Half Year 2020 Enel Chile SA Earnings Call
During this conference call. We may make statements that constitute forward looking statement within the meaning of the private Securities Litigation Reform Act Gulf 1995, such forward looking statements with Blake just like only at our current expectations.
Not guarantees of future performance and in golf with lots of the <unk> actual results may differ materially from dose anticipated in forward looking statements I suppose although there is actors.
These factors I described in and now Chili's press release reporting its first held 2020. This all the presentation accompanying this conference call and they'll Chili's annual report on form 20-F encoding under risk factors.
You May access our first held 2020 results press release and presentation on our website www <unk> and E L Dot Hill, and our $20 up on debt as he sees website W.W. Dod FCC dodgy ofi.
Readers are cautioned not to place undue reliance on those forward looking statements.
Which speak only as of their gates and now Chile undertakes no obligation to update this forward looking statements ought to disclose any development as it was all of which this forward looking statements become inaccurate, except as required by law.
I would now like to send a presentation over.
Over to Mr. Seville club as head of Investor Relations put now Chile. Please proceed.
Thank you very much need yet and good morning, ladies and gentlemen, and welcome to the now Chile second order to sell them 20 results presentation. I Hope you are well unsafe your Han inartfully older requires safety measures. That's it brings me.
That's request to Oh, I am not that look let me jump Investor relations.
Our presentation will be hosted by Paul the philosophy, our CEO and use that because they always careful in occasion off. These events. We are you I don't think appropriates Brittany schmelz majors, we are all connected smart homes.
Oh, we won't be much then make my life interim he was an update on the global situation that to your safety and how the company's responding to me.
Then does that be walking through our find you should read though our operation performance and you'd be them more details on our 2020 you'd be non guidance update.
They usually waning action Buffalo Lee no debt questions will be received only be a shock available in our webcast at www Dot and now that's yeah, I think Investor Relations section at any time. During your presentation. You can meet your question just sort of like.
Then being cut the top off the web page as a question. Let me remind you that major participants I call next it Oh, you only have moved as always our IR team will be we're quoting it should be available to provide you with I need to take any formation you meet with respect to the speakers, including just.
Thank you.
Thank you know for your presence and now let me hand over the call to problem.
Thank you, we sell Bella and good morning, ladies and gentlemen.
Let's start by mentioning the I'd like to slow depicted on slide two.
Today the.
The war is facing disorderly difficult times since the beginning called debt crisis and that she also realized the severity of the situation and the prevented or an assistant managers.
You can pin offering is stable and safe and did you say service said, where they scored <unk> at all times, the safety and bad Oh power employees, our clients and extend our providers.
Well, we're generation the network facilities afforded the operational.
Thanks to our commitment to because utilization we have developed a solid platform that has turned out to be he meeting our customer needs. The commission that you.
Why is they're struggling we did the few quick DC NEXAFED seemed pretty sure compensation shopping centers.
We have been promoting remote walk you Miss was only she seems to separate rds by evolving got worse systems toward the cloud.
Today, if you pick a number of employees are working remotely and that fee sent an effect.
Oh spot or commitment with the energy transmission with sustainable developer the country or my 27th and ensure that I shouldn't Chile announced skews the seizure two MPC paid the closure or book I mean, no one by December 31st 20 Twitch.
And Bocamina II by May start to first Twentytwenty too.
This aegion implies grows in March bare metal thing to meet that in the national discovered position plan and that we didn't make an it she there the first ability to stop generating from core imputed.
He language the previous announcement and the chili's progressing into their mental Disputable project Goulding in our strategic plan.
These initiatives seeks wed <unk>, all the 2000 megawatt or renewable store got bought by Twentytwenty too.
Awful, which is already under construction.
This project refer our position as the first renewable operator each year.
Roughly.
We have a safe liquidity position to continue executing goes throughout did you into phase This global challenge.
Let's move to page three.
First the war I would like to thank all our people before they bought it even some commitment.
I didn't we laid actions did a sealants full our company.
I want to respond to my things.
Our contracts that are being sporting deeply our diabetes.
For the Demon go this girl what crises, we have taken all the necessary measures to guarantee the safety or people are going talk talk to clients as well as ensuring the country detailed et cetera.
As mentioned in the previous quarter, we have created a committee to analyze the situation on the day by day basis and to coordinate all required to action. We may need to date. Therefore, when other were sent to our plans and network of fully operational.
Large number of our people, we can give what can more easily wants to the warranty.
Measure will be or both.
What are the ones that need to be in our facilities the process will be gradual.
Taking all the security measures.
As of June 15th.
We have gradually restarted the month Monroe readings and building distribution with all the corresponding preventative measure that includes best aren't projection gear to such words as well our customers employees and the computers.
[noise] up to this day following the English and in place we temporarily below our clients using the average consumption over the last six months.
We deem but on the pro differences between the building overestimated the electricity usage and the after reading, we voluntarily decided to apply payments solution to or articulate the clients to whom on one of the readings were suspended.
For instance, if a client consume more than the work that's been built by the company.
We will automatically split to be currency in five month by month stolen without interest rates the adjustments for any additional charges.
In addition to help our clients to cope with this crisis, we have voluntarily extended the benefits on deferred payments that we have offered to the most watermark lot yes.
The end of the image.
[music].
Now on page four.
In this difficult to die support she left for the war.
We have reaffirmed our commitment to our communities.
Looking into action the voluntary campaign responded to the challenger called me thinking it to support the most worried about communities, especially the ones most affected and closer to our deep.
Under this program, we have donated to electric ambulances to direct cross with respect to chart importance.
He wants is hard for us the weve guided the locked them and we represent an important cost reduction fourq institution when once compared to the these at the college.
Thanks to a collaborative work with the University that Catolica and we do you see you. If you will see please to surpass the network.
We have implemented in electric bus that was adopted as immobile birthrate to support the detection called in making cases and finance Logix secret for testing.
We will continue with several other project with our low cost two countries.
So we could understand importance to oil in the comes.
Together with the get tired of this situation.
Now.
On page five.
Steve Delta Brickell Colgate 19.
Luckily dust back to levels last seen only during the global financial crisis, having the uncertainty on the depth and duration of the economic crisis due to funding.
Oil and gas prices.
One shot.
During the important decline so once compared to 29, peaking figures.
Emerging market currencies are under stress and.
No that you'd MPS was currency is considered the ones that most of the sealant They love them.
We have to say depreciation of around 80% year to date basis again, the U.S. dollar.
The index Dematic.
Which measures economic activity of the country constructed by 15.3% he might twentys better Celesio days.
[noise] social distance measure how impacted the larger number workers and the economic activities, especially in the main seat is bringing the unemployment rate at 11.2% to me.
Well go to redirect the sides reaction this land central bank decide to leave the interest policy rate at <unk>, 0.5%.
To continue supporting market the liquidity in commercial and.
In addition to this measure because also carrying out the U.S. dollar us walk pooling arrangements to reduce volatility or Chilean business.
The early considering there he sent the pool, which allow it 10% of voluntary withdrawal.
Of the Chilean pension funds by their contribution.
Now on slide six.
The country's locked down has impacted the electricity demand in many economists say those related to the dust beauty in Congress.
Tariff companies have reduced its operation to meaningful levels and to some extent shut down their operation, which are so important decreasing demand.
As we can see on these slides.
Both our generation distribution business. This phase important degrees, but degree concentrated since must twentytwenty.
South of the locked down measures.
The demand reduction the boss generation distribution businesses are mainly explained by the contraction, although they let the consumption.
We can see is affected not only this should position at it but also not artesian overcome.
This reduction is primarily driven by commercial industrial sector as many stores more that's more indices are close.
On the free market perspective at least in our international business, we still see an increase in that amount versus last year, primarily driven by the received and so our free muck clients as demand can you.
And by the new DTA secured by our company, especially in the tourist spots. So this year.
On page seven let's focus on distribution collection.
Our fourth digitalization.
Hello Pos.
To ensure that couldn't you need to or business without compromising the safety ought to clients in collaborators.
We have good all I want to ship to strengthen our did you touch on improving the experience or client.
As of June our distribution plant output.
Downloaded by 360000 clients and number of 74% high got overlaps the EFI, yes.
Well of course increased the number of payment Sean that's available to our clients.
As a result in June 88% or the payments were made to do just that shines.
By June Twentytwenty, we have executed more than 55000 agreements with clients to delight the payments and mitigate the impact on our collection.
Which 10000 have been stride with the most vulnerable ones.
How much by March 22 inch.
As a result.
We sustain the average collection level to 97% to the first semester twentytwenty.
This was our historical levels overall under 90 days or said.
Let's now focused on a dollar cheap on slide number eight.
As you can see in the first Jeff.
You do there was a significant rainfall deficit and therefore, the first semester of this year was the dry period registered accounts.
To understand the performance our company, we're presenting the greatest driving for.
For our most significant where even billions mildly beyond that up it.
As shown to Rightsize died since mid June we observed a recovering Brian for almost reaching normal levels to date.
In addition, that's been improvement in 11 soaps no accumulated in the mountains since range of be Netcomm been by a very low quote contribution with zero suggests it's very low did you.
Dick rapid Snowless I guess, then those observe it looks to you.
Under the current conditions, we expect the generation on the second semester Twentytwenty.
To reach around seven Terawatt hour.
Approximately.
So damn so either generation twentytwenty would be very similar to bring to the previous years, reaching around the 10 11 that have a tower.
Let me remind you that the generation with LNG natural gas. The car is currently the natural edge over in that Sheila portfolio to cope with the trough as you will see the following slides.
To conclude this section let me.
They did you.
On an English a framework evolution, we are in slide number nine.
On the contingency fraud. We include the decision made by the executive goal by the Parliament.
The Senate and the Congress recently approved a new low known as a basic services.
That aims to benefit the most wilbur clients, so basic services industries.
This week those benefits tunable clients already voluntary offered by our company.
And that litigation over not cutting off the domestic light, yes that are not paying their bills.
During the emergency periods.
This low as bina posed by the second piece that applied splits right for us because the technology.
The center is expected to vote on this month or by two days you don't want why the lower house as already rejected the presidential deep.
For the saying that we walked in line with the lower house Bill will be affected.
Other meaningfully decision is the first to the modification the peak hours regulation during the winter periods.
After the decision on suspend every let me because I worked out.
The new regulation Pendy that 60 degree Mesa spent the Pixelworks Iris during August and September.
These changes will very marginal impact on generation slightly more distribution, especially.
In September period.
To respond to the economic effects of the crisis sees the look down the Chilean government us propose more than $30 billion or measure to boost the economy.
Oh structural measure the Minnesota energy services straight to the next step refer to the new distribution low so called gives no lay lager Muslim.
According to the mystical medication. It for is it three step approach dealing with opening of the market and the condition of the few gossip trade there.
Quality of service improvement.
And distributor generation.
Well the first point.
The Governor we presented.
With the required measure to open gradually the market, creating that figure so of energy Terry.
And the find the rules for the commercialization activities.
On the second the sort of topics.
The government is expected to propose a new measure to us.
The concept of incentive regulation that should reward I call option company and the new elements on distributor generation.
On the new distribution I go through cycle. The government's recently, Bob wish they'd be the imports as to why external consultants to carry out there in related or is this on the new referenced mothers companies.
We will share more details.
Oh the current the framework in the next quarter as respect that the first advisory board communities by September 20.
Finally.
The government is expected to rule on flexibility.
Oh directly system.
Creating mechanism to guarantee they continue to the deposition process.
And did a deal both financially the coverage.
On the erosion development, a global internet deemed as being created to focus on this new technology to evaluate all the business opportunity rising from the European Commission, New Green did the agreements signed between the Chilean Goldman and the European Union.
Now.
Let's go through our strategy starting with our discovery realization brothers, we are engaged 11.
On July six.
Let's see any help arise to proceed with the final decommissioning discrimination and termination on Bocamina one operation.
On December 31st went range.
More recently on July 24th this unique as also authorized the early this condition. We can mean a too by the end on May 22.
Let me remind you that the commissioning of the two units of book I mean that will be finalized without accessing to the energy strategic also.
We these achievements.
We will become the first utility to phase out its course with my Twentytwenty too.
We are working on the redeployment.
Plan for all the Warchest of the units and the congressional these facilities by sequel economy perspective.
With the aim of contributing to the Verifones or these are there where the unister located.
Within the our decision about the phase out to Bocamina, we call for our commitment with the local community the perspective Adjacencies.
Recently, we have financed the construction overused word afford to set a set of community. In addition.
Okay. Good Clark is another fishermen, we live access during the next month.
Land phase out.
Two especially tough comps for project aimed at improving that you should get pvds.
All of entry entry into new businesses.
Furthermore, was the certainly settlement process for over 1003 other family.
Has been aligned to international standards.
Our discovery physician strategy and just transition policy.
We improved the visibility or sustainable model and our you said you provide.
The same time will reduce our exposure to commodity volatility and liberman risk, bringing better margins and allowing us to access new financing is we're introducing called.
In addition, we also believe immediate term that and that Sheila we benefit from potential increase in this liquidity and considering these derisking strategy.
Let's now see more details on our discovery position strategy on page 12.
[noise] to cope without discoveries Astra strategy in freight.
With our customer needs, we have under construction, one gigawatt or renewable capacity.
And another did you give us ready to start the construction by 22 into it.
In addition to that we have approximately four g. gullah.
Over the will capacity in different phases of development, representing an optionality for the future two countries Derisking, our generation portfolio from commodities and George.
On page 13, let me give you an update on the status or a newbuild project that's under construction.
During June 2020, we have started the construction over and I could to power plant.
I thought that investment of 177 million USDOT less likely to will include the 52 winter buys over 4.5 megawatts each.
Reaching an installed capacity of 144 Megan.
The environmental permits I've been already issues and the winter bias will be sheep to cheat the next month.
But to the project we've been operation this year and the remaining part he went to 21.
Well, it's everybody on the expansion of the plant will bring a total net capacity to 69 megawatts.
Considering the Covance situation, we have review the project timeline and devote a special attention to define safe number bear Stearns.
Facility to adjust properly our construction Ken limiting the number based on a quarterly plus standards set up all your we'd be in operation next year.
On page 14 on solar project.
All the percent of solar project been already have already received a day environmental licenses.
We are now working on some specific cases with ecological these digital cheated to manage some findings and conquered onsite. When we list. We have started the Stevie Awards.
The main BPC MLP contract.
Were already sign and particularly for campus that's all in as Abbas yet.
We are already receiving the fourth we'll tag models, indicating that our supply yes out in operation and commit that we that Constantine.
As a solar project constructing vulgar stage part of this project will be all lined by 20 twins and the remaining part by 2021.
Before I go let me give you a color on loss Congress project, we are on page 15.
Yesterday, and then generation release them until the fact, indicating that the conclusion of foolery assessment.
We're getting the conclusion or fully assessment on the project.
Up to now.
We have already completed the 10.5 kilometer so project done out of 14.
The remaining 2.5 kilometers will be excavated we did you tunnel boring machine.
The assembly electromechanical keep event in the current powerhouse I've been already completed.
Let me highlight the debt during the construction on divestitures.
Let's go next the up in the lower tonnage that section already business.
We haven't gone for the very challenging geological conditions.
That forced us to change structurally the construction.
To guarantee technical efficiency and safety at work.
Our employees and contractors, we have decided to adopt a different but more affordable construction solution.
Required more time additional budget.
Therefore.
The changes in the project with these changes in the project, we expect to finish the civil works construction over those condos power plant by the end of Twentytwenty tree.
Followed by the commissioning and the commission operation or the Russia, you sort of approach.
Now, let me drive you to our main industry Kipp you guys over that period for our generation business on we are on page 16.
The total net production for the first.
Decreased by 14% amounting to nine Terawatt hour.
Given by minus 0.8.
Or lower generation in our hydro power blends, reflecting that always you performance.
And my final 0.6 that I worked our old lower thermal production, mainly in our coal fired plants due to the closure open up a couple of printing myself for December when TNT.
And then but overall were system margin of course.
He temps or energy bonds with a minus book by hitting the market with the purchase of 2.2 kilowatt hour first ask twentytwenty.
If area of plus point.
Eight Terawatt hour best will first 2019 also as a result of low dollars you imagine articles.
The lower is the marginal cost is explained by the jumping and that's what gas availability you transmission line fully operational starting from June 2090.
Mission, Oh, new renewable capacity and the reduction of countries demand.
As we still want to People's lives, our physical energy sales decreased by 6% of 4.7 minus 0.7 Terawatt hour main this played by minus 1.1 Terawatt hour.
Lower consumption of distribution company, mainly associated to that ammunition onto the PPA is we decided in ml secured by in 2006 spokesman.
And the lower demand in the second worst.
Partially offset by <unk> 0.6, Terawatt hour or I guess free markets.
As part of our strategy to capture new clients.
And the ones recently me right to that.
To the free market.
Now moving to slide 17.
To explain the most relevant operating kept the ISO our network business.
The tough fundamentals to answer counters litigation.
The energy distributed in first half twentytwenty decreased by 6% when compared with the first off 2018, mainly due to the lapel measure applied by the government is up yet.
Our customer base increased by 43000 clients.
When compared to the first after last year.
With the last few reaching 1.9, 19 90 million oak clients.
The visit addition, all our distribution business, we continue to improve the quality or service.
And we have reached 2249 tele control equipment installed in our treat.
The next do yes, we are planning to other finance Eddie five additional units.
To guarantee the system reliability and availability.
Can do to focus on the critical for say the insight.
Replacing approximately 676 kilometers okay, what's in our noticeably.
And executing approximately 14 kilometres of medium pulls touch screen and station and the reinforcement in the first split between.
Despite the logistical restrictions.
[noise] coming from social arrest and lastly for the pandemic situation.
Our interruption index to say the decreased by 15%.
Finally.
As part of our plan of system called University lists we were able to reduce hope to 53% the power interruptions due to adverse weather conditions in our networks.
On page 18.
Let me go through I want to maximize networks main project.
On the waters investment plan.
We have conclude important interconnection project NUCYNTA, nor concession area internally introducing different measures to continue improving the resilience in the management of our minute.
On the media was what the side during the first after 20, we haven't concluded the construction of a 52 kilometers of network.
And distillation of 169 total control.
We continue to perform important civil works to cope with expansion that we mobility segment and to improve the traffic issue the cancer.
Let's move to analytics and business acquisition.
On slide 19, despite coffee outbreak, we continue to consider that leadership on electric mobility and on litigation.
First off Twentytwenty, we have secured new constructs on public lighting upgrading delighting infrastructure.
Led to bring in a more efficient system in favor of the local municipalities.
On supporting the Emobility or in the country.
We have signed the pastiche with ANNEXA show implementing fast charger for ebay course in the next question.
Our company will be the responsible for the maintenance a war the charging units to be sold.
Moreover, we have secured new contract with larger real state groups to provide the new charging infrastructure to that project.
In June we bought into fruition additional 150 electric buses in the Metropolitan region Awesome, Yes.
Additionally, we are promoting the use of more recent the clean technologies.
The use of electric buses combined with solar energy and started charging sees them for the mining industries.
Finally, and thanks to the collaboration with.
Rob can private partners. We continued our efforts to promote the use of efficient eating in order to replace the use of wood.
To contribute to the action carbon emission and particulates in Chile.
Almost 7000 devices have been installed seems to 27 team.
And we are estimating to avoid the 22000 tons of suit with U.S. erode.
Now I will hand over to two separate for the analysis of results.
Thank you Paolo.
Before starting let me explain how we haven't adjusted our fingers on both 2019 and 2020 on page 21.
Screening in NIM, we had excluding from adjusted figures. The PPH early termination booked in Q2 thousand 19, and the net impact of impairment of Bocamina one.
But that Africa booked in the second quarter 2019, largely coming in our previous calls.
Of the 2020 Eagle we are adjusting the be done anything come.
With the cold stock impediment, which can be.
In booking at once called the call well that we have both been accused yet for Bocamina, one and welcome any too.
That's our asset that will be decommissioning soon.
Yes.
Only be that would be around 50 million dollar.
In addition, we had also excluding the impact of the impairment of Bocamina II as the results of our decision to anticipate the closure of the goal.
Let's now move to the financial some money.
About 20 Quinn.
So styles.
2020, adjusted EBITDA anything out of basically inline with the last year adjusted shoes.
Our total capex among the 322 million dollar.
A 109 or same higher than previous year.
Focusing on our the cannibalization strategy and digitalization of our distribution business in new connections.
The adjusted so.
Increase three two but thing mainly due to lower tax payment from pays speed that will be Florida.
Explain.
Let it on partially offset by the possibly be done.
Our net debt in the period increased 448 million dollar basis December 2019, she goes.
Mainly due to the higher topic blend it security a June 2020.
Lower receivable from our company as the results of the energy I believe they should make any.
Hello recollection distribution I will give you more detail in the polar we like.
Yes.
Now on slide 22.
Let's start with the coffee.
Our capex amounted 322 million dollar.
That said, we are 100 and then.
Then please.
Focus on asset development.
Got summit Capex totaled 26 million dollar.
The 2%.
2000 in with the main embankment allocated to be the connection to new customers and the consequence of the increase in our flying be particularly in the first quarter into improving our commercial see them to guarantee better interface with our client.
The continuous dizzy digitalization of our customer into fee and commission internal processes, we continue to be a key factor to address future changes. After these contingency period.
Asset management Capex reached 35 million dollar basically in line with that 2019 first.
Good.
The distribution activity represented 48% mainly focused on repaid in low voltage underground failures and replaced some facility due to the social out of it.
The generation activities represented 52% mainly related to them, but I mean in digitalization thinking about our unique.
As of June 22, 80.
Our development topic reached 261 million dollar, namely a located on renewable.
Part of our Decarbonisation strategy, which recorded $244 million and live on digitalization of our network that is bringing out.
Operational flexibility.
From our total development topic.
He did a phenomenal cheetah, we have deployed around 30% than that.
20, creating.
The remaining part of our Capex will be concentrate in the third and fourth.
Two of 23, according to the London Cool the project execution, that's a much like the not my construction de Vito wind and solar project.
During the last and the first about 20 Feeney almost 96% of our investment was allocated to the achieved the as the GTAT against that and then Sheena commit the.
Now, let's move to slide 23.
To see.
Welcome.
EBITDA breakdown.
As you can see the second should 2020, adjusted EBITDA is being impacted by hydrology for about 33 million dollar.
The long bond measures had any impact in the demand of our generation in distribution business.
You know what a junisha business the impact accounted for 23 million dollar driven by the bets on most of our rig called that out.
Partially offset by the positive from us.
What we.
Yes.
The demand is also take it.
Our distribution business due to low where energy consumption, mainly in small businesses and industries integrated into the market.
DAPL effect of a lower demand image reached the 3 million dollar.
Does that bake there were many offset by.
Maybe $1 million related to lower spot price.
And the results of commodity price reduction lower demand.
All interconnection transmission system into any between.
$90 million associated to the net cannot be coverage effect due to the recovery of brain right as shown in slide three in this presentation.
20 million dollar of study.
Nation, mainly originated by the supply cost recovery equally.
Yes.
$20 million on open another which include.
And lower transmission cost positive BP indexation insurance reimbursement.
And management action to increase the efficiency in our business without compromising the state of our employees and contractors.
In addition to that nickel stock impediments head to want to impact on energy.
Yeah.
During the second quarter it down.
Let's start with that it'd be doubling down on slide 24 hours yeah.
As you can seamlessly side, we had isolated to of nonrecurring.
Relative to the early termination BP agreement in.
Anything Tina and the previously mentioned Colestock impairment being 22 any.
Excluding the effect.
Our adjusted EBITDA is knee Italy's play mainly due to.
Lower hydro generation impacted for 42 million dollar as a consequence of drought that has been affected the county.
Lower demand on that English.
Generation business and lower energy consumption in the solution visa.
So talladega and negative effect in the middle East the million dollar mainly related to the locked down measures.
Sales of two LNG cargoes during the first half 2019 that wasn't executed this year due to the oil price of commodity dependent the nation on market.
We then impact of 22 million dollar.
These negative effect that were offset by the following items lower spot prices.
$54 million positive impact on PPI indexation totaling $19 million.
But it wasn't the of $20 million and other costs for about $8 million, mainly associated with the insurance reimbursement booked into any to any.
In slide 25, we havent some money the pad for most of our origination business.
Including engines can ask John and getting power.
Okay.
Generation EBITDA I have already walked you through the mean, Buddy issuing review slide or that would like to recall use that.
In line with the last year without.
We have reduced 58% of our generation, we're doing it will succeed.
As there is out of the ready maintenance element our origination adjusted EBITDA.
Virgin reached 47% in the second Q2 anything any.
Which is 8% hi, yet then second quarter 2000, and seemed despite low but at the production in commodity should not.
The first up 23 in adjusted EBITDA margin was 2% point higher than that first out.
When it maybe them managing.
Please let me explain the most relevant operates in fact of our distribution and they'll.
So moving to slide 26.
The second Q.
2020 be diary 46 million dollar or 29%.
Lower.
EBITDA competing with the second key 2018, it mainly due to.
Lower energy consumption.
In both regulating the premarket client in the second to 2020 versus.
Second Q.
20 maintain what about.
Million dollar mainly due to locked on measure it applied by the government.
Contain the spread of Colby.
Hi, Yes energy losses due to reduced upping the DVT because of logistics would be a restriction.
Increase own conventional process cost to cope with the common difficult situation that hour.
And are facing.
As of June 2020, they'd be done over and it will soon and then alike.
Hey, the lower is.
Due to the second quarter performance as abomination decreasing they'd be done in 50% compare with the first of 2019.
Now on Slide 27, let's books would mean driver of our net.
Income.
As already mentioned before the 29 in EBITDA include the P.A. early termination.
Depreciation amortization, and but that reached $166 million increasing by 12.
Mainly due to higher provision on bed that.
Many on distribution business due to the 2018, social unrest and will be the names in it so.
I have depreciation any GP.
Due to the depreciation of this year, Janine and basis again, though like.
20 training.
Hi, depreciation of distribution business due to the hiring basing villa fear.
Partially offset by the closure of the Rebecca.
On.
December refit Lithia and the phase out of but can be no one too.
The impairment increased by $513 million, mainly due to bocamina to impairment booked in June 20.
Related to the early closure of the plan Len Me 2022.
Financial Red Bank of 74 million dollar we did decrease all $90 million, mainly due to the lower average cost of out of that sets that it out of the renegotiation in integrating our net debt.
And finally in the nation.
In the foreign exchange rate appreciation in first about 22 any impacting positively in financial receivables.
All right.
Income tax the minority that's like the lower results related to Bocamina II.
Impediment effect.
As they called say when of all double the reported for South between 20 net income.
Reached a losses of 400 in 3 million dollar.
The first top 2020, adjusted net income by their Bocamina II impairment is in line with the results of that just in thinking.
Oh first.
2019.
No.
Moving to the cash flow on slide 28.
Our first styles 2020 adjusted for.
Reached 166 million dollar strongly impacted by could be thinking that resulted.
On lower collection in our distribution business and lower EBITDA impacted by.
Lower demand in our businesses.
Despite this challenging situation, our adjusted for stuff to any Phil.
40 million dollar.
In 2019 adjusted figures.
Mainly due to lower income taxes paid in the first starts to any training mainly due to the tax Chris the reimbursement from existing here and the lower monthly provisional payment.
Lower financial expenses, mainly by the depth that equally at Angel negotiation with an finance international.
Partially offset by lower adjusted EBITDAC 2020 minutes 2019.
And low net working capital, mainly due to lower collection on distribution business or about six the 2 million dollar.
Hey, Im generation business for $29 million due to the energy stabilization make me.
And alike boxes payment had on 20 screen that the where in operation during that bought 2019.
Let's now take a look.
At the net and gross on slide 29.
Our growth that increased by 500.
67 million dollar basis December 2018 amounting to.
4.6 billion dollar as of June 22, any.
Due to any Chile, new funding with an financing termination to finance, our renewable Capex plan impact should offset by an innocent she led that than most physicians.
Our net debt so as of June 2020 compare.
Generally.
20 increased $148 million, mainly due to our topic Blaine.
Average call so on that.
Was reduced from 5.2% in December 29 team to 4.6 as of June 2020, showing an important improvement in our financial condition as the results of our constant effort, so denying our financial expenses.
Average stands.
Our that is almost seven yeah.
Finally on our debt amortization on slide 13.
I would like highlights our total liquidity position reached 0.9 billion dollar.
Making as able to finance, our Capex plan and being in a comfortable position to face the possible what's the nationality nycomed.
Our debt amortization.
We don't see any concern considering that move that qualifying the next two years with an average of about 200 million dollar.
Moreover, we confirm our depth, but at the GE to maintain our best thing fixed rate and U.S. dollar.
Now let me conclude this part of the presentation driving you to our new heavy that target for the year.
Before moving to new guidance, let's take a look at Walt.
Whitney Finland.
The summit that brought our financial results now on slide 32.
Only be doubt demeaning, but from Covidien in associated with the sharp decline in volume in both Jinisha and distribution business.
But equally in the Douglas demand.
The remaining impact on the need that is that related to the increase of losses. In addition on cost.
Well now about the solution businesses.
Related to the customer care.
All this call being partially offset by saving activities that we put in place.
Moving down the income we recorded negative impact on DNA of 6 million dollar.
Driven by the increase of but that would be shown in the second quarter.
Oh legal without the copied the impact from our adjusted net income.
By Nicole Stott impairments should have been hired by 37 million dollar.
Now let me conclude this spot on the presentation driving you so our new EBITDA target for.
Yeah.
Alright.
Of course stock.
[music].
[noise]. It begins by 33 during our presentation, we have shown manufacture that come up in the past Peter we changed our generic for this year.
Oh, I thought our company strongly committed and working hard to mitigate the negative factor some impacts are difficult can control and manage.
As they they're all gene.
All the impact on Koby Dinning Tina.
The man reduction and macro assumption as commodity price location.
Aspect and among others.
Yes.
Seeking our transparency with our investors and all the interesting part it we have around seven oceanarium.
To reflect.
The deterioration of some variables that are extremely difficult to predict.
Any possible changes on that could drive to be French fanatic. Therefore, our EBITDA is expected to EBIT devaluation from trending 50.
Dollar to from the $50 million to be in a range of 1.2 to 1.3 billion dollar 2020.
We are not yet anticipating our view on net income project is we are running several actions to offset.
At most evaluation of our Doug.
On Cup.
We don't see important deviation as the larger parts of our development Capex is expected to deployed now on the second out on the.
Well I will hand over to you for closing remarks.
Thank you two separate.
The current situation represents a challenging scenario to the sector.
Despite that or.
Period, adjusted result choice NDRC. This performance based on stress, where our door people business what are your ability digitalization and quick reactions to external conditions.
At the same time.
We are confident on our mid to long term performance, considering the strength or diversified business.
Our focus on the capital mobilization.
And the development of our project in generation in distribution business demonstrate that our company continues to create value in this new environment.
Respond and anticipate our clients' needs.
He is the best way.
To ensure the quality and reliability our services tied to the continuous improvement all our digital platform.
Finally, the resilience or businesses are sustainable strategy supported by.
The strength of our balance sheets and the by eventual additional liquidity measures portamento headwinds from external advisor.
Thank you for your attention and let's now open the company's section.
$10 to sabella.
Hi, parliaments NID things. So we have received a lot of questions. Okay with it yeah I've seen that we have lot of questions. So.
Yeah. So are we going to collect some have been in other questions will.
And just say information from me too too.
You got.
Questions to ask Bill.
The first question came from where you know he keeps round sanctions that.
He's asking yes, if we can be more details on the I'd be factoring.
From the receivables our company's shambo generation.
In addition segment.
Yes, I believe there yes, the answer to two separate site.
Yeah.
Thank you Isabel.
They see that.
The agreement.
With that I'd be.
Going to add though.
In a cause the nation also with all the other.
Play in the market.
The agreement.
Basically can see any potential facility to sell to I'd be another bank.
The receivable accumulated by all the generation company of the market.
In.
The factory has been im going to be Peter to sell periodically the receivable incrementally it though.
And that of course, so Oh, we are talking about only the receivable that recognize.
On the degree.
And.
We are you know.
We are still evaluating.
With the the condition are good for us about that we believe that keep me, saying in order to reduce the risk of all possible changes in an equally attrition I.
Okay. Thank you just lapping we also have.
Question strong family, which he need from Santander and also it's gone from Atmel, starting from scratch a bank as can't even more detailed zones that delay on its Konrad Roger one which indeed in.
Well, both front end hints about.
How much we have already and that really 2000 training and what we're expecting.
Yes.
Yes regarding the evolution over lets Congress project.
As we mentioned.
Bauer previous called the project includes.
Walks on.
On current as the total amount to support team and.
It includes also verticals peak that connect today and the lower section of the project.
In this in the evolution the critical path, we found the Gerard geological challenges in B.
Development of the better or divest connection that require.
To review the technology to implemented this connection we use.
International.
International advice, Australia. This at the end, we have decided to adopt them off the safest the technology to connect.
The did they invested that do have a domestic connection between the two the too.
And then the talent to partner and the end and.
All in all these easing the because they got bought the during the realization of these connection we will be able also to finalize the missing part of the ore zones that connection or towards the data towards Laguna will the new boring machine. So this is that as the reason why.
These delay that clearly it brings.
To work together, we delay some of the additional topics on in order to zero we spent.
Around the 30 million of U.S. dollar.
What we.
We are doing now we are replenishing the capex spending.
In order to evaluate send to let's say according to the evolution of the product of deposit into a much of the war. We see do works that are that we are planning between 20, let's say second part of Twentytwenty on people at the end of Twentytwenty tree today, we reach should perform.
I'll turn over 80 870 million.
Perfect. Thank you.
We also have my questions from have yet slotted cement jabar.
He's asking some questions. The first one is that what we're seeing improvement in our working capital as a consequence, the completion on far digitalization process.
Our so yes in more detail if we can leave them then likely impact of the basic.
Yes that latest reaches Bobby close.
Sure.
Most worried about lines and the third question, which is likely they backed up this is spatial in peak hour price.
And.
That we elsewhere for it.
Page.
In Japan, Okay. Let me, let me manage let's say there that's making some clarity it first of all regarding the.
Basic service low.
And then we can comment about the performance of the collection and lever you said.
To the commenting the numbers regarding the.
Basic services.
We'll see.
Since the end of March we have.
Offered to the most whatever clients.
And agreement in order to Splunk to suspend the payment.
Regarding the deals because their consumption.
The energy and the 12, an agreement to start the payment.
When they account three will exit.
From an emergence period with with the.
Monthly installments.
Without interest.
And clearly with no risk over.
Off or the service.
These are did put let's say they segment of client that has been interested that comment. This is a voluntary a proposal was referred to the presentation at the time was sick.
40%.
Since stage, all the lets say put a family.
That.
Cut to the social Register.
Social internal issues that have guns.
Regarding these evolution there wasn't discussion regarding proposing you eat as low.
The conference, although includes 60% or the same kind of wouldn't or clients and the on junior when a D president be near to extend the dependent the 90 days already mentioned superior.
Adding additional 90 days, we extended the period of does offer.
And that we expand the perimeter of the potential.
One of appliance according to the putting into the final alone so suddenly to see the centered more some additional categories and so today when the discussions are going to feel an argument and the saying that we are offering this kind of agreement and just kind of benefit to the global client.
The low ASP.
Let's say approved by the lower house and Senate during.
Listen to spend time last week.
Last weeks and.
At the end the.
President decide to.
Put the Peter EBITDA right regarding the seasonality or these are these the low the discussion is still ongoing.
The.
Lower hours.
Rejected the Vito and now discussions are going to said.
Regarding the impact over.
They are approval the potential approval or you slow either at intends over.
The benefits to the would've appliance, we already offered seems to last March. So we don't see any pro any any impact to this we have already saw some some thousands.
Agreements with the.
We'll go clients, we don't see any problem, we'll see material impact on bid now on on a on our now but the problem is that the less they did the low includes also.
Statements regarding the.
<unk> ability to cut off.
The non pay the non.
The clients that I've not paying their bills, even if they are not multiples. So this is clearly may run the risk to a large the potential.
Base of clients that may not babies during the emergency period until now the the law States 90 days.
After the he shrink or the slope.
This is the real integration.
And it depends on the attitude go over the non are reasonable clients in respecting.
The.
Deadlines and the payment.
Yes.
Then there is also another question regarding.
Our.
The collection.
Since March we improved a lot to the our destock platform.
To reach all the services include the payment it into our digital channels.
Through visit our technical improvement and also roll through a stronger communication to our clients and as we mentioned the presentation by June we reached 88% all over.
Okay.
Collection through this this terminal.
Regard.
What what are the other.
I don't mean questions.
Yes.
Yes Cannes film Slate is it's also regarding I think you you ameren everything that was about that but be careful worsened now so.
Oh, the peak hour, yeah correctly, because the pick our.
Yes, I know they don't did cover towards the two decision regarding the winter peak hour. The first has been issue for them and corrected the end of March.
And.
I was referring to add real and May period.
And the second these have been applied until the end of May.
Then we.
Came back to the normally go three approach during June and July.
And the recently.
New releases coming from.
The regulator for defining.
So so to excluding.
All goes the September in <unk> and relationship you can go.
They they impact on the first the teacher and regarding at least maybe a was a negligible in terms of impact on our distribution incur.
Considering D.
Period.
Okay Ghost and September considering that we were feeling in the during the.
And wintertime within potential.
Compressor and weather effects and considering also.
The current evolution over all the pandemic, maybe that's the will have a larger impact on.
This decision that depending because.
Except to decrease still missing.
May have an impact arrange over.
Three meal $3 million an hour accounts.
Perfect. Thank you Paolo.
So we have.
Another question, Sean said that added MBT g., so at the faster some credicorp Anatel Intermark Ernie.
And they are all asking more details regarding our guidance, okay and if my market sales on the breakdown that we presented.
Like.
And now so if we can give more details on that we've done that say Ghana.
Be distributed for in 2021 regarding 2020 resell.
Okay. Let me give you the answer on the dividends and then leave the.
The answer.
To do set.
Regarding dividends.
And you.
Should take as examples last year last year, we as we had the impairment Oliver Rebecca and book I mean, a one that has an impact as an impact an accounting impact on our side.
And then then we the who we decided to let's say to apply our dividend policy on a pro forma basis without taking into account to the accounting impact of the commissioning. So we have the flexibility to do the same.
This year.
Now we have not changed you know when the we will not change the dividend policy, we will see.
The say evolution, the secondary or 2020 demos of cash generation in order to take it.
Final decision on how to apply the dividend policy, which base but.
The direct the reference the is that what we decided last year. So.
We can take a decision despite all the de accounting impact of the Paramount regarding the stabilization.
And.
Then leave separately.
To provide detail regarding.
The device guidelines.
Okay.
So for what comes and the guidance.
[music].
I mean as you've seen this slide we had three minute first one on it because where we talk about the koby. The impact. So we are talking about basically oh, mainly and out the impact on the demand both.
On generation and the distribution.
And the.
Especially we are talking about there.
Part of the clients that are.
The small businesses like as more like an a mall or that kind of small indices.
And that can be also a regulated so it's not them at all.
Three on that not only threeca.
And.
We have also as we mentioned the wheels so.
Two came to the consideration.
The impact of loss it can that can be.
With because of the shown in the.
Top of anything Kizomba unpaid be.
No they they pull disease the scenario the assumption that we are taking to the conversations that.
We are going well.
Yes seem to have a negative.
Action in the old July.
With that a little bit recovery in August that doesn't mean that we increase the that among budgets that that number.
And that will be lower.
Then the award and the biggest along and we assumed where the and.
Brett tone to a normal situation.
In September.
Of course.
I mean.
Good.
Going back to a normal situation doesn't mean that the demand will be.
In the same as we forecasted when we proposed industrial claim of course, because you know.
Some of the small business closed and so we're not easy to two going back the easily but of course, we we assume where the.
A return to normal demand an end of the.
Well what consent andrology.
Again, I mean, the impact that we consider was thinking about on it or is that these.
More or less in line with the theater, where took about 10.5 terawatt hours.
Oh.
Either production.
Clear I mean, the situation is getting back there.
So also in this case.
That is equal to understand how much will be the the production.
Huh.
As of today, we prefer to be to be conservative you know that whatever a meaningfully positive.
Results in the following mall.
And then the last part of our.
Negative impact is coming from the macro optionality non us.
Of course, the liberation isn't it is larger because we're talking about the impact of.
The foreign exchange I expect a U.S. dollar pays us.
What concern our business that are you know who really impact us like this solution.
But we are talking about also.
Uh huh.
While the commodity price fluctuation.
The impact on our.
Aging.
Activities.
And.
We are talking about.
About the.
The impact of a change today that has in our financial arranging for whats consented and the deck. So I mean, this kind of evaluation.
Good day.
An important.
Balances depending on the effects.
What I can tell me that is off to the you know the Samsung Oh.
That brings us where the 450 million dollar.
Or in other words that way, but $260 million not auction or another.
Use an exchange rate of it sounded a little bit more than a standard pays us dollar.
Okay.
Okay. Thank you exactly we did to the time, we have I'm just to do two more questions. Okay. So.
The first one that we would see discount on Muslims Brilique action sports event will take on board.
Tim when it I announced so many reaching new customers and there is that should give more details on our LNG contract.
Steve.
We need which started in the presentation, we believe it does.
Right, what we come online second half of your so we can give color on this contract will now so.
If we can sell so on that for March shipments.
Thank you.
Yes, I lived there.
His question to you said well just let me add the an important point and that thing.
To be clarify regarding the let's say the development of the company, especially regarding the impact to all of the new timeline for those Congress.
Because the.
What we planned.
The development of the Companys from today until the end of Twentytwenty too easy to grow through.
The.
2000.
Megawatt or renewable capacity that we are building.
And this through the optimization of the portfolio regarding the composition of the R&D.
But can be.
Caught fire facility and these are these ease it with the.
Plan.
Not impacted by the delay or.
Lets Congress Mr that.
The project that we have on the pipeline reached 2000 megawatt our radio defies. The one giga is under construction. The other one are ready to start.
There is no dealer direct impact on the.
Lets say development plan of the company to reach the target to reach our position potential position as a market.
Due to the delay or the new scheduled regarding.
Regarding let's countless Congress.
And just an additional clarification because it is an element that I'm assuming is under the sport for this period. The regarding we explained with this the effect.
All over.
The.
Basic service low.
The we already offered these benefits to the Wellbore clients, it's clear that they impact or this loss is a you will be issued in a situation where the M.
The.
Country, and especially the outer like Santiago the impact of the chronic pieces is very stronger we were waiting for the effect of the old. The plan is very Gordon in terms of inject liquidity the season, especially who has the most vulnerable and medium families.
We are working a struggle in order to add to the clients to use our our digital channels.
Regarding payments so the 10 stores.
Cash collection.
We are performing as Max after we can attempts or.
Company performance and support to the two hour club to our clients.
Clearly these low may have any public especially regarding the.
No cut off for all the normal or better pay years out that are not considered workable clients.
Not really separate poured the commenting on LNG contract.
Yeah. Thank you Paula I mean talking about the LNG contract.
Yes.
As you know we have.
Counter long term contract.
That is a link the two.
Which basically two.
The commodity.
And the of course, we use the continent, mainly for supplying our.
Our plan, but if it is Columbian.
We can also resale.
The amount of the got that we buy a under this contract now last year.
The price then finish on market side were pretty high. So we were able to make some trading with these with the amount of gap that used to buy.
And is the reason because we had a bidding portal for its outlook yeah.
This year.
You know the commodity.
Drop so as you know so the price.
A final price of our contracts reduce as well and there is no.
No big a possibility to do this kind of trading as a matter of fact that.
Our.
Our contractor.
Right in the last time you know.
Yeah, let me, saying that in July, but I believe.
Almost around $4.
And in medium with you.
And the.
I mean.
He is the reason because we don't have that such a positive but like the here on that end of course, so we havent.
She Bennett.
A cheaper gas available for our plans.
Of course.
First sectors that thank you very much.
So we have other question back we had eight okay. We tried to summarize.
Most money, let's say more question, but we feel like most.
The to the time.
We then I have to keep an actor okay, but I would like to conclude these results conference call reminding you that tower Investor Relations team will be available for any other delta you may.
Well you know policy wanting to just say the final ward.
Good morning that disconnected.
Yes.
Let's say that the.
Just to confirm.
First of all.
I would like to confirm the resilience of the company.
And and the fact that considering that quite tough situation that we're leaving the country.
From the first of all and also probably wont know we point of view, we continue to let's say the delever and to the to develop our TV to.
And specialty and with all the area, where we're very bullish starting from the lets say management and the construction of the new plant National the plan to a section the plant improvement and investment in the grid and also development over the pvt is related to the let's say the newer.
The new let Leslie said this even if.
We have two phase with the wide largely difficulties in.
Having the possibility to we agreed to implement a tool.
Our our Ah.
Let's say at cost our activities on the ground.
So I think that we can give a specific answer to the many questions that we have received.
Through our.
Restoration, China and we are we are available for any additional the.
Considering that the evolution is quite complex. So there are changes very.
Very very frequently the resi impact to that may have on a regulation on the manager to the business. So.
Please feel free to ask as a.
Additional information or comments of change that.
The answer the more.
Yeah.
Perfect. Thank you Paolo and now it's difficult to them for here. Thank you very much to.
They they say youre. Thank you.
Thank you. Thank you very much work for you.
Ladies and gentlemen teleconference for today. Thank you for your participation you may now disconnect everyone have a great day.
[music].