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| Statement |
|---|
| The better-than-expected hydrology and the gas trading activities during this year, complemented by the several managerial actions we have taken over the last year, supported us in achieving our commitment towards our shareholders |
| And this is – this is related to the big rainfalls that we had last year that, of course, on the one hand, were really positive to our performance in 2023 |
| Anyway, as I said, of course, it’s a very good business news for Q1 |
| The main effects that explain our FFO in this period are the following: $1.3 billion coming from EBITDA driven by the strong hydrology contribution, gas trading activity and better results in the Distribution business, $406 million negative impact from the cumulative stabilization mechanism effect in our receivables, reducing the cash conversion of that period |
| This year, we had a remarkable performance of our Generation portfolio |
| The better-than-expected hydrology due to the El Nino phenomenon and all the gas trading activities’ outstanding performance supported the achievement of our goals and targets |
| And finally, a positive contribution of $27 million in grid margin, mainly due to increased remuneration related to indexation, lower financing compensation and higher demand |
| The PEC 3.0, a very important positive and important sign of stability to the energy market |
| Finally, I am pleased to announce that will beat all our financial targets for 2023 |
| which reflects our confidence in Enel Chile’s future and solidity |
| In the full year 2023, our EBITDA increased $358 million versus 2022 pro forma, mainly explained by the following effects: first, a positive contribution from hydro and renewable totaling $213 million, mainly relating to improved hydrology volumes; second, a positive effect of $94 million in variable costs, mainly explained by lower spot price in the period due to a better hydrology since June 2023; a one-off effect of an agreement with one of our PPA suppliers and lower transition fees, partially offset by a lower [indiscernible] generation margin |
| During 2023, we experienced a significant improvement in our operation, mostly explained by a more efficient generation mix related to a better agrological situation and the contribution of our optimization portfolio action plans developed and executed during the last year |
| Favorable agrological conditions during 2023 allowed us to reach a higher-than-expected hydro production, exceeding by 25%, the level recorded in 2022, totaling 12.2 terawatt hour of hydro generation, a scenario that we had seen since 2010 |
| The agrological situation in our reservoirs is also very positive year-to-date, when compared to last year’s figure, especially in the South |
| Second, a positive effect of $83 million on variable costs, mainly explained by lower withdrawal, spot price, lower transmission fees and savings due lower fuel consumption, both as a consequence of best hydrology in the period |
| Regarding our gas optimization and trading activities, we have guaranteed natural gas and LNG supply to our fleet and executed some very profitable sales to local industrial and mining customers and also to foreign market |
| Taking this into the consideration, our fourth quarter 2023 EBITDA was around $71 million higher than 2022 pro forma, mainly explained by the following: First, a positive contribution from hydro and renewable assets totaling $41 million, mainly related to the improved hydrology in the quarter |
| As you can see in the full-year period and the fourth quarter 2023, our earnings indicator present an important improvement compared to the 2022 figures |
| The 2023 results showed a solid operating performance |
| So what can I say it is that we are pretty confident that first quarter results will be boosted by this additional hydro production and additional water in our reservoir that we have been experiencing in this first part of the year |
| It has provided me with considerable professional growth |
| And of course, it would help us to probably perform better than expectation in our third quarter |
| And we are also pretty optimistic since the main critical work were already finalized |
| That later coupled with the conclusion of optimization initiatives, such as the sale of Arcadia last October, enabled us to achieve our EBITDA and net income committed |
| So we have some upside there, and we have probably posted some upside compared to what we now can expect for 2024 |
| Regarding EBITDA and net income, the improvement is mainly explained by a more efficient generation mix thanks to the outstanding hydro renewables performance and due to greater gas trading activities, we will see more detail in the following slides |
| Let me say that we consider government proposals very solid and aligned with Chile’s position and growth in incentives investments towards the decarbonization |
| Our FFO in 2023 reached $986 million, representing improvement of $334 million |
| In addition, a positive contribution of $80 million related to the gas optimization activity, mainly due to increased gas trading activity for 0.9 tera BTU made in Q4 2023 |
| To conclude, during 2023, we recovered around $358 million related to the stabilization mechanism, the PEC 2, include the current project, which represented around $180 million, a positive impact in our net income |
| Statement |
|---|
| Asset management CapEx reached $129 million, 36% lower than previous year, mainly due to lower maintenance activity in conventional generation plants in Distribution business |
| Now saying – commenting if it’s possible to predict if would be also of some comfort in April or during the second quarter is difficult today |
| $18 million in OpEx and other costs mainly explained by our new renewable capacity inflection across all the businesses and negative effects in [indiscernible] due to a higher recognition of gross margin in 2022 partially offsetting the positive effect in distribution margin of $3 million, mainly due to indexation |
| Well, look, regarding Los Condores, we are finally at the end – the final stage of this very particular project, very challenging project, and let me comment, first of all, that all the main civil works that were related to all excavation demand and so the promise that we experienced with this project has concluded |
| But unfortunately, on the other hand, make us impossible in some months to continue working on Los Condores project |
| Fabrizio Barderi Well, of course, this is a very challenging question |
| The above maintenance effects were partially offset by $115 million from lower PPA sales in Q4 2023 primarily due to lower average PPA price, mainly related to lower commodity indexation in the regulated market |
| It is difficult to project this in terms of yearly production because starting from the first of April, the [indiscernible] period would end and the new rainfall would affect the overall production of the year |
| It’s worth mentioning that our commitment with our clients were fulfilled with a higher portion of our renewable generation, which also led us to lower energy purchases in the spot market, mainly the non-solar hours |
| Basically, we believe that the lowest is going to be booked in end of March, beginning of April we are seeing to recover $450 million approximately |
| Likewise, these adjustments affected the bottom line by a total of $83 million in the full year and $41 million in the Q4 of 2022 |
| Difficult to predict whether we are going to have again this kind of a recovery |
| And so we have some months delay due to this unexpected stop that is related to the heavy rainfall that we experienced last year |
| Difficult to comment about Q2 |
| Development CapEx reached $597 million, representing a decrease of 33% versus last year’s figures in line with the remaining renewable portfolio under construction |
| Of course, the inflows are decreasing, as expected, of course, as always, during the [indiscernible] season |
| So right now, I cannot say that we are going to repeat the recovery |
| These adjustments affected the bottom line by a total of $1,230 million and $1,185 million in the full year and in the Q4, respectively |
| The above-mentioned effects were partially offset by $17 million from lower PPA sales in the full year 2023, mainly due to lower average PPA price due to indexation partially offset by higher capacity payments in this year, $41 million OpEx and other costs mainly in Generation business explained primarily by our new renewable capacity and maintenance of plants and inflation across all the business |
| A lower bad debt mainly related to the client net debt recovery due to several commercial actions |
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