEC. 31, 2001
TH US$ TH US$
------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from capital increase through the issue of shares 2,568.5 35,395.1
Proceeds from loans 0.0 0.0
Proceeds from bond issuance 0.0 0.0
Proceeds from loans with related companies 139,015.6 127,524.9
Other financing sources 15,524.2 38,388.6
Payment of dividends (15,221.7) 0.0
Payment of loans (37,480.6) (8,120.1)
Payment of loans with related companies (142,670.5) (217,982.2)
Other financing disbursements (9,262.3) (14,318.0)
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NET POSITIVE (NEGATIVE) CASH FLOW
FROM FINANCING ACTIVITIES (47,526.8) (39,111.8)
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CASH FLOWS FROM INVESTING ACTIVITIES
Sales of fixed assets 23.9 10.3
Proceeds from sales of investments in related companies 4.1 0.0
Sale of other investments 0.0 0.0
Other investment income 0.0 0.0
Purchases of fixed assets 0.0 0.0
Investments in related companies (28.5) 0.0
Investment in financial instruments 0.0 0.0
Other investment disbursements 0.0 0.0
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NET POSITIVE (NEGATIVE) CASH FLOW
FROM INVESTING ACTIVITIES (0.5) 10.3
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NET TOTAL POSITIVE (NEGATIVE) CASH FLOW
FOR THE PERIOD (5.4) 27.1
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INFLATION EFFECT ON CASH
AND CASH EQUIVALENTS (3.6) (14.9)
NET VARIATION IN CASH
AND CASH EQUIVALENTS (9.0) 12.2
CASH AND CASH EQUIVALENTS
AT BEGINNING OF YEAR 13.9 1.7
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CASH AND CASH EQUIVALENTS
AT END OF PERIOD 4.8 13.9
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EMPRESA ELECTRICA PEHUENCHE S.A.
MANAGEMENT ANALYSIS OF THE FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2002
The Company's Financial Statements for the year 2002 show a net income of
ThUS$ 27,848.4, explained by an operating income profit of ThUS$ 60,506.3 and a
non-operating results loss of ThUS$ 28,342.2.
For the year 2001, the company's financial statements showed a net income
of ThUS$ 6,907.2.
ANALYSIS OF THE INCOME STATEMENT
(FIGURES IN THOUSANDS OF US DOLLARS AS OF DECEMBER 31, 2002)
Operating Revenues for the year 2002 reached ThUS$ 94,097.3, which is 11.5
% lower than that of the year 2001. This is explained basically by the decline
in sell prices in the regulated and spot markets, and lower energy generation.
Operating expenses for the year 2002 reached ThUS$ 33,333.3, which are
47.2 % lower than those of the year 2001 mainly due to a decrease in energy
purchases and transmission toll costs in 2002.
Administrative and selling expenses for the year 2002 reached ThUS$ 257.8,
which are 52.0 % lower than those of the year 2001.
Operating income for the year 2002 reached ThUS$ 60,506.3, which is 41.8 %
higher than that of the year 2001, basically explained by a decrease in energy
purchases and transmission toll costs in 2002.
Non-operating results for the year 2002 reached a loss of ThUS$ 28,342.2,
compared to the loss of ThUS$ 35,173.4 in the year 2001. This is explained
primarily by smaller exchange differences loss in 2002, that reached a loss of
ThUS$ 6,181.1 in 2002 compared to a loss of ThUS$ 12,586.6 in 2001; by higher
interest income that amounted ThUS$ 4,195.9 in 2002, compared to ThUS$ 892.3 in
2001; as well as by fewer interest expense.
INCOME STATEMENT
(THUS$) DEC. 31, 2002 DEC. 31, 2001
------------- -------------
Operating income 60,506.3 42,672.1
Operating revenues 94,097.3 106,285.5
Operating expenses (33,333.3) (63,077.0)
Depreciation 16,730.5 16,978.2
Interest expense (23,452.6) (24,922.7)
Non-operating results (28,342.2) (35,173.4)
Net income (loss) before extraordinary items 69,547.7 49,160.3
Net income (loss) for the period 27,848.4 6,907.2
LIQUIDITY, BORROWING AND ACTIVITY DEC. 31, 2002 DEC. 31, 2001
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Current assets / Current liabilities 0.45 1.66
Acid ratio test 0.44 1.66
Liabilities / Shareholders' equity 1.15 1.28
Short-term debt / Total debt 69.8% 17.3%
Long-term debt / Total debt 30.2% 82.7%
Interest expense coverage 2.97 1.97
Property, plant and equipment (ThUS$) 455,946.6 472,311.5
Total assets (ThUS$) 547,284.2 564,814.5
The operating revenues comprise the energy generation that is its line of
business. The company's business was developed in the Chilean market and more
specifically in the Central Interconnected System (SIC).
The operating expenses are basically comprised of tolls of energy
transmission, depreciation of fixed assets, energy purchases and expenses
characteristic of the operation of the hydroelectric power stations.
PROFITABILITY DEC. 31, 2002 DEC. 31, 2001
------------- -------------
Return on total assets 5.01 1.28
Return on shareholders' equity 11.09 3.05
Return on operating assets 13.04 8.88
Earnings per share (Ch$) 32.67 8.19
Return on dividends 3.97 -
PRINCIPAL ASSETS
The company's assets are shown in accordance with generally accepted
accounting principles in Chile and the regulations and instructions of the
Superintendence of Securities and Insurance in Chile. Significant differences
compared with market values are not shown.
TARIFFS
Regulated node prices for the Interconnected Central System (SIC) were set
at US$31.98 per MWh (monomic price at Alto Jahuel) by the National Energy
Commission in October 2002. The figure is 3.6% lower compared with the price set
in April 2002 at US$33.17 per MWh. The Chilean electricity Law, that was amended
in 1999, established the security of the system in any event and forced
Pehuenche to redefine its commercial policy for avoiding risks not offset by the
tariff settings.
CASH FLOW ANALYSIS
During the year 2002, the company's cash flow from operating activities
totaled ThUS$ 47,521.8, which basically results from the difference between
sales and financial and operational expenses of the period, but also considering
the effects of the decrease in current assets for ThUS$ 929.6 and the decrease
in current liabilities for ThUS$ 10,378.9. The difference between the
operational flow and the net income for the period is basically explained by the
exchange differences loss of ThUS$ 6,181.1 and the depreciation for the period
of ThUS$ 16,730.5.
Cash flow from financing activities during the period totaled ThUS$
(47,526.8), which basically resulted from proceeds from loans with related
companies of ThUS$ 139,015.6, proceeds from capital increase through the issue
of shares of ThUS$ 2,568.5, payment of loans with related companies of ThUS$
142,670.5, payment of loans of ThUS$ 37,480.6 and payment of dividends of ThUS$
15,221.7.
MARKET RISK
- - The company has a high percentage of its credits denominated in dollars,
because in the Chilean electric legislation energy prices are strongly
correlated with this currency. Nevertheless this natural covering of
economic nature, in a scenario of high volatility of the dollar during the
year 2002 the company continued with its policy of partially cover its
liabilities denominated in dollars, in order to attenuate the fluctuations
that generate in the results the variations of the exchange rate. As of
December 31, 2002, the company has covered by future contracts Dollar-UF
an amount of US$ 223 million, compared with US$ 214 million of the year
2001.
- - In terms of interest rate risk, the company has 100 % of its credits in
fixed rates.
- - The company's contribution margin is directly affected by the hydrological
condition of the year. Basically, in extreme dry years the generating cost
and the spot market price can be instantly increased by more than 6 times.
The average energy generation of Pehuenche is 3,500 GWh, that diminishes
to approximately 2,050 GWh in an extremely dry year.
EMPRESA ELECTRICA PEHUENCHE S.A.
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 ELECTRICA PEHUENCHE S.A.
BY: /s/ LUCIO CASTRO MARQUEZ
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LUCIO CASTRO MARQUEZ
CHIEF EXECUTIVE OFFICER
Dated: March 25, 2003