Q3 2019 Earnings Call

Good morning, and welcome to the essential.

Florida Conference calls during their results announcement for the quarter ended on September Thirtyth 2019.

Participants will be in listen only mode should you need assistance. Please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions.

Please note this event is being recorded.

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To the Investor support section on the Companys corporate website at Www Dot central ports, so dot com.

A replay of today's call may be accessed by accessing the webcast in the Investor support section of the de Central Porto Corporate web site.

Before we proceed. Please note that certain statements made by the company. During this conference call are forward looking statements and we refer you to the forward looking statements section.

Oh, our earnings release, and recent filings with the S.C.C.

Central Park.

Assumes no obligation to update forward looking statements, except as required under applicable applicable security laws. In addition, all financial figures were prepared in accordance with I, Oh, Yes, and our stated in origin.

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So unless otherwise noted.

Please be aware about some of the numbers mentioned during the call maybe rounded to in order to simplify discussion.

On the call today from central purchase.

It's George.

<unk> Executive Officer, Fernando Burney, Chief Financial Officer.

Well I grow scrawny financial manager and.

Yes.

Galleon Investor Relations Officer, and now I will turn the conference over to George or Baird. Sir you may begin [noise].

Thank you.

Joining me today.

Our management team from what I'm, sorry, I can report undersized something you want it has kind of like game.

To answer any questions you may have.

You May know following the today show Nextshares covered 27th and you want me to trace it wouldn't take offers on December .

Well keep you informed and relevant parties see changes maybe incremental.

That said I would refer first do they operate.

And then continue with some recent news regarding some kind of portal.

Finally, Fernando I like why not sure often Walker.

Yeah, I wouldn't equipment continued to show excellent tracking them, so really I really do ask everybody WD to our time our unique.

Just remain high maybe 5% seem you know nab under the one o'kane during the same quarter, so kind of 18.

Nine percentage point, Bob that's up I believe youre talking about your needs for the 20 I'm not showing some type of work that's good taking advantage.

Regarding energy generation during the storm quadrant, we generated <unk> 0.9, 10 or what.

The Crazy Nike want higher percent higher than the second quarter 2018 at 11% nowhere done that in 2018 degrees watts or you did a less water inflow from the leave my remark ankle.

Rebound, which decreased 6% new generation from I want to hide a basket of the lagging that that's gone you did the energy generation from our comedy decreased 18% because they scheduled maintenance.

Remember seemed carbon number seeks to support the complex, which implies a reduction of handwritten 19, Geo what hours during that month.

And I know what these badger outside our smaller steam turbines at the reference that accretion that did not increase five.

Well I agree for sand in the first nine months in 2018, that's come about the same Peter because it doesn't that 18, and 1.3% who in the field quadrant compared to the same period last year across our business segments.

In addition, a factory that introduction of new renewable energy pass and efficient now, including some of the one that's in south Central portal has and will be building.

It's a matter of fact, we are proud to announce that we have increased our renewable energy generation more than 200 people <unk> percent during the quarter as compared to the same kill 2018.

During the quarter like if they've done a one and a tier one wind farm, which started operations during August and September 2019, respectively.

We're shooting operation not enjoy right hander, then I could be five do you what ours.

Additionally, during the third quarter, 2000, and making the wind farms that got together to nobody want to began commercial operation adding.

56 megawatts to our renewable energy performing and generating 72.

Our during the first week operation.

<unk> large users under the term market, where you're a different work demand.

Second our production to broke in the coming quarters, as we continued to execute or aggressive expansion plan.

For example would have read pieces are now where piece there now that they knew they tend to go generation viewing Stockton operation or Coburn fraud.

Seven weeks before they sketch would agree with committed to achieving 93 megawatt got when installed capacity.

Any generation you'll need to be machine is among the most efficient opt to see then we wouldn't almost fully leased battening down hole here.

Hi, good advances in our terming out six Sundance a project to our older Georgia power generation you need these unique will be we'd see added 50 megawatt or around 8% do our current installed capacity and more importantly wouldn't provide it at a crazy.

As you haven't seen with high efficiency for our customers.

Finally during the quarter, we continue with the construction wind farm like in around a one which we said electricity ended the rental work to program and Mackie I love selling books, which we sat electricity under the matter framework.

Good day decent park. These last two projects have already signed long com power purchase agreements with private the customer for hand handed and 87%.

Yeah, I mean estimated electricity generation respectively.

Our long term I read out contest anchored in though directly with customers with price is set in us dollars.

Additionally, we continue with the collection that monthly installments she'd be Oh agreement that schedule. During July we collected 825 medium cases, including in Baghdad tax related to the installments of course, Bonnie do they want the first and due to Oh, good CBL agreed.

Yeah.

Finally during the quarter came as a made a gap offer to all generators to cancer old pending Craig, let's see what was accrued between ourselves and then.

13, and 2016, which excuse me the funny and seem there provenance trade receivables after upsetting the bottom older loans and advances granted by them.

He doesn't even include an 18% reduction of them out brings about plus accrued interest that's coming out to a.

As a consequence of these cross section of the company collected 1.6 billion pesos, including the associated Bank I didn't tax.

And now I would turn the call over to Fernanda Weve, who will comment on the financial highlights optic water.

Thank you.

Before starting it's worth noting that the financial the thing and so on for the quarter ended the on September 17 to doesn't like being including the effect of inflation adjustment applying the internationally counting a standout number 29 accordingly, the financial figures that I will mention have been stay.

In terms of question thank basis of the end of the reporting <unk>, including the data from previous period and war and growth comparisons here mentioned consequently, the comparative information into the financial statements for the quarter ended.

September Thirtyth dose and the team is not compatible so their financial statement previously published by yes.

There was sold for what operation during the third quarter of 2019, what do you like we though we've our big pensions revenues from continuing operations agreed 37%.

But he made the young patients in the third quarter compared to 5.7 be young during the third quarter of 2018, mainly driven by an increase in cell, it's under contracts which amount.

Two 2.5 billion basis during the third quarter of 2019, that's compared to 300 million pesos seem to third quarter of 2018 mailing view their revenues related to put together in lupus plan acquired in June 2019.

And the energy generation from the wind farms, Ajita and I got the China, one during the full work, though and I look up the shot to on a T to I can only about do we.

We just started operations due in June and September 2019 respect.

And the increase in revenues.

Was partially offset by end degrees infill under yes, yeah, Ross it regulatory framework, which start though.

5 billion pesos during.

During the third quarter, that's that doesn't make theme that's compared to 5.1 billion pesos in the third quarter of 2018 degrees. What you do a decrease in energy generated.

11% of course, I mentioned before which got and they got the bundle to kind of around 60 million basis, I know degrees, Oh 1 billion pesos due to lower energy Mpower price for units and data and its give us a regulatory framework established about resolution number while.

Starting on much.

2019, and the lower than inflation in Greece index trend right before it's important that of 2019, which impact until you've said in U.S dollars.

In terms of Russian think based on current are there enough that are important.

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Sporting goods channel they viewed in the third quarter increased 40% compared with same period of 2019 wage inflation rate.

For the 12 must be I am on September 32019 was 54%.

He's degrees in that Tls, it was partially offset by an increase associated to itself.

Supply fuel, which amount to 1.4 beyond basis during the third quarter 2019, compared to two countries I need the median pesos during the third quarter of 2018.

Our gross profit margin in the quarter, increasing 36%.

This increase was due to above its young revenues and was partially offset by an increase of the cost of sales totaled.

3.2 billion pesos compared to 2.3 billion pesos in the third quarter 2018.

Good grief in cost of sales was primarily driven by.

Sure on increased in the use of our self supply fuel.

Use for the production of the theme or to replace.

The fuel for life like I mean, so for the units on that and if you have out there which totaled 1.2 billion. During the third quarter of 2019, that's compared to 500 meter young basis in the third quarter, two dose and 18.

I'd say gone.

13% increase in non fuel related cost of production, which totaled 2 billion pesos in the third quarter 2019, as compared to 1.7 billion pesos in the federal work that was 2018, mainly related to the operation of pretty Gotta Love the land a square in the second quarter busy.

Operating income before appraisal results net increased 36% to 4 billion pesos compared to 2.9.

Billion pesos in the third quarter two dozen they.

This increase was due to the elements young men's just increasing gross profit.

And I books, the monthly proportionate increase not only said I began selling expenses totaled 592 million basis.

Let it seven increased <unk> percent increase that's compared to 40.

Oh, Yeah, 31 million in that sort of what that off the dose and his team.

Our adjusted EBITDA was around 14.1 billion peso seem to third quarter of 2019, which includes 6.8 billion basis increased.

He needs with foreign exchange difference that's associated with the funding the men and see me that programs trade receivables, which other than which are denominated in us dollars.

We don't see at least affect our adjusted EBITDA. During the third quarter of 2019 was 7.3 billion pesos, an increase of 97% that's compared to 3.7 be obtained in the same vetoes dumps and then a follow the same metric.

This increase was mainly driven by increasing gross profit mentioned about.

And.

3.5 billion pesos or one thing getting.

In interest related to commence address he will collect collection that fourq I mentioned before.

This was partially offset by 616 million pesos, he noncash charge related to Brooklyn, the unplanned valuation at fair value.

They call. So they need the income was 3.5 billion compared to 5.4 billion in the third quarter 2018 with it. So you know again, though.

So in 27.7 basis, but they are now the shoved elements you mentioned, if I don't know net income was.

They got the legally imposed by the higher financial expenses net financial income that I'm out 8.8 billion in the third work that the dose and the team compared to 3.9 billion in the same <unk> thousand 18, mainly due to a and being threat foreign exchange different a good on that how young that well see shouldn't during that period.

Related to a long something for the terminal renewal then as she expansion projects.

On the position of reality Olympus power plant.

Most of which of them I mean, it did the U.S. others.

And finally, we tried to gain on net monetary policy shown up 700 million pesos during the quarter, that's compared to a loss of 1.3 be young into third quarter of 2018.

Thank you and now we invite you do us any questions to our team.

[noise] well now begin the question and answer session to ask a question you May Press Star then one on your Touchtone phone. If you are using he speakerphone. Please pick up your handset for pressing the keys.

She was try your question. Please press Star then to at this time, a pause momentarily to assemble harp roster.

The first question comes from Frank Mcgann with Bank of America. Please go ahead.

Okay. Thank you very much or just wondering if you could maybe provide a little perspective on how you are.

Seeing your relative position in terms of [noise].

I'm thinking more in terms of new investments going forward, what obviously the market very difficult to we have a lot of pricing issue, but in terms of the competitiveness of the overall market and a and the need for new investments potentially over time I'm to improve efficiencies in the system I was wondering how how you.

You see yourselves position going forward to two to add additional capacity.

And when that might be necessary.

See though the market as well supplied currently.

Okay. Thanks, Frank for for your question.

What I think the is the most important thing today to be cautious I mean, and usually what we are dying doing today in order to do see what the new government will do with all our investment.

In the sharp than what we are doing age we continue with that it probably exit the that our advanced under construction to tell me six will be an example, though that the case.

They all that had we have you got the I love between she supposed to be tells us as a combined cycle that we are waiting for the cosima try not to show.

Agreement, we have four project and seeing what the government will I mean, what kind of change if any the government. They knew I will do with that we've had contracts.

Oh.

Oh I see I mean, the current market that situation has it gotten markets. So that it we don't see an urgent need for you'll get passed in the short term.

Yeah, and it depends on their rules of the of the new market did you lose that the government then you're going would put in place to see which will be our I mean, you on that.

Put a future.

Thank you very much.

You're welcome.

Again, if you have a question. Please press Star then one.

This concludes our question and answer session I would like to turn the conference back over to Mr. up there for any closing remarks.

Okay. Thank you everyone for your interest seeing some transport or we encourage you would call at any time for any information you may need. Thank you and have a good afternoon.

The conference has now concluded. Thank you for attending today's presentation you may now disconnect.

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