Q3 2023 Enel Chile SA Earnings Call
Yeah.
Good morning, ladies and gentlemen, and welcome to Enel, Chile at nine months and third quarter 2023 results conference call. My name is Victor and I will be your operator for today.
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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 and involve risks and uncertainties actual results may differ materially.
Operator: Such forward-looking statements reflect only our current expectations, are not guarantees of future performance, and involve risks and uncertainties. Actual results may differ materially from those anticipated in the forward-looking statements as a result of various factors. These factors are described in Enel Chile's press release reporting its nine months and Q3 2023 results, the presentation accompanying this conference call, and Enel Chile's annual report on Form 20-F included under risk factors. You may access our nine months and Q3 2023 results press release and presentation on our website, www.enel.cl, and our 20-F on the SEC's website, www.sec.gov. Readers are cautioned not to place undue reliance on those forward-looking statements, which speak only as of their dates. Enel 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, except as required by law.
Clearly from those anticipated in the forward looking statements as a result of various factors. These factors are described in Enel Chile's press release reporting its nine months and third quarter 'twenty to 'twenty two 'twenty three results.
The presentation accompanying this conference call and Enel Chile's annual report on form 20-F included under risk factors you may access our nine months and third quarter 2023 results press release and presentation on our website www dot and the C L.
In our 20-F on the Sec's website www Dot FCC dot Gov readers are cautioned not to place undue reliance on those 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, except as required by law.
Operator: I would now like to turn the presentation over to Mrs. Isabela Klemes, Head of Investor Relations of Enel Chile. Please proceed.
I would now like to turn the presentation over to Mrs. Isabela <unk> head of Investor Relations of Enel, Chile. Please proceed.
Isabela Klemes: Buenas tardes. Good afternoon, welcome to Enel Chile Q3 and nine months 2023 results presentation. Thank you all for joining us today. Joining me this morning is our CFO, Giuseppe Turchiarelli. Our presentation and related financial information are available on our website, www.enel.cl, in the Investor Relations section, as well in our app, Investors. In addition, a replay of the call will be soon available. At the end of the 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 listening mode. In the following slides, Giuseppe will open the presentation with our key highlights of the period, go through our portfolio management actions and market context updates, finally give us a view of the business economic and financial performance.
When Scott good afternoon, and welcome to Enel, Chile third quarter and nine months 2023 results presentation. Thank you all for joining US today. Joining me. This morning is our CFO, Joe Kennedy, our presentation and related financial formation are available.
On our website www dot and nasdaq's yacht in the Investor Relations section and as Larry Naira App investors. In addition, a replay of the call will be you'll now available at the end of the presentation, we will be an opportunity to ask questions, but your phone or webcast.
Shot show the link ask your question media participants are connected only in least in animals in the following slides we opened the presentation with our key highlights of the period, Dan go through our portfolio management actions and market context updates.
And finally give us a view of the business economic and financial performance. Thank you for our nation and now let me hand over to you that deserve it.
Isabela Klemes: Thank you for your attention. Now let me hand over to Giuseppe. Giuseppe?
Giuseppe Turchiarelli: Thank you, Isabela. Good afternoon, and thanks for joining us. Let's start our presentation with our main highlights on slide two. I would like to start with our portfolio management highlight. During the year, we added around 400 MW of new renewable energy capacity, contributing to our long-term ambition of decarbonization and optimization of our portfolio. We are pleased to announce that the Arcadia transaction was concluded last 24 October. The proceeds total $556 million and shall be used also for deleveraging and current needs of our business. Let me remind you that the operation involves the selling of 4 non-strategic solar power plants amounting to 416 MW. We will give you more color in the next slide. This year, we had a very positive rainy season in the country, the rainiest year in the last few years.
Is that data without payment.
<unk>.
Let's start.
So with our main highlights.
I would like to start with our fourth quarter highlights.
During the week added around 400 megawatt.
Renewable.
Contributing.
Thanks, Amit.
Okay.
Okay.
Alright.
We are pleased right now that thats kind of a transaction was concluded.
They can see.
Bye bye.
Megan.
That will be used.
Also the delivery fee.
About what.
Sure.
Let me remind you that the operation involves the building of <unk>.
But the last call.
A replay amount of diesel.
100, <unk> being Mega maybe give you more color right.
Hi, Vivien.
We had the ability for the rainy season.
The Iranian yes.
Giuseppe Turchiarelli: This is reflected in a 28% increase in our hydro production versus last year. For what concern the market context on the distribution business, the final technical report of the VAD 2020-2024 has been already published. The process is not yet concluded, but I will give you more color on this later. Regarding the factoring of PAC II, in August 2023, we received the first tranche of IDB issuance related to the Enel Generación Chile and Enel Green Power Chile of around CLP 330 million. During October, we were able to collect an additional CLP 17 million, and we expect to receive an additional CLP 32 million by the end of this year. Again, about the PAC, I would like to mention that the government signed an agreement with the Congress, based on which a draft bill should be presented during November to address sector-relevant topics.
This is reflected in a 28 alright.
Hi, John Best of luck.
But I'm not concerned that market context on the distribution business.
The technical report.
Great.
<unk> already.
The process is not yet concluded, but we'll give you more color.
Lee.
Regarding the factory.
In August.
Great.
First.
So let me speak to that.
Chile.
Okay.
Great.
Got it.
During the <unk>.
Collect an additional.
And we are doing.
And then.
$2 million.
Okay.
Again about the bank.
You mentioned that the governor signed.
In agreement with that Congress based on which a drug.
Should be building.
But rather than.
Giuseppe Turchiarelli: Specifically, a solution related to a potential new price stabilization mechanism. In November, the government committed itself to presenting another draft bill to discuss topics such as the transmission planning process, storage adoption, and renewable support. Having said this, our EBITDA rose, reaching CLP 783 million, or 60% higher compared to last year adjusted figures. Our FFO increased by CLP 790 million versus last year's figures, showing an important recovery. We will have a deep dive into the economics and financials later. Let's move to slide three. Let's now look at how we are consolidating our renewable leadership and optimizing our generation portfolio. During the last year, we have focused most of our efforts on developing a diversified renewable mix matrix in line with our decarbonization strategy. We are reaching the final stage of several projects, either in the north or in the central south region.
Is Italy a solution.
Based on mute.
Okay.
Also in November the government Committee.
Andy and Ralph.
Scott.
Such as this.
Mission planning process.
Adoption and renewable.
Okay.
Our EBITDA rose reaching.
$3 million.
R R.
Higher compared to last.
And now.
<unk> increased by $790 million versus last year.
Joey any possible recovery.
We will deep dive into the quantity.
So Lisa now led.
Move to slide three.
Let's now look.
We are closely.
Renewable leadership.
Our generation portfolio.
During the last.
Focus more of our.
On developing a diversified renewables.
In line with our.
Pickup ambitions.
And we are reaching that.
Perfect.
In the north or south.
Giuseppe Turchiarelli: In this nine-month period, we connected almost 0.4 GW additional net capacity, of which 0.3 GW were added in the last quarter. Among the projects already connected in this period, I would like to call attention to Manzano, a 99 MW solar power plant located very close to the consumption loads in the center of Chile, and our wind farm in the south, Renaico II and La Cabaña, which allowed us to connect 72 MW and 106 MW of wind capacity to the national electricity system. Therefore, our renewable capacity continued increasing, and in this period, we have reached 6.7 GW out of 8.8 GW of renewable installed capacity, representing 77% of the total. In terms of cost, we have received the operational commercial certificate for 1.2 GW in 2023 for projects like Renaico II, Campos del Sol, Huanchuy, Valle de los Vientos, and Finisterre. For more details, please see the annex.
Sure.
In these nine months.
We connected almost data.
Additionally.
A week.
013 gigawatt.
Well.
Among the projects already committed.
I was glad to quality income.
And 99.
Solar power plant is located very close to the consumption.
And the Santiago, Chile, one being filed.
But as I recall.
And talk about them yet.
To connect.
Okay.
Pete Mangan.
Yes.
Okay.
Therefore, our renewable capacity to continue increasing.
We have reached PS.
Got it.
Yes.
Representing 77%.
Okay.
Thanks.
We have received the operational commercial duplicated or $1 <unk>.
Yes.
Great.
Process.
So well.
But as I look at the April 15th.
Our market is please keep down Mick.
Giuseppe Turchiarelli: As a part of our unlocking value goal focused on optimizing our portfolio, reinforcing the value of our assets, an important milestone was achieved a few days ago. We completed the sale of our subsidiary, Arcadia. A transaction that was announced in July and was foreseen in our 2023, 2025 strategic plan. All the conditions established for this kind of transaction were finally fulfilled, including the approval from the Chilean antitrust authority, Fiscalía Nacional Económica. In line with the agreement, the buyer, Sonnedix, paid a total amount of $556 million. We expect to record a positive impact in both our net income of around $106 million and our net debt of around $550 million in Q1 2023.
As a part of our unlocking base.
Paul.
Hey, Mike.
Reinforcing the value of our asset.
But the milestone was achieved.
We completed this phase of our subsidiary.
Dr. John This was announced in July and it was costly.
<unk>.
2025.
Yes.
All the condition established this kind of transaction.
Including the approval from.
The Canadian crop.
Please go ahead.
In line with the agreement, thereby yet Dominique <unk>.
Open amount both by banner.
Million.
We expect to react positively impacting both our net income of around $100 million.
Our net debt.
Sure.
Great.
Giuseppe Turchiarelli: Regarding the latter, I would like to point out that the tax corresponding to the sales of Arcadia that totals around $61 million will be paid in April 2024, and therefore, it will not affect the 2023 cash flow. This sum will give us more room to execute our CapEx plan and strengthen our financial position. Now, on the next slide, let's look at some updates on the hydrological situation and gas optimization activities. I would like to highlight that this year we have benefited from the very favorable hydrological conditions. Hydro production has been higher than in 2022, both in the Q3 and nine-month period. As of September, we record 28% of additional hydro production, reaching 8.1TWh. Considering this scenario, we expect to close the year with around 11.9TWh, 2.6 more than expected.
Regarding the latter I would like to point out that the stock.
Rob It's Tony.
Thoughts around $61 million will be paid in April 2024.
And therefore, it will not affect it very quickly.
Yes sure.
Yes.
We gave up some more room to execute our capex plan and strengthen our financial position.
Now.
Slide let's look at some update on the.
With that situation.
Sure.
I would like to highlight that we have.
From the very favorable hydrological conditions.
So that's going to be higher.
Both.
Q3, and nine months.
As of September we wrap up.
Three 8%.
Of additional production, reaching eight one.
Sure.
We'll see that in this scenario.
To close the year with down 11, 9% at about that one too.
Two more.
Thanks, Steve.
Giuseppe Turchiarelli: As a result of the significant increase in rainfall, the hydrological situation in all our reservoirs is positive, especially in the south of the country. Rainfall exceeded the hydrological level of the last 10 years, and in Laja and Rapel basins, the average level of hydrology of the last 60 years were surpassed. In addition, as you can see on the image at the center of the slide, snow cover in the mountains is better than last year in Maule and Laja areas. Regarding our gas optimization activity and trading action, we continue having a comfortable gas availability, thanks to the long-term LNG agreement with Shell and the contract signed with Argentinian Gas Supplier.
Hey, David.
The significant increase in rainfall at Roes because situation all of our research.
For the game.
Actually in this out of the account.
Rainfall exceeded David Osaka level of the last year.
Laughter.
Beijing.
David label by a thorough review of the last year.
Bob.
Addition, educated on the image.
At the same store this slide no cover demand is better than last year.
Okay.
Regarding our GAAP optimization activity and trading.
We continue aiming at the conference about gas availability.
For the long term LNG agreement, which kind of contract timing.
Giuseppe Turchiarelli: Since 1 October, new firm agreement with Argentinian Gas Supplier for up to 4 million cubic meters per day started to operate until the end of April 2024, enabling us to optimize our CCGT generation cost. Thanks to the availability of Argentinian gas in the central zone, we continue carrying out LNG swaps to the northern zone, where natural gas is not available. In this 9-month period, we diverted several gas shipments to the north, totaling around 12 TBtu. In addition, we continue executing several trading activities with local industrial and mining customers and with foreign markets. In connection with the latter, we have scheduled the trade of 2 ships in the Q4, as we did in the Q1 this year. The total expected contribution margin for all this gas trading will be around $270 million approximately for the full year 2023.
Supply.
Since October.
New frame agreement that we've got supply yet.
Two 4 million cubic meters.
But it properly.
Okay.
And Anthony.
Our <unk>.
Turning to costs.
Thanks <unk>.
In the Central zone.
Continued giving out LNG swap with an orphan.
With natural gas isn't available.
This nine month period, we divested Sarah.
Shipments to the North pole.
Well thank you.
In addition, we continue executing and server trading.
With local industrial and mining customers.
Yes.
Convention leather.
The theme of two sheets in the Q4 as we see in the Q1 this year.
Okay.
Contribution.
Contribution margin for all of these.
It will be around $170 million.
For the full year 2020.
Giuseppe Turchiarelli: On page five, let's review our performance and new initiatives in distribution and analysis business. Let me highlight some indicators related to the distribution business. In our concession area, the number of customers and distributed energy continue to grow. Therefore, new opportunities and challenges continue to arise. On quality and efficiency, looking at the last 12 months, we see a significant improvement in the SAIDI index of around 12 minutes, and the energy losses have remained flat versus the same period last year. Before moving to Enel X, on the distribution tariff review, the final technical report of the VAD 2020-2024 has already been published. This report already considered the several discrepancies raised by the distributor during the external stage. However, we are still waiting for the tariff breakdown by type of tariff, which should be published by the end of this year.
Now on page five let's review our platform a new initiative in the future.
Visit.
Yeah.
Let me highlight some indicators related to the distribution.
In our constituent.
The number of customers.
And if you continue to grow that for new opportunities and challenges hosting for Iraq.
On quality and efficiency looking at the last month, we see a significant improvement.
Of around $12 million.
And the energy losses.
Remain flat.
Yes.
Before moving further ahead.
On the distribution side.
Thats fine.
Part of the beauty.
Really great.
<unk> has already been published.
Wrap up a radical.
Correct right.
During the exit fee.
H.
Right.
We are still waiting for the tax breakdown by type of filing.
We should be published by the end of this year.
Giuseppe Turchiarelli: After that, we have a new stage of the process, the rentability check. In this stage, the industry rentability will be reviewed. After all this process, we would have the final distribution tariff released. Considering all the steps I've mentioned, we expect to have the process concluded during 2024. For what concerns the 2024/2028 distribution tariff process, the VAD process has already started, and the components of the aggregated value of the distribution for the 2024/2028 and services cost for this new regulatory period has been already defined. The process is still ongoing, so next year we shall have more updates on the matter. Regarding Enel X, we have some interesting milestones focused on the electrification and decarbonization of our clients' energy consumption. Let me go through some examples.
We have a new speed that process that rates in check.
Page eight the.
Beacon will be revealed.
After all this process. He was alive, we will pay the final.
Final distributions I can release.
Considering all that I have mentioned, we expect this process.
Doing well.
Paul.
Our wolfcamp asset.
2028.
Eight bushels per acre.
Sure.
<unk> process.
Process has already started.
The component of the aggregated a.
A good chunk of the 2020.
Instead.
Instead of cost of newly with FBR.
At this time.
The process is still ongoing so next year.
More update on that.
So I got the unless we have some interesting milestone focus on the application and the organization of our clients.
<unk> reached in the EU.
Let me go through some examples.
Giuseppe Turchiarelli: First, we have incorporated 2,200 e-buses into the Transantiago fleet, or 36% higher than the previous year's figures, mainly through 358 new e-buses of Transantiago 5 to support public transportation and through the agreement signed with Goi to deliver another 214 e-buses. Second, regarding public lighting, the indicator rose by 18%, mainly as a consequence of new contracts signed with Maipú and Castro municipalities. To conclude, we continue working to increase the number of public and private charging points for electric vehicles and to be awarded with more lighting projects throughout the country, increasing, in this way, the electrification of the market. Now, let me drive you through the financial performance of our business on slide six. I will begin summarizing our main results for the period. To better evaluate our company earnings performance, we present the 2022 figures as a pro forma that includes two main adjustments.
Alright.
We have incorporated 2000.
E buses into the back into the Santiago.
Are.
It is 6% higher than the base year figures mainly through <unk>.
<unk> New E buses.
That one five to support.
And through the agreement signed with employee.
We'll deliver.
Bob.
Thanks, Tom.
And public lighting.
When you say there are rules by 18%, mainly as a consequence of new contracts signed with <unk>.
Amongst them.
To conclude.
We continue working to increase the number of public and private charging points autolytic byproducts.
And to be awarded with a more of a lagging process.
While the count.
In this way.
The issue of the market.
Now, let me drive you through the financial platform of our business on slide six.
I will begin summarizing our main results for the period to better evaluate our company early summer, we presented clinical into vehicles.
Pro forma this includes sumit.
Giuseppe Turchiarelli: First, the EBITDA has been adjusted by the impairment of coal stock, totaling CLP 63 million in the nine-month period of 2022 and CLP 1 million in Q3 2022. This adjustment affected the bottom line of CLP 43 million in the nine-month period and CLP 0.4 million in Q3 2022. The second adjustment, and the most relevant one, is related to the sales of Enel Transmisión in December 2022. We excluded from our analysis the EBITDA of Enel Transmisión, which amounted to CLP 77 million in the nine-month period and CLP 24 million in Q3 2022. This adjustment affected the bottom line by CLP 46 million and CLP 15 million in the nine-month period and Q3, respectively. Now, on the FFO.
Alright.
Maybe that has been adopted by the impairment of coal.
So totaling $63 million in the nine months.
Video is.
And $1 million in the third quarter of <unk>.
Okay.
These adjustments affected the bottom line of $43 million.
Nine months video zero point $5 million.
And that's what that clinically.
The second one.
And then most of element one related to this deal.
And as detailed in this segment.
We excluded from our.
They did that.
Palin reached.
<unk> amounted to $77 million nine.
Nine month period, and $24 million in the third quarter.
These adjustments affected the bottom line by policy.
And $15 million in the <unk>.
More video into Q3.
Great.
Now on the call.
Giuseppe Turchiarelli: The 2022 figures are adjusted also by the Enel Transmisión perimeter in terms of cash by CLP 18 million in the nine-month period and CLP 15 million in Q3. The 2023 figures also excluded CLP 310 million paid in tax due to the capital gain obtained from the Enel Transmisión sale. Considering this, let's see how the earnings indicator and the FFO perform. In the nine months period and Q3 2023, we see a relevant improvement in the EBITDA and net income versus 2022. This is mainly explained by a more efficient generation mix, especially during the last quarter, due to the improvement in the hydrological situation and better distribution performance. We will see more details in the following slide.
Two figures does it also by the evidence that we can be better in terms of cash by $18 million in the nine month period.
<unk> million dollars.
Yes.
The 23 figures also exclude visa.
Yeah.
<unk> million dollars paid in stock.
For the capital gains.
But we can say.
Yes.
Considering these let's see how the early indicator.
Paul.
Bob.
And the nine month period.
The third quarter of 2023, we see a relevant improvement in EBITDA.
Net income basis.
This is mainly explained by more efficient generation mix.
Especially during the last quarter due to the improvement in that rollout.
And better distribution.
We will see more detail in the following.
Giuseppe Turchiarelli: Regarding the FFO, the 2023 figures show a relevant improvement impacted mainly by the EBITDA of this period and by the effect to factoring first tranche execution for around $303 million. We will see more details later. Let's review the progress on CapEx on slide seven. Our 9-month 2023 total CapEx reached $537 million. 74% of our total CapEx deployment was related to renewables, and 94% of the total CapEx was linked to the SDG goals. Customer CapEx totaled $64 million, 18% higher than the previous year, mainly associated with the new customer connections. Other investments reached $102 million, 15% lower than previous year, mainly due to lower maintenance activity in conventional generation plants and distribution business. This effect was partially offset by new renewable plants in operation and the maintenance program in Brazil.
On slide.
Regarding that.
The 2023 figures show a relevant.
Improvement impacted mainly by the EBITDA.
And by the effect too.
First execution.
And that entity.
We do see more detail later.
Yes.
Let's review the progress on Capex on slide.
David.
Our nine month 2000.
So by Capex reached $547 million.
74% of our total capex deployment was related to renewable.
94% of the total capex, mostly.
The goal.
Customer capex totaled $64, 18% higher than the previous year, mainly associated with the new Amish.
Mitch.
Further investments reached $102 million.
15% lower than the previous year, mainly due to lower maintenance activity.
The Asian plant and distribution.
These effects.
Offset by new renewable plants in operation.
Then program.
Giuseppe Turchiarelli: Development CapEx reached CLP 381 million, representing a decrease of 34% versus last year figures, in line with the remaining renewable portfolio under construction. Let's move now to slide eight, where we have the summary of the Q3 EBITDA breakdown, accounting for CLP 391 million. First of all, let me remind you again the changes in the company consolidation perimeter, mainly due to the sales of Enel Transmisión Chile in December 2022. We have included a pro forma of our EBITDA for the Q3 2022 for comparison purposes. Q3 2023 EBITDA is CLP 162 million higher than the 2022 pro forma, mainly explained by the following.
Development Capex reached 381 million, representing a decrease of 34%.
Versus last year.
In line with the remaining renewable portfolio under contract.
Let's move now to slide eight.
The summary of the third quarter EBITDA breakdown accounting for 90.
$91 million.
First of all let me remind you again the changes in the company.
<unk> perimeter, mainly due to the case of bananas.
In December last year.
We have included at the corner of our EBITDA for the Q3.
2022.
Based on progress.
Third quarter, turning to increase EBITDA is $162 million higher than the 23%.
Mainly explained by the following.
Giuseppe Turchiarelli: A positive effect in hydro and renewable contribution of +$149 million to our margin, mainly associated with improved hydrology in the quarter, and the positive effect of +$132 million of variable costs, mainly by a lower withdrawal spot price in the quarter as a consequence of a better hydrology in the period. The above mentioned effects were partially offset by a lower gas optimization activity, which decreased by -$109 million, mainly related to the lower gas margin prices and lower gas trading volume of 3.3 TBtu, which is equivalent to one cargo of LNG approximately when compared to the same quarter last year. $36 million for lower PPA sales in the Q3 2023, primarily due to lower average PPA price, mainly related to the evaluation of Chilean pesos versus US dollar in both free and regulated market, and also lower commodity indexation in regulated markets.
A positive effect denies that octane renewable contribution of $149 million.
While our market mainly associated with Ing group.
Hydrology in the walk.
And the positive.
The effect of $132 million.
Both caused mainly by lower white spots in.
In the block and the costs that went through.
Therefore mix affects the west partially offset by a lower Scott optimization DVD.
Which decreased by $1 9 million mainly.
Mainly related to the lower gas prices and lower GAAP trading volume.
3.3.
Steel, which is equivalent to one cargo of LNG approximately.
When compared to the same quarter last year.
$36 million of lowest Ppas.
Sure.
Good day.
2012 increased primarily due to.
Lower average PPA price mainly related to devaluation of.
Good evening.
Pesos versus the U S dollar in both regulated market.
Lower commodities indexation.
Giuseppe Turchiarelli: The remaining variation of our EBITDA come from CLP +16 million due to the grid remuneration related to the indexation, client required services, lower fines and compensation, partially offset by lower demand, better effect in OpEx and other costs, mainly by the financial hedging in the quarter and higher effect in the rents due to the recognition of Transantiago fee basis. Let's move to slide nine, where we have the summary of the nine-month EBITDA breakdown accounting for CLP 783 million. As we did in the third quarter, we are excluding the 2022 EBITDA of Enel Transmisión for comparison purposes and for a better understanding of the 2023 results. Enel Chile EBITDA increased by 60% or CLP 293 million, mainly explained by the higher contribution of hydro and renewables of CLP 172 million, mainly related to the improved hydrology volume.
Sure.
The remaining variation of our EBITDA come from.
Plus $16 million due to the greater amortization related to the indexation.
And the required services lower financing compensation, partially offset by lower demand.
Based on expert in Opex and other costs, mainly by the financial aging and therefore.
And how you are affected.
Due to the recognition of.
Yes.
Let's move to slide nine where we have a summary of the nine month EBITDA breakdown at currency.
No.
SUV deep.
In the third quarter, we are excluding the perimeter into EBITDA.
For comparison.
And for a better understanding of the twin clinically breakdown.
It is fairly benign feed by effectively.
293 million, mainly explained by <unk>.
High yield contribution of either a removal of 182 million mainly related to the improved.
Royalty volume.
Giuseppe Turchiarelli: CLP 98 million from higher PPA sales in nine months 2023, primarily due to CLP 37 million of higher average PPA price, mainly related to the indexation. CLP 38 million, mainly due to the higher capacity payment revenue, primarily due to two factors. First, delay in the close of some market renewable projects, which increased the payment for all the projects in operation. Second, the new power plants connected and commissioned during Q4 2022 and within 2023. A better effect of CLP 17 million in variable cost, mainly related to CLP 162 million related to a lower spot price in the period due to a better hydrology since June 2023, mainly during the not solar hour, and one-off effect of the agreement with one of our PPA suppliers. Partially offset by lower thermal generation margin, which amounted to CLP 144 million, mainly related to the lower thermal generation.
$98 million from higher CPUC in nine month 2023, primarily due to.
$37 million provide yet.
It's mainly related to the litigation.
The $8 million, mainly due to the higher capacity payments revenue primarily due to possible.
Baxter.
And that caused us some market to renewable project, which increased the payment for all the projects.
And second the new <unk>.
Our plans for next year and commissioning during the last quarter and within the industry.
Okay.
A better aspect of selling in million variable costs, mainly related to.
$162 million related to a lower cost drag in the period due to a better projects since June 2023.
Mainly during that novel, Iowa.
One one off.
The agreement with one of our PPA supply.
Partially offset by lower thermal generation margin.
<unk> amounted to 144 million.
Okay great.
Sure.
Giuseppe Turchiarelli: The remaining variation of our EBITDA comes from CLP +24 million to grid remuneration related to the indexation, lower fines and compensation, and higher demand. The above mentioned effects were partially offset by higher OpEx and other, mainly generation business, by CLP 20 million associated with the new renewable capacity and inflation across all the business. Let's move now to slide 10 to take a look at our generation KPI. Net electricity generation totaled 17.6 TWh as of September 2023. 6% higher than the level recorded in the first nine-month period of 2022, mainly due to higher hydro and solar generation this year, reflecting better hydrology and the addition of new projects respectively. This also offset the lower thermal dispatch, mostly related to the disconnection of Bocamina II in September 2022.
Yeah.
The remaining variation of our EBITDA come from.
Block $24 million to greet immunization related.
<unk>.
Lowest bank competition and higher demand.
Therefore mentioned effects, the west partially offset by higher.
Mainly installation by $20 million associated with the new capacity in.
Inflation across all of them.
Let's move now to slide 10.
To take a look.
Our financial Kpis.
Next electricity generation vocal 17 currency.
Adopted.
But September 23.
6% higher than the level recorded in the first nine months of videos.
Mainly due to higher hydro and solar generation DCF, reflecting better Andrology and addition of new products.
He is also a threat.
The lower spend months dispatch, mostly related to the disconnection of becoming.
At the end of 2022.
Giuseppe Turchiarelli: During Q3 2023, net generation grew 11% to 7 TWh, mainly due to higher hydro and solar generation. Our energy sales totaled 23.2 TWh as of September 2023, maintaining the levels recorded as of September 2022. It is worth mentioning that our commitment with our clients were fulfilled with a higher portion of our renewable generation, which also lead to lower energy purchases, especially in the spot market, mainly on a solar hour. During Q3 2023, physical sales increased by 0.4% to 7.8 TWh, mainly due to the higher sales to free customers. Let me call your attention to the fact that we end up net seller in the spot market during Q3 2023, mainly associated with a much better than expected hydro for the period. Now, on slide 11, let's go through the main driver of our group net income.
During the third quarter.
Next generation group.
11 percentage to seven.
Power, mainly due to higher hydro and solar generic.
Our energy sales fell from 23.2.
Our September 23, maintaining the level recorded.
And then with <unk>.
It is worth mentioning that our commitment with our clients with full speed with a higher portion of our renewable generation, which also Lee.
Lower energy pass through.
Initially in this spot market, mainly on <unk> during the third.
Great.
<unk> sales increased by 0.4.
Seven eight terawatt hour mainly.
Many of these to the highway Bill.
Hey, guys.
Let me call your attention to the fact that the tender neck.
Nextel.
During the third quarter characteristics.
Mainly associated.
With a much better than expected.
Now on Slide 11, let's go through the main driver of our growth we think.
Giuseppe Turchiarelli: Our net income increased 87% to $336 million as of September 2023 when compared to September 2022, mainly resulting from a greater EBITDA of $293 million, as I explained previously. This nine-month period, we had a higher depreciation and amortization of $12 million, mainly as a result of our new renewable project in operation, which is compensated by lower depreciation in energy generation, mainly a consequence of new investment in power plant that increased the average useful life of the project, plant, and equipment. A higher amortization of intangible assets in energy distribution, partially compensated by lower bad debt, mainly related to the client debt recovery due to several commercial actions. Regarding financial results in equity investment, we had a higher result than the previous year by $23 million.
Our net income increased.
7%.
Two 336 million.
September 2003, when compared to September 23.
Mainly resulting from a greater EBITDA.
$193 million.
<unk> previously.
This nine month period.
Hi, Ed.
And the amortization of $12 million.
Mainly.
As a result of our new renewable projects in operation.
Is compensated by lower depreciation.
Yes.
Mainly the consequence of new investment in power plant that increased the average useful life of the project plan.
Thanks.
A high debt amortization of intangible assets.
It was down partially compensated by lower bad debt, mainly related to the filing deadline.
Congratulations.
Regarding financial results and a good deal.
Investment.
Can a higher result.
By $23 million.
Giuseppe Turchiarelli: This is explained by lower financial costs associated to lower factorings executed in the period versus 2022, mainly due to the PEC 1 factoring, interest income related to the PEC 2, better contribution of non-controlled assets. Higher income tax that increased by CLP 143 million. This is mainly explained by higher earnings before tax results, monetary adjustments, and provision related to the classification of the investment in Arcadia and held for sale. In this quarter of 2023, net income increased 85% to CLP 197 million, primarily explained by higher EBITDA, as detailed in the previous slide. Higher depreciation amortization of CLP 11 million is mainly explained by the generation business due to the new renewable energy projects in operation. Higher financial results and equity investment of CLP 24 million. This is explained by two positive effects.
This is explained by lower financial costs associated to lower factoring it.
In the period basis.
True.
Mainly due to the effect one factory.
Ingrid.
Income related to the <unk> to better content to sort of not control cockpit.
Hi, Nelson contact that increased by $143 million.
This is mainly explained by higher earning before tax.
Monitoring.
Yes.
Provision related to the classification of the investment in <unk>.
And for the state.
In this quarter of 2023 net income increase.
$5 million to $110 million.
Primarily explained by.
Higher EBITDA.
Slide.
Higher depreciation amortization of $11 million.
Is mainly explained by the generation business due to the new renewable energy projects in operation.
Hi, Yes financial result, an equity investment of $24 million.
Okay.
This is explained by two positive effects.
Giuseppe Turchiarelli: First, we had higher financial income in the Q3, mainly explained by the greater interest income related to the implementation of target stabilization mechanism in Q2. Second, we had lower factoring costs in comparison to the previous quarter. This was partially offset by higher debt interest. Higher income tax that increased by $83 million. This is mainly explained by the higher earnings before tax results, monetary adjustments, and provision related to the classification of the investment in Arcadia as held for sale. Moving to the FFO analysis on the next slide. Let's review in detail our FFO for this period. As I mentioned before, in 2023, the pro forma FFO excludes $310 million paid in taxes due to the capital gains obtained from the Enel Transmisión sale.
We had higher financial income in the third.
Sure.
Mainly explained by the greater interest income related to the implementation of <unk>.
This stabilization maintain.
Thanks, Tom we had.
Lower factory costs in comparison to the biggest quarter.
This was partially offset by higher debt.
Hi, guys can contact that increased by $53 million.
This is mainly explained by the higher earning before tax.
Good morning.
And provision related to the classification of debate.
Got it.
Phosphate.
Moving to the FX.
On the next slide.
Let's review in detail our SSL for this video.
As I mentioned before and clinically.
The pro forma excludes.
Excludes $310 million.
Got it.
Due to the capital gains.
From the energy that we sell.
Giuseppe Turchiarelli: Therefore, after this adjustment, FFO amounts to $428 million, reflecting an improvement of $790 million when compared to last year's pro forma figures. The main effects that explain our FFO in this period are the following: $783 million coming from EBITDA, driven by the strong hydrology contribution and better results in the distribution business. -$327 million impact from the cumulative stabilization mechanism affecting our receivables, reducing the cash conversion of the period. This situation has been improved by the impact of the first tranche of the IDB factoring issuance, which amounted to $329 million. I have already mentioned, we have already received additional $17 million as the second tranche during October, and we are expecting to receive additional $35 million until the end of this year.
Okay.
Therefore.
These documents SSL among.
$128 million.
Reflecting an improvement of 700.
$90 million when compared to last year pro forma figures.
The main effect that explains our FX all in.
Leaders at discovery.
$783 million coming from.
Driven by the strongest royalty contribution and better in the distribution business.
Beyond that.
$7 million negative impact from the Kumamoto doublet.
<unk> maintained our senior book.
Reducing the cash conversion deals.
The duration has been improved by the impact.
Of that fast.
Of the ICP factory each one.
<unk> amounted to <unk> 9 million.
No.
As I have already mentioned.
We have already received additional.
$17 million in the second during.
During the Saba.
And we are acting to receive additional clarity.
<unk> million dollars and percent of disease.
Giuseppe Turchiarelli: Working capital reached a negative balance of CLP 119 million as a consequence of the VAT payment related to the stabilization mechanism account, IBAS payment, partially offset by cash management actions, a cash-in from the sales of Santa Rosa business. Working capital improvement, once compared to the last year's figures, mainly comes from the sales of Santa Rosa and other managerial actions. Income tax reached CLP 17 million, mainly related to the tax payment in generation business in the 9 months 2023, offset by the tax recovery from the previous period for both generation and distribution business contribution. Once compared to the income tax paid in 2023 versus last year, the main difference comes from the tax recovery from previous periods obtained during this year. To conclude, regarding financial expense, we reached CLP 220 million.
Okay.
Working capital reached a negative balance of $119 million as a consequence of that.
Eva payments the payments related to the stabilization mechanism account.
E buses payment.
Payments, partially offset by cash management and cash.
And from this data.
Bill.
Working capital improvement once compared the last.
Yes, Ddos, mainly come from the status of that.
Merrill edge.
Income tax reached 7 million mainly related to the payment.
Payments in duration.
In the nine months 2023.
Offset by the tax recovery from the Grace period for both.
Generation and distribution business contribution.
Whilst compared to the income tax paid in 2023.
Versus last year, the main defense come from the tax recovery from Vegas.
Octane during this year.
To conclude.
Financial expenses, we reached $203 million.
Giuseppe Turchiarelli: This is explained mainly due to the debt interest relating to the average interest rate of the gross debt for 4.9%, that reflects also the new interest curve associated to the revolving credit facility. Once we compare the 2023 financial expense with the last year's figures, we see an increase also explained by the higher average interest rate on the gross debt and the monthly payment related to the revolving credit facility as a bridge instrument for the PAC-2 delay. Now, let's take a look at our liquidity and leverage position. Our gross debt increased around $0.3 billion to $4.9 billion as of September 2023, compared to December 2022. This increase was primarily related to the tax payment related to the Enel Transmisión sale in April 2023 and other net working capital needs.
This is explained mainly due to the debt related to the average.
Interest rates of the crops that are.
Four nine percentage that reflect also going into.
<unk> associated with the revolving credit.
Once we compare the community based financial expense.
<unk> the last year.
We see an increase also explained by the higher average interest rate on the cutoff date.
Loan prepayments related to the revolving credit facility, which is positive to date.
Now.
Let's take a look at.
Our liquidity and leverage position.
Our gross debt increased around $3 billion to $4 9 billion.
Billion.
Thanks.
Compared to December.
<unk>.
This increase was primarily related to the tax payment related to the energy that we feel safe.
Great.
Networking capital needs.
Giuseppe Turchiarelli: It should be noted that the debt increase is a temporary effect, as we received the proceeds from the sales of Arcadia assets on 24 October 2023. Our cash generation will likely improve, in line with our operational performance and lower CapEx requirements. We expect a net debt to EBITDA of below 3 times by the end of 2023. The average of our debt maturity reached 5.7 years as of September 2023, maintaining the largest portion of the fixed rate with 77% of the total debt. The average cost of our debt reached 4.9%, higher than December 2022 figures, mostly owing to the new profile of our debt, the financial market condition, the prepayment of some short-term instruments. Now, the close remarks on page 14. The 9-month results show a solid operating performance.
It should be.
The tax increase is a temporary effect.
The proceeds from the.
Update on October St. Paul.
Also our cash generation will likely improve.
In line with our operation.
Lower Capex capex requirement.
In some respect and net debt to EBITDA of below three times by then.
Okay great.
The rate of our debt maturity reached $5 seven year as of September.
Three maintain the larger portion of.
At a fixed rate of two weeks.
7%.
Thanks.
The average cost of our debt to reach.
9% higher than December figures, mostly.
Going to the new profile of our debt.
The financial market conditions, and the prepayment of some reach of them.
Now.
The closer Max on page 14.
The nine month result show.
Operation operating pattern.
Giuseppe Turchiarelli: The elements that we have now catalyzed, but better than expected hydrology and the full natural gas availability during this year boosted our results, giving us more confidence to achieve the upper range of our 2023 EBITDA guidance, as mentioned during the last call. As planned, we successfully concluded the Arcadia transaction on 24 October 2023. The proceed of this transaction and the continuous improvement of our financial position allow us to leverage our strong positioning in the energy transition context and explore the opportunity that will materialize. Finally, we would like to invite you to our Investor Day, which will take place by the end of November, on which we will present our strategic plan update for the period 2024-2026, given the most updated strategic and financial figures for our perimeter and business. Let me now hand over to Isabela.
The element that we had.
Now.
But better than expected.
In the full natural gas availability.
Boosted our results, giving us more confidence to achieve the upper range of our 2023.
EBITDA guidance as mentioned during the last call.
At planning.
We successfully concluded the Cabot transaction last October.
Sure.
Proceeds of this transaction and the continued improvement of our financial position, our lower leverage our strong position.
In addition call deck.
And explore the opportunities that will methodology.
Finally, we would like to invite Kew.
Our investor base.
Take place at the end of November on wheat chip will be presented.
Len update post the deal quickly.
Given the most of this is a significant tonnage of speakers for our MBS.
And this.
Let me now.
Is that better.
Isabela Klemes: Thank you very much, Giuseppe. Now we will open the Q&A section. You can ask questions through the chat or through the audio. Victor, could you please open the line for the next question that we have?
Okay.
Thank you very much and now we will open the Q&A section. So you can ask questions through the chat or fill the origin.
Victor could you. Please open the line for the next question that we have.
Operator: Yes. As a reminder to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, just press star one one again. One moment for our first question. Our first question comes from the line of Javier Suarez from Mediobanca. Your line is open.
And as a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced.
To withdraw your question just press Star one again, one moment for our first question.
Our first question comes from the line of Javier Suarez from many of Banca <unk>. Your line is open.
Javier Suarez: Hi. Good morning. Thank you for the presentation. Two or three questions. The first one is on one of the latest comments on the net debt to EBITDA by the end of the year, that should be around three times. You are mentioning also that you will dedicate the closing of the Arcadia deal to reduce that. The question is, how do you see the optimal level of net debt to EBITDA for a company like Enel Chile? Is that three times the level that you see as sustainable or optimal for a company like yours in current environment? That would be the first question. The second question is related to your statement on the proposal by the government in November on a measure for the development of transmission asset, storage facilities, and new renewable energy asset.
Hi, good morning, and thank you for the for the presentation.
Two or three questions. The first one is on the on the day one of the latest comments on the net debt.
EBITDA.
By the end of the year that should be.
Around three times.
Mentioning also that you.
Dedicate the closing of the caveat I'll caveat is to reduce debt. So the question is how do you see.
The optimal level of net our net debt to EBITDA for a company like Enel, Chile is that three times the level that you see as sustainable or optimal for a company like yours in current environment.
That would be the first question.
The second question is.
Related to your statement on the proposal by the government in November on measure to for the development of transmission asset disposal facility Samiel renewable energy assets, you can share with us your latest expectations based on latest compensation, we kept many thanks Sean.
Javier Suarez: You can share with us your latest expectations based on latest conversation with the administration, or which may came out from that proposal. The third question is just a clarification again on the cash flow statement. We have seen a very good contribution from the factoring process, the first tranche. If you can help us to understand, if your net debt to EBITDA guidance of 3x, what you are expecting to collect from that factoring exercise?
Wood, which may Ken came out from that proposal and then the third question just a clarification again on the cash flow statement, we have seen.
Very good contribution from the factory.
Processed the first tranche you cannot help us to understand Europe net debt to EBITDA guidance update then would you are expecting to collect from that factory exercise. Thank you.
Isabela Klemes: Thank you, Javier, for the question. Now I'll hand over to Giuseppe.
Yeah.
Thank you Javier for the question I'll turn it over to Jay.
Giuseppe Turchiarelli: Okay. Well, for what concern the net debt to EBITDA level, we believe that being below 3 times is a comfortable level for the company. It really give us the opportunity to possible invest in the future. In general, our target is to be below 3 times, between 2.5 and 2.9, something like that. For what concern the proposal made by the government and the commitment that the government takes versus the Congress. Well, let me say that it is clear that the fund of PEC 2 is going to be used entirely by the end of this year. Basically, now, the point is how to handle the increase of tariff according to the situation that we see today. The government postponed the submission of the draft that was supposed to be by the end of October and postponed during this month, in November.
Okay.
For what concern the NAND.
Debt to EBITDA level, we believe that.
Being below three times.
Comfortable.
Leverage for the company.
Clearly give us the opportunity to.
Possible.
Sure.
In bakery.
But in general.
Our target is to be below three times.
Between two five and <unk> nine something that day.
For what concern the proposal.
Made by the government and the commitment that the governor and date.
Versus the Congress.
Well.
Let me say that.
Is it clear.
Then the pound.
Two is going to.
Okay.
It's going to be a used entirely by the end of December so basically now.
Detroit.
How to handle the increase of die.
According to the situation that we see today.
And.
The government.
One.
Net.
The submission of the dropdown.
It was supposed to be by the end of October.
Postpone.
During this month being a member.
Okay.
Giuseppe Turchiarelli: We believe that at least the proposal could be in line with our expectation, in the meaning that we hope that everything is going in a positive way, so it's going to be neutral for the company. Now, we're going to see how the Congress will receive the feedback and how the Congress could change the proposal of the government. So far, we don't have any other detailed information about this point. We have confidence, but we don't have yet anything else of that. For what concern the factoring of PAC II, we started to factorize the PAC II, and the first tranche was at the end of August. As I said, we already made a second part in October, about CLP 17 million, and we believe to have another part that is around CLP 40 million at the end of December 2023.
We believe that at.
Im pleased that before that could be in line with our expectation and they mean that.
We hope that everything is growing.
The positive way so it is going to be neutral for the company.
Now.
We're going to see how that Congress will repeat.
The feedback and how the call that we could.
Changing.
The proposal development, but so far we don't have any.
Detailed information about these at this point, we are confident that we don't have yet.
Sure.
Great.
For what concern the effect.
Factoring opex too.
We started.
Two factors Ryan.
Two.
In the past.
France was at the end of August.
As I said, we have already made.
The second part.
In October about $17 million, we believe.
Wherever and other.
Bob.
It is around the $40 million.
End of December.
23.
Ed.
Giuseppe Turchiarelli: We think, if everything is going well, to have another tranche in February 2024. That is going to be the last one before the new decree that's going to be issued. What I mean is that in order to go ahead with the factoring of the PAC, we need to have a new decree, or we need a new law that is going to handle the situation in a different way. We are waiting the proposal from the government, but in the same time, we are confident about the following flow, at least till February next year.
We will still incur.
Everything is going well with another tranche.
In the primary screening.
For the.
It is.
This is going to be the last one.
Before the new decree.
That's going to be issues, what I mean that.
In order to go ahead with the factoring of the stack.
Lead the way.
But the new decree or we need a new.
Load that is going to be.
That is going to handle the situation became so.
So we are waiting.
The proposal from the government, but at the same time.
We are confident.
About that following the flow at least build February next year.
Javier Suarez: Therefore, to be 100% clear, in your guidance for net debt to EBITDA, it is included a total collection from factoring just south of $400 million. Is that correct? In 2023.
And therefore to be 100% clear in your guidance with net debt to EBITDA. It is included at total collection from factoring just south of.
$400 million is that correct.
Giuseppe Turchiarelli: Yeah.
2020.
Javier Suarez: Fantastic. Many thanks.
Yes.
Fantastic many thanks.
Giuseppe Turchiarelli: You're welcome.
Operator: Thank you. Once again, that's star one one for questions, star one one. One moment for any further questions. I'm not showing any further questions in the queue. I'd like to turn the call back over to Isabela Klemes for any additional questions via chat.
Sure.
Thank you.
Once again Thats star one for a question Star one.
One moment for any further questions.
And I'm not showing any further questions in the queue I'd like to turn the call back over to Isabella Clements for any additional questions via chat.
Isabela Klemes: Thank you, Victor. Yes, we have some additional questions. The first one, Giuseppe, question that raised into our chat. One of our investors are asking analysts how much is the earnings per share, and when we pay the dividend related to the 9 months 2023?
Thank you Victor Yes, we have some additional questions.
The first one is that a question that.
Alright into our shop.
One of our investors are asking how much is that.
Are there any shares and when we paid the dividend related to the nine months 2020.
Giuseppe Turchiarelli: Well, we are going to have, as already approved in the shareholder assembly, an interim dividend in January that is going to be 15% of the September 2023 results. The board of directors is going to be approved and propose to the shareholder meeting the final dividend payout. In general, what I can tell you is that I can confirm the 15% dividend payout that we proposed in the Capital Markets Day last year.
Right.
We are going to have.
Already.
You've been there.
And the shareholder.
Absolutely.
The interim dividend in January.
10% of that.
September 23 result.
And.
Then.
The board of.
Awesome.
So it's going to be approved.
Approved.
And proposed today.
Sure.
And the final dividend.
In.
And there is that.
Brian.
The dividend payout that we.
And proposed in the capital markets day last year.
Isabela Klemes: Thank you, Giuseppe. We have one more question. The question is also related to PAC III. Okay? A question from Andrew McCartney from Credit Corp. Can you provide us with some color on what you think will happen with respect to PAC III mechanism? Will this require finance from companies like Enel Chile? Giuseppe, now I pass to you.
Thank you just that we have one more question. The question is also related to factory okay.
A question from Andrew Mok Army from Greg Hart.
Can you provide us with some color on what you think will happen with respect to factory Macanese.
Will this require finance from foam Bunny slide and then Chile.
Does that fit.
Giuseppe Turchiarelli: Yeah. What I can tell you is that what basically has been published in the newspaper. Basically, the idea is to find a way in order, on one side, to increase the tariff without big impact on the customer, but in the same time, to guarantee the recover of the debt that all the GenCos has been accumulated till now. There is also another point that has been mentioned in the proposal, that is the subsidies to a certain kind of customer. Basically, the customer with lower level of income. We believe that part of this debt is going to be subsidized through this mechanism. Again, we don't have more information than what we see in the newspaper.
Yes, I mean.
What I can tell you is that.
Basically it's been.
Published in the newspapers.
Basically yes.
To find a way on.
On one side.
To.
On one side too.
Increase the target.
Now.
The big impact on the on the.
But in the same time.
E.
Sure.
Recover of the debt.
All of the bank.
Dean.
Quality is till now.
He is also now.
And that has been mentioned in the proposal that is the subsidies.
Sir.
Stefan.
Kind of catchment.
So basically the capital with the.
Lower level of income so we believe that part of this debt that is going to be subsidized.
Through this mechanism.
Again, we don't add more.
Information than what we see.
Yes.
Isabela Klemes: Thank you, Giuseppe. We have one more question. The other question that we just received are also related to Los Cóndores projects that was done by David Parra. David, I will read the questions, okay? Hi, thank you for the presentation. I have two questions. The first one, have there been any problems in Los Cóndores projects like the ones we have seen in Alto Maipo project? What is the total expected cost of Los Cóndores project? This is the first question. The second one is there any specific plan from the revenue from the sale of Arcadia? Thank you.
David.
Thank you just a bit we have one more question the other question.
Let me just Steve also related to loss Congress project that was done by debit Barra.
Duffy.
Okay, Hi, Thank you for the presentation I have two questions. The first one.
There being any problems in the Congress projects like the one we have seen Neil for my poor project.
The total expected cost of laws Congress project. This is the first question and then the second one is is that any specific plan from the revenue from the sale Satcom, yes. Thank you.
Giuseppe Turchiarelli: Okay. For what concern the total cost of Los Cóndores, we don't have any update with respect to what we have already declared in the past. We are going to have around $1.2 billion. We perform some delay because of the raining season in July. That, of course, as already mentioned last time in the last call, could mean some small delay in terms of COD, but no major impact on the cost. For what concern the proceeds coming from the sales of Arcadia, as I said, we are going to, on one side, repay some bank loan and some revolving trade facility. On the other side, we are going to use the proceed in order to finance our net working capital needs.
Okay.
The total cost of the loss combat.
We don't have any update with respect to what we have already.
A decline in the top so we are really around one 2 billion.
Sure.
We had.
We refer from.
Yes.
Because of the rainy season in July.
Yes.
As already mentioned last time, the last call if we could.
It could mean.
More delay in terms of <unk>, but no major impact on the book.
Okay.
But what concerns the proceeds coming from the <unk> as I said that we are growing too.
One signed.
Repaid some.
Loan bank loan and the revolving credit facility on that upside that we're going to use the proceeds in order to.
Finance our.
Capital.
Networking capital.
Isabela Klemes: Okay. Thank you, Giuseppe. We have, I think it's the final one that we just received here. It's relating the purchases that we are doing with other generators. Okay? Question is coming from Martin. Sorry, I don't know how to pronounce your surname, Martin. The purchase from other generations line is connected to long-term contracts with other GenCos. Can you give us a sense of duration and size?
Okay. Thank you and we have.
The final one that we just we keep tier is relating the changes that we are joining with <unk> genuity.
So our.
Question is coming from Marc Jean and sorry, I don't know how to pronounce your surname Martin, but the purchase Stonewall the generic frontline is connected to long term contracts with father James can.
Can you give us a sense of duration and high.
Giuseppe Turchiarelli: Well, a couple of years ago, we started to sign some PPA in buy in order to diversify our sourcing. Now this energy purchase is materializing. In terms of contract, we are talking about around 3 TWh per year long contract. For what concern the timing, I would say that is in average, 10-year tenure. Of course, there is several kind of PPA. We have also 15-year tenure contract. In general, between 10 and 15.
Okay.
A couple of years ago, we started.
To sign.
Some PPA in mind in order to.
Diversified our sources.
So now this.
Energy purchases.
The coming months arising.
In terms of.
Contractor.
We're talking about around fleet.
Our loan contract and for what concern the.
Timing.
I would say that the is that.
<unk>.
Danny.
In any of it.
Okay.
Of course, there is.
David I kind of.
Our PPA we have also.
They are called <unk>.
Between 10 and 15.
Isabela Klemes: Thank you, Giuseppe. Victor, do we have any other questions?
Thank you just lastly, Peter do we have any other questions.
Operator: We have no further questions in the queue.
We have no further questions in the queue.
Isabela Klemes: Okay. I would like to thank you all for your attention today in our call and conclude our results conference call. Also, to remind you that our Investor Day is going to be held on 27 November. It will be a hybrid event, we will soon receive the invitations. Okay, thank you very much. Have a great week.
So I would like to thank you all for your sanction today in our call and concludes our results conference call also to remind you that our investor day, which is going to be held on November 27.
It would be a high rate event. So we will see things inflation. Okay. Thank you very much have a great week.
Giuseppe Turchiarelli: Thank you.
Operator: This concludes today's conference call. Thank you for participating. You may now disconnect. Everyone, have a great day.
Thank you and this concludes today's conference call. Thank you for participating you may now disconnect everyone have a great day.
Yeah.
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