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| Statement |
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| The rating agencies Fix and Moody’s raised our outlook in Edenor following improvements in the company’s risk profile, sorry, just last week, we completed the successful missions of an exchange of $100 million based local dollars, which has helped us to improve our debt profile and capital structure |
| With the improvement in our risk profile due to important changes in the regulatory front, two of our rating agencies, Fix and Moody’s, made positive moves related to our debt |
| These figures underline our unwavering commitment to improve service quality, which is evident in the strong improvement that we have been achieved in our service indicators |
| This will enable us to continue our strong investment program and continue to improve our service level |
| For the fourth quarter, our distribution margin rose 34% year-to-year to ARS44.6 billion, mainly due to a lower energy purchase cost, and to a lesser extent, tariff increases implemented yearly in the year |
| At Edenor, we continue to work on our plan to transform the company and transition it from its current strong position as a leading electricity distribution company in Argentina in a broad energy leader with a bright future |
| The investment plan executed in recent years continues to show results that are reflected in continuous improvements in our service quality by reducing the duration and frequency of outages since 2014 and thus exceeding the regulatory requirements set forth |
| Analytical tools powered by artificial intelligence have augmented inspection efficiencies and our Market Discipline actions continue to detect and rectify irregular connections |
| In addition, the energy mix this year improved with more lower costs of hydroelectrical supply and reduces thermal energy costs due to lower fuel costs |
| Over the past 11 years we have invested more than $2 billion in infrastructure to strengthen our operations capacity and position in our company for the continuing operating success |
| We expect this will lead to material improvements in our area and net income and position us for an improved financial performance |
| Fix raised its rating and Moody’s improved the outlook, which will be reviewed to a positive signal -- that are a positive signal |
| We expect these changes to lead to a more dynamic company with substantially more favorable financial results going forward versus the last several years |
| Edenor is a distributor, has demonstrated its resiliency and ability to adapt, which has allowed it to significantly improve its service quality indicators |
| The main factors driven the improvement were a substantially positive impact of ARS198 billion due to an agreement for a payment plan for a month due to CAMMESA for the past energy purchase cost |
| We are an industry leader in Argentina with a leading 20% market share in electricity distribution |
| Our debt profile and capital structure has improved notably past the exchange and issuance of these new notes |
| This will enable the company to continue to make the necessary investments to improve the quality of services, transforming the grid into a smart network with technology and innovation |
| A key goal of our strong investment program was to enable the company to provide reliable service during periods of peak summer demand |
| First, the positive effect of tariff increases contributed to higher revenues, even though these adjustments were still below what was needed to fully compensate inflation |
| For 2023, the SAIDI and SAIFI service quality indicators showed further improvements to 8.2 hours and 3.4 average outages per client in the year, reaching records low and down 75% and 64%, respectively, compared to 2014 levels |
| We remain focused on continuing our strong investment program to continue to improve our services to our clients |
| For the full year, energy purchases rose 3%, which was helped by a record high temperature in the first quarter of the year |
| But I would say something additionally is that we have been released of the ongoing concern because Price did a very important review on the numbers in order to show that there are no big restrictions in terms of financial position of the company and that improves a lot the company’s performance |
| This recovery in services is mainly due to the strong level of investment that the company has been made since then |
| For the full year, the distribution margin rose 24% to ARS242.2 billion, as shown in the slide, due to several factors |
| These improvements have restored the economical equilibrium of Edenor |
| As our next challenge, we want to lead the transformation of the electricity grid into a smart grid with technology and innovation, implementing solutions already available in other places in the world, which will allow us to gain even greater efficiency for the benefit of our clients |
| On March 7, 2024, Edenor completed two notes issues -- issuances in the local market for a total amount of $100 million with a 30-month maturity, which enables us to improve our debt profile and extend the average maturity of our debt |
| This allows us to solve problems that raise in the network remotely and quickly |
| Statement |
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| The weak performance in the fourth quarter was due to softer demand and no tariff increases in the second half of the year despite continuing high inflation |
| On the net results line, Edenor reported a net loss of ARS32.7 billion in the fourth quarter of 2023 versus last year earnings of ARS11.7 billion, mostly reflecting the lack of sufficient tariff adjustments to compensate inflation |
| In the fourth quarter of 2023, energy sales volumes totaled of 5,261 gigas down 3.6% year to year and was led by the decrease in consumption of 6.4% in residential customers |
| As you can see on slide eight, revenues reach ARS120.4 billion in the fourth quarter of 2023, a decrease of 17% in real terms versus the fourth quarter of 2022 |
| Energy purchases were ARS75.8 billion in the fourth quarter of 2023, a 32% decrease in real terms compared to the fourth quarter of 2022, which was driven by the weak demand that we just mentioned |
| EBITDA for the fourth quarter of 2023 was negative by ARS19 -- ARS29.2 billion, compared to the last year profit of ARS43.9 billion for the same reasons mentioned above |
| This was a sharp swing from last year’s loss of ARS40 -- of ARS54.4 million |
| Our country has a balanced energy matrix that presents numerous challenges in the area of transportation and distribution |
| We achieved a reduction in energy losses to 14.9% in the fourth quarter, down to 15.6% in the last year’s fourth quarter |
| For the first time in many years, the auditors do not include a concern about the company continuing as a growing concern |
| It is important to remember that the 14.9% losses -- total losses, 9.7% are technical losses, which are recognized by the regulator in our target |
| For the first time in many years, our auditors, PricewaterhouseCoopers, are not including a concern about the company’s continuing to operate as a growing concern |
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