ENIA - Earnings call transcript Q3 2021

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Operator

Good day, ladies and gentlemen, and welcome to Enel Américas' Third Quarter 2021 Results Conference Call. My name is Jessie and I will be your operator today. Please note that all lines will be open in listen-only mode until the question-and-answer session. [Operator Instructions] During this conference call, we may make statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements could include statements regarding the intent, belief or current expectations of Enel Américas and its management with respect to among things Enel Américas business plans, Enel Américas' cost reduction plans, trends affecting Enel Américas' financial condition or results of operations, including market trends in electricity sector in Chile or elsewhere, supervision and regulation for the electricity sector in Chile or elsewhere and the future effect of any changes in the laws and regulations applicable on Enel Américas or its affiliates. only and expectations, involve reflect of not statements performance future risks forward-looking our are current guarantees Such and uncertainties. differ a factors. may forward-looking results materially anticipated those Actual in statements as result various of from the Américas' of described These factors in the Report rates risk or Chile decline Annual government include United market elsewhere, in States and in other interest adverse or United decisions regulators XX-F, capital increase by Form the Chile of including States equity factor. a Enel markets factors in or and on elsewhere, in under

any SEC's You to may access to website those only our at reliance Enel undue their Readers XX-F forward-looking not obligations on Américas' Américas as cautioned forward-looking of those proceed. which no speak may Relations. the as the update presentation are forward-looking now on of which statements, disclose inaccurate. www.sec.gov. will place de or dates. Rafael Head Enel undertakes Mr. result development la now these I a Haza, Investor over turn become statements you statements Sir, to

Rafael de la Haza

And of slides, Thank the company, afternoon, will main Haza, gentlemen, our period. to Head welcome this de results ladies Investor presenting am quarter you, our XXXX of CFO, Relations good Aurelio and third presentation. Américas. la coming and Enel I and in be Jessie, the Rafael the Bustilho, figures of

website. will slides have that uploaded the the this follow me remind you company's presentation that Let been already into

lines. be the will only presentation, the session. remember telephone questions have we Q&A made Following Please that through the usual can

highlights call number in of by hand will the Now, X. main start Slide the over who period Aurelio, me let Please, Aurelio. to the outlining

Aurelio Bustilho

compared we all In an everybody. afternoon terms recovery last seen Good have countries year. of important demand Rafael. this third in you, quarter, in to Thank

smart São also which XXX,XXX part conclude aims are a Paulo, in meters of meters to that project install in smart meters São that We of XXX,XXX in Paulo. installation the

improvement in increase for during was that Goiás, nine of main months The in first of grew the the EGP Americas, increased in XX%. consolidation year results, last the income by adjusted week by and XX.X%. demand EBITDA tariff adjustments the and net the in our terms reasons important tariff quarter the In of third explain XX%

were time, we At strategy. Universidad These de reached level carbon of the CT-X in and in Andes. transition relevance of PwC and ESG, assessment. by our reflect the Regarding governance Moody's recognitions of ESG we scored compliance the best practice same by Los highest

with of more working After Finally, continually XXX we capacity. are start solar glad we same the renewable have and added gigawatts megawatts X.X energy the the announce EGPA merger than operations gigawatts X.X we're of under capacity. construction. new time, Americas, non-conventional to of another At wind on of

to the demand slide following the of Let's collection. evolution currencies, to move and see

against was Brazilian currencies suffered the this U.S. real left dollar As shown currency the that on depreciations. quarter, third during the chart, appreciated only while other

in better we distributed, higher. during we period XXXX, year the COVID, recovering electricity in recovery, before are That period. glad last the this seeing position And Regarding Demand to is to look the has are continued last in significantly if now we levels compared recovery even the pre-pandemic. quarter. a pre-pandemic see

better to around XXX% region, we points now the collection, are In than important percentage In in we levels. an last which countries, increased of especially Peru, pre-pandemic four X.X have terms recovery the compared of collection, slightly year.

Goias. in an an debt, to Sao bad hand, mainly million. deterioration US$XXX we in Paulo a can Enel lesser or reaching in increase by and of debt increase other This the explained extent and Rio bad regarding Enel see On is the XX.X% Enel

this figure, improving this showing we coming the increase the our line. an distributions level bad of are the reduce in for that expect in operations We in short-term, debt months to in especially this

our period. at look a the for Now let's investments have

the mainly become that in explained CapEx the of terms in of higher most incorporation quarter With period. EGP EGP US$XXX a investments of XX% million. important this investment consolidation the EGP by of Americas, business period is CapEx total. which represents increased XXX% US$X.X to country In the XX% cumulative billion. Americas, our last mainly same by increased by reaching $XXX considering increased by XX%. investments the have we million, the CapEx third would XX% Brazil would see This total explained has with distribution terms, year, Brazil. increased which of Without this, the reaching the CapEx by contributed year, During of in of CapEx XX% with of by Without of our contribution compared of Americas, have

analyze following of installed year period demand region. higher period XX% Net of XX% explained production increased the terawatt-hours XX% the in respectively, to now XX.X the and a production In operating terawatt-hour our third reaching which consolidation last XX.X increase compared terms, and the by Americas hours, and Peru. XX.X our quarter Energy incorporation increased Americas cumulative EGP production recovery EGP Generation the EGP from capacity by sales highlights XX%. Americas same in renewable. by and XX% during in XX% in by by slide. mainly and of the nine third due the explained reaching months business, terawatt operation of Let's reached is gigawatts XX.X an to quarter increased – the

demand Let's quarter Electricity of operate. represents recovery X% nine which analyze explained the in in where in network's cumulative period, X% four terawatt-hours terawatt-hours distribution the and we the reached and and in is respectively. XX.X increases important months third business in the countries in slide. This XX.X by next

suppressing XXX,XXX of all an we among around level of million the $XX had declines last It's in the increase companies. number of XX distribution customers, months. Regarding

and the while energy which In terms an flat SAIFI had important exception the indicators, losses countries of with of SAIDI quality the during period basically four in reduction. remained improved Peru,

Credit portable basically in had we in solid to card Enel pandemic the stations, business, slide, the we'll the X microinsurance growth lighting. and was X while businesses. due XX%, a following charging retail On business period. public line, over decreased by fannings, see Enel restrictions In bike

in delivery for points. And increased nine XX% which by terms sold of reaching to the delivery X,XXX points Regarding the amounted XX.X means months retail first XX% a the energy sold the the increase of business, in the energy retail year, of hours terawatt number in business.

energy at focus and in or excellent now CTA for the being carried obtained transition The agency, of assessment which an a of COX ESG for strategy rating, by next the reflected and Let's free highlights best the to transition. strong Américas company The three the carbon company. The reduce our transition integration co-generation was more, EGP emissions have is Moody's well of of company the strategy. lead our is deceived this in and by look Américas our company which puts the credit even regarding our Enel merger exposure a in the to position the score then score the one is a energy slide.

best we system system the that the governance our first study and that at are a Chile. and our transparency international Finally, obtained in reporting corporate that announce reflects – governance made level. These the corporate of best [indiscernible] in Pricewaterhouse the company to practice glad boosts practice measures by place compliance aligned level in with the is in regarding the

coming Now financial I the the about will slide. period results comment for the in

is terms, period by million quarter Regarding the an US$X,XXX from is increases than In been the million, we we net the XX.X%. demand explained EBITDA increased to in get during than impact This consolidation to control we we in it devaluation, of basis, increased million, EGP by XX.X% the XX.X% third the and income year. on mainly the of reaching Dip] the million, is have a increase a and negative EGP distribution both EBITDA debt currency increased of year, terms while by negative quarter same Américas, and this by from million XX.X% higher US$XX increases and last net the inflation seen reached the basis. which Despite the X.X% have billion. impact cumulative XX.X% a EGP that OpEx, which [Audio higher XX.X% cumulative Group by recovery coming In business. period, cases, during EBITDA of of last reached better on US$XXX the explained FX. better quarter in result. net increase year. the financial XX.X%, of Américas the nominal in If contribution third of Américas US$X.X EGP period exclude cumulative level able and Dip] and [Audio decrease of while Funds US$XXX in operation US$XXX impact by this excluding Américas last of result from

We net debt will detail and of terms cash in it the presentation. in in analyze flow

positive and a same increased Colombia of than EBITDA by EBITDA generation for a the increased breakdown. from $X,XXX America see retail slide, EBITDA XX%, main business XXXX, period distribution million for that a its EGP let’s the you of of renewable XX% represented of third see Brazil get $XXX take improved million. plus while contributor $XXX Peru $XX in EBITDA that On On impact Starting Consider and see Currency X, Network to from XX%, the while million of with of Enel by X% $XXX second coming came all grew consolidated we a XX%, million results, XXXX. Américas. basis, had which X%. in evolution the final expect was higher country $XXX we Central by when from and $XX quarter Argentina negative the thermal look million. this million, had other million, a devaluation we $XX impacts, by

mainly from solar, this From next X.X X.X Colombia the Colombia. the period the X Brazil under from gigawatt, results X.X slides. Currency wind most would capacity and contributors. winds, gigawatts negative XX% of end focus year and or business explained represent this EGP which in the X.X the is higher gigawatts them begin capacity to in the Panama. gigawatt Américas. gigawatts X.X Américas case [Audio impact devaluation sales quarter of year And hydro. had during was from this XXXX. are explained mini soft a a effect, on of plant during This energy being operation year, renewable Peru. includes six new EGP in to a projects for and this reached cumulative Let's since of in period Without X.X gigawatts of the million And the EGP In increased increased Brazil, EBITDA and America, months higher by the cumulative new same from capacity which thermo consolidate this have which XX%. EBITDA reached gigawatts, currently X.X Brazil year Colombia, slide. On – contribution gigawatts gigawatt by We In Dip] EGP the Brazil capacity a by X.X sale have have by and X.X business in terms, networks XX% mainly added $XX this came third and $XXX of next mainly Dip] quarter Brazil basis are and coming until EBITDA third price April, in coming in of year are this of EBITDA an XX% better $X,XXX Américas. explained from gigawatts X.X for million construction, $XXX reached from Central businesses Fortaleza. Américas. generation operations the of gigawatt [Audio the of main year, generation during first XX%, projects million. million increase coming of from X% when of nine from started we These will by X compared and EBITDA coming from of

million Regarding Columbia. nine projects the months to reached totalled we CapEx for it $XXX CapEx, is due first million. mainly and quietly $XXX Brazil in

next XXXX. slide. networks let's The the XX% quarter compared third of Now by to increased business see business the networks in

We the an to from to have These due last year $X,XXX countries, million reflecting difficult Important demand mainly energy In Enel countries, energy adjustment nine after better to XX% increase cumulative business period year X.X% that with last increases reached of Brazil increase growth months result we four results XX% an main during compared Sao but the in Columbia Brazil, the solid due the On EBITDA in same contributors. in the in being in of to the in distribution Paulo. better demand times, improved along terms, all pandemic. year. highlight to by these EBITDA of Brazil. in tariff the main recovery came the tariff higher and of due represents a faced Ceará

payments million, period analyze networking Funds flow Brazil recovered capital This $X,XXX period of of in than operations cash tax million. Américas. of expenses the from CDAs this should amounted [Audio period, free starting than from after Let’s cash $XXX lower last billion due in or negative a on amounted million, million amounted Dip] to amount our We of including, coming get financial $X.X result while million, flow includes $XXX for net mainly coming year million paid $XXX an less from financial the a $X,XXX to to XX% slide. higher million $XXX EBITDA $XXX million. to to – during investments be $XXX EGP minus that to

analyze distribution now the in gross me debt our billion amount Holding. debt that is Enel subsidiaries almost the Enel made Brazil offset compared is debt reduction from explained currently $X.X this slide. holding offset merger and Let the cash by The at our increase coming company Columbia the injection $X.X And increase in in by level. which Enel with of to by billion, a to an the includes in of in Américas in Gross increase is amounted partially December an Enel coming XXXX. Américas XX% Américas, S.p.A. and before

Looking paid had at million million. seen previous minus dividends billion. $XXX Américas our reached at the effects With in the Net and project Again, to the starting the $XX contributed for coming is mentioned. cash injection the receivables effects $XXX that debt level. this amounted or $XX this net net million year, million equity the $X.X Américas the less free flow financial with debt, received of the billion plus Enel cash we’ve $XXX of million, we total US$X.X of with slide. EGP minus last before from

total. that In see terms holding remains at the the Brazil of Américas while debt at Enel in country, major represents level we currency XX% contributor, level only of

partially variable can cost for of Colombia, Brazil. X.X% we better an this with at regarding see in debts to in This rates indexes rate liability and to increase and associated the from level. by of Enel Américas Finally, refinancing Peru offset in is the [indiscernible] go period in management conditions debt, debt in

this conclude me Let presentation some remarks. closing with

the allowed consolidation saw During important assets. region. across This us we quarter, EBITDA the a by boosted in level recovery improvement the an of operational solid to renewable have situation

company continue are our players America. as and our Latin focus with ESG we of ESG in positioning We one best the

Finally, strongly Raffaele? we are nonconventional, with executing renewable coming our strategy. the new sources, from and capacity delivering in line

Rafael de la Haza

the pass the [indiscernible] to you you. thank I an Aurelio. well QA. operator, Thank your me Fetch you Well, please. thank call for now the operator for

Operator

of Participants will session. begin speakers. question-and-answer Bartoli Speakers now question we of is [Operator Instructions] you, first Thank the our from Enrico the Stifel. line

is open. line Your now

Enrico Bartoli

for thanks And my question. afternoon. have good I Hi, taking three.

is one Brazil. first The on

strong You distribution from show the this business. very increase in EBITDA

and provide made adjustments you If on you a are and demand tariff to next you period. adjustments from in is the particularly for demand tariff of the to some the Second companies additional give seeing in And the the the of that days us comments possibly receive fourth in any quarter? us electricity quarter expect already sector over question outlook drivers which business. of addition next your also on the related that in terms you can you renewable can if quarters recovery both and the more you recovery

of this and show X.X You execution. gigawatts capacity

renewable If your Thank for or capacity I you And of one and on the hint the of over U.S. year? guidance and remind you confirm it's last the country, around level $X most the elaborate some that back if on if full can but the you. can us can you us for think, year, pipeline billion, this. you which next EBITDA give of in on development the to top visibility have the this that

Aurelio Bustilho

mainly you two explained right. Hi, by your increase in for Well, the distribution factors, Enrico. is questions. Thank

Sierra all – it's but Well, Rio, the results, October São and Paulo We for have Sierra already the X.X%. tariff them nine in in have in all business these months X% done, first Rio in in is tariff right? it's in well it period, one the we and for readjustments in First distribution in readjustments it's of and Brazil. Paulo, São if been around not is it

the reasons secondly is one this profit land. of the they are So

year all X% X% Brazil, the there are during not I and regions And the period. are same than better only We in but period. the XXXX, mean last of

in recovery shows this this So, line.

If will – I fourth the thing if the for things ask maintain quarter balance think this you me that there two will only this are situation.

And will get seeing not jump in not of First the the that countries thing adjustment recovering sustainable this will we how it this results. recovery a first effect. reduction got cannot in recovery, let's estimate for all, to the will the recognizing say to the there's of terms in one let's and the support that not tariff issues level quarter. But are that demand we economy their that of but the month, can mean, the terms I we from more important of is [indiscernible] but are maintain temperature last say the one temperature. is XX% recovery also be side of And it's

terms for distribution of the improving to because and advantage improve of the pipeline take is we renewable business period. the the transition capacity this and this it constantly to key In deploy for during business, sorry energy are business renewables

So constantly we are improving.

and this and projects. I practice of pipeline stage. develop of course pipeline of difference best when the And of – if to XX day, gigawatts to you projects course, of early XX.X% but with of constantly better pipeline which develop improving in I deploy we of Brazil. enter in of which in will need the in I that following pipeline, now these it XX these to in improving the XX XX, order XX.X really gigawatts, is gigawatts are are figures, stage mean, of mean, you XX.X are gigawatts Brazil. development constant mature XX which mature have mean sorry, the stage. XX see gigawatts in gigawatts We mean And doesn't

that are on the momentum solution seeing and in you the depends XXXX. we to this the Let auction EBITDA but the government. this were exactly our the pricing the operation, of I Columbian very right – mean, industrial and to do by can. promoted we but awarded sorry to regarding in me in the are order with tell clients due year. the auction to is operation with is we here seeing will Columbia – in and way proactive serve we least, our of is And yesterday related you XXX the due that that project last it start we if this evolution that one in is that main to now, the produce integrated XXX best advantage to an a $X.X way mean megawatts portfolio and have effects. to this not – we take the for with effect gigawatts And of install very estimation – of performance. well that demonstration with I issue it Again, positioned billion the are especially the

it it's how but confirm more the for to year. number, billion US$X.X this moves to see Let's forward

Enrico Bartoli

Thank you very much, very clear.

Aurelio Bustilho

You're welcome.

Operator

Next Peretti is question Henrique Morgan. JP the line of from of

now is line open. Your

Henrique Peretti

morning, have I Thank Good questions. Aurelio. you. two

is The first hydrologic crises. about the one

in having better are We rainfall October.

that about second press for between in think good were the be if month, November, this question R$XX and the it's reading the is early distribution too for do – the billion. XXXX, sector could to is, the question operation new local we if declining or segment And December range for billion next and and competence launch R$XX this So tell. risk you would a

would have down. withdrawal much question would Enel So and should we be from when fund this it the you. Thank how

Aurelio Bustilho

financially, volume yes, that as good, we very mean, maintained have but are is again, Very the questions. we with economically, flags the and improving, working Henrique. seen by either the cost these even I is know, right. these the it's they to effect business, Brazil attentions. by good Very you, but points. in distribution the distribution affected mean, distribution and flags more paid well, because good related, of on some higher have require improvement with Thank I so this companies, But as having paid been demand. you not are part by generation capital still ratio,

the So in not but financing, regulation financial, that's we not terms say to only in distribution annual, discussing regulator let's all only with rebalance order of annual situation in companies of distribution companies, right. terms why are

pretty not of different that We similar from previous completely the the, right other expect, it's well, you or now, coincidence, we the the the one on related energy. it's that last – that, And quarters contracting dispassion but you course let's contracted are over similar, a is depends dynamics much is see it – company. over over companies, amount, these right. it's year, if if the to the because the a not to have amount see more that say and on of amounts distribution the But distribution

is to the from generation, amounted but to company. are billion, you rough other estimating or of very hydrogeneration or billion for here from something add. the the the let's million XXX around big that parts distribution US$XXX more if our R$X.X we to you right, each the But This it's estimation I for the these this because difference close operation. amount more see expect distributed R$X the or for is say mean, as is less calculation We the less divide companies. distribution and a is our fund know, And company, quarters

all answer order questions, have year. me. of confident please a are concluded We to remind don’t economic if say with negative that and end we have opinion, good, you very the position. until moving my good reaching That's a Brazil impact I a situation, a good this not, are we if regulator financial see in discussing But a so this very but why base a we because situation. are in but let's the in in good process I it's not

Henrique Peretti

scarcity one hydro follow regarding up Yes, the just flag.

until do place to no quotes kind free level to expectation red final or outside, remain you in have happens hopefully. the normalized consumers, rainy corporate with flag. or it's deeds April, two then also the then And more remain season, system's you place to, companies. go until back go the after of before hydrology, level And latter distribution can the matter to is the be think to to the red So cash April we in to like better and what we will going of going the April on April. one the then it If back government a a diversifies have

Aurelio Bustilho

on Especially, Depends of situation will – question. start summer. Good their especially the the raining. during it

the this that December, expect November And unless this my they is of will very but a let's And of that good first consumers, a government and hydrologic. the demand of of see a improvement response the will they in good terms means compensation, population, that reacting with We then course by while sense. good we be month which perception demand their they’re in in response. positively this that say opinion hydrology, also our conservative demand, maintain, impression very see combination

I the situation very is see. reduce from mainly be, improvements one’s of that They any a the the these let's government course could tariffs, will the hydrological I they be this maybe flag, but what issue situation. both will approach can the of consumption, little exactly that know probably the on the factors, in government bit behavior, to they the will conservative but that but mean, I mean, level see these alleviate don't I government, and the do, So what

Henrique Peretti

you, Thank Aurelio.

Aurelio Bustilho

You’re welcome, Henrique.

Operator

Sounis Goldman Flavia of Sachs. of from question is the Next line

now is line open. Your

Flavia Sounis

those renewable call. several in the Brazil, you concerns, wanted is well. Good you're have question from seeing a costs. hear bit I of the Hi, say capacity development a in increasing chain we supply you been for have My you lot regarding to would the it. if specifically I Aurelio, as you. along morning. little something seen hearing Thank pipeline, lines regarding thank headlines about CapEx the we

this some If costs regarding us us of market Thank in around only what from whole a some negotiation in the of also market, movement, you capacity, contracts are you. a development Brazil, in free but good of and could companies you in seeing detail interest or hint seeing for of the what you're information here, contracts the not if could terms if the region. of in some for you you're of or thinking this give terms give lot pipeline

Aurelio Bustilho

Thank say cheaper, is big, only important asking free terms market, you. green Flavia. but also regulated big exactly regulation for reliable, these more movement more market question of the from energy an it's these more It's to is let's right. this Not because region you, is new for Thank the the the – transformation to moving let’s Brazil. And new meters liberalization smart the is scenario choose because growing Columbia, the own possibility in meeting this for embedded this smart is and deployed of incentivize also in with say deployment, to is – Columbia their their with meters magnificent. smart energy. the this of supplier And this clients

is opportunity. limits working terms So Brazil, as In know clients reducing the the a but for more difference that And slightly in to that challenge, of Columbia, on model are it’s we have a limits. a revenue different, big you or be cap but and remuneration. the it’s system movement, this of they think the I escalation these is way free. There’s doing a

let’s and face is know sustainable have these the upstream of meet to key to way the position. a our – from to and in energy say value green the perspective business So to chain be upstream

quantity new So but this solid obvious, very most chain. customer, the this so and I’m to sales the that’s Brazil. that and in have million, main the of in XX key basis or discuss proactive the clients XX force what a is have and why with in note a to is we be force But are have both integrated positioned to very connection companies region very in to we and them million in the important clients sales main saying, distribution

and they to well-positioned the solar what users like very that or the are energy green distributed lighting, the to cheaper order the flexibility, plant, here And energy. customer to embedded and and energy, free mobility, energy this they plant, then – be and more the services selling centered that the all we wind gas these more portfolio energy key provide be the thermal is of provide of want we be related entered mixing use energy, wants the entered that with the of with once in hydro response, So more the customer with in the sorry, to reliable demand for lack the smart customer thermal what complimenting is want the platter more the what and this. to entered what

And for moving that course, development. the of and of it is of reduce it’s terms because commodities, to the in in see that here chunk movement you I ask to you So advantage an not of an charge lot them to that’s from lots to Colombia, like of countries important as market, is free is margins Brazil, increased what consolidated the – and the clients, it’s big but also a can opportunity. in if will will more what value we mean, conversation you of market the these, but for cost those related even more us, Brazil, very energy issue take key the this key regulated but is that mentioned if you see of this of add

to be competitors. the XX%, again but of we the can development in and general, not for us, expensive, us, – – the the it seen increasing these product, the impact full other and in that but in these so for would capacity can effects Of more you by say, from for need, we’ve comparing tell let’s to the to procurement we from inflation, project, materials will is using that mean right. wind some the cost advantage course, the will of take impacted, seen it that saying are terms our procurement studies But be production for increase which that of deployment, so I this terms minimize everybody. and terms XX% right, And we all with China, the that of the And of on, the expect solar increasing very is terms of we these, these increase there I wind less terms impacted of will especially procurement projects shareholders. I all well-positioned in due of in of had the another of in are to capacity which of this winds, offender, example controller in it cost cost cost XX% because for XX% for in to that, capacity,

good means capture public In means more have to also better – not got the yesterday to a – good that a than megawatts, information, higher, these but auction of more highest demonstration situation. price And opportunity. XXX an which the in the price. yesterday. and The were Colombian that’s our price was project, a got of Columbia it’s in we renewable why practice of yesterday XXX agility we auction you we previous awarded average per course project, a megawatts. in was which a megawatt one, even is we and with that is wind, this got, a Columbia, better that terms the year, they It be Columbia energy price we public, in probably, for should pricing, best this the the or captured in which In this and was it’s hour, of price opinion, but have our price of promoted we very solar basis Columbia XXX of was

Columbia situations go purchase angle the some lot. in same So way sell energy, the energy, but only but for the up, sometimes expectation, to a then easy the the do see, short-term with not see sometimes you influences because also energy, you you practical example, down think some

cheaper these take company capture the short did sell, the but we protect pandemic for opportunities. the you to see with So to like And purchase Brazil – purchased not to period, we term. a only also need some in energy you to energy when if

where I example, long deploy – operation that least we they the providing prices are especially the the advantage see options note last Brazil. these fastest of in short-term we push are And in a very we in course, can in Columbia. cleaner had have we to Please the better our energy. energy same also cheapest the clients. level Brazil, to with to and renewable that of best of the and pricing for and we energy compare yesterday and mean to the in and but capturing enter for January way And is showing to and you another best I hydrology best need fast a not in different this So in in situation, Columbian example, project the remedy in XXXX. hydro of COD, it’s if the to that’s very that The develop the and mean is green this gas pushing so on. in producing that opportunities. proactive this pricing the for right and the region prices, market terms then

also of our terms that’s environment, and sustainability to contribution situation – and the economic clients system. in the but terms So mean in to and profitability of I

Flavia Sounis

That’s you. great. Thank

Aurelio Bustilho

You’re welcome, Flavia.

Operator

Suarez Next of question the Mediobanca. Javier is line of from

open. Your now is line

Javier Suarez

morning, and advance. Three caught me, and conference, some repeating of maybe Hi, my I of apologies these colleagues. so for Rafael. my the have Good during some questions questions many during someone things questions the presentation. missed Aurelio got because from I’m I if and the excuse the of Q&A in repeating the – I’m

the working So the on one capital. is first

Looking I call, capital it normalize at my up mentioned working quarterly year. that the was that notes, the impacts previous think net would negative next during

call. on the second when And people sentence, If quarter expecting the have – the that question. third the or working the is company are you first capital the a of during you So that was the the the company you expecting this normalization are worsening debt would during year? was happening. quarter you is expectation of on clarity that see there where of a if guidance seen That

particularly in company second Brazil. question high, that losses the remains of The on the energy is

despite our take and reduce the wondering increase the the can managerial was remains of company that I losses, these actions to what impact. field that stable So energy

reduce one Brazil a So is have helpful projects losses options Colombia. well. I the would that as managerial And and opposed guidance third execution following. are be seen the focusing in growth there to in in to you that any the on

statement to and energy likely to renewable comes that is So it to Enel developing that focus then strategy thanks. the Many rest Columbia would and concentrated strategy, Brazil on likely first Américas, is geographically all you negligible. be a when say to consider fair have a concentrated highly

Aurelio Bustilho

in you no two from billion, would I with the quarter estimation this retail and problem. for we be expected much, these was working yes, before number million US$XXX Thank of the it’s recovery we these said R$XX the to information. expect all regulator situation. This mean, companies, Brazilian that expect and moved the time distribution that right. deteriorates second demand negative deteriorated mean, end our we that Look compensate see good R$XX with Javier, period. effects, will regulator around the – you that it’s capital, to answering with this the companies. in the financial new so way the – situation in moving and billion, second, information, impact. deteriorated But this the for The other these. to so hydrological regulator hydrology is are on. rough The are over the balancing But Thank we the but it’s to distribution for amount rebalance until mean, in position year, the hand, is I the of the originating a right, we this total expect total regulator for can around and financial new of is R$XX the with positive you. working I terms capital, a rebalancing very from that that’s we on billion

So is this issue. new the

yes, are losses, you of terms In right.

and specially in the no, In real, main are Brazil, it’s We still right? right. Argentina Brazil, high offender,

of losses, market. depends course, terms in focus discipline of a in this lot of Our

So high, real, XX% always is the losses since discipline about of thing. for we talking level do is the – But market, is the it to the to operate recovered capacity which in of we will these in regulator level. we recover and maintain we’re too losses

So, this issue. a I important very is mean,

Argentina with the course, collection we invest. maintain to also anyway, operate, there is to balance digitalization Argentina, loss, is issue the related an related – discipline are – we margin discussion losses in in what we’ve regulation recover to investing a recover, only recover. is we of again, since but but capture and are and recovering But is recover and we here, cash restriction this real to we operated the we Argentina also that will terms of we more the would XX% addressing. the – and in the terms But and there in of regular losses. to are pandemic But – of remote on hand that in not I this Of Buenos is especially these the to other terms improving a also only discussion more the we’ll we’ll are delinquency flow capacity losing focus the confident product mean,

I mentioned, we we’ll levels. that recovered expect we to since one discipline, and operate think that point And maintain – So for last I the capacity recover you forgot these have the you… the or

Javier Suarez

I strategy on Yes, Brazil in the capacity – I concentrate growth of that execute was most seen and the I was have mentioning the and asking in of Columbia. company, the on

Aurelio Bustilho

Yes. a a be a It say rest first going is point. is It’s then all to very going to good is to very It’s that good statement a be. the point. Brazil fair priority and Columbia

let’s to but strategy, more, answer in our that Colombia, requests, then in and are we demand capacity possibilities, right? seeing is there what situation Javier, are they say, are are analyzing. demand these this, this you requests, should I And Brazil, see more mean, the we pipelines, You right. that there are mentioned, answering something As mature

– of that you time, Peru are if thing exactly frequent. you is this We Brazil see if that especially point, because what hydrologist, want, issues, good analyzing more seeing more so interesting of part and see and a we’re climate Chile very also frequently, one opposite the from you the in also, is in hydrology our in terms are the one different Colombia happens right. great it’s because And is

in and perimeter. So Peru Colombia that our right, complimentary Brazil, with in

– the well So the of generation we we very terms are a to balance situation it. a and in in especially very hydrology, balanced this very is because had good point

if portfolio, we Brazil we as a well-positioned also terms, – and was also work this that – means we requires in I why may we is because more, are compensate may your a why to complimentary Yes, are possibility high, more If But still Peru. again, Brazil [indiscernible] it good That’s we and say. it, are systems. work terms because So the Brazil are to to it you the in and our compare analyzing increase we are it you situation? and say, capacity, demand to hydrology we seeing And in question positive. analyzing the have of are balance but are to Columbia I course, right. exposure in more very this possibility, in of investing analyzing

So improving advantage demand, XX% to model, Columbia. metrics Brazil let’s of is the in Brazil, higher, analyzing increase and of regulation, terms you’re process, the this in in take technologies the why it renewable increasing more the both of much terms of No, – conditions that’s in push say, in still at terms and that we talking of are and energy. higher Colombia, not are because are about we a government in more mature than Brazil but energy, the Peru of is it’s in generation wind is these solar of Colombian

very good point. So your question, But why. that’s a it’s

you analyzing, see the repeat, analysis push but also, order we the be of of positioned a risk analyzing course, demand, terms we also of in to in the way I are balanced more in it’s see will we We decisions that’s so the hydrology. in more know climate more in very the future, not seems situation past happened very, what’s important. way of this all same the that kind frequent and happen very, in

Javier Suarez

Very helpful. Thanks.

Aurelio Bustilho

Javier. Thank you. welcome, You’re

Operator

[Operator Instructions] Langlois Next line Nicolas Cuprum. from the is of question of

now is line open. Your

Nicolas Langlois

some questions Aurelio. going Many there’s you’re call. for like help I Hey, me. conference to thanks the that

interest or annual Maurizio, take question with to important this understand sort there $X the how see and understand the your investment have rating bit period. just that and with is costs rates debt, understand one. you’re low a financial done, to right. service points of that working increased. debt debt thinking investment How is of capital like I’d has payments from ups of increasing billion the – or the million year-to-date million the the one, that could there of liability the right of of I renegotiation on company, in rates in I that understanding of billion company this this are customer second incorporate because maybe $XX management come deterioration a is because and the understand advantage in financial the amount to as third I about important target, increase corporation portion spectrum. that the can’t quarter couldn’t much the My average it was debt holding report, to is on The the explained like that the compensate but last for an final has as as, coupons you discrete first XX back much the I year-to-date costs be in the the of basis earnings the XX% you an cost second like might saw would quarter viable do one, think $X government $XXX Enel the it’d the company EGPA, of how the

In terms of the company. other

our operation basis? Brazilian tariff current this for the the years? seen be mechanism chance the see of do how do real third So, how the management see distribution and balance double-digits on And capital? Eletropaulo you of question to you the how for is, that thanks. recovered is next the And couple possible of sheet Many continuing imbalance my working what question

Aurelio Bustilho

the in Yes. is point not interest to from in especially right? from Nicola, average XXXX financial your mean, – X.X%. it Well, so moved X.X% moved thank at situation, cost for rates Right. right, increasing, I Brazil, the a Well, question. you four

we pay Enel of the payout to but the an the see right? pay the company, million, $XX hand $XX but increase we maintain cost cost, But flow for the of the previous right. special cash we that the remember this is in maximizing the of paid increase and if see Américas. compared there the cash from Enel Américas million, So, increase you If can one less costs, more, we But less – consider of the financial in course, we right, is interest period. in to we pay you costs, flow, if right, Brazil, around financial you pay rates, less

Américas balance, with exchange or variation in costs the in we the reduce Américas. Enel Enel and effects So, do financial

reduce moment, prove million the management the reducing the in the million. So million right? this this with cost, So special we opportunities Brazil, we then $X this also with and worse, $X in Then in will with intergroup. million, Américas capturing $X – Enel with $XX calculation keeping liability prove right Columbia

effect we for So things. And positive intergroup. especially taking I mean, two $XX market-to-market, million $XX of then advantage of million have

First more with of, that’s we we the situation of course, why maintain revenues. debts all, have, the connected of our

by in management from And devaluation, the the also of our got last last opportunities spread. you with the What’s advantage see refinancing, right So reduce And we spread of are different the taking debts, liability year, year. is happening the seeing expensive reducing. to our especially an that end way. debts, that Nicola improvement this when now, the – is is we

the lower and key refinance to here to last is get compared year. So a spread

saying. despite are the cost, mean, spread. better rates, exposed the impacted, And reducing we paid CDIs I the but the interest exposure financial cash dollar to increase of costs, seen much refinancing, flow day the right, Brazil. company advantage were the very in and better liquid services, So, interest not for to months And speaking, financial of U.S. of we the if that CDI take less you’ve example, course, growth because reducing nine sorry, in in we

Nicola comparison July million, important capital, $XXX the we’ve year, think $XXX we it’s each just of the we impact of Contaco contact that So, when year Brazil, capital, in working in received last remembered last injected you injected negative right? in see networking of because million see company. of terms In the the a

year to let’s thermal so you the which months two and expect Brazil, bad imports submission situation, and in hydrology, recover after explained the dispatch effects Argentina wait to negative let’s need – you one or recognizes say remember from to on. it’s – will say that year hydrology, the the situation Colombia, this Brazil, different from in effect the deteriorated I Brazil that we Because especially Second of right?

to You the expect next for need year.

$XXX a expected had of are terms hydrology, around impact discussing with the that million in regulator huge effects which be these we we we So, to by compensated.

We main this first, extraordinary because this, we So reason Right? cash. our is of by count the factor; with for year. two with end that expect the the deterioration of debts

Let’s it compensate by with situation – we year say to FFO Contaco for capital, of we have demand. a reduction each, is but be and didn’t in factor a similarly cash say terms the before energy moving good compensated other the situation period, of will let’s for related of that have worse them the origin. of a to purchase, expect are other by in recovered which last be we have the reason these this we networking, And that this the year, but next very a discussing or effect, this with Contaco, energy, in another year, way anticipating the of will which for regulator end we or

Okay.

on missing as at there that hope this is the quarter, still cash Power, the cost, any from of by of the Green also as next the won’t be year right. the discussed Enel level to of and agreed the right? we Enel Enel this it that Américas came previous cash cash in indeed in we, mainly we support Américas to reduction Did their the course, Regarding of but end projects Enel public, year, Américas

So these We inject can are long money increase reduce not line our with capital as the credit use with require. we these, costs lines. using as and and credit project

And the the we pretty the and in comes project cash so in that everything be these impact still if don't is countries. with of of also mean said liability the thing suffer exposure financial to which that also you in with U.S. this a mean, yes, the of I injected well, the is billion money we ahead. project the remember last course, that's this it's much managed, there to and costs sorry. the only devalue a better the help to to I to dollars. for this other dollars, Brazil important million the very I us, of helping $XXX and means, to not it enough also that today came to countries. the manage And reduction year costs. don't by currency with well with expect that US. end us I this but in know We question, is inject federal next strategy One good in evaluation, merger linking not I $X inject Colombia consolidated expect, effects mean the protected in but protect last year, and reducing the funds. Go this if development

Nicolas Langlois

the do with regarding EGPA is to And S.p.A. do the And it? you plan that Can talk there financing Enel please you what about cost? what's

Aurelio Bustilho

conditions financing always of Enel financial the cost as condition is absolutely no, why and arm's do. Arm's S.p.A, arm arm's And competitive, here. transparent looking no our mean? for be total. are financial situation should Okay, terms out if for market the the length, these. do you to with clear length any to we costs a what finance, length S.p.A, of With there way not? Right? there's issues have of we be of very If we it but we course, a better Okay, Enel of in better of

costs are pursuing financial costs of of constantly. We reduction

Okay. And very. in a

Nicolas Langlois

what's right So the Right? journal

Aurelio Bustilho

the these will IPCA, financial in okay is in Always in of currency, costs. of revenues. CDI, inflation be the in IPCA, currency Right? spread also local course Reis, index, local which If a in the the looking right? is This which Nicolas local and of or instruments the we will the for currency same is it or be are

XXX spreads this especially with to We are to work with Nicolas strength the Right. the points over basis XXX able, CDI. with our over financial

Nicolas Langlois

right? but and U.S. the that So I rate that current the what efficient is what's dollar mean, current

Aurelio Bustilho

In U.S. distribution have dollars. asset companies, we financing for not it’s example, Brazil, Yes, with right. for

in you're If the…

Nicolas Langlois

EGPA. that an I mean, EGPA EGPA The – with

Aurelio Bustilho

not Yes, pretty Yes, mean, same. financing much long-term refinancing with the but S.p.A. it's Enel is the I

And clearly I it of constantly here I you of half mean can of these No, is This you it's on here So financing. But can are just have you is We these. of the don't I I the right? for cost now. show it's the the on spreads working that is important difference this if tell just can reduction know tell discuss second you not. one of, look financial this right that because open Nicolas, second, right – the to one equity now.

about what I don't are X.X% are always level about, EGP about are level, cost, for interest with here, consolidated Américas talking We alternatives X.X are talking especially order projecting debt with okay. to we which with is I Enel We Right, what total reduce level we spread you – total total cost, nowadays, that right? the costs. Again, have if that we I are better we the X.X. this see projects X.X% isolated costs. comes we mean, have EGPs Nicolas, we're looking plus cost in talking no there's mean, know we projecting? mystery the that. total Yes, these

with But FP infrastructure the bonds the depth, if project, it if do the with the you we’ll course, debentures be better will or there, or We look there's again, the with in for look difference financing you Brazil, If better here. in in situation no doesn't Dona of and with higher rather see for example, Brazil. this or subsidized matter for longer Banco be the example, cost. for or the

R$X.X is promoted Nowadays, Reis, contribution, billion, X $X benefit the have dollar, it’s defined pension US billion, X got defined what fund defined what contribution, XX%. in migration a we we the reis, did remember that we is from for migration right on to but or billion we because in nominated sorry, dependent what today

the all pension or more beginning order XXXX, a to right. it year, fund the fund these say, of of one to plan, sponsorship, liability, So from in of let's of giving period, to say, the expected transform end by this means we sponsorship to in the prepare the of which is remove money, system course that say XX it a we're will, the to remove managers XX. and this that in because at money of pension, Starting to terms let's amount the announced for of let's the

liability, with of a a depth. I terms a into rate. pension table it in we'll mean, I and more financial mortality in more in of, transform discount of Nowadays, this terms profitable is predictability terms costs, mean,

not is profitability more business. because a it's it's important our So

So transform the the with risk, by with that a fix into the this have beginning say of XXXX, And debt. will we expect it with it will is situation. X or billion be we lower amount this, let's a the risk

Nicolas Langlois

Thank you much. very That's pretty clear.

Aurelio Bustilho

Nicolas. you, Thank

Operator

No questions speakers. further Instructions] at time [Operator this

Rafael de la Haza

there questions. are more Well, no

these as So me may the investor Thank call. very results usual, you that evening. conference doubt you you any let remind much. nice relation is team for available I a have Have And from conclude that results.

Operator

conference joining. you today's concludes Thank Thank for And call. you, all that speakers.

You may disconnect. now

Enel Americas (ENIA) 27 Oct 212021 Q3 Earnings call transcript