ENIA - Earnings call transcript Q4 2021

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Operator

Good day, ladies and gentlemen and welcome to Enel Americas Fourth Quarter 2021 Results Conference Call. My name is Howard and I will be your operator for today. [Operator Instructions] As a reminder, this conference call is being recorded.

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 Americas and its management with respect to, among other things, Enel Americas’ business plans, Enel Americas’ cost reduction plans, trends affecting Enel Americas’ financial condition or results of operations, including market trends in the electricity sector in Chile or elsewhere, supervision and regulation of the electricity section in Chile or elsewhere, and the future effect of any changes in the laws and regulations applicable to Enel Americas 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 described of and These factors in of Enel the XX-F, States government decline in adverse include interest in in other in Chile, increase or rates States regulations the or Factors. decisions Report capital an elsewhere, Annual the or market on United under equity including a factors market elsewhere or the Chile Americas United by Form Risk

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

Rafael de la Haza

of morning, Relations In and our Good period. Bustilho, will Maurizio to main for presentation. Head the I Enel figures and our of am Bezzeccheri this ladies Rafael welcome our the Haza, la coming XXXX CFO, Aurelio year Americas. de full gentlemen slides, and results CEO, Investor be presenting

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

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

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

Maurizio Bezzeccheri

morning, Good Thank you, Rafael. everybody.

reaching quarter XX% Green improvement EBITDA had last recovery increase year Americas the indicators important fourth compared XX% Enel are we increased and main in of operating the in and year, main on Power full explain our XXXX, that the by period. the levels. important during demand in The the reasons to consolidation an pre-pandemic the During results.

a addition at In level. adjustment accounting in positive impact have that resulted we this, EBITDA to an in Brazil

details affected will impact. that was income the implied higher see expenses We one-off later financial Net effect a negative and on. by

On remained the last to debt compared significant net debt, increase in the our ratio flat other EBITDA hand, year. despite

we ESG, the transition. continue with to commitment Regarding energy support our strong

As were a this, consequence rating Project. we by with scored Carbon of D a the Disclosure

time, incorporated on Finally, the X.X capacity. with meaning X.X new renewable we another gigawatts working into new added same of have during EGP, gigawatts capacity fourth the continue our thanks under X.X of quarter, gigawatt to we the we that construction. metrics, the At merger

to move see our Let’s the following slide current to scenario.

left we where As full except during Guatemala, the the shown operate currencies cumulative year on the the flat. remained which quarter U.S. in the all for devaluated and chart, the against side of dollar, countries

terms In operate increased has an on can of countries, currency we countries devaluation cost all the the which This partially the we level, our except in it see for increase in Guatemala. and has impact that our inflation, in. by CapEx on compensated been operating significant

an saw quarter, while recovery during important and trend. Regarding electricity continue growth Argentina, we Peru distributed, the last Colombia its in

be saw countries, On rationalization a the launched see to recovery which plans we the decreased full due other end, to year, the government the activity, pre-pandemic in the line levels. conditions lower in connection Brazil lower temperature has by dry economic with slightly allowed we in the and four year. with Considering last

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

pandemic. client increase debt, bills than not to year to paid in by bad However, we the the terms had X XX%, more Brazil due of of an in mainly due in

have let’s investment look the a our for period. at Now,

the During CapEx million. of CapEx by would in mainly the our $X,XXX period. In with have explained to year, is Brazil. same this business this fourth million, explained of by which of of would by reaching mainly period of million. considering increased CapEx XX%, CapEx have $X,XXX of CapEx Without the $XXX XX% last compared cumulative Without contributed XXX%, XX%. by distribution EGP investment our the by This terms increased a investment which increased XXX% in higher total contribution represents year, reaching by the increased quarter EGP, consolidation of

CapEx our plants in CapEx generation the significant grew and growth development line mainly period, commitment Asset the to energy of development our or transition. with strategy in the renewable due a manner with during

hour, same capacity now region. incorporation In a by cumulative With to is EGP highlights XX% year, XX.X reached period generation the In consolidation by we increased gigawatts the our of by EGP, hour renewable. and during to production Peru. fourth quarter from in business, XX% the periods, operating the XX.X analyze showing commitment terawatt emission-free installed mainly Energy increased our the explained full our our due by XX% of last by XX%, and to higher slide. increased demand the terawatt energy production in in year which this, EGP compared and and XX% reaching terms, the on to XX.X Let’s the of production an transition. of XX.X respectively, reaching quarter XX% production following increase XX%. fourth and recovery Net hour have sales explained terawatt increased

which demand quarter. full Brazil decrease the in and X.X% important Colombia Argentina, by the business terawatt in recovery distributed partially year analyze fourth hour This coming by an hour offset X.X Peru, period, Let’s during slide. in and reached respectively. is and of explained slight the quarter X%, in the indices fourth in Electricity terawatt represents a network cumulated XXX.X in

of around number XX XX.X we all the of companies. had Regarding reaching customers, among almost million in increase distribution months, last XXX,XXX an customers our

reliable SAIFI small fourth our period, during in the in indicator the Argentina, and a decreased improvement to improved and a four countries. in us SAIFI showcasing allows losses efficient in while the energy of of commitment quality way country electrification towards our with terms The supply goal. steady In deviation and indicators, SAIDI energy result

we the maintenance business. had repair Enel business card X improved. slide, X in and with see growth In On charging Enel and station and very we and photovoltaic a business, credit following contracts, will and lighting retail solid public plant also

and XXXX, customer electrification, of amounted helping increase a retail the delivery sold businesses increased X,XXX. compared means us hour reaching target. XX% on our goals And a to net zero our on which energy keep XXXX. number Regarding and XX.X business, by XX%, points to in focus terawatt Both the toward reinforcing strategic

have in slides. at highlights ESG look a now our Let’s coming

social As environmental operation. recognitions part on operations and being we embedded of our governance behavior, reflect have and sustainability corporate previous mentioned we our already our our culture the action occasions, ethical in with of these day-to-day responsibility, how

maintaining in During all year. ESG ratings the main the positive our the company of XXXX, improved previous trend

you cluster. taking MSCI, Climate received and As S&P, in This in we significant ESG Refinitiv, we issues. means highlight XXXX, Russell, had We company Change see, can the positioning to for we in want that FTSE, XXXX made we on management Dow are improvements. the climate CDP Jones, the the action coordinated and score that application Moody’s the

Supplier XXXX climate Ratings in B Report organization a supplier engagement evaluates that Engagement and CDP the received also change. We on

Notwithstanding Aurelio, their again the part. reporting for Yearbook call our Aurelio Sustainability now we financial are accelerated class. in recognized the our looking be S&P to improve pass in to on proud the Jones a Index also score I to by will Dow Bronze XXXX with is results, yours. this always are system. the floor We

Aurelio Bustilho

Thank you, to morning Good Maurizio. everybody.

XXX we and If we to higher by sorry, it the fourth million, order income IFRIC Americas million terms by that, that we IFRS million XX basis the Having and and comparable, EBITDA XX in This EGP moving the year this positive adjust decreased and which to Americas terms, make better an an accounting last Americas you Let last make revenues. impact the of to XXXX, of to impact by full case $X,XXX me the get increased million, the EGP In and an adjusted operational exclude explained financial Brazilian fourth the revenues that the X million in currency $XX Colombia than is begin EBITDA negative cumulative include the year impact for quarter consolidation results X% a devaluation, $XX Group at while due higher million XX.X% distribution the of year. for fourth in period, same a implied which XX.X in This Peru. net in fourth mentioning subsidiaries fourth rule XX, we represents – devaluation decreased quarter. by generation, mainly in some and negative for the by especially from and and currency million $XX a EBITDA $X,XXX of quarter the of conventional impact the EGP XX%. the quarter it on the in EBITDA reached this of years. of EBITDA $XXX impact, the our adjustment is excluding of $XX million XX.X% level year. in full IFRS from than for is of nominal impact slide have to said the by if XX%, cumulative XXXX period In quarter. impact,

operation order XX.X% in to increased coming better net XXXX reaching of reached $X,XXX on focus by debt the billion. million, net compared a from understand while have these last year, will We to Funds in decrease a income $X.X X.X% numbers. in slides

flow in the will in cash We presentation. detail later – and in analyze debt this

devaluations evolution EBITDA to of by EGP while in all million, the see while contributors except $XXX from Enel operational for Colombia million, Starting XX%; this Networks same we from improved a XX%, grew slide, basis, a coming and and XX%; during have million Argentina, breakdown. generation EBITDA $XX with million, have a the by businesses XXXX, last EBITDA X by X%; results $X,XXX EBITDA Considering X%. while Peru, Credit On positive country we Brazil Americas. had increased $X renewables negative million, demand XX% Thermal America, of higher fourth see represented than mainly are of quarter of we year. final lower of these that was $X,XXX we which $XX see On million. we and from the networks. – million for due retail that a Central period coming million, by its consolidated plus got and period, – Brazil, impacts, will to $XX our impact decreased $XX million $XXX financial respectively. EBITDA other main

see Let’s slide. in accumulated coming EBITDA the

million devaluation million represented country of that a $XXX EBITDA XX%; by same Thermal we million, results. increased reaching X of last generation X%. increases operational grew from negative had we all Americas. period improved Brazil and from consolidated $X,XXX with Argentina, businesses by while our $XXX the million, than impact and can Peru, in IFRIC $XX million, a $XXX year. $XXX from impact On Central main by respectively. Here, XXXX, EBITDA which significant $XXX million while contributor see of retail higher million, million Enel including was EBITDA of X%; that we XX% by positive final $X,XXX $XX for $XXX XX%, from a the came renewables Colombia and started of of America, million, Currency EGP see and XX%; increased million, Networks basis, have the our XX while

higher and main On mainly generation and the business reached sales. would and better had in networks by by is offset of being mainly in partially a in EGP slides, have by XX% increased Fortaleza is This an compared generation the contributors. represents this $XX increased Brazil explained on Colombia business year. Peru contribution effect, results Colombia, to million Without due a and negative prices have cumulative EBITDA EBITDA focus the energy Let’s sales $X,XXX in which last This increase a XX%, million. currency of basis, XX%. This to in by EBITDA by Americas. of devaluation, higher impact explained coming XXXX Brazil,

period EBITDA X.X capacity new X.X this of solar Let’s projects megawatts and X% analyze XXX Central fourth of gigawatts this coming under and have in most the EBITDA quarter million, coming of mini currently from will construction, capacity cumulative From which X Brazil during gigawatts, XX% gigawatts includes hydro. the Installed XXXX X solar, was X.X gigawatts X.X from reached slide. X. capacity and megawatts Colombia. from which gigawatt them EGP quarter In in X.X XXX XX% fourth X.X and basis, from XXX a in are wind, year during in of operation which came begin $XXX added wind X.X the gigawatts, million $XXX reached from gigawatts in April gigawatts XXXX. gigawatts capacity megawatts this This XXXX, are Americas in operation from during from Brazil. Peru. America, We since

we reached $X.X this due mainly in CapEx, billion in years billion. the $X.X to Brazil Regarding X Colombia. CapEx and quarter, totalized projects for

Finally, from are our gigawatts, XX which long-term pipeline XX currently gigawatts early reaches stage, in around the stage. in mature XX gigawatts

and business by to have last X% decreased reclassification year, compared Without EBITDA decreased XX was from Colombia the Brazil in effect partially Peru. year. explained. business the networks IFRIC This reached renew $XX represents would lower fourth amount cumulative in lower includes increase contributors. the business by by analyze business of an networks demand Argentina quarter, in coming to $X,XXX terms, Let’s last main million. distribution costs. quarter slide. results in the in million, Colombia next already by EBITDA and On better to reaching results in to the compared the $XXX in mainly offset This million XX% made due This due explained X% EBITDA being distribution, higher

impact exclude demand prices. higher X%, XX, from have the in four due the EBITDA However, countries and increased IFRIC coming to sale if by would higher mainly we

contributed lower this, the other million, Then debt Let’s connected to impact before slide. plus and $XXX of – tax higher and is and million, last million coming analyze by $XXX Starting explained. Argentina income to we XX and base. EBITDA negative year which by due negative net perimeter adjustments. from in amortization in for to and earnings a is income X% $XXX Colombia. are variation explained a devaluation $XX $XXX million XXXX IFRIC higher Net higher mainly in we income, which already to includes tax currency impact One-offs to amounted due the get depreciation in million. $XXX have million from of $X,XXX we million, have mainly while and with next million new XXXX. With results rate higher paid asset net financial tax $X,XXX for than on

cash slide. our flow next the in analyze Let’s

financial million of capital these Brazil the The explained amounts results coming the contract impact $XXX After million of flow XXXX, recovered million. working capital get minus from to million. billion, this Americas, of an tariff starting negative from the in $XXX First operation to amount positive to million to paid in XXXX due to CVA of to in $XXX XXXX. $X,XXX that $XXX during in from $X.X we includes EGP free $XXX investments adjustments. amounted increase of Taxes related working a $X,XXX million, amount million, EBITDA by be to period $X,XXX mainly mainly expenses net million, cash while should of including minus net coming compared is

includes debt at cash to This EGP Americas, amounted billion amount $X.X debt distribution SpA Enel of currently increase is by offset XX% by in XXXX. me by slides. is Gross of in This the injections and billion, from an Enel increase Holding. offset merger subsidiaries, Brazil partially Let holding increases compared which explained the now analyze Americas in following before to our and in Americas in December also the company reduction $X.X by made coming debt a level. gross Codensa, our is

contributes – had we of previous minus to the cash Americas amount debt, dividends financial our million. minus last as Net million cash of FX and free $XXX mentioned flow, in and $XXX the $XXX finance Americas which backs With aims this at $XXX $XX effect net reached with minus billion with million. million new from receivables, $X,XXX year, starting paid net $X.X Looking coming projects. debt million, total $XXX plus million EGP EGP from aforementioned, projects renewable of slide. coming of injection to net million equity new

the terms we country, total. remains while of and the of at than represents see largest debt level XX% In less contributor, holding currency the Brazil

Brazil. was debt, period by variable of an refinancing from by X.X%, the growing X.X% to regarding conditions for Peru. trend in we the offset Finally, increase debt back Colombia in and partially with cost the indices in better in explained rate can This a the rates mainly see associated going this

will credit Now in $X.X and finished and look liquidity with at year split on cash the debt billion liquidity, following lines. slide, evenly among amortization. our the we We committed

debt profile a an have also period. We the years liquidity smooth maturity over to years the for the X.X with coming maturity of and average enough support maturities

Please, with closing slide, following presentation Now the remarks. will Maurizio some on the Maurizio. finish

Maurizio Bezzeccheri

an saw have EGP recovery us EBITDA of our a line During solid on improvement This, we guidance strategic XXXX, a allowed at across levels. reaching announced with contribution to level, important region Americas, in the operational the solid plan. along with pre-pandemic

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

we new renewable you. strongly the executing from coming Finally, line strategy. and in delivering sources Rafa, non-conventional capacity are to our with off

Rafael de la Haza

for Maurizio, for for you proceed. operator Operator, please explanation. you, call Thank the thank session. the your And Q&A I the the now to pass attention. all

Operator

Instructions] first line of from [Operator from Enrico or question Our comment the comes Stifel. Bartoli

open. Your is line

Enrico Bartoli

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

all, if provide expect can If for comments the of can the electricity evolution demand us this that and of the distribution outlook expect XXXX? in growth a First year, you you for update that you the tariff particularly the in increases few on drivers on business. you

maybe helpful. some very comments country So really by would be

change the financial in some question is in items Brazilian related revenues. been into Second well, results have If moved understood business. from distribution this accounting to I

regarding the we of you this talking is XXXX. provide for about. one if capacity expected The is how that is that additional of can some renewables you If much And details actually kind what additional are EBITDA, of last items cash?

you much. very guidance by also some details you this year. provide Thank possibly a the CapEx that, country and on can that you expect If on

Maurizio Bezzeccheri

I the start question. the question for to demand. regarding will Thanks first take

of are, are while pre-pandemic of We to in conference The terms distributed lot really the suffered a – on pandemic. sense the we in where reduction the to we Sao expect during – customer observing due are we back business Paulo, demand commercial there change countries all coming generation, level. the of in demand the as in we is in to some are in that due mostly Brazil said the base decrease that

domestic seen in the we the have pre-pandemic, and so an the increase observed going And to by back consumption demand industry we customers.

So the generation, then of Brazil. especially distributed commercial demand have major suffering in in segment is And you segment. terms

So grow will in terms countries Regard give growth the expected of demand demand XXXX. country in country, give can in the terms you number general, some Enel continue of by Americas. all different number to Aurelio in projection can of – we is some for

will on second, is Regarding let let just mostly Aurelio. affected Aurelio variable second is the [Technical to would IFRIC the by this. that ramp be but the the reply I XX Difficulty] Please, I will reply, Aurelio

Aurelio Bustilho

Enrico, Hi, thank for you, your questions.

the new X.X For we in of capacity, renewables. gigawatts coming have years, right,

the XXXX, We then have of XXXX quantity if have XX% little want main XXXX of to, XXXX. for have increase is for I X.X, more XX I If the this from XXX related for quantity you – and you a XXXX. mean, XXXX this this XX% quantity yes. okay? we of mean Then for – XXXX, half XX% Then XX% is than which right? this bit – we megawatts, for

Maurizio Bezzeccheri

speaking. Aurelio, Maurizio

of have we what wants IFRIC is just kind The exactly to He extraordinary other understand done. related question revaluation XX. to

Aurelio Bustilho

Okay.

we – XX, reclassification effect consider mean, financial – period, a this before results. consider in I we this XX IFRIC we regarding For IFRIC as have a

of company. next to of inflation, think – the okay, distribution I related the the the net regarding

is tariff basis mean, a this due this financial partial classified reclassified since this our results So to related – of after the the assessment as an tax. to base I then as operational with adjustments. we it is base – before results asset this the the a that is bid auditors, period, was for

results. So as it is operational better reclassified

it year, XXXX, year. $XX I okay? full talking full I’m amount this about In mean So was $XXX million. was million. the

Enrico Bartoli

an just to or clear, just sorry, change? are accounting Aurelio, additional revenues be cash this

Aurelio Bustilho

net each no. okay? drag you It concession I results year. What is classify before this an reclassified each because distribution just actual in it it But financial year, what to each was of No, readjust the accounting, then just right, company accounting. mean, we results, Brazil we within operational the classified EBITDA, Enrico, – need is as –

Enrico Bartoli

Okay.

year can And you. you you some thank tariff distribution for increases Okay, the business? in on the provide details expect this that

Maurizio Bezzeccheri

that you recall Yes. you This is just X of years. the adjustment if every tariff to year, say X period remember, years,

XXXX, So an what CPI. due depending to the to for is is tariff is, the devaluation major the due adjustment indexation is or tariff definition to example, year-over-year observed [indiscernible] Brazil inflation in in we or the of just

Argentina countries. inflation of But the even tariffs this. of XXXX adjustment most have though in adjustment the In to we or with from well. So But different tariff the totally the change new a expect will mostly. mechanism in are due of of well, as increase all tariff you tariff, the the inflation, as the adjustment tariff Peru be And the had other Brazil tariffs for adaptation the new defined in Colombia, the XXXX, we recently, be definition. will will adjusted in

Enrico Bartoli

very thank Okay, much. you

last Sorry, the very, one. very

If year. spend this EBITDA the numbers and you can CapEx guidance for on for the

Maurizio Bezzeccheri

up you. Aurelio, to

Aurelio Bustilho

Yes. I we next the year this to we are The estimating and X.X. billion the for okay? calculating. the X.X we that rationalized of currency, course, are mean, year. between of have range is related And number EBITDA, X.X That’s this

billion So if have $X.X are $X.X the we are now. for considering lower mean, more billion that is billion, have we billion. amount XXXX, effect I I and we $X.X – we between – the mean, the $X.X the here seeing considering figures

closed we billion. now, So $X.X $X.X we at in billion in $X estimating XXXX, are $X.X billion XXXX. Net XXXX, and billion closed billion $X.X in we income,

We in billion $X.X billion XXXX. and XXXX billion $X.X XXXX, in in are estimating $X.X

Enrico Bartoli

you much. very Thank Perfect.

Maurizio Bezzeccheri

You welcome. are

Operator

you. Thank

Piccinini Mediobanca. from of question line from Our next the or comment Sara comes

line Your open. is

Sara Piccinini

working taking three, first one is my also capital. have questions. I on Hi, thanks for the

lower of that at Looking capital at of versus in but still the we XX, what the seen the remains still level X level Slide – bridge. months. looks where the have a high high showed working It you

And do correctly, have the if figure the And on to reabsorbed? So to received regulator. cash Is we to other be this level – the Sorry bridge, or that see for COVID we FFO? long this explains bridge from but related the included improved. in in this hand, that working better just the can and is this work from to you expect have COVID the how maybe FFO capital positive this Conta so substantially you Contra the terms where seen I effect the question, in of FFO. the understood understand

The second energy question the is on losses.

at This if high. to an energy we you of renewables. this So where year? managerial question. you question you level? quite look actions losses, the level still on other Slide it last improvement indicated the second And doing looks Or is see the lower is Do X the over are

– the versus capacity expect increase it Or commodity expect indicated the the you you effect prices? Thanks capacity of higher XXXX, contracted XXXX. the this this the megawatt CapEx of some already you capacity per doesn’t lot. your in for level So for If expectations? and so CapEx suffer a

Maurizio Bezzeccheri

on reply capital. Okay. the reply second will I working Aurelio third, and will let we and the

by are as tariffs Regarding they and some losses, you losses, extent. to as know, recognized well regulatory

a we we say in the are that our If not in through, Centricity customer the are are you operation. but nevertheless, customer. are completely something that what changed doing, with our daily just formula, are supposed cases, our by be relationship to is we compensated in many that tariffs. the we we transforming But go losses can of

in we we with cases, the some in works was the system just person. we X cut relevance a what the customer of the just And of the of with needs that have course, we it explaining suspended. pandemic activity all started after are – platforms exactly works case X it customer, months, powerful good are now which, the the to system. our last we the our years benefit Since to how in of of of work are explaining exactly in to not – So relationship grid able a know obliged how were have

of this of recall well you with discipline as means bad we had, market. we we impact working reestablishing an conversation still As but the debt in are from the of that continue XX%, the

cases, that in due in summarizing are the Argentina, in in or but many many the in of performance Paulo course. in recognized the with in the losses, line on in or for like example, special the situation, So tariff regulator cases, Sao Rio looks to high [indiscernible] Evio

Regarding of we items already of in of In material of under general, course, renewable let’s the course, our of general, energy, contracted, negotiation are due the we the question majority but are supplier. crisis performance equipment, the suppliers. But were course, the see situation IRRs in there. to our of impact project. our say, with huge a this, of in thanks create don’t material we the to strong with And our to the this, is logistics able of of relationship,

supplier, IRR a for the cases on are a as for observing material and our we project. problem the is each not well solving are this in We which impact

let have to please. course, capital, Aurelio? if Regarding you working I Aurelio other some And questions, of reply.

Aurelio Bustilho

the full Conta to So negatively a huge right? mean, $XXX if right? injection amount lower Sara. regulator This this support to Conta see course, work Slide now you million, impact. Hi, Thank order all let’s affected I you, positively distribution this the in Well, like in is of a hydrology, million it condition, year that Conta the Brazil, right? in the Brazil, say, been the capital affected to similar companies in in mainly being, very anticipate smaller Maurizio. XX, working today. in of think, the impacted with the we by another an to [indiscernible]. company impact, have price, in right? for has The in anticipated purchase distribution I hydrology hydrological established This Conta better their So due million. effects, distribution with XXXX, $XXX is may which sector, a not for why the a discussions – we from of Brazil, of In higher say, have mean, have this this to to, order we are have only of the whole say, $XXX this in COVID the a impact A negative if year – the are impact, all I company the money but money, the see And amount I the million today balance XXXX, by regulator we hydrology $XX improvement distribution was, of around was Brazil. is impact, of – and let’s in we COVID. COVID, the flag than better we that’s distribution, mechanism the financing of amount the way, is situation the order company in by sector with amount

still from we the losses very are impact also difficult know, of XXXX, the still come as these this to This compare we will what XXXX, have it’s So to issue still to hydraulic with in regulator. the still XXXX, come, explained from you support recovering, I we that huge In a mean amount improve pandemic. Maurizio discussing XXXX we are but impact. it’s impact, and collection.

we – the mean this improving the progressively I of can is in market we since – discipline are So period. the operate

expecting we and that course, this have of and hydrological last improvement. year, didn’t in we effect XXXX – difficult are So, the

in situation of the okay? order improvement number the the capital, First one, and the reservoir regulator the rebalance two, support from of to the working

Sara Piccinini

Yes, I if that guidance... guidance the on on – yes. sorry, question And may in the on – sorry.

Maurizio Bezzeccheri

Please?

Sara Piccinini

Yes.

I clarification. of that the made in end the your just on question provided plan at that was a on the business the looking guidance at target latest Sorry, you Enrico year. before, the

this Basically, volatility the you. net expecting EBITDA to of Thank understand I So lower correctly? are And end the be is the of in related currency? guidance? the and income to did the you

Aurelio Bustilho

Yes. Yes.

correctly. You understood

the the lower part in expect We okay? guidance, of

Sara Piccinini

sorry interruption. thanks the Many, and for

Aurelio Bustilho

give this, are we gigawatt right? the about X.X think or America, I you Sara, Brazil, in estimating more gigawatts CapEx we that in just color implement. – Colombia, will CapEx, in to are be billion, then of less that estimating invest This for $X investments Brazil $X.X asked we Peru right, billion we we you regarding us, will years. sorry, more Central and Two-thirds then these per where said add coming we will the X.X

Sara Piccinini

for lot a clarification. Thanks thanks. the Many,

Aurelio Bustilho

welcome. You’re

Operator

you. Thank

comment the Riccini Our question of from from Santander. next or comes Murilo line

open. is line Your

Murilo Riccini

also questions. for operations in Could this? distribution if Hi. second in details about segment the more something you Brazil, color. Maybe Good the Thanks positive The contractions more give details more the us can please? some performance of us a little generation the on provide and Colombia Peru. business or I volumes details the regional that of elaborate in explain seasonality you some one, had morning. the on the in

any other this of us one, The structural remember Chile you changes the or opportunity to year? an us update on company you Thank if That’s the give as possibility kind or an see for you. other that could delist from all.

Maurizio Bezzeccheri

Okay.

growing the Regarding Goiás, demand the only is Goiás at Brazil, demand, if growing. is Sao in you look Paulo. that the distribution reducing look de The is energy up Rio Ceará if really X%. companies same, at Because Janeiro you growing. is

– said, have of seasonality as an the the course, will Regarding, you impact.

I mentioned, what are consumption you this and consumption demand we well fresh of But the with XXXX, of structuring a can have air company. observed both In you is you as have of Sao an little have to other in effect. a something be a transition Paulo, demand, have that you and we the transformation If more are you like And Sao the less some some in have Paulo the case conditioning, – of pre-pandemic or you weather, distribution the have comparing back bit reduction reduction, X%, less the that. impact.

an you you And if structurally said in organization – is call, Sao – ongoing, and domestic Paulo. this what So, all customers distribution Paulo the continue, you can one customer like by something in the to we goes because more recall have that is company of you you we America, XXX,XXX added during process customers of new as Sao you Latin in have something if because changing observe, gets increase Paulo. that Sao something terms

side, big are example, food customer in losing We storage the of a the – from commercial for industry. the big

overall, to in back before Sao is the a the customer you an customers. domestic going industrial that other consumption are to the segment increase with of bigger Paulo is And you going pandemic. if this, – look margin have The back

other aspect energy the So distributed the is to and demand. all related

Brazil Gerais installed, in Sao you the – in of the distributed at on energy state megawatt look of the top megawatt of are in if Paulo distributed So, of energy. Minas terms installed

of But in in another question growing distribution is the demand is and component reduction Colombia terms the the the Sao Then company Paulo. this other Peru. of of the second demand. So, is of performance

Let’s PPI the say, in due Colombia, we observed during to XXXX higher price indexation.

price green a a we And we then industrial of the Colombia. price, up, higher and is was result course, of sold been going some positive production energy. generate higher and Then of certificate. this hydro with the index So, this transforming have

Of course, review. we tariff spoke about

I you of recall, more more put more distribution said Colombia revenues, If network. we regulation having and RAB sort cap investment a is in so that revenue in had

been have And the is very these in investments later. small in recognition recognized delay It a so tariff.

tariff well then distributed is of for And distribution, have terms major of effect. As the in an PPI indexation volume energy. you

contract hydrology both a different our of In an effect the very price. in of course, better of position, Peru, terms is and mix a a of cover good contract, of to hydrology, higher our course,

got of terms we volume in of over in a there distributed higher energy. is So, in of terms mostly Peru results generation. And due to distribution better

process of of are decision Regarding you aspect the course, delisting. are we that and possible question, there – no study time. over always analyze that the we But told we – is we something regarding last on this we taken the

all shareholders. always starting of interest better the in So, we organization are

and we in in let’s completed we through December today, see, XXXX, you exactly, results made, energy. XXXX. last showing are as that assumption. say, renewable the then completed we integration So with we some we year, We And promised the deliver

is. always decision decisions we and being, taken, time are been the better thinking For have whatever no organization

Murilo Riccini

the one, going Energy There you of on comment this very as provide this this was new on renewals on discussions view take and Maurizio. if of forward. Brazil. Ministry into the more renewal on concessions? the are currently you more Could to helpful, view distribution I you the will And the matter Do of That may. conditions the have a account begin last about a Could many bit? little concession in your

Maurizio Bezzeccheri

I on And concession. In kind renewable? years X distribution suppose every years every of of about the the for Brazil, example, – are have there. you revision talking what is you the ministry. have hydro or based Did about you rededication already that the formula distribution They concession year, talking or of you of for X defined a concession are are you application talk by WACC. a the and concession WACC

a normal countries. is like in all this process So,

the particularly X revision every other remuneration different a of years, in have Nothing You Brazil from years. the X tariff countries.

Aurelio Bustilho

Okay. concession it. situations, let’s but explained, what Mauricio Murilo, talk I renewable. Brazil, In different we know that about have you for have date we different mean

for, first current Eletropaulo the depends We contract regarding the in have in operator the in situation Paulo, was wants or the these it Ceará first the distribution, in all it for XXXX, depends renewables on discussions Maurizio this years distribution – the from the you Rio to and we concession XXXX KPI This, have, XXXX established – depends XXXX, you cheaper will we and it’s explaining, system. operator also course, be the of that contract regulator. the and understand the is and on consumption the than We satisfaction, I up going have I is mean – that that it that of the the started as the it’s the right. renewing regarding more Sao services. renewal – we the mean it for we Then mechanisms, have different do KPI it’s an on X concession the quality contract a analysis that and if one the before the in good of renew, the reaching right. concession. operator, the all, are is the cheaper again, losses, the of country, read right. I mean consumer, more KPIs, way season. concessions are it you on meeting the priority for mean mean, times clients, I if And the then quality, we especially the the But to the optimize KPIs, variation depends best as know, – reaching I

course, will and renewals. to maintain maintain that operation this our, right. there So, of really miss if And in Brazil be these you our issues, it to is in concession, – our all the renew order is intention

Murilo Riccini

was Thanks. helpful. Aurelio. That Maurizio very thanks and May

Maurizio Bezzeccheri

You’re welcome.

Operator

Thank you.

Our of the next comes Capital. question Credicorp from comment line McCarthy Andrew or from

is line open. Your

Andrew McCarthy

if on the capital going expectations conversations Good of just Rafael are? morning My Then authorities, in thanks getting your are the working could wondering any for this likelihood the there second and on follow-up you Aurelio, provide presentation. first my was with tariff everyone question, Maurizio, what how color increase. a just question the adjustments Argentina the year,

a quarter. apologies I are if was in on – then just fourth here, And of of that you to an authorities CapEx obviously you was the if those what agreement with but check will on is now understand terms like. of bit in number for didn’t a the acceleration then I question coming through. and CapEx timing in XXXX that when hear you – to you cash wanted flow see the had that already trying timing Just that just the it. the it, given quite And you when we it Conta said seeing, final maybe the the should like get seems

CapEx XXXX? for we for understand trying about just it that number how me. should to So, think That’s

Maurizio Bezzeccheri

in supply definition XX% to the try In adjustment generation XX%. Okay. regarding first distribution go to first I a will Argentina. days, will reality, The the question we component getting and the these of the of to already the to component. are tariff

another of we year to go are the And reason, observing We they XX% both XXXX. this with insufficient adjustment. tariff for you of think that in I consider that need in cases, if that the middle ahead’s in inflation just are

course, And company is for improved as the is distribution generation etcetera. – in pass-through adjustment will continue added component of we have on tariff, But for are XXXX. as then charge cover we an a the company, improve of payroll, on will generation it’s of – We for investment, the this this well VAD value distribution. and we So, will just of the of tariff it’s needs first insufficient a for to the tariff But of recall there. course, component company. balance generation that the

company adjustment a tariff So, suffering situation. the this are due put we that put we fact the to the of getting under limited – distribution will

reason, just along adjustments work to this need already on some for other get adjustment So, we that first the years. to

to the the be is revision because all with ministry in tariff major just tariffs. one XXXX, of the that last have XXXX, there XXXX. a The recall transition You was agreement would over in

later, years need X we So, another to adjustment. have

So, CapEx in and let to reply. will XXXX, let capital, this to we Working capital I the is Aurelio – situation working will Argentina. address Aurelio

Aurelio Bustilho

question. you, Thank for Andrew, Thank you, your Maurizio.

It was we probably the see flag XXXX our of as mean situation. the of is is and being, by the improving capital, tariff also amount well, regulator by enter in two our indication. by enter completed or probably In of course, the the what are via will solution. what it weeks This first Conta – we the discussion and from what because of quarter end we parallel, the money say, say, in will numbers. entering let’s the let’s solution. our in end or estimation, this of of the and of see hydrological explaining, regulator will working I first I the Regarding of cash March the beginning moving to or with end by will will ends, season, quarter, or by hydrological, And April. XXXX,

But billion. by maintain to will probably CapEx, I is Regarding no CapEx, provided we FX, we CapEx. bit we a that you a this accelerate If the could be lower. little provided. no, asked mean to $X.X the we there I CapEx intention accelerate adjust mean

mean We resets year, in also I the Brazil. reset in – next see have the tariff important we tariff

mentioned, the want of fall effect already tariff this new capacity, renewables for the coming consideration we plan as the but into capacity – the that So presented also took – I the and year. we

billion this line So, I we with presented for in are XXXX. estimation $X.X that we mean

Andrew McCarthy

Maurizio and very Alright. Aurelio, thanks much.

Maurizio Bezzeccheri

welcome. You’re

Aurelio Bustilho

you, Andrew. Thank

Operator

Ramirez of question Sebastián comes [Operator Instructions] Our next or Banchile. the from from line comment

open. is Your line

Sebastián Ramirez

question, the for Many flows for cash I Hi presentation. with got one thanks regarding it’s guys. XXXX. quick and

you you guidance next we should what of leverage end plus expenses, interest should where end that taxes should so the next billion on expecting the that, And Given of or billion $X.X and billion think think $X are you debt growing be $X.X year? on year? in already said around that CapEx do low therefore, net and overall,

Maurizio Bezzeccheri

You can Aurelio. try,

Aurelio Bustilho

do. net Thank Sebastián, in difficulties, of question. situation. mean not projections with your mean very sound will even Even not right, realistic despite debt, danger despite you, and to one but situation our we thank X.X say, are let’s the with in if CapEx, have be right. the Maurizio. solid we that boosted thing pandemic, though a I the behavior important terms we in situation the prepared, X.X. a seeing with – for see EBITDA, that you of are in what Remember at these due a we hydrology, from I we to XX I I things will is hydrological, maintain move this policy you IFRIC X.X. also with that solid we we will fund, leverage, a X.X – considering be If boosted mean that X.X. payout situation, are of And we projections, our adjustment, leverage be less, we are we by will eliminate lots pension also mean we this the

XX% to reduction from the flow. XX% in order So, the rebalance close we to to cash have

net our and We the of terms again, course, debt. payment priority in situation sound of maintain – are of maintaining here, finance is to

situation We very have liquidity. a good in terms of

take liquidity. on, And need we our deploy And X so renewables. see our to capacity of rate important reset have again, and and If the in of in our lines advantage XXXX. liberalization you credit billion tariff market, we of improving of

analyzed way. sure here so that a put industrial, reduction why facing the very in published the are we – policy these and mean – in in the decided that thing good we it didn’t order hydrology. this I to good a sustainable we and propose we all wasn’t situation The when dividend through we was our elements So, plan pass that’s news when – in internal to external order to

after, in you And different anticipate that Brazil, We in And X the hydrology. see you cash have improvement know a from year for we example, flow. Colombia, significant the recovery.

a year. bring compensation could this elements very good these also during So,

as to are only measures that’s of and certainty will in the this future. position response in we distribution position face effect, dividend confident prudential And So, order I have the a terms liberalization, risk very that solid market happen our generation. that all have – meet XXXX. important XXXX, I site these we beat maintain a payout cash – are flow. financial And mean the mean, I we sound this, prudence we these with in mean in with all elements, we to to why the behavior position payout, better

Sebastián Ramirez

still how that are could that to in that follow-up very an don’t If in the big is within on Should that has renewal accelerate That’s of increase specifically? happening I we know, projects a clear. the XXX in megawatts with the Brazil the Should been room be is there is, for between have there to on market. – XXXX? megawatts that what socializing I acceleration side, think talking been add of on regards seeing we accelerated may some think CapEx you you to XXXX, that X,XXX the plan order something see

Maurizio Bezzeccheri

you in focusing process I entire means customers. That way, the right what we Enel, in reply integrated this our are a what for that Group this are will margin. I going commercial is in on are we told what now, the the doing definition strategy Really, reason. is of we

this will on generation. Brazil, based a additional sense now, portfolio new and acceleration in and strategy right We for for have strategy, for this In eventually will we we elaborate commercial that a elaborating a commercial that in are commercial are commercial new start strategy. doing call example. this, operation we elaborate energy. What And we of under new our in defined we right renewable strategy call projects construction now to

So, was and focus it. we are the then one side the having of changing energy before On focus. sell

having strategy commercial Still our and facilities. additional focusing won’t. on generation we Now,

So, the that plan additional acceleration on plan we elaborate. of are on to generation is in renewable acceleration commercialization based the the possible going

right elaborating We are now.

an operation important construction have and of you already, in Brazil. So number in gigawatt in

ambitious will We have to able plan. be commercial a more

energy. this Of will course, for renewable recall additional

Sebastián Ramirez

Many for clear. very clarifications. the That’s thanks

Maurizio Bezzeccheri

welcome. You’re

Aurelio Bustilho

Thank you.

Operator

in queue the am to back over like management closing for I the would time. remarks. any this showing to turn Thank no questions additional at I conference you.

Rafael de la Haza

there if we no results the close Well, are other conference questions, call.

day. any remind me have. good team you for usually, attention, you Let available a and that you doubt may Thank the that is your have for Investor Relations

Operator

in the you concludes Ladies today’s program. for thank This and gentlemen, participating conference.

You may wonderful have day. now a disconnect. Everyone,

Enel Americas (ENIA) 28 Feb 222021 Q4 Earnings call transcript