Q4 2022 Enel Chile SA Earnings Call
Speaker 1: theaha
Speaker 2: My name is Gigi and I'll be your operator for today. At this time, all participants are in a listen only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone.
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Speaker 2: During this conference call, we may make statements that constitute forward-looking statements within the meaning of the private securities litigation reform act of 1995. Such forward-looking statements reflect only our current expectations, are not guarantees of future performance.
Speaker 2: and involve risks and uncertainties.
Speaker 2: After results may differ materially from those anticipated in the forward-looking statements, as a result of various factors, these factors are described in a Nell-Chillis press release, reporting its fourth quarter and full year 2022 results. The presentation accompanying this conference call and Nell-Chillis
Speaker 2: and your report on Form 20 included under Risk Factors.
Speaker 2: You may access our fourth quarter and full year 2022 results press release and presentation on our website www.nl.cl and our 20th on the SEC's website www.sec.gov.
Speaker 2: Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. And then Chile undertakes no obligation to update these forward-looking statements or to disclose any development as a result of which these forward-looking statements become inaccurate. Lee
Speaker 2: except as required by law. I would now like to turn the presentation over to Mrs. Isabela Clemes, Head of Investor Relations of Enel Chile. Please proceed.
Speaker 3: Hi, buenos dias, good morning and welcome to an Archilis fourth quarter and full year 2022 results presentation.
Speaker 3: Thanks to you all joining us today. Joining me this morning, our CEO of the Superbauder, and our CFPOLG, Josephice Kelly. Our presentation and related financial information are available on our website, www.anel.cl in the investor section.
Speaker 3: and in our app investors. In addition, a replay of the call will be available soon. At the end of this presentation, there will be an opportunity to ask questions via phone or webcast chat. Through the link, ask a question. Media participants are connected only in listener mode.
Speaker 3: The following slides, Fabrizio will open the presentation with our key highlights, later passing by markets and portfolio management action.
Speaker 3: Giuseppe will continue with our business economic and financial performance.
Speaker 3: Thank you all for your attention and now let me move over to Fabrizio.
Speaker 4: Thank you, Tabela. Good morning and thanks for joining us.
Speaker 4: Let me now start with the highlights of the period on slide 3. 2022 was a very complex year, but it also was the year in which we had the opportunity to take all several actions necessary to recover our company's financial position faster than expected.
Speaker 4: Today I will give an index look into this and how an archie there is in a better shape to continue addressing the challenges and taking advantage of the opportunities with the D.R.H.D.
Speaker 4: We are very pleased to announce that the 2022 year was a turnaround in our story. Mainly through the asset rotation activities such as the sale of our transmission assets and for for the management through the re-enrotation of our energy contract to share and last but not least our gas trading and the activation of the system.
Speaker 4: All these actions, plus recovery in our business performance, allow us to significantly outperform the everyday and net income targets for 2022 announced at the 2021 Investor Day. Moreover, we have exceeded net income projections presented in November during our last
Speaker 4: This result, where a sheet, despite a very challenging market's content.
Speaker 4: Spot crisis where and continues to be under pressure given the commodity scenario and the bottom of the international transmission system.
Speaker 4: Nevertheless, improved hydrology and several optimization alternatives ended up affecting this situation.
Speaker 4: Hydrogenation increased by 2TW compared to 2021.
Speaker 4: Regarding our decarbonization path, we added around 0.8 gigawatts of additional renewable capacity into our portfolio during the year.
Speaker 4: Also in December 22nd, 52 we started a commercial operation of our green hydrogen pilot project in 2003.
Speaker 4: As a result of all our actions and strategy, we have continued to be a benchmark as one of the region's best ESG performers.
Speaker 4: In fact, we became the first co-free electricity generation company decided after the disconnection of the unit to its bohemian power plant fertility last September .
Speaker 4: Before moving on, another significant milestone was the company's fast delivery chain, reducing its net depth EVPA ratio by around 60%.
Speaker 4: As a result, we improved our liquidity to support our strategy for the 23rd, 2025 Field calculation.
Speaker 4: In April 20th, 2023, we are holding the annual shareholders' general meeting, where we are going to propose a final dividend of 5.1 pesos per share.
Speaker 4: So that's a link 5.4 phases per share for the 2022 fiscal year.
Speaker 4: Now, let us move to slide 4 to review our main KPIs of 2022 Verus Power Guide.
Speaker 4: Even though 2022 was a complex and challenging year for the energy sector, we faced Edwin and put ourselves in a much more comfortable position thanks to several optimization actions.
Speaker 4: which we will discuss in more detail in the following slides. First, we added 0.8 gigawatts of renewable capacity, reaching 76% of our total generation by the end of last year.
Speaker 4: Therefore, we accomplish the renewable purchases in our portfolio KPI and report our commitment to the energy transition in the health.
Speaker 4: In addition, regarding early targets, the best business performance coupled with the conclusion of stabilization and unlocking value initiatives during 2022.
Speaker 4: enable us to increase our AbDA and Nest Inc.
Speaker 4: Notably, in both indicators, we exceeded the upper range of our guidance and now things during 2021 invest for days.
Speaker 4: making possible a significant recovery in the company's financial situation, as we already anticipated in November . In fact, the net income figures for 2022 were even higher than the last projections we shared in November .
Speaker 4: In the following slides, we will give some more details about our initiative and how it was translated into this outstanding performance improvement.
Speaker 4: On July 6th, let's briefly talk about the market situation and how we have developed our recovery plan. Let's talk about the market situation and how we have developed our recovery plan.
Speaker 4: Last year we carried out the recovery plan by developing several actions to face the challenging scenario that puts the whole energy sector under pressure.
Speaker 4: Namely the increase in commodity prices, transmission constraints, and critical hydrology conditions at the beginning of the year.
Speaker 4: All in all, during 2022, our short-term optimization initiative contributed to the success of the
Speaker 4: $276 million as detailed in their lives. Hydrology recovery during 2022 and the natural rate gas strategy has boosted our portfolio results and to forward it additional margins from international trading and gas growth to the north of Syria.
Speaker 4: with a high cost of $1,190.2022. On natural gas, let me confirm that we are also adopting the tallest gas policy for 2023.
Speaker 4: In addition, in 2022, we connected 0.8 gigawatt of new renewable source to the capacity.
Speaker 4: All our renewables growth contributed with a 1.2-terawatt hour of additional generation with a positive impact in the year of $37 million.
Speaker 4: On right-seven, we will review the development of our renewable projects during the last year.
Speaker 4: We continue to promote and support the energy transition in CHIA.
Speaker 4: preventing our vocals from poking and take places throttling
Speaker 4: During the last few years we have seen new people increase our new board capacity to a diversified pipeline and loving us to consolidate our position.
Speaker 4: During 2022, 0.5 gigawatts of capacity received the commercial operation date that caused some ?ihin?m?ruct.
Speaker 4: We continue to improve our portfolio and currently have around 0.7 GW of projects in construction in the ground.
Speaker 4: Here we have some updates. We have started the construction of our first solar project in the central region, actually in the metropolitan area of Santiago. There will be an hybrid project with a best connection. The project Manzano represents the first step in updating our growth attitude.
Speaker 4: which we announced during our last investment day. Now let's move to slide 8 to talk about two actions that are successfully unlocked our access value lag.
Speaker 4: According to our integrated approach strategy presented at our last investor day, we have carried out several actions, including those intended to strengthen our balance sheet matrix by sustainable growth and locking the value of our assets and consequently, the investor position for future opportunities.
Speaker 4: The most relevant case was the execution of the stage of an inter-sumission Chile last the time. The non-corrusted of our company that hasn't been adequately valued in time of our
Speaker 4: The proceeds of the sale of the taxes at the very interesting market multiple were used to optimize our debt levels and to that we'll show you later.
Speaker 4: In addition, we have also concluded an important negotiation to extract the value of our NNG long-term agreement, taking advantage of high commodity practice momentum.
Speaker 4: This initiative, which totaled $520 million, allowed us to monetize this contract value and reduce our exposure to potential natural gas prices.
Speaker 4: All detection aligns with our value proposition, a commitment to our shareover.
Speaker 4: We continue reviewing our assets, looking for prizes that it's luck or not other fertility
Speaker 4: On page 9, let's review our initiatives and performance on the distribution segments. They are nosso sprouting. With that we will get them on the data of all ventricated spaces.
Speaker 4: Electrification is vital to take off common change, a fundamental pillar of our integrated
Speaker 4: During the last few years, we have focused all our efforts on announcing our dreams and improving the policy and digitalization of our network.
Speaker 4: All these efforts have allowed us to improve our main indicators, particularly the losses and quality indicators.
Speaker 4: Additionally, as you can see, we have developed a different initiative and promoted several partnerships to boost the decarbonization of our clients' energy consumption.
Speaker 4: Let me go through some examples of the video.
Speaker 4: Regarding the liturgy segments, we were awarded a tender for replacing 2,600 woodscows with an air conditioning unit in the temper.
Speaker 4: Podelko will finance the project as a mechanism to obtain the mission.
Speaker 4: On the B2G segment, we close the deal with the municipality of San Joaquin to provide energy solutions at three-fourth facility.
Speaker 4: This process includes a TV blanch, LED lighting and water-eating through heat pumps.
Speaker 4: Finally, in the B2B segment, we closed an important contract for 14 years with an ongoing industry plan to develop a 1.15 megawatt peak photovoltaic plan.
Speaker 4: This is the largest project up to date for energy.
Speaker 4: On page 10, I will conclude my section giving some evidence of our creating value for old approach.
Speaker 4: Our commitment and efforts to the energy transition began to pay off years ago. And now the market recognizes us as one of the best ESG performance in the region.
Speaker 4: Our cabbages reach 92% CSG related and over 89% aligned with the use of problems.
Speaker 4: This confirms that our strategy invests in sustainability. Also, sustainability finance represents almost a quarter of our total debt input.
Speaker 4: This is still plenty of room to improve this indicator, but it is something that will take some time.
Speaker 4: A considerable amount of our investments is as it did related and now an important piece of our test is also it related.
Speaker 4: A significant milestone was the completion of the Gold Space Outrocker. Now the rest share is risen to 76% of the total, 6 basis points higher than in 2021, and also we reduced by almost 20% our CO2 emissions intensity.
Speaker 4: Achieving 218 grams of Q2HP1 in 2 kilowatt hour.
Speaker 4: In December , the company was recognized once again by June confirmed in the first place in the three categories of the Dow Jones Personality End.
Speaker 4: In December , the company was recognized once again by June confirmed in the first place in the three categories of the Dow Jones personality agency, after having obtained a core of VDNA.
Speaker 4: The Gateo Rinsuwares, Emerge Markies, Integrating Markies of the Pacific Kingdom.
Speaker 4: Energy is also confirmed in the Peace Corps Code emerging in the Peace Corps Code Latin America market idea.
The carbon disclosure project highlighted for the second time the company's leadership is emitting the V.
and reducing greenhouse gas emissions.
This time the company improved the tracing from B to KMI.
Bloomway gender equality in the 2023 confirms an issue for a second consecutive year, measuring publicity trade companies diversity and inclusion for women. This result reflects the company's commitment to diversity and inclusion.
Thanks for implementing actions and programs that have flowed gendered gaps in the energy sector and provide accessible development.
Energy less receives the highest awards given by Alas Vente, the company Grand Prix. The last is the most important category, a company can aspire to in Alas Vente. It is awarded the only one company in Latin America, delivering leadership.
consistently and externally in the public disclosure of information of its investor relations and sustainable development process.
Let me now hand over the presentation to you that our table. Many thanks for being here.
Good morning to all our investors connect.
I will start my presentation on slide 12.
where I show a summary of our main result in the Minus Rampment of the Pigeon.
In the full year 2022, the Vida is adjusted by the impairment made to the core stock of the period, which amounted to $59 million. And $61 million related to the rate of adjustment, connects it to the generation development project. It's geothermal, hydro power plants, and thermal properties.
that according to our strategy and evaluation, we have decided not to execute.
On the last quarter of 2022, we have also adjusted our EBITDA, but they already made a rate of booked in the videos by $61 million. All these 2022 adjustments, affected the bottom line by $80 million in the flu year and $39 million in the fall.
Now let me recap the 2021 adjustment.
The 2021 EBDA figures were adjusted by the cost of and the voluntary retirement plan, the total 80 million dollars in the pool year, and 28 million dollars in the last quarter of 2021. In this case, only adjusted by the cost of the retirement.
All these 2021 adjustments and the environmental relationship to the Bocamina 2 book in the Q4 2021 resulted in an adjusted income of 74, and 42 million dollars in the career and the 4 quarter of 2021 respectively.
As you can see in the slide, all earnings indicators represented an important improvement versus 2021 figures. I will detail later on our performance on activity and meeting.
But before moving on, I would like to reinforce the results of our efforts to reduce our leverage.
Our net depth divida is decreased by 60% as of December 31, 2022, where the same period of the previous year.
It was mainly explained by the managerial action already mentioned by Sabreziuk, the shell agreement and the sale of annual Transition Access Exhibited in 2022.
Let's review our copy on slide 13.
Our 22 total profits reached $1,120 million, freshly in line with our guidance for the year.
In terms of taxonomy, 92% of the total capital was linked to the digital growth, mainly related to our rainbow boat growth.
and 89% of our investment are aligned with the AUU taxonomy, which is coerent with our sustainable strategy.
customer-capex total $70 million, similar to the previous year, and was deployed mainly to announce our free focus on quality and digitization in order to improve our customer experience.
other investment which won under $94 million and were mainly focused on several maintenance and repair activity to guarantee the continuity and resilience of our operation.
On that regard, an important portion of our capital was mainly focused on the maintenance of our gas thermal fatigue.
Consider the performance of the maintenance in our thermal feed in the last year, as a result of the severe drought in the country in the last three years.
Development Capac, which hit on the $56 million, representing an increase of numbers and in line with our renewable strategy.
Let's move to slide 14 where we have the summary of the fourth quarter address to the BW down accounting for $9.32 million.
The variation was mainly related to the agreement with Sheldt Time and executed in December To make 2021 that's totally announced.
and increasing our PPA sales of $1.6 million in Q4 2022.
Primarily explain by the highest evaluation in the non-paisos that you need to hold.
$81 million due to better acknowledge in the period, renewable growth related to the new capacity connected, adding $4 million in the deduct of the period, and the gas optimization activities that generated $40 million on margin.
as a consequence of a solid natural gas policy defined for 222. All the defects that have just mentioned in the donation side were offset by a negative $64 million related to the variable cost.
mainly due to the higher thermal generation volume in cost related to the commodity price and higher regattification cost due to higher volume.
And my highest cost price in the system in Q4 2022 mainly relates to the commodity price centers initial line constraints. And on the slide let me talk about the other elements that explain our EBITDA.
Greece accounted a positive impact of 11 million dollars, mainly related to types of indexation in both distribution and transmission business, long term.
due to no compliance on political services to the eye from previous years. To conclude, let's review the financial negative aspects in the video, $9 million of the aging people and associated with the bond debt of any children and children, $50 million associated with the bond debt of any children and children.
This variation was mainly related to the one of the factors associated to the agreement which I will show.
For under the 69 million dollars from higher PPA sales, families explained by the higher foreign exchange of Chilean pesos against dollars, an increase in the unregulated PPA and higher regulated demand.
$37 million from renewable growth contribution mainly due to the new capacity added in the video. The better hydrology in this year resulting in a positive impact of 100% in your
$1 million from renewable growth and contribution mainly used in new capacity as the individual. The better hydrology in this here results in a positive impact of 100% in your job.
And finally, by the gas optimization of steel, it is the generate is $169 million from Mars.
All the effects that I just mentioned in the generation side were offset by a negative twenty million dollar Silver wool cost.
mainly related to higher thermal generation costs due to commodity prices and higher electrification costs in the period due to higher volume, partially offset by higher thermal generation and the aging commodity coverage instruments in the period.
A negative $200,000,000,000, due to highest profit in the system in the Fourier 2022.
The Riemil separation of a word-abida can't flow. Can you speak?
$43 million due to great remuneration and demand. Mainly explain by...
$49 million on tarp indexation in both network leaders.
He left a million dollars coming from distribution and the remaining from transmission business that is consolidated in our book up to November 21st.
The recovery of the demands in the field which increase for per cent in the PULIA 2022 compared to the previous year reaching pre pandemic level.
This effect has been offset by additional sign book and appeared, the total $12 million.
To conclude, let's review the final two aspects in the video.
A negative changing instrument effect associated with the bound actor and higher topics mainly in generation business.
by $35 million because of the inflation level of 22 versus 2021. Let now give you more detail on Generation KPI on page 16.
Next, electricity generation increased by 70% to 22.2 TWh during 2022.
Mainly resulting from a greater hydro production due to the improved rainfall and higher dispatch of our CCTV coupled with a higher generation from other renewable sources.
resulting from a greater hydro production due to the improved rainfall and higher the patch of our CCTV coupled with a higher generation from other renewable sources, especially solar production.
mostly related to the additional capacity of new projects. Similarly, NG in increased 9% to 5.7% of a tower during the Q4 2022.
highlighting the improved idle production and also greater generation from other renewables.
Our energy sales increased 11% during last year. Mostly related to greater sales to regulated customers, couples with highest sales to recovery, primarily due to new contract.
During Q4 2020, physical states grouped by 3% mainly as a result of a higher states to choose by
Now, on slide 17, let's go through the main driver of our group Metinka.
Our Fully-A 2022 adjusted 19,000, amounted to $1,417,000, representing an increase versus last year figures of 8.8 times.
The main balances are coming from higher adjusted data which increased $193 million or 2.2 times as already played in the space life.
Higher DNA impairments and bed depths of $32 million versus 2021 mainly related to higher depreciation and monetization in energy power assets.
Finally, explain by the evaluation of telenium phases in the period in the initial commissioning of new solar power plants already connected to the grid. A higher depreciation in distribution related to the new project and higher amountization of intangible assets related to the new commercial system presently agraizes an end distribution.
Financial results and equity investment reported an improvement of 32 million dollars in 2022, mainly due to lower expenses related to the factory executed in 2022 in our generation business. While
compared to 2021 figures, or would refer into the accounts received by the Rose from the type stabilization law. In the highest financial capitalized cost as a result of our renewable development plan in execution.
All the defects were partially offset by a higher financial experience as the consequence of usage and bridge loan rate in the second and third quarter of 2022.
Incontacting increased by $167 million, mainly related to the higher economic forecast security standards. The
of the company, these effects were partially offset by a tax-benefit due to the monetary correction in the period. To conclude, our net income was also positively impacted by the sale of an interest rate during the fourth quarter.
This transaction resulted in a net effect of $760,000,000. Q4, 2022, adjusted net income reached $1,300,000, and $5,000,000, representing an increase of around 15 times. Q4, 2022, adjusted net income reached $1,300, $1,300, and $5,000,
in the quarter, mainly explained by the sex average estimation. Moving to SSL on slide 15.
Defoliar, Tunisian Etude, Raphael, amounted a positive $6.72 million in the bill. Mellie explain by.
The full year 2020 to EBITDA, which amounted $1,000,000, and $7,000,000, $44,000, $2,000,000, 2021 due to the regional previously explained.
The community stabilization mechanism extracts the in-hour view board account.
We call 33 yuan for a government currently 1000?rimes on the first flight.
reducing the cash conversion of the period.
Let me highlight that $90 million are related to the visualization mechanism approved in 2019.
Emperor 400 £34million of related to the Ume mocking up production war…
According to the mechanism of the law, we expect to receive the largest amount of this interactive bulk during 2023.
The working capital in the field accounted for a positive impact of $8 million, mainly due to several action management.
including factoring of stabilization energy mechanism S1. Let me remind you that the next working capital of 2021 was positively impacted by the factoring related to
20 19 stabilization mechanisms received or executed during the 2021.
and recovery of LNG makeup got from previous years.
income tax reached $24 million, mainly associated with the annual corporate tax pay, would like to recall that the 2022 number were impacted by the tax losses resulting lower payments of tax.
once compared to 2021 figures. And finally, the financial exchange amount is $2.256 million for a single dollar price in the language of last year figures.
Now, let's take a look to our liability management on page 19. Our growth depth decreased $0.3 billion to $4.7 billion as of December 2022, when compared to December 2021.
You should be noted that the reduction by $1 billion in death when compared to June 2022. This decrease is due to the prepayment of NL Chile committed credit line with NL Finance International and Novacocia in Mitsuwa. DROP.
from September 21 in August 2022.
All this debt reduction is coming from the usage of proceeds from the sale of an El Permission as we committed to all our stakeholder last year.
Therefore, we improve the average of our depth maturity to 6.3 years and we also increase the peak rate portion to 84%.
In addition, the average cost of our depth decline to 4.1 is of December 22.
From 4.4 as of December 2021. In terms of liquidity, we have a very comfortable position in order to cope with possible people judgement.
in the depth map that we will let you to the overall economic situation and also to support upcoming depth map tours. Now, I will end over to Fabric.
to the overall economic situation and also to support upcoming depth maturity. Now I will end over to Fabri.
Many thanks to you Zephyn. Now I will point out some closing remarks on the age 20. Despite the very challenging environment during 2022, we have been able to deliver a more 10 solid, operating infrastructure problem.
This is represented by our earnings along with our unlocking value action. This represented a turnaround story for our last week.
These outstanding results led to an important improvement in our financial position.
giving us room to continue pursuing our strategy towards decadentization, electrification, delamition, value-cation for all. As we have presented in our last investigation.
We will continue working to leverage our set of assets, people and expertise to have our integrated and sustainable business model. Putting our triumphs in the front.
This gives us confidence that the energy is more than prepared to operate in a volatile way and to take advantage of the energy of it.
Let me know and go with the bill. Thank you Fabrizio, thank you Zepi. Thank you all for your attention. As I haven't dissipated, we will receive questions. We have four and chat on the webcast on this occasion. The Q&A section is now open. Gigi, please you may start. As a reminder to ask a question.
please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by, will we compile the Q&A roster?
Our first question comes to the line of Javier Tlares from Medio Vanca.
Hi, good morning and many thanks for the presentation and for taking my questions. I have three. The first one is on the slide number 18 and the impact on the stabilization mechanism that has played an important role in 2022. So the question for you is which is your expectation of that stabilization mechanism impacting speed pink.
in the next year to come, for example, in 2023 and 2024. So any life on the possible recovery of these working capital or cash flow absorption would be helpful.
The second question I think is one of the spending tests you are mentioning in the regulatory framework evolution and particularly interesting on your expectation from the capacity regulation of capacity placement.
I think that on the presentation you are mentioning that the new regulations should be published during the second half of 2023. So if you can help us to understand the implications for NLC of this new regulation on capacity placement. And the third question is on the balance sheet structure of the company. There has been a significant improvement in the net debt to the company following the procedural formula.
extraordinary operations. I think that as we speak net debt to Evida, it's along the lines of 2.7 times. So the question for you is what do you consider an optimal net debt to Evida for a company of the profile of NL Chile? And if you intend to continue through 2023 and 2024?
with this strategy of asset propane as an asset and management of your portfolio. And the very final thing is if you can serve with us your cost update in 2022 and expectation for 2023 and 2024. Thank you. Thank you, Javier. I'll hand over now to Fabrizio.
Yes, let me address the second question later. I am going to do that for the first and the third question Even if I think that the third question of course is that very general one and usually the magic number that I've told you It's heard about is three but anyway do that for me will give you some more
comments about that. The second question about the capacity payment to make and well first of all let me highlight that this is still something that is under discussion. Of course there are some documents that are available to the different stakeholders for their comments so we know quite well which is the current status of the proposal.
And let me say that we don't see any particular impact in the short term. Basically for two reasons, this is something that has to be approved. And the second reason is that there is a very quite long transition.
periods in which the old and the new mechanisms will go in parallel. So we don't envisage any big impact in NNLS without NNLS support.
In general sense, let me say that I think that then...
what the news in this new regulation are quite aligned with our long-term objectives and they are reasonable because in the end the most important changes will affect
So there will be some specific method in order to assess which would be the contribution for storage facilities to receive this capacity payment and we are very interested.
about that and the other issues are more like details like reducing a little bit the solar capacity payment but existing and under construction plants could decide to stay with the old mechanism and that's the reason why we don't see it.
first part. and we don't some
less competitive thermal plants like diesel plants, so the more costly units of the... and this is the finalization for them, but we are not involved in that part of the business, so let me say in general terms, the more stronger...
impact on our results and in general sense we are aligned with the intention of the regulator in introducing this change.
on our results and in general sense we are aligned with the intention of the regulator in introducing changes. Is that?
yes okay for what concern the recovery of the receivables that has been raised because of the new law according to the mechanism we expect to receive most of the amount by the end of 2023 we are talking about around
in mixing structures in unlocking. Not mor than a damn'
there. Big.
of these receivable in the B.I.D. So we believe that if everything is going to be according to the plan, starting from the second course we should start to recall the impact of these amounts. But in any case, slowly we continue to understand for a few seconds from the training session.
the amount of to be recorded should be around 450 million dollars for what concern the leverage the optimal level of the leverage let me say that below three times the test is our target
and this is basically something that is in compliance with the requirement that we have with the rating agency. So we believe that by the end of this year, we are able to achieve this situation. For what concern the COP of Death 2023.
We are going to have a little bit an increase in terms of cost of that, which we had in 2022.
because we are going to repay some short time debt and that limit have
We are going to repay some short time debt and that's really if I have a more cheaper
cost. So we believe that we are going to close lower than 5% between 4.5 and 5%. Okay, thank you Giuseppe. Gigi, do we have more questions or any follow-ups on Javier, please?
Yes, one moment for our next question. Our next question comes from the line of Fernan Gonzalez from BTG PACSHUL.
Hi everyone. I have three questions here. One is about the distribution segment and some of the headwinds that it has been facing. I've seen some publications through an elder story was shown about the electrical cable theft that happened last year and how much it increased.
And also we've seen comments in the press release related to fines by the regulator. Could you walk us through what exactly is happening to that business segment and what you can actually do to improve any problems that you may be facing?
My second question is on the generation segment and I would like to hear your thoughts about the massive amounts of renewable capacity that's going to be added this year and how the system is going to absorb that. And whether or not you believe we may be getting into an over capacity situation here.
And my third question is about your Green Hydrogen Pilot Project in Magallanes, which is already producing.
What's the next step here and what will be your role in this JV? Are you going to be the supplier of energy or are you going to be participating in the whole production process and exporting of the product eventually?
Thank you for now, Fabito. Okay, let me start with the third question. That's quite simple to address. We are not only delivering energy, but we are also in a physical...
50% 50% joint venture with with with April with Amé HIPAA in the Glee hydrogen part of the project. So for what the green hydrogen production to concern we are in a perpetually 50 50 joint venture and
transform it into an e-fuel. That is actually the final product of this pilot project in which the uptake is pushed. But we are not in this part of the industrial development. As I said, we were not interested because in the end...
As a company, we are much more focused in green hydrogen production. This is what really interests to enhance. The second question was about the generation segment.
Well, let me say that it's difficult to predict that there would be structural overcapacity in the system soon. Of course, there are huge developments in this.
But we also know that there are some transmission constraints that should be...
So we don't we are not for seeing a very different market.
so brought in the short video Tomig knit pull.
That's basically our view. In general, let me say that, of course, we are actively managing our portfolio in terms of selling energy to a final company.
to final currency that of course, alpha also to manage potential over capacity release. But that I say, I don't see any way at changing drastically the situation in the short middle term. And first question about distribution. Well.
Actually what you mentioned is something that, of course, let me say the fines. At least the fines is something that is quite recurrent, let me say. And I can end over to the FA if we want to give some more details afterwards. But let me say something, of course, that is the requirement because this involves many options.
the electric white that are stolen. This is something that of course is, let me say,
It's about, it's a more general concern, okay? And this is something that is absolutely in line with the situation that she is facing in other situation about the increasing problems with... And this is something that is absolutely in line with the increasing problems with...
with equation about security and
Unfortunately, through the number of these events is drastically increased. This is an increase.
focused also by the government in order to introduce some more strict regulations, some more strict laws in order to prevent and disincentiveize this kind of situation.
Oh, maybe only point that we can add is that part of these.
and they are coming from the previous year, something relative to 2020, before the 2020, and clearly every time they do this, that's a thing that we are fighting, you know, like
to support our ways.
sometimes you know these details are not really
sometimes you know this distance are not really. treatment guitar or you.
Thank you. Thank you. At this time I'm showing no further questions over the phone lines. I would now like to turn the conference back to Ita Bella Clemens.
Okay, thank you, Gigi. So we have received some questions for the chat and also for our mail. So Fabi, to do that, for the first question here is coming from Rodrigo Moras, from Moniza Set Management.
Rodrigo is asking two questions to us. Now the first one, if we could explain more about the gas optimization gains.
that were booked in the fourth quarter of this year, now so in the year of 2022, what's the meaning of the optimization? And the second question is related to the distribution business, no? What are the actions that we are doing as a company in order to improve the performance of this business?
And for me to design it? Okay. So let me address the right address with question.
But in general terms about any distributions, let me say that of course this is something that is related to regulation. Is it something that...
Of course, we are trying to manage to improve very careful...
management of our investment in order to improve quality indicators and to enable potential future opportunities that we derive with the electrification process that I think that will.
give some more opportunities to the distribution sector. As a matter of fact, finally, we also welcome the parties, the governments and specifically the energy minister recently.
recently stated that this initial segment is absolutely a priority in order to review in general terms regulation that we think is not appropriate.
In terms of gas optimization, gas optimization is something that is absolutely core to our portfolio management and that has become particularly relevant in 2022 and will be very relevant also in 2023.
And the activity, this, of course, there are several activities that we do, you know, to optimize our position and take advantage of all the potential opportunities. Of course, there are many factors.
that of course was a particularly high price context in the markets, and that was the reason why we benefited in our results as we showed during the presentation. And we are doing the same for 2023.
in which we already sold four cargo in the international market that also delivered to us very interesting margins because we carried out this activity during the second half of 2022 and then.
international market prices were much higher than today. And of course, there are a lot of other optimization activities that we do also locally in terms of exchanging gas with other players in the market and also to optimize our own production between the different power trends that we have in the country.
Okay, thank you Fabrizio. We also have another question coming from Maria Guazca, the Vivenda Corredores. Anamaria is asking a question that's more related to our controller's shareholder, but she's asking with the political situation in Latin America.
in which countries have you considered investing? So as we will not answer by our controversial, they would say about this if we could give some words about what is Chile, knowing through the portfolio and if we're seeing any kind of investment on our perimeter here. No, what in general stands, of course,
present along the valentine, we think that this would be something that would be confirmed in the future. More locally, so for what this concern directed to energy, of course, we commented the?? with the need to terminate the delay of the displacement and deformation of the ventilation
and transmission we mentioned that we are continuing, always continuing to see if there is any other opportunities for value creation and according to of course what is the...
What is the the the optimum with returner profiles for our access in our in our But we don't see any big divestment any active any disposal that is not any big support in our plan and so as a state we look we are looking at the future with this value creation view but nothing big is just in the moment.
Okay, thank you, Fabrizio. We have another question coming from Thomas Gonzales from Scoria Bank. Thomas is asking us two questions related to the Guest Agreement. After the agreement with Shell, which is going to be the new amount of LNG treatment per year this year?
And who is going to be the supplier now about this contract? The price of this new shipment is going to be higher or lower than before, given the drop in international few prices.
Okay, but let me say that what in general tends to the contractor which is still there. The agreement that we made was just to do partially as we showed during the presentation, the amount that is under this long-term contract.
But we are still sure that we would continue to be our LNG provider. And for what concerned 2023? Let me say that after the agreement.
The amount of the contracts would be reduced from the original 18 cargo to 16 cargo, out of which, as I just mentioned, were already sold in international markets. So now we are hosting to receive...
It's planned to be delivered 12 cargo to Chile, that would be like 33 terabitieux this year. Under the same agreement which shares, the price is linked.
to when it's particularly down to every app. So it's benefiting partially from the drop in the commodity. And we are already trying to be satisfied also from Argentina and the Guards. We already contracted 16-theta-bizou.
up to Adrin and respect also to potentially suit some additional volumes for the rest of the year.
And about the price also the engine guys got of course this
We can line that with LNG long term contact crisis, we're going to do in Chile. That is.
Significant is lower than the international market price.
So let's say that in general terms we are continuing to look for additional opportunities to actively optimize our gas portfolio and trying to extract the maximum value from it.
Thank you Fabicio. We also have one more questions from Alejandra Arenda, ITAO VBA. The question is also relating to the LNG and the drug asso. Can you give us about about Park idea of what the margins is for those that end of cargo sales during 2020?
As we already mentioned, this activity almost goes on like one act.
some of $150 million last year and was related to three cargo plus some additional optimization of CAs that we carried out. So let me say that in this context we achieved up to $40 million.
because we closed the day during the second half of 2021.
Okay, perfect. Thank you Fabrizio. Okay, I'm checking here. We don't have many more questions. So I will conclude our results conference call. Let you remind you that our investment, investment, investor relation team is going to be available for any doubt you may have.
Many thanks for your attention. See you soon. This concludes today's conference call. Thank you for participating. You may now disconnect. The conference will begin shortly. To raise and lower your hand during Q&A, you can dial Star 11.
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