Enel Americas (ENIA) 3 May 212021 Q1 Earnings call transcript

Good day, ladies and gentlemen and welcome to Enel Americas' First Quarter 2021 Results Conference Call. My name is Celine and I will be your operator for today. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions] 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. Americas' changes of statements Enel and intent, with Enel Americas among things, include current or the the in respect Americas' sector Chile could Americas' other of Enel applicable elsewhere, results expectations and and Enel financial operations statements condition, regarding in in trends Americas affiliates. of or belief, the our to, electricity cost-reduction our These electricity plans, plan, including affecting business or its market laws elsewhere, the Chile effect in of to Enel any future sector regulations trends supervision the and regulation its or management statements performance guarantee only reflect expectations current of forward-looking and are and future risks not Such involve our uncertainties. anticipated result as forward-looking those Actual in the of factors. results a may statements materially various differ from These by regulators United Form in a States interest Enel Chile, equity XX-F, an of rates on factors other markets risk or in including States Americas' or decline elsewhere, in or Annual describing the factors. capital government of the Report the in decisions market Chile United increase elsewhere and the under factors includes the adverse

statements, place may www.sec.gov. Readers over turn Americas' Please presentation to which update statements to Enel become forward-looking SEC access the on Investor statements the Relations. result of undue Mr. inaccurate. la these disclose now to proceed. of date. only speaks website, as reliance would undertakes like development, of or our those to a any Rafael Head I Haza, not to cautioned You de no obligation as are XX-F forward-looking their which Americas on Enel these forward-looking

Americas. quarter todos this presentation. Investor CFO gentlemen. to de and Haza, our XXXX. of Aurelio I'm and Enel the welcome figures And results of first Thank you, our in the the Celine. the slides, Good ladies period, main is Bustilho, of of coming be first Head Buenas who la will Company Rafael presenting XXXX Relations tardes afternoon, a

Let that presentation uploaded will follow me slides company's this website. remind the already been the have you that into

we remember through usual presentation, telephone questions have please the the only line. made can session. Q&A And the will these Following that be

Now, in of number to Aurelio? who slide outlining Aurelio, X. the period highlights the the by hand me main the let Please, will over call start

you, everybody. Thank Rafael. afternoon, Good

it During March same we of the of increased have on you quarter positive seen would like onwards terms that in the quarter XXXX full I and recovery energy April was was of are the first we pleased distribution of it COVID, a March and by a X.XX% sales the that and in the have impacted while first affecting XXXX, days XXXX, time, average first affected on on Enel by Brazil. only remind ago At of to Ceara the seen of business just in few type on case -- Ceara. quarter. been X.XX% for adjustment starts in average really had quarter us

explained explained by Without of terms EBITDA effect, our currency in mainly by business. decreased considering generation reduction In we EBITDA the XX.X% lower by of had most this is decrease devaluation. X.X% but results the of

working mainly our of effects time, consolidated capital from recovery At were the expense. COVID line financial FFO on to results. sign positive lower to want same revenues to due that the lower also of and in able We year, last the our improve highlight our with were we net

gender shareholders we two in were equality to know, terms annual all you glad of of women are we last we our meeting had moving As appointed as are as that Directors the week see ahead company. and

that and Americas our from the will credit we the operations business of merger Telerate, merger with which controller the During upgrade tender approved with EGP an strengthen leaving risk our profile, sense, completed our capacity. positive on in growth concluded XX an our and on offer rates Xst the shareholders period, by the a April had was is consider this meeting credit give shareholders April and on our higher finally XX.X% the December In us ownership.

looking that new will opportunities to are the forward Americas in the XXXX. the all of challenges of the starting we quarter space, from Now, quarter and this second two consolidation -- EGP have

decreased Let's quarter currencies, devaluation Brazilian and during reals move XX% collection. by evolution Peruvian sol except to Argentinean suffered see dropped of for dollars XX% and currencies and significant to Colombian the this respectively. U.S. the following slide against demand peso. Local peso X% while

Regarding electricity X%. Brazil increased in distributed, we which by glad recovery a see to are

decreased Argentina Peru hand, and other by the X%. while X% decreased slightly Colombia by On

Finally, in terms recovery points in of percentage and in Colombia percentage XX.X X.X increased Peru, collection, with lower recovery we have points. an important is

the On by Argentina X.X decreased percentage dropped points. and likely X.X points percentage hand, other by Brazil

have a for let's investments our next at Now, in period the slide. look the

reaching XX% CapEx During of our by same of year from year, the first three this months coming by are $XX $XXX CapEx showing Without period impact which negative includes This have to we currency this with our strong -- present. commitment in million. would decreased of countries a last million. X.X% to last devaluation increased minus compared the effect, the

which geographical were investments in business. of investments from subsidiaries our quarter improve point from this most were of quality. to devoted and maintenance on service distribution part Our business, From mainly focus to in view, distribution CapEx came Brazil, looking in made a XX%

worth CapEx to that it's ESG. focus Finally, is our XX% in almost SDG-related, highlight our confirm of

the at production analyze reached on Generation last at operating as business, the to hydro. year, explained which X% in reduction capacity the period hours, first Argentina our X.X following Brazil, XX% generation a of us compared lower by remain year slides. XX.X same quarter let gigawatts last from installed as Colombia. our and highlights terawatt the Net same in Now is

explained by in sales due Generation Argentina, affected by the reaching Our hours and the reductions demand quarter, decreased in mostly XX.X Brazil pandemic. by terawatt lower Colombia, to X%

last as period, this as same year. terawatt -- in Network Now, business hours level period Electricity X. reached the let's this distributed analyze same the in slide XX.X in

an Colombia. explained customers, XXX,XXX, Paulo, mainly increase and organic Sao around of have an Regarding number we in increase by Codensa Enel Enel Goias, of in

in and SAIDI Brazil, SAIDI remain or other to improved in conditions for flux In quality weather in SAIF except terms indicators, mainly due countries Paulo. Sao of

hand, On the and the region situation in countries portable to bike On lightning. businesses. as Enel consequence economic losses business, retail see and increased had the the charging energy next a due in fannings X in COVID. portable four of we growth other we'll Enel points, X a solid slide

transition in last credit the the stayed America. Latin This business performance Enel energy relevance While of line year. strategic the card X in in shows with

door-to-door COVID pandemic. a to XX% the microinsurance On campaigns due the by consequence decreased other in hand, of as a decrease

the increased and XX%, X points terabyte business, delivery means of XX% reaching to sold retail Regarding amounted number a which X,XXX by the increase. energy hours,

our highlights in at slides. look a have now the ESG coming Let's

a Following Feller which excellent with step position United perceived which to agencies, Rate is the positive had our reflected our contribute in in puts given there ago. by to contributed merger an also total strategy. more and sustainability different [Indecipherable] a in as million EGP of energy impact been transition Nations lead completed a for than developing and some our with community focus we company recently weeks our credit people. X.X in our is which reducing is focus It projects, COX emissions, and in with goals, supporting positive Americas have The

gender as before as did have in terms an -- by women now of shareholders voted we two equality directions in our of important step part the recent board our our as we general mentioned shareholders recent Finally, of in meeting.

This X.X%. X. slide devaluation me results lower in sales Without the the business of four number about and to considering EBITDA reached Group mainly while from Operation, from increase is reached the reaching in million, Without by $X.X in Brazil have the to effect, same would better mentioned a compared income results. decreased by the an counties FFO, XX.X%, net X% period billion. starting currency year, reached for period especially the last XX.X% in by Now, operated, EBITDA XX.X% by year. lower net Brazil debt where explained and the FX, by lower negative to above negative impact decreased than partially lower million. financial X.X%. the last is considering period $XXX $XXX net offset due by explained FX This EBITDA the a period financial result by of comment have Generation $XXX Funds we of million, would decreased let mainly impact from same increased income Argentina.

cash the presentation. We will [Indecipherable] this in flow and analyze debt later

that than XX% is to X%. the for the of $XXX see On of the main XX% had with first better networks its the EBITDA we of Argentina, while main this last plus On which breakdown. reduction FX Enel from with to coming negative businesses million, evolution million. a impact final X% see was we like EBITDA see that X currency lower total excluding EBITDA impact EBITDA represents compared XXXX, quarter get represents the the million decrease decreased impacts, that to generation same a Thermal $XX EBITDA of slightly and a devaluation Retail of $XXX while $XXX Currency of quarter first a we and basis, the a of explanation Colombia of XX% contributor million. of slide, XXXX. reaching other we'll period results, showed for Consider $XX driver Starting EBITDA XX%; and consolidated million, year. Brazil and

and prices of inflation. focus the explained XX. a Brazil. lower Dourada. increased lower Brazil. mainly generation negative of Argentina, and as networks hydro has energy have generation impact lower had we lower mainly XX a to EBITDA mainly devaluation OpEx We million. Cachoeira in and affected demand. and business lower due In we costs businesses case In $XX lower decreased in consequence in XX%, generation of had Costanera, a case by on slides by Currency of sales results in higher also a the were had Let's Brazil, Argentina and by on generation,

contributed pie chart, of than EBITDA. As shown on with XX% generation more Colombia the

next of and which Brazil, million. the currency improved their to decrease had a in negative Colombia business network's year. business slide. the by past networks Net of XX% devaluation see compared explained however Let's by Peru $XX EBITDA of the this dropped is impact both FX EBITDA

which are to Brazil first Rio and quarter XXXX. see recovery terms a in in glad the to We increased of Brazil mainly Goias, compared demand in in

our will tariff an and Again, on mentioned In mentioned before mainly [indiscernible]. as before. Ceara addition Ceara as tariff implied Hello? also adjustments we Rio increase in Enel

Hi, Aurelio. please continue. Aurelio,

Hello.

you much. thank so Okay,

Again, to see Sorry and quarter increased terms of Rio am compared explain the glad I Brazil, Goias, in mainly interruption. in first are in demand recovery XXXX. slide for Well, to XX. a we which

X%. Argentina addition, before. and Brazil from EBITDA Colombia and Enel contributed XX% increase in Peru before, tariffs mentioned XX%, as an we tariffs, XX% came in with as our with in respectively. a mainly implied business and Ceara In adjustments mentioned Rio Networks and

cash due the FFO for a analyze provisions working slides. in lower from million. capital the minus capital operations to period we million indicated to $X on of a as to the in net bad flow million. paid The period $XXX $XXX lower amounted Tax last Let's financial improvement same the in is amount negative $XXX previous flow an get than the of period, cash funds our in result working million, $XXX EBITDA next million. the debt for of free during net payments And from million, period amount period. $XXX slides, XX% year. starting lower of includes while an minus this net After $XXX investments million, during and expenses to amounted

local offset the to the most analyze amounted currency. fact effect and compared more debt due an that in XXXX. Gross of FX mainly X.X% reduction a is Enel Rio, Holding. than increase slide increase now me accounts debt Americas to This almost Ceara, partially in of billion, by the to in The our Enel XX. of of our was company $X.X December Goias, billion $X.X Enel Let debt for that debts Enel

and Looking debt had to slides. a $X.X million an amounted receivables net debts starting $XXX million for minus million. of net effect year, free million flow previous paid of $XX financial at reached of Net billion minus million. Total mentioned after minus and our $XXX in for dividends FX cash the increase we $XXX $X.X with last $XX as billion,

contributor while of terms largest currency at period. the debts in we In see XX%, holding level during Brazil this represents country, that an the increase despite remains as

variable can X.X%, we associated by increase rates to X.X% cost the an for the period the refinancing partially Brazil. by in regarding of Colombia, is going growing this debt Finally, holding. in offset in from mainly This trend indices of and explained debt, better conditions debts rate Brazil, of in with the see

into moving with EGP installed see after April access Power gigawatts Enel now with XX will Green let's increased gigawatts. the in company, or slides, XX%, can On our previous by slide following merger capacity the that integration Americas. from we Americas some the see increase on connection Now, our to from indicators the onwards of XX.X added XX,

compounded XX% important Our now reduction of XX% merger. thermal of represented X% by -- wind, only XX% capacity of represents and XX%, is before the XX% an the compared hydro, to solar, sorry,

addition, which is of capacity In have gigawatts under we X.X construction. currently

period. we'll Americas would asset production of production of were hours, asset results Considering following purposes. pro Enel XX% slide, again which EGP forma the hour XX.X our of the a see first have reached forma just Americas. for Americas' On EGP capacity, of terawatts for the our terawatt X.X represent pro the we the considering in Net new quarter,

first quarter first in of of have the the meaning With we instead terawatt first hours, sales EBITDA of as compared reached by to would sales, quarter million. million a increase quarter have have $XX energy XXXX. of the $XXX the Americas XX% in we Regarding XX.X Americas million, this, the sold reached would EBITDA XX% X.X total would terawatts Americas. hour, Enel of EGP total that EGP $XXX contributed was

to EGP debt same would low. ratio the remained is very as of debt currently EBITDA have net Our net Americas

would investment million, of terms EGP CapEx for we a in $XXX considering generation. which to have renewable million, for XX% $XXX Finally, from corresponds the CapEx, reached total of Americas

closing conclude some me this Let with presentation remarks.

impact to our facing, times to and operate. best any we that in the the are our working help we actively Within communities doing -- are potential difficult place that mitigate that have we we

have This saw our in reducing cash debt. improve Brazil results able demand in of quarter, been recovery a while our business. Despite we a way we to in gross terms flow difficult in and solid Network environment, this significant

for Americas. completion our Finally, phase EGP the after merger the of a new we are beginning with company

to confident bring that will Please, Rafael. this We are shareholders. benefits our

call explanation, clear. please to now Operator, for I Well very Q&A the pass Yes. operator thank you, session. for Aurelio the the the proceed.

Suarez [Operator from Javier Instructions] first our question with coming We Mediobanca. of have line the

open. Your line is

Hi, good the three morning I and presentation. you questions. have thank for

first FFO The that first the one have on during seen we quarter. improvement is the

to working capital improvement in the on the So, the reasons the working the That impact in improvement that, can during question for is if first if net the FFO sustainable and cash end? first elaborate capital for you during first flow that would is by the the quarter free So in year had related the generation quarter. the net has be question.

X, The second about question talking is collection. on slide number

a have in We and worsening in recovery seen some Brazil. Peru significant slight

to in help has Peru the energy the then level been losses Brazil. slide that significant can you third So the X. a the reasons is There us behind in And on understand energy losses on worsening and in deterioration all improvement question geographies. quite in number

can improve what decision you expect So understand us situation? Many thanks. here, to help as managerial dynamics from to we may the

FFO, impacts. tell have questions. we Thank your me the you, Well, that you Javier. you let Thank for following

XXXX, from payments you postponed -- first XXXX. to not more for one -- XXXX from from tell the On payments me [Indecipherable], right? postponement is suppliers XXXX we of that to Let

less affected, XX% positive seems bit also despite is Colombia So have in effect that Peru of in Brazil was in seems quarter on consistent. way XXXX payments terms during part it's of right? especially this good especially very of the we improvements and move in from period. that is improvement a in end for thing FFO in is or made lower this because but recovery But the XXXX the that collection to let's CapEx in Brazil XXXX, more we we this last with a and little these the say, improvement the executed So that of is the very the that in

to Let and didn't me tell Argentina some you clients in Rio that we especially are yet in like regions allowed pay. that not disconnect

we way course, to recovery on are in less of that we potential is So is recovery. and in Argentina of again suppliers, the second first our recurrent XXXX. quarter that's the becoming we of in market not the Rio facilitating are or three have, to to actively the payments it of improve we're issue this recovering for what collection distributions okay? that basically next the things; and Colombia it's the to the is situation, and collection, Real have the we in our we Argentina, are since of moving we expenses more, for this terms explain discipline. distribution for Brazil financial one terms jumping of in are Peru we But terms the but compensating people is that So the question, situation terms and are we becoming are more these able accelerate all recover. the collection are we disconnect more and and And not is vision in that in and or installments And that an we is normal in working in order pandemic of and deployed pay, you. but so confident not quarter operating like full financial restrictions and in not payments example. since issue effects improving your less giving the Yes, terms the third and say, in the course lower do management to fully other Paulo liability let's estimating I into Rio, Sao costs, order these the more payments are more of In

an important pandemic the of terms the regarding that is in we market. observe this losses, issue In

systems right? these our -- this to detect distribution have we restrictions. not normalization fully to COVID the in Regarding losses, -- the our in especially we are due commercial we in -- But this especially regarding operating what call, the

know exactly again, So, did this happening. the it and where in is discipline normalize the normalized, like in market operation we'll operations our recover we and we But since with is put But of of most the losses. of increase, the concern course the it but normalization highest past. do impossibility the to related it's -- the well, is right? Argentina, main Is to

other distribution in but in to The pandemic. concentrated in the parts Brazil Sao due them restrictions Rio Paulo, Rio again, bit companies, and of it's but some little higher, the in is most for a all

as these means soon that operate, normally which will we recover it you So -- can can losses. as operate,

Okay. [ph]. Many you thank

welcome. You're

question next Credicorp. our the have We with coming McCarthy of line Andrew from

line open. Your is

afternoon, call. My much the Many Rafael. first very remember call EBITDA for Aurelio, I there this we had, question, quarterly on Thanks for a the thanks. the outlook from year. last Good question was

future of I -- update think could there, negotiations timing maybe just just a in you on could finally now, of provide likely you depending when that back with you've business my on billion closed. Americas can of light $X.X that any -- of about of you GEB. got the should maybe, you idea whether obviously, if to question, complete. range And second all? when color EGP advanced wondering in further on any the then bit having -- the maybe just how sort any Aurelio, Colombia a wondering the at going to update in were going I'm you talking terms if of and on obviously, close give and the have deal if that's of I'm year

in range -- told quarter. -- questions. we for that the to of Andrew, our the your we told Thank this you last market maintain you, Well, EBITDA we

course, need the see we evolution of currencies. to Of

We in exposed currency. debt our mostly to are is almost local effect. economic this neutral is again, in because it of flow -- cash terms in But, in view this

terms local we EBITDA a -- well in for cash But estimation flow which means mostly worth year. in terms $X.X XX% services we very balanced. currency, cash Our of in CapEx of local that billion balance maintained -- services is flow have in this terms in of

see -- how Let's the evolution. it --

and we are regarding years. is In eventually, on in -- a tax let's Colombia But and -- terms facing more say the some than well, Colombia difficult some so operate reform of Colombia, a XX confident. their downgrade effect. or We situation

-- through very place a a country good very the this all are situation have has keep solid good to a pass confident that and the country the revelation, institution. investments, for We solid fundamentals very

are that's our So, in country. we And confidence we the why advancing. maintain

again, that hope good of that mentioned company Bogota, very will as we to confident explained very And and a agreement a the growing You we of discussions and we the on and a important And possible our get on are as we this and But a facts in possible, bet we our reach Grupo lots deal a is But Enel the we a going lot the -- Grupo -- you country -- as Energia it an said is in keep Energia year. we good to believe very in soon and relevant de Americas are positive to which mood. to Bogota defensing very shareholders. country, which our as is the as very good soon defense beginning the can constructive de to it has positive and very details and can is with -- way. us important situation good in the constructive despite still in now. this in country. potential right facing And we

just CapEx. there with the business it's Aurelio. might the, Obviously one sort with remarking are easy not I much, -- I'm the on very business. on And the wondering on? expanding renewables what follow-up and to that on ground may, any side just question be just if seeing network if advance the on that plans always Thanks delays I the the of guess you're all Fantastic. based from there, maybe up, particular the pandemic, worth

not Andrew, no we are delays. seeing

confident We are plan. our in

the very a we why in industry. of made chain this merger. people's of and strong vision value We have a long the -- vision the vision term vision have a we That's

a want to and with plan grid. modernization also forward our distribution we renewable with So, move

utility in terms successful prepared it's to of because in teams are And plans. these our our of be to success the have we move and train maintain very forward our some vision field important next but we COVID of So, we course year. for -- the restrictions operations we

deadlines our So, we terms and our guidance of in maintain our and projects CapEx.

Wonderful. Thanks very much, Aurelio.

welcome. You're

sorry. Aurelio,

new Gonzalez have He's And Brazil. with received question having if and the to question the the Scotiabank. is that question year our also the companies in of connection considers Tomas a good XXXX this another with Enel in for problems necessary is for Conta-COVID ensure distribution how some Americas related also in to from will Conta-COVID country. companies be the a situation distribution We

have Tomas. Thank the Tomas. of recognition that you of the know that still Conta-COVID, the we first the is So Conta-COVID, is all also got or it this first that And we Gracias, debt we you, regulator that economic pending million Well, update, in the for issue. less are a reality. so financial received and the and Conta-COVID July didn't we discussing are in in we recognition discussion $XXX one right? we the discussing period disbursement -- it economic because more yet with

we case, are COVID, facing the Brazil the pandemic. this of situation of in in still countries, Our

clients we consideration on. country the regulator course, as a the effect and a I to let's above the with order a situation the at with that we this end, to this But in regulator. is say are But is number. readjustment that the of but increasing final are So are figure, same this the demand impact is final same begun. country, are we economic Rio forward situation recognition, to okay? of the probably that higher increasing as taking are -- the plan of discussion the the the are specially We losses regulator to disconnect and we on for you, say, something collection. be told the see possible of COVID, readjustments not addressing of recovering affecting before, the economic and package being And sensible -- the -- and -- moving equilibrium This the this so the discussion example let's confident the being of we hand in Ceara. in was this right is it final And discussing have inflation

perfect. Okay,

audience. As the screen, from far as do I can on have more the not we questions see

relations any And you So I much you doubt you for investor let that conclude that very the available thank remind me much. Thank call. results And have. very everybody. conference is for you team may

This for concludes call. participating. you Thank conference today's

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