Q1 2020 Earnings Call
[music], ladies and gentlemen, thank you for standing by and welcome to the Q1 2020 and no Americas results call.
This call at this time all participant lines are in a listen only mode. After the speakers presentation. There will be a question and answer session to ask the question. During the session. We wanted to ask a question via chat through the webcast refine the last I will be in charge of taking questions. Please be advised that todays conference is being recorded.
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The conference over to your speaker today, Delphi and allows our head of Investor Relations. Thank you. Please go ahead Sir.
[music] <unk> body, ladies on your Goodman.
Mostly to lots of work until one first quarter two for something to be sounds presentation.
I'm not players and I thought I don't think that's totally show here with me, So where are you able to yield cheerful on the company.
First before we hope you are all on your families on faith on when do you didn't get a new Stein.
Let me remind you that these presentation, we finally as like they'll probably nobody ability to do a company's website.
Following the presentation, we will have to use like you and I say shield.
Do you see opportunity that we don't we only have received through did shop owner wet gas.
Now, let me over the gold or whatever you want to see a whole who decided by aligning the main highlights from the video peanuts like not that's true.
[music].
You know Hello, everybody all outdoor do.
Well like I told his could think when regardless as you all know.
We're always going through difficult times that these moments due to the Cobi 19 buyers.
Company, it's completely focused on developing best possible managers to freeze the situation and we are rapidly reacted in order to protect our people and help our community.
In the coming to life.
See more detail up all these companies.
Going to all our operational highlights in the Americas it'd be done for these Peter reach an 848 million U.S. dollar the Queen seven per cent compared to this in Philadelphia.
Is it mainly explained by a negative currency devaluation, LIBOR, which reduces our results by 100 imports have them helium U.S. dollar without these mega TV track, but that would have increased by 9%.
Net income increased by 2% reached $208 million. He's is explained by lower financial expenses due to the payment of Brazil's bad.
Uhhuh last year.
After we were able to do with the proceeds will be kept coming queens regarding the potential impact coming from copied 19 situation I company is well prepared to feed into working capital needs that we may have duty beside the spirit, we have more than $2.5 billion because they love.
<unk> liquidity.
And now we're not that it did not reach or was below one time.
On them and the rating agencies habits come from it.
Our ratings.
Finally in terms of E.S.G.. We were recognized said, we broke glass for being bark Oh, the ranking of top performing companies offer some annual corporate sustainability defenseman.
Back to us.
Publishing the gaming ops, we did win.
Following slides well see a summary of how we are facing copied 19 situation.
[laughter].
[laughter], taking kindly preventive measures.
Make sure our employees. So you didn't get called the 19 emergency around 50% of you talked a workforce I'll walk you remote any and all personnel that can work in Malta lease curried doing so.
We have also think taken steps to ensure the safety off our employees on the field.
I think Dan we protect people equipment doing what counts as well everyone. The nano Americas school, but by the insurance policy, which was answered bayano SB eight and once implemented worthwhile.
First paper Obsoletes Kings.
The leadership to our clients. We have worked all focused on increasing visibility cities in there for us would have redesign the website. So far <unk> subsidiaries weve declines experienced and focus on communication and thing and channels, such as emails that management and as messages and.
And then.
Uh huh.
Becoming flight, we'll see the engagement, we thought were open age into operations and stakeholders.
Regarding operations.
Our infrastructure, it's really is fully operational and reinforcing a squeaky called me for extractor easing keep concern on these difficult times and safety and security protocols have been reinforced.
Some of our companies in Brazil have notified their counterparts for foods much articles.
Mitch has done a as a presented manager to negotiate with suppliers looking to mitigate the impact of the current completions. We have also committed afterwards on all the counts, which we will break even doing the nations to help institutions virtues magical materials and bridge.
That's good measure income needed. These now let's see the main government managers you'd be comfortable where we have operations.
On the topic.
Regulation.
Got them at the local regulators have have taken a variety of measures looking to curb the impact of the virus on population and the economy, Argentina, Colombia, and Peru, or even mandatory quite in time to me and see these numbers do like some people are doing the same.
Oh for countries have implemented some for form of wafer bumping then to low income clients as well as goals in commercial offices, which has a negative in fact effects on a collection.
We went to wants to highlight measures like didn't make it up would it be sought out 950, Brazil.
Which our aim is to bring liquidity relief on distribution companies that are the most affected by the current situation. We did decrease on collection.
That's similar vein liquidity lines for company were implemented in Colombia, we the same a with the same objective.
On the likes of topics on the following slides.
Total capex for the Peter amounted to $201 million, a decrease of 6.6, a person's compared to the same bureau of last year. This reduction. However is mainly explained explained by did valuation not look okay. So we don't be our capex would a increase.
By 11%.
Oh investments were mainly devoted to maintenance capex and focus in distribution business.
Like the like we analysis.
From a geographical point of view, 60%, though for investments.
Need Oh, no it's easier to review with a significant increase in white house in the <unk> and <unk>.
Now on the bottom bites, let's see I want to me, it's gene indicators.
As we have said in the past U.S.G. spark yeah. He bought that Barack Obama strategy in that sense, we continue with our fault, whose bone come to you would be we had the United Nations sustainability, I mean, she's gonna be lifted development goals, we have been supported our community through.
Goals for seven and eight were almost 5.5 million people have has been benefit that we'd dollar actions.
We also had.
Have contributed to SBG, nine and 11 related to build a sustainable industry infrastructure and seats in this way in the Americas relies on its low carbon value added products and services, where this month meters and and then.
Because our ran up on the development of human area and he boot the quality of life in these areas innovation in order to prevent cyber security cyber security incidents. We go over all of our web application expose it to Internet, we advanced cyber security so.
Actions in America has contributed to fight against trying to change by generating.
58% LP energy Hydro Alaska hydroelectric assets duty this experience as mentioned before in Americas was included in the sustainability in your book up Robeco, Some no Dana Dana bronze category.
These recognitions confirmed the good work that we are doing and the relevance debt sustainability pass on our strategy.
Now lets analyze all financial performance you become mean is lives.
As mentioned before we bought the did not reach at 848 million U.S. dollars, a six month samples sent degrees compared the same beautifullest via wherever we if we exclude do defects variation.
Which amounted $147 million negative effect.
He thought would have increased by 9% <unk> net income increased by 1.6%, reaching 210 $8 million disease, mainly explained by lower financial expenses due to the that's being at the National brands you made with the proceeds coming from last year kept.
The increase.
That's helpful reach at $127 million, an increase of 87% compared to last year, while no. That's the greeted by 11%, reaching 3.8 billion U.S. dogs, we will not lies in the steel cash flow and that's I had owned it.
They should.
On the coming to light, we'll see we'll see if diebold loosen a and it's a breakdown.
Stopping from 999 million U.S. dollar thought they'd be die from first quarter off last theater.
We can see that distribution and large I don't if there's it's good to you did we bought the decrease.
While an elite also shows an improvement on the other him thermal generation have any Balkan Greens and they'd be dot mainly explained by Fortunately that wouldn't know adjustment made in last year EBITDA I'll be standby with dealer business is also shown says most Doug.
ER and the courage the both currency devaluation before Congress wherever you are pretty but had a mega TV backed off 138 million U.S. daus, which mostly explained the 7% reduction of consolidated EBITDA.
There's all business lines distribution represents 49% of already be dot why incineration contributes reported 30%.
From reached 33% he is a large hydro with deal and elites represents 6% and 1% respectively.
Welcome to finalize that 89% they've already be done it generated by zero zero backing <unk> direct Imations xcede.
Let's now in our lives do our operation.
Hi, like operating highlights in different regions lives.
[noise] own generation business, our installed capacity remained basically the same as last year, reaching 11.3 gigawatts from reach 55%. Our hydro net production reached 10.6 Terawatt hour, an increase of two per cent compared to last year and adult.
Generation PPH petsense correspond to hydro generation, which increased by 200 megawatt hours.
Our energy sales decreased by 9%, reaching 60.6, then about tower D is explained by a reduction in Threed, Nick Bbten in Brazil.
That's another life distribution business in the coming in the coming in because he'd like.
Due to the energy remain at substantially flat compared to last year, reaching 30.2 Terawatt hour.
Mainly driven by lower demand in and at some phone due to a weather condition a in a in the C. D E Bay state of some bulk any people who do two degrees in economic deed.
Consequence of copied 19 situations.
This is partially offset by a small increase includes inside the sue and themselves.
Regarding the number of customers, we had an increase of around 157000, mainly explained by a increases in and it's a bomb good insight and glass.
And why did indicate doesn't do but no subsidiary, except before and I was shocked.
Well, we suffered severe rainy season and also suffering damage on our networks goes it by increased in the last the wall social violence and complexity during the second half golf lifestyle fast there.
On the families libel see inner leagues and retail businesses.
And then links business you can see Beth I do you see what people like boy.
Likely be Greens reached 392000.
A couple times Bennett panels installed also decreased 4.4, Nick I'll watch 2.2 megawatts regarding financial services, we had a significant increase in credit card business.
Which reached 882000 aktiv guarantee carts.
While you eat home the level of contracts, Michael Insurances was in line with a last year.
Finally in Emobility, the number of charging stations in Queens. Its phone 100 to 589, mainly explained by Columbia in Argentina.
Regarding retail business.
The number off the LIBOR at points increase it by 10%, reaching 3069 MD energy just sold amounted to four.
How about towers in line with ER with bleeding 19.
Let's move to a point comforted by comes in on its own becoming flights beginning with the we've done Tina.
If he does not have been a degree by 11% or $80 million, reaching $63 billion nobody something you know put or something else that did not increase it by $32 million.
But these results was offset by a negative FX impact of $39 million.
The generic some business so for the deprecation enough that its buoy fabric and EBITDA decreased by 10%.
Reaching 50 seats 1 billion Boes.
We don't consider the FX effect. It did I would have increased by $34 million 46%.
Yes, it's mainly explained by higher capacity.
You know in nominal terms by a higher sales, partially offset by a lower full margin and higher costs.
In the distribution business it'd be that decreased by $2 million, mainly due to FX effects, you know British on therms you'd be by increased by $9 million, mainly due to higher tighter due to the inflation that if adjustment Oh from March last year and highest social pads.
Demand in our concession area was 1.7% higher compared to the same period last year.
This is important to mention that we are going to you're doing a big effort to sustain the operation innovated scenario.
Shopped drop in our revenues was the result of becomes his financial economic situation and frozen pattern for more than two most.
Have calls has a significant losses in the company as you can as you can see despite this losses, our commitment Easter guarantee quality services continuing cost this emphasis on duty vehicle beaten 19.
She's.
Topics in Argentina degrees of by 19 million bonds.
Bad compared to last year. Most of these degrees was due to FX effect in operational dirhams capex decreased by only $3 million.
That's continue with the Brazil, the following slides.
He brasil overall be that seem to be real decreased by 13% or 50, or 50, preprint $53 million, including $64 million off Mega TV package coming from the FX effect, we dealt to be negative affect EBITDA would have.
Increased by 3%.
He'd be time to generate some business decreased by 37%, though $45 million, which expanded by words, resulting fortaleza. That's a cone said quinsa claims oh for lower energy sales and higher cost Oh gosh I explained at the beginning to us on a one off Baltic these adjustments.
We sell into 18 19.
EBITDA in the distribution business isn't by 5% or 16, Neil Young what's dollars. If we don't close either the FX effect EBITDA increased by $34 million, mainly due to the somebody's dad, who sets and higher losses brick companies.
Partially offset by lower and they're just sales.
Got that seem Brazil increase it by 5% compared to last year, reaching 182 million bonus.
If we don't consider defects in fact, capex increase it by $42 billion.
Let's move to Colombia on the following slides.
If you bancolombia increased by $12 million on corporate center.
Back to the same Peter last year. This result was well be thing that despite the negative impact of 41 million less daus due.
The currency devaluation, if we don't see either the effects defect EBITDA would have increased by 17%.
Yes, the generation business, if you think visit by 4% or $8 million. If we don't go see either they affect defect.
I have any cleans up 18% or $32 million. This was mainly due to higher spot price higher prices do their contracts and an increase in energy sales.
Did you shouldn't be this it'd be done increased by 2% or $4 million University symptoms, the increasing by $21 million, mainly explained by higher that is higher and it just sales lower losses, and a better quality all such services.
Got fixing put on the decreased by 18% explaining by a make whole parts by the effects effect and lower investment in distribution business.
Now lets analyze the room in bidding on this slide 18.
Exactly.
Richard $132 million, which means that degrees of 80% of or 11, neither <unk>, nor as compared to the same Buda Belfast.
He the generation business EBITDA increased by 7% or $5 million. This was mainly due to lower energy purchase costs and lower food cost.
Partially offset by lower revenues due to lower and it just seems you.
Could you shouldn't business it'd be bad degrees by 281%.
Or $15 million. These was mainly due to lower distributed energy and higher energy branches in costs.
Sales increased by 5% compare to last year, mainly due to the coffee 19 effect.
But they'll graphics, increasing by 4% compared to last year.
That's been I wonder lives, our being their main indicators mm become mean ER is light.
Starting from $848 million EBITDA.
Scott Walker off to any green the company registered depreciation and amortization for an amount of 303 million bars.
5.8% higher than the same viewed left here as a result of for larger asset bases in Argentina, and Colombia, reaching on that it all up 545 million Boes.
Net financial results amounted to minus $140 million, which represents a lower cost of the $36 million compared to the same Peter the last year.
Dcs. So this is mainly due to lower financial cost financial cost financial expenses in University.
The thing and stuff that that's equinix and with the purchase false and there's some Paul.
He comes back switches there'd be the Peter was $132 million.
Rich, it's a really 1.6% lower than the last year, mainly as a consequence of lower earnings.
Both on marrying that income amounted to $210 million, while at the beautiful data you can reach a $280 million, a 1.6% increase compared to the previews your results.
All these elements that's in the lives the cash flow even next slide.
Like we anyway.
It's from operations amounted to 100, and we do $7 million starting from an $80 <unk> $848 billion beats. A result includes a negative net working capital if you put an amount of $498 million mainly in Brazil.
Thanks beads duty to be amounted to $122 million Wow net financial expenses amounted to 101 million Boes.
Net cash flow amounted to minus $219 million duty defeated after invested $183 million in maintenance Enbrel tactics as indicated he did reduce lights.
Dividend speed by the company amounted to 163 $62 million as you can see like so denied abrasions amounted to $15 million due to a leasing a in Colombia and busy operation you mobility.
Oh. These these effects built on that that's increasing by $490 million compared with last year.
Let me give you a quick update on the use of proceeds over the last couple agrees into next is likes.
As you know February or off these Europe, when we announced that already danger to make a cat thought of Oh, sorry fabric off last year opinion 19, we announced a dollar intention to make a kept an increase of 3.5 billion U.S., though.
After many meetings with the most of our shareholders and having heard the market to be didn't we decide to reduce them out to 2 billion U.S. dolls, we announced said that the use of proceeds would be dedicated to the payment, though that in connection with a eletropaulo I end up some follow because each one and two starting base luxury.
Relative to the pension funds in the NFL football April last year. These operation as you know what's a boom that we've done next through the nation shareholders.
Good.
He novelist after the first brand. These like you do annual Americas. They the acquisition, that's often have some volatile for an amount of boot 2.5 billion U.S. box.
In September we successfully concluded the captain <unk> with the remarkable 99.5 left percent level said Scrooge find them in March of this year, the Brazilian pension fund regulate the group in the <unk> distinguish on some follow pension funds Bruce.
Which includes the remaining or 400 500 informed millions U.S. dollar.
In order to implement the contribution benefit migration plan.
Let me now analyze the data for our company either following slides.
Gross debt amounted to five point $47 billion degrees of the deepest sense.
Since December 280 90.
Effects in fact accounts for a deficit reduction of more than $1 billion. This is mainly explained by the fact that most of our debts he'd be local currency and by the fact that these currencies that's different than he he bought them devaluation duty defeated special especially.
Well in Brazil.
In terms of currency.
Almost half of our that is located in Brazil and in local currency as you can see on the charts.
Finally regarding the cost of debt, we can see a reduction for the speed going from 7.1% between a 95.9% for first quarter thing between this is mainly explained by a degrees the weights off that that's coming from acquisition and often it's.
Oh, and lower variable weakness the ratings you better conditions to refine its that's in Brazil, and Colombia and historical are doing Columbia ends particle reduction.
Off a Brazilian inflation rate now let me show you how our company is relative to when you put dish potential liquidity needs. Thanks to the hours solid the financial situation and position.
Our liquidity and balance sheet remains strong.
We are we had around 2.6 billion U.S. caught us off availability liquidity as of March 31st.
Cash and cash equivalents accounted for 64%, though it though while committed credit lines account for the remaining 36%.
In the context of global pressure metrics.
Consequence off the Corona beetles funding.
And despite these little down in the economic activity and the lower electricity demand in the region.
Moodys and doesn't and boards.
To be confirmed in the Americas as an investment grade company.
Our strong liquidity and credit profile give us confidence to support our financial strength is doing these difficult period.
Let's move to slide 25.
And you can see here.
Well. These are for this year, we have maturities for around one point 15 billion U.S. starts along the along with the liquid well see some showed on the previous lights.
We have also important leverage capacity to face these are decent.
Our net debt to EBITDA ratio is slightly below one time.
Which gives us the possibility to we shoot new beds for up to 6 billion newest Doris without booting increased our investment grade.
Let me conclude this presentation with some closing remarks, and they'll Americas is well prepared to face the economics consequence off that Brendan and we'll continue to strengthen our attention to all our stakeholders doing to cope with 19 emergency.
Once we exclude currency devaluation affects our business showed solid performance do either for squat with strong reserves results compared the same you have left here.
Despite the crisis situation the company's significantly increase you capex in local currencies, especially in the distribution business in Brazil.
Our solid financial structure endorser.
[noise] endorse it by the rating tied into a these allows the company to come from the emergency situation.
It is move a wait and to withstand the financial and operational needs in the short them without a major major leases in our and on Americas is actively supporting initiatives to mitigate the impact all the time, they making big communities, where are you where we operate.
Let me just tell you that Ah we feel that disease. This thing the first time that we do each dissuade beside this presentation a hope the next time movies or in a better you know better condition and hope you are safe and well, let me have lent to reflect the complete.
The the queer need session.
Well, thank you very much already already liana.
No we didn't know where do you any sense you on I'd like to remind you that their questions we'd come from their child welfare nickel Buddy.
Yeah. So with your question receiving their chats comes from balance if they came from mounted on the first question is definitely one.
What protective measures have each county implemented for you got to be like one of the time.
Non payment pay many still mice.
Okay. That's all.
The second question from bar.
It's a depression.
Capital next year.
On 100%.
Maybe Sean please.
<unk> centric to have rest of the chain generation and transmission in an official might it be any relation or I mean for them on mining.
When he left there not expansion of its animals money transfer it'll be energy transmission company.
Okay.
Thank you Rafa good after the video. Thank you for your Youre your questions a well a in Argentina, we have mandatory quite in time extended into a man defense. That's the latest though you from isn't that we have.
We closed the Boulder commission or the commercial offices.
And only personal needed to do compete itself all services in the network and demobilizing, Yeah, Yes, we are getting the streets.
We did spray audited to keep the lights phone huh.
Of course, we the safety in very Ah Ah lots of a basin.
We just safety condition of our people.
Any ultimate Argentina, we have to lead this disconnect or to sustain some basically services for six months for users use its we've done a week or so show, there's a or something in Brazil.
According to tighten is not amended thought here at account three level at some follow.
Well its abolished the region that we have the biggest the effects of the crisis. The crisis in England's he was the state of the highest level.
Some follow has declared that amended protocol in time and you made a thing none of my thought is that well there there was a solution or eight HM 200, and said the age of easier previously to sustain some fall a of supply for 90 days a duty disputes afford before let's say no.
Payments duty diesel 90 days right.
Weve yields a delinquency at U.S. you get weekend that disconnect but for this be didn't know a we'd management to preserve the reviews. The provision of course off the public you know electric distribution services, which is which is maintained it well do them than you did a pretty bizarre down there.
950 of these you.
Increased to 100% discounts to consumers.
Benefited by social rate.
Let's say a consumption up to 200, and we need kilowatts hour I'm, sorry kilowatt them HM.
Well, there's also auto keeping TV or the they account for a bit sub zero C.D. This obviously, Brazil, just a reserve resources to go over these these measures so the topic of distribution company.
Blade would be less let's see the of course, we are refining this number two to see the big back in our conference in Colombia, There's a mandatory point in time extended into May 11.
Liquidity line or for for the company voluntary contribution and transfer Oh, no reconciling validsoft subzero should the by the administered off energy.
Transitional measure up to four payments or alternative builds a well there is a definition of the payments Peter of 36 months.
For social striking one and to grow 24 months from social start the three and four.
And for other people they use it as agreed that between device or what's the regulator will act as a let's say as I as I made Diego.
<unk>, Yeah mandatory went by and extend into me the same.
As you well well there is I I state depend much emergency restricting mobility off all see teachings, except for a portal working on essential services and of course, our our fuel the activities. It's considers the essential services.
We are certainly.
Postponement of payments of contribution to see them.
Which is never believed there as of June the last day off April Gateway.
Well, that's a that's more or less visa of course, we sent a show that is likely present the.
Managers. So you can Ah you can see to have more more belts. We are we have a pleasure to to complete the answer the the other question was regarding a net working capital and collection well a local actually is associated with the two concepts or the growth or of course, the closure of our collection.
In China and channels.
And having in mind that before the crisis, we have a major part of our collection do the that's been done a into physical agencies and now with the digitalization process isn't the only on our platform innovation or improving the digital channel.
Channels, we reduce abuse, let's say just dependency huh, we had we used to have 60% and now it's 40%.
In the email division, which are which he was a very good the advancing so but of course the disease something that though we are more exposed because people cannot go to the physical.
Leases in some a in some a in some areas.
And now of course, the benefits for low low income customers as I explained before or has that has or let's say a delay in these a in these payments are allowed by regulatory measures.
Well the as I as I told you. The first one we are fighting because we've been hit valuation.
And the second one are gonna thought he uses of course it there's a a lots of a discussions advancing and I'm confident that will have a a solution in the coming into coming weeks or two Cooper, the financial and economic suppose it a especially in Brazil.
Well, Oh, we have a certain points, we declared it and we formed a dollar our outlet at a energy providers that the we maybe influence. The majority comes off a cash collection of course, we are not confident that we'll have fiber goes up on solution for these.
In order to to let's say to have all been value change up or electric sector.
Im not very well balanced said.
Rafa.
Okay, well. Thank you already okay. Thank you actually get phone for liquid skills and knowledge move to uncle sometimes.
Uh huh.
Uh huh.
Pardon me Rockpile, please check and see if your line is on meal [noise].
Oh, My Gosh, you hear me.
Correct.
Part of it all right and I hear me.
Hi. This is already you can you hear me [noise].
Yes, we can hang out and I got my uncle right. Okay.
Yes, I got cut off I mean here okay.
[laughter] first question.
[laughter] have you seen effects on demand delinquencies so far in companies can be shown companies.
Counties have been done most effect now because the first question from Banco Santander.
Second question have you received any contract renegotiations request for generation business, which counties have received a mall.
Sandquist came from Banco Santander in relation to out again do you know how much they came into being two companies huh.
Was there any agreement between to generate thoughts on companies Huh.
The last one he founded on many guys he's going to change he's going to modify your strategy to focus on 28, he's taken into consideration because when a shadow. Thank you.
How far are just one just to clarify who sent to this question I'm, sorry, I didn't get your because it it will be.
Well he lost some dose modelo Santos from Banco Santander.
Well.
Okay. Okay. Yeah. Thank you and what do you look for your for your question.
Well be mandan delinquency for distribution companies.
Of course, there is a we are falling daily. These these issue Uh huh.
After safety after of course meant they need the lack of someone off our clients.
This is the priority Oh, the financial financials, I'd be a falling and managing that daily you know the babies.
What we are seeing is that we are the most affected commensurate Gunther is out there who.
And anniversary right.
Or what to of course, it today to be learning process out because it didn't start Didnt know region.
In a in March March 15 in of course, we have seen or some some a improvements during this process. So it's right now it's difficult to predict how we will move on to be unto the becoming becoming miles but.
What we have seen that's good who in Brazil with the is the nature of that nature or affect you. Perhaps you are well up we see that being the beginning we have oh, we have that I believe we've seen the beginning of 95%, but now we are are we are around a nickel related basis.
5% or if you see doing the said the less days yacht around 15% any booby mm why is that because into beginning to us had difficulty to do getting their learning process how to <unk> to <unk> also kicked up really gets to the customers and so on but.
Taken advantage off our platform and our digital channels.
We've been improving duty building a duty viz, a viz speeders mm in terms of.
In terms of a alpha generation.
The negotiation, yes, let me tell you that we hadn't bought a let's say.
We have seen a better picture in terms of the of the generation and commercialization business in terms of negotiation.
Competitors, there because I thought it mark why is that.
Because we have taken adventure.
<unk> approach in terms of Threed the nickel much transition activities. We also are being Ah Hep had these approach of not selling commodity bids, but selling services selling.
And so he problems alpha generation and offer consumption of our clients. So this helps us to be very proactive.
From our side and also for the crying side.
Understanding and.
We are being flexible and having a flexible a negotiation process in order to accommodate to their production capacity, let me tell you that I.
If if it's more than 5% that that I see problems or to be huge comparing to decent due to this and after that.
In the current the scenario. So we are the grid the major part of our of our selling off our sales it's been a well address it would be with our with our clients Oh of course, a better will be some situations that the cannot so it's over them. So.
One, but it's a medium own a I can observers in the and I can serve and I can tell you that some meaningful part of our of our of assays, it's not relevant right now and again the disease days it to a very good strategy.
Are you initiate the two years ago.
A a you know are trading commercialization activities to be part of the off their solutions, not only selling commodities, but selling.
These approaches of surface okay.
Well I think in relation to Argentina, Yes, we are delaying that statements of come isn't nothing new in deciding this field of course, Oh, we are not sandino would have this strategy, we have a delays and we got just men's new lazy ER and a in the the collection was generated by the regulator.
<unk> regulate the Matt Matt managers.
And the government sooner than we compensate our cash flow, we that we that where the company is not it's not something that we can say that's new we've been <unk> deep using the pass on a and of course, we I believe that you now intensified agreement between generation generate because in a income is though of course we.
Yeah, we have that have been you're having very good space just goods the issues to discuss with government. We become is that we'd be easier, but up until now we don't have a former formal agreement with the with the regulators and a anda generation companies are but I think it's a it's a process.
ER, but anyway, we always consider Argentina, or indeed, saying itself neutral cash flow will not be putting that in Argentina.
If we don't need for half delays, we have somebody should be the the the collection and ER and the readjustment of course will compensate that we'd.
Without investment a in a in cost because in the in the in the country right. So that's in general what.
Nothing new that's what we will be doing a and you're doing in Argentina right now. Thank you.
Okay. Thank you O'neal, a we healthy we're still so my main focus and take a lot of Hollywood. They need every call. Thank you very much for your questions. The first one is a or we don't look for working capital evolution.
And then on <unk>.
With that like late or for the foreseeable ASIC already or some pay fields.
On the last one if they hit the impact on EBITDA from Argentina. How did you have to focus on plenti due to they thought increasing distribution amplification of generation business.
Okay. Thank you Rick is equal for you know you on your questions are but supervision well that as I was telling you it's difficult to predict right now the being back in terms of of networking capital, especially in terms of politics, and writing which.
Is the first line up orchestral.
Right. That's we let me tell you depth in the beginning we personally so I've said in a what we saw very negative prediction right.
Welly, especially in Brazil, and a it was.
It was announced that it would be around 30% of a of.
Delinquency and so one of a a reduction in kashi enough distribution companies and so you're not seeing BCBS right now.
Are we are we are seeing he pent up demand reduction.
I want to 12 point a 12.9.
For a sense, but.
You know right now not being the first classes that the in the in the in the country in the country lab.
And the GAAP and meant that showed some reduction in Brazil also point to 2%, though demand of March ER versus March.
A lot of last year.
Or so.
Of course, we are we see a reduction but not accordingly inside these news a debt that was in the in the beginning of the of the thing that make that clients are.
We are and as I was explaining we adding moving our our collection, we are giving alternatives to depth to our clients. It was very important thought was financial businesses, yeah, especially in Colombia, we which helps us to do to have a better.
[noise] better channels for for collection, So Uh huh.
Right now what we don't have deceiver, yet you said, they too deep learning a process and it's very important that oh, so the government, especially in Brazil, which is the major part.
He is a is considering measures to compensate the deaf seemed a into distribution now so.
My my answer is that.
We are now we don't have these figures right now we'll have a probably after oh. These implementations off the measures from the government right a and a wheel with broccoli are allowed to two and tell you what's the what will be exactly the.
I think back what what can I say, what I can sit values that we'd be meeting pool, the improving doing this.
The last the last month.
And we expected to.
Keep on maintaining our cash our cash in.
Moving to come in the coming weeks he himself a effects Ah yes, there is.
I will not denied that's it's a huge impact in terms of effects are you.
So simple calculation you do see the defects in a especially in Brazil, and Colombia as she or he would your variation. It's a simple calculation and you can you can calculate by your.
Bye bye like the best a consensus that do you want to use and then do.
To proceed the facts for the for the coming for the that yet and <unk>.
In terms of Oh Sargent Dino.
Well the Pacific Asian effects.
ER well was we saw you or the beginning of.
In March.
It is it is around $10 million to $15 million estimated by this year.
But again, we need to see a from a complex seaboard <unk> a complete.
Situation with all the measures that though we are implementing for the next quarter.
And I don't know if I answer all the questions.
Yeah for four here recently.
Yes, I think so thank you Enrico think hotelier I know, let's move to Bloomberg intelligence, taking my model.
He's asking for the following question can you. Please clarify if you are they feel comfortable we do it EBITDA and net income guidance to focus on 20.
Eating that even the declining but what do you mind devaluation.
Got my face in Latam.
Well.
This is asking right.
Thank you very much for <unk> for your question.
Well.
Well.
If the major impact. These is the defect of course, they affect a I don't have the figure there there's lots of a variation and I phone sensors, but that they effect. So we are winning back to the that they'd be died net income off the company, especially baby back right. If you could.
Difficult relation with our with our co sensors and now our consistent all at a assumption and the and the situation that we have right now in terms of realities of the devaluation and in terms of Columbia, especially in the Columbia business, you'll see that ER will have a huge impact.
This is the major impacts we don't we still don't have put them back to the Gulf believed that the total impact of Koby 19, right, but I can tell you. We net defense the major impact I mean that 80 or 90% of impact will be a.
And it's been a is due to the effects a effects impact right. For example, the reality is EUR <unk> five foot Boy was 5.75 0.3 right now so you see a.
A huge devaluation.
That sense that because the revised generated in bringing that you'd be dine Bennett income budget, there anything Brazil I agree I can look occurring so translate that into U.S. dollar you forget the the current the.
Effects of going to go to see BRL.
To U.S. dollar you see a huge huge by agents is not difficult to calculate the high and we are talking about oh, more or less a six fundraising twoeight hundred nearly a million dollars off effects a impact in terms of they'd be dot <unk>.
So.
In terms of demand, it's it's something that will steal a.
Waiting to see more development once one important thing does that if you see all the regulator especial that blend or 40 countries. The official planner. They are planning model last week over into countries in the second half nobody can assure these are not not.
Doesn't know I'm, not even but the working with this would be set a assumption nothing with they've got off the documents desire to go over.
Maybe the date back to the lower or so it's a it's a it's very recent to do to see the impact and again.
I think in mind that especially in Brazil, which is the major impact.
We have the compensation are being worked good bye.
By the regulators and all the distribution companies even resumed in order to compensate beside negative impact on demand and let me remind you that in Colombia, we have a revenue cap methodology, which is which provides or we could make a at least the economic impact than did see.
Vision companies a record.
So more or less just as a somebody effects will be the major impact not difficult to calculate.
And that demand is to see a especially their recovery of economic activities. The the you know countries as I said the plan there or the governments in each gone tomorrow. It lasts the artist amazing their workover rigs are starting to improve in a in July.
Oh, okay.
Okay. Thank you and Keith Thank you a really.
The following week, where sales growth come from Mediobanca Sabatini.
When I say that set us you're going to stimulate that ability with them. I mean, we have four questions from mediobanca defense quickly on either photo anyway.
It could you. Please provide provide more details on the 498 media U.S. dollar working capital impact.
These ideas, we have sold through the year.
Second question either following one how much is if I know support that they company receiving from the company's Inc., which he told base cool these mitigating not working capital.
They said if we still would you consider M&A danger to fight power.
On the R&D and if I know one way from Mediobanca, you see how much would be Dave Buck of Koby 19 International pretty dumb Nic fix that you estimate in your numbers seem to focus on 20.
Yeah. Thank you think you're better bunker well its entered that that we have a let's see I I.
Hi space or liquidity have very well Vicki.
Very good position things off a of credit lines right to support these are the speed is.
We have liquidity of 2.6, and a billion dollars in terms of cash and cash equivalents and credit the lines. So we are prepared or of course.
What what they are facing is something.
That we never predict it.
Of course, we didn't do we didn't do that kept a waits for disperse. It does this purpose, but you hate to help it says a in terms of balance sheet. The ER to compress the best through these are the situation Uh huh.
Of course, we will not a and we are not the considering and would not want to use our firepower to decide to describe is about.
It's it's better to do to have you seen basically situation be side.
Ben that achieved a position.
In terms of a of affinity yes are we still maintain our strategy is to keep on going into and a in the reason although right now it's not our priority of course is not our our focus we are we are focusing maintaining alper.
Operations and so long.
But we have a a special or especial team.
Working scouting opportunities being and developing a new.
New possibilities and so on a but a in general terms is not the our priority is off but I was just right now is to use two main Dan alteration meant they ought to pay our cash and cash flow, maintaining our our financial stability and a and ER and taking advantage of visa financial position too.
To maintain the lights on which is the main domain the main position and the safety off on people.
How can you can you help me, they're not the without doing a point or I'm, sorry, if you're going to asphalt.
Yeah.
Yes, there is a quick and I don't know where M&A site by what a taking into consideration here and there the ratio in the company on the last one a yeah. They.
Yeah.
Yeah.
I don't have a follow on there just to follow it we can do it this way a five oh. It is a if you can see there. The limited that's we have to 2.5 times or not that to be done well established by our credit the agencies and talking about more or less from four to five 4.5 4.5 billion.
The U.S. dollar one think it's very important under the pension fund that we got the approval to use the proceeds into start or did the risk of the pension fund something very important that the out of working very hard in the very assertive lead doing these year in order to close the year with major part of these of these Ah that's.
The pension fund desktop some pounds.
Oh, the image in the middle part de risking okay.
So half of please sorry.
Yes on the last question is how much would be the impact of koby thinking in terms of EBITDA mental fix photos on 20, that's happening partially offset a deferral.
Yes, we do not have been calculated or you have to we have lots of oh situations, but.
We prefer not to calculate because it it's important to see the development buff Oh, the behavior of the of our consumption in a and clients in the in our geography, but let me tell you that the a in a good scenarios that we analyze it the major part of <unk> effects.
Okay Inc. box of nickel did is related to the facts I mean, a 80% it will be effects, a and it's not difficult to to make a couple of places in scenarios.
Considering that we we publish a a where our macro assumptions.
Okay perfect Aurelio Fabulous have you noticed moved away the Castro two questions a critical.
First question is definitely one energy losses have increased during the first quarter two for some 20, he's there I come on explanation for that up.
Well just said I'm only days models based on what are your respective regarding them for the here.
The second question in the following one related to your generation projects any of them give be delayed because of koby 19. Thank you that.
Okay.
In terms of.
You can self of delays not in generation. Thank you very much <unk> question.
We have some issues I'm in some some plants that we have won one keys of a into a infection in terms of compete 19, but at the it's already sold it. So it's not relevant so we we ought to we maintained our Ah our.
Major projects.
Or just repeating O I it's related to.
Maintenance not to growth because we do not have any any goof deviances our approach of projects.
In a in America periods.
Second question Robin.
The second question is able to energy losses, a the recent increase during the first quarter two for sometime team Oh, yes.
I'm, sorry, I'm, sorry for fall two meeting that in terms of energy losses.
Well the major the major impact.
Was observed.
Nah in sat huh.
Or why is that well we have.
And in some parts in real we have a deterioration in some areas related to the two more oh, let's say aggressive that aggressive the off the market then complex complexity off from our social complexity and also is there room, writing the rules some areas.
In our distribution companies, we have we'd have any agreed not.
Not relevant inquiries, but ER, but something that that we are focused on to reduce.
A with a with a more complex it did do complexity in the in these markets or or or or low income populate that mark areas.
To do come back door to fight a these this commercial losses right. So we are implementing the the managers to and realigning demand should be measures.
No I wanted to keep on to keep on diesel Rachel's ER and controlling.
And also imagine theme that defeat lives in Argentina, we had the some some deterioration in some parts of the of the village also due to the coffee the and 19 or we had some a restriction to to not to enter into but to reconnect studies.
So these vicious he should that we have to sobi in that and we call vetting and are we are confident that will.
We love compensate the bleeding or doing the following the following the 40 months. He himself working cap go why is the difference between the the or what the explaining that 498 million media and U.S. dollar I think back negative think back let me tell you bet a disease this will be compensated.
During the during the year right or not the too as I told you too.
Improve the Capex improved the open monetization in these are gonna do they seem to end a in the region, we've beaming Gleeson and thank God, Yeah, we've been Gleeson these activities.
In the end to end the off doing the of doing the 19. So what do you have seen right now is a a bargain basement self these oh, we scopic or to do to be compensate the other part.
East related to.
In fact in Ah you now was bought a a spot it's bought payments in Brazil, especially in Brazil or debt will be compensated by the goal I thought he assets.
But we are having a little have these yeah from busier own once we've got that if we decide if we are readjustment being breo.
And a in a in Seattle and right now in that that if we are recording. These these effects. So does this major related to the capex or airports in the end of doing the 19, and but albeit a embarked off the of the.
And effects of higher attendance or in the spot or let's say not the spot market, but the spot.
Prices.
To dispatch thermal plants and it will be compensated doing booting busier and you know I lived in the industry in the first half of next year why is that because we'd have a data for readjustment in a in March of real in April we sat huh.
And in somebody's going to be July and English as it would be in October so the the day here, it's not the same year off a of off of the greatest waiting so it will be to move some parts to blend into anyway. Okay.
Thank you. Thank you really following their following question comes from Scotiabank, Joe Colin.
The question either following can you. Please give the rate of collections in each of your accomplishing April how that compares to that begins to the previous malls.
Okay.
Just one moment please.
Let me get the they must deal right now, but let me tell you that I can I can tell her that we have let's see until until January.
We are recovering more than what we invoice it right I've been telling the in the January we are recovering if we voice to 100%.
We are recording 101% more or less right.
We start that you feel the level of Oh production.
By March a which is around a more or less I can tell you the figley exactly their favorite it but that it into being a little bit lower off 100% I mean, a 90, 98% more or less mm.
[noise], that's it can be again.
Fail.
Hey, good idea they last quickie on a cost from a tough she's been a from Morningstar.
My question either following ask Koby 19 impacted on Joe to focus on 22 first on 22.
He kind of spending plan of 5.3 billion or you, there's no less especially with the majority plan for proceeding networks.
Thank you Josh.
Yeah. Thank you Charles for your first question.
Well, yeah, we're not changing decently spine right or a wide because it is very important to first of all told to keep on improving the quality nowhere in our region right in our assets the quality of supply off our clients.
Let me remind you that 80% of these Ah.
Let the due to the distribution assets. So it's very important to keep on maintaining their capex and to keep on investing you know there too so we do.
The quality and losses say now where you know region.
So the government daming them.
The Glenn.
Or of course, you. Some multi site is I referenced say five points Liza easy new west dollars, considering the Capex and.
The scenario or they are the assumptions that we used to be the capex, but having said that will not or we're not good considering reduction need but it's important to mention that we develop at a very good capacity to be flexible in terms of capex.
In the last five years, we'd be the.
Oh, the tariffs which sets.
In doing needs very well in a very good because the mission by regulator off our capex, which means that that we've been very assertive and we'll know who learn a in a very good learning process.
And improved our flexibility bins themself crack which means that are these gives us lots of confidence that needed shut them, if we need to base or some capex investments for example, relived that too.
Demand in Greece, or two new clients.
Increase or decrease our demanded degrees. We can we can adopt <unk> our capex another two to pass through these crisis speed. So.
The the most important message here is that a weekend or we can be very flexible in terms of capsid capex to adopt the base to adopt the tightening but in general terms we are not.
Dosing.
Our our our targets are either in the region and maintaining our interest in the in South America, and a an impressive mm.
Thank you. Thank you really have a well as there are no more questions I conclude their results conference call Hey, Let me remind you that us use while they missed operational stamey soluble for any Delta you may have a stay safe. Thank you for your attention.
Ladies and gentlemen, defenceless today's conference call. Thank you for participating you may now disconnect.
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