Good day, ladies and gentlemen, and welcome to Enel Américas third quarter 2023 results conference call. My name is Gigi, and I'll be your operator for today. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. This presentation contains statements that could constitute forward-looking statements. These statements appear in a number of places in this presentation, and include statements regarding the intent, belief, or current expectations of Enel Américas and its management with respect to, among other things, Enel Américas business plans, Enel Américas cost reduction plans, trends affecting Enel Américas financial condition or results of operations, including market trends in the electricity sector in Chile or elsewhere, supervision and regulation of the electricity sector in Chile or elsewhere, and the future effects of any changes in the laws and regulations applicable to Enel Américas or its subsidiaries. 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 in the forward-looking statements as a result of various factors. These factors include a decline in the equity capital markets, an increase in the market rates of interest in the United States or elsewhere, adverse decisions by government regulators in Chile or elsewhere, and other factors described in Enel Américas integrated annual report. Readers are cautioned not to place undue reliance on these forward-looking statements, which state only as of their dates. Enel Américas undertakes no obligation to release publicly the result of any revision to these forward-looking statements, except as required by law. I would now like to turn the presentation over to Mr. Rafael de la Haza, Enel Américas Head of Investor Relations. Please proceed. Thank you, Gigi. Buenos días a todos. Good morning, ladies and gentlemen, and welcome to our third quarter 2023 results presentation. I'm Rafael de la Haza, Investor Relations of Enel Américas, and in the coming slides, our CEO, Mr. Aurelio Bustilho, will be presenting the main figures of this period. Let me remind you that this presentation will follow the slides that you can find in the company's website. Following the presentation, we will have the usual Q&A session, but, please remember that questions can be made only through the telephone line. Now, let me hand over the call to Aurelio, who will start by outlining the main highlights of the period in slide number three. Aurelio, the floor is yours. Thank you, Rafael. During the last few months, we have continued with our renewable generation plans execution, adding more than 400 MW of new capacity this quarter. With this, our matrix is now around 90% renewable, in line with our energy transition goals. Adjusted EBITDA in this quarter increased by 20% compared to the third quarter of last year. This considers homogeneous perimeters, meaning that we are including results from Peru in both periods and excluding from 2022 results Fortaleza, Goiás, CIEN, Costanera, and Dock Sud, as we do not consolidate these, those companies anymore. We are also excluding FX effect, which had a positive impact of $7 million during this period. This improvement is mainly explained by better results in distribution business in Brazil and generation business in Colombia. We also saw an important recovery on our group net income for the first nine months of 2023, which reached $0.8 billion, a significant increase compared to last year, which was -$100 million. This increase is mainly explained by the impairments related to sales of Enel Goiás, Enel Fortaleza, and better adjusted EBITDA. Regarding net debt, as of September 30, we reached $6.1 billio n, which is 12% lower than year-end 2022. This is mainly explained by lower debt consolidation related to asset disposals. On slide four, I will highlight our positive performance during this year. This slide shows a summary of our main indicators in a homogeneous view. This means excluding for both periods sold assets, Fortaleza, Goiás, CIEN, Costanera, and Dock Sud, and including Peruvian assets, which, as you know, are in a sale process but still are part of our operation perimeter. In generation business, we significantly increased our installed capacity and net production thanks to the deployment of new renewable power plants. In grids business, we increased our customer base and energy sold, while smart meters grew by almost three times. Our financial indicators showed a very positive performance, improving E BITDA, increasing our CapEx, and maintaining our net debt rate and ratios basically in line with the last year. All these reflects that we are performing in a solid manner, and our main indicators are improving across our businesses. Let's now analyze the following slides, our operational highlights. In generation business during this year, we have added close to 1 GW of renewable capacity. After the sale of Costanera, Central Dock Sud, and Termocartagena, we reached 14 GW of installed capacity, of which 90% is renewable. Net production in the third quarter reached 13.9 TWh, a decrease of 7% compared to same period of last year, explained by the deconsolidation of Costanera and Central Dock Sud. Isolating these effects, production would have increased by 11%, explained by higher generation in Colombia and Peru. From our total production, 87% is emission-free, a significant growth compared to the 74% of the same period of last year. Energy sales decreased by 3% during this quarter, reaching 18.8 TWh, mainly due to the change in the perimeter. Isolating this effect, sales would have increased by 4%, mainly explained by higher sale in Colombia. On slide six, we'll focus on our development of renewable capacity. During 2023, we have added almost 1 GW of new renewable capacity, 593 MW are our wind farms located in Brazil, and 381 MW are solar plants located in Colombia, Peru, and Central America. We have invested $1 billion in renewable energy during the first nine months of this year, mainly located in Brazil and Colombia. We are currently working on addition 1.4 GW of capacity under construction located in Brazil and Colombia. 300 MW are wind projects, and 1.1 GW are solar projects. During 2023, 400 MW will begin operation, while 1 GW or 1,000 MW will enter in 2024. Regarding our pipeline, we are considering 51 GW of new capacity. From this amount, 23 GW are in early stage and 25 GW are in mature stage. In addition to this, we have around 1 GW of battery energy storage system, and we are also considering 1.4 GW of project under construction already mentioned. Let's continue with grids operation highlights on slide seven. Electricity distributed reached 27.8 TWh in the third quarter, which represents an increase of 4% compared to the same period of last year in homogeneous perimeter, explained by higher sales in all our distribution companies. Regarding number of customers, without considering customers of Enel Goiás last year, we had an increase of around 420,000 in the last 12 months, reaching 23.6 million customers. Smart meters increased around 2.6 times, reaching 605,000 during this period, mainly due to the deployment in São Paulo. Our net RAB has increased by 19% in the last 12 months, reflecting the significant investments that we have done in our grids. The ratio net RAB per customers also reflects an important growth of 17%. In terms of quality indicators, we can see an important decrease in Argentina, mainly explained by the extremely high temperatures that we saw during the summer of this year, sorry. In the rest of the countries, our quality indicators improved or remained flat, except for SAIDI in Peru, which increased due to a change in calculation criteria compared to last year. Finally, in terms of energy losses, it improved in Argentina, Brazil, and Peru, and remained flat in Colombia. Let's analyze our investments of the period in the coming slides. During the third quarter of this year, our CapEx decreased by 8% compared to the same period of last year, reaching $766 million, mainly explained by the dispos al of Fortaleza, Enel Goiás, CIEN, Costanera, and Dock Sud, and lower investments in generation busine ss in Peru. If we exclude the perimeter impact, the CapEx would have increased by 5.5%. This is mainly explained by higher investments in Colombia and renewable business in Brazil. From the total amount, 67% was invested in Brazil, while in terms of business, 51% was devoted to renewable and 40% to grids. Growth CapEx reached $431 million, and was mainly devoted to renewables with 83%. Now, I will comment on the financial results of the period in the coming slides. EBITDA in the third quarter reached $1 billion, 11.8% higher than the same period of last year, mainly explained by better results in generation business in Colombia and distribution business in Brazil. This was partially offset by the fact that we do not consolidate Enel Fortaleza, Enel Goiás, CIEN, Costanera, and Dock Sud in this period. If we exclude this effect and also include results in Peru and isolate effects, we get to an adjusted EBITDA of $1,142 million, an increase of 19.6% compared to the same period last year. OpEx decreased by 9%, mainly explained by the change in the consolidation perimeter. Net financial results increased by 38.1%, mainly due to lower financial income related to regulatory asset in Brazil. Group net income in the third quarter reached $307 million, which compares with a negative net income of $680 million last year due to the negative impact coming from the sale of Enel Goiás and Enel Fortaleza. This positive net income is a consequence of good operational results and growth in EBITDA. Finally, in terms of debt, we see an important reduction of 11.5% compared to December 2022. We will analyze in detail our debt later on. On slide 11, we will analyze EBITDA evolution and breakdown. Starting from $894 million of EBITDA of third quarter of 2022, we have to exclude $105 million coming from Enel Fortaleza, Enel Goiás, CIEN and Enel Costanera and Dock Sud in order to make it comparable with third quarter of 2023. We see that we have positive operational results in renewable grids, retail, and Enel X, while thermal generation decreases. With this, we get to an EBITDA of $991 million for third quarter of 2023, which is 26% higher than last year, considering the same perimeter. Effects had a positive impact of $80 million, resulting in a reported EBITDA for this quarter of $1 billion, 12% higher than reported EBITDA of same period of 2022. As already mentioned, Peruvian assets are considered discontinued operations, meaning that its result is considered below EBITDA level. If we consider EBITDA coming from Peru, we get to an EBITDA of $1,149 million. From our reported EBITDA, 54% came in from Brazil, 43% from Colombia, and 3% from Central America. In terms of business lines, grids represents 47% of our EBITDA and renewables 46%. Retail and Enel X contribute with 6% and 1% respectively. Let's see EBITDA breakdown on a cumulative basis in the coming slides. Starting from $2,930 million of EBITDA of this first nine months of 2022, we have to exclude 341 coming from the asset disposals. We see that we have a positive operational results in renewables and grids businesses, while thermal generation, retail, and Enel X decreases. With this, we get to an EBITDA of $3.1 billion for the period, which is 19% higher than last year, considering the same perimeter. FX effects had a negative impact of $172 million, resulting in a reported EBITDA for this half of for this period of $2,899 million, 1% lower than reported EBITDA in the same period of 2022. EBITDA from Peruvian operations was $515 million, reaching with this an EBITDA of $3,415 million. From our reported EBITDA, 59% came from Brazil, 38% from Colombia, and 3% from Central America. In terms of business lines, grids represent 50% of our EBITDA and renewables 42%. Retail and Enel X contributed with 7% and 1% respectively. On slide 13, we'll have a focus on the cash flow of the company. Starting from an EBITDA of $2,899 million, we see that net working capital amounted to - $926 million, mainly explained by water scarcity account in Brazil, PIS and COFINS credit used in connection with reimbursement to final customers, CVA impact in Brazil, and effects and higher inflation impact in Argentina. Taxes paid during the period amounted to $553 million, while net financial expense amounted to minus $479 million. With this, funds from operations amount to $942 million, a decrease of $830 million compared to the same period of last year. After investment of $2,044 million, including $1,132 million of growth CapEx, we get to a free cash flow of -$1,102 million. Let me now analyze the debt of our company in the coming slide. Gross debt amounted to $7.2 billion, a decrease of 11% compared to December 2022, mainly explained by the deconsolidation of assets available for sale in 2023. Isolating this effect, gross debt would have increased by 1.7%, mainly due to the higher debts in Enel Colombia and Enel Ceará, partially offset mainly by lower debt in Enel Brasil, Enel Américas Holding, and Enel São Paulo. Net debt reached $6.1 billion, a reduction of 11% compared to the end of 2022. This includes free cash flow for -$1,102 million, net dividends paid for -$199 million, extraordinary operations for $1,530 million related to the sales of Goiás, Costanera, and Dock Sud, net debt deconsolidation for $906 million, and effect for -$346 million. In terms of currency and country, we see that Brazil remains as the largest contributor, while the debt at holding level represents 80% of the total. Finally, regarding the cost of debt, we can see an increase for this period going from 9.8% to 12.5%, mainly explained by higher interest rates in Brazil and especially in Colombia, and to the fact that in December 2022, we had the Peruvian operations, which had the lowest cost of debt. On next slide, I will conclude this presentation with some closing remarks. During the third quarter of 2023, we had solid operational results across all our businesses, with relevant increase in energy demand. We maintain a solid financial position, which allow us to execute our CapEx plan. We are strongly delivering and executing the new capacity coming from renewable sources in line with our strategy. Regarding our corporate simplification, let me comment that our asset disposal plan is on track with no relevant news from the moment. Finally, let me announce that we are going to present our strategic plan for the period 2024-2026 during the last days of November. Soon, we will send you the invitation to all of you. Well, thank you, Aurelio. Very, very clear. Now, we are going to pass the call to the operator for the Q&A session. Operator, please proceed. Thank you. 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, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes on the line of Javier Suárez from Mediobanca. Hi, good morning, and thank you for the presentation. Three questions. The first one is on slide number 13 on the cash flow of the period and the net working capital absorption that is close to $1 billion. You can help us to understand the evolution of that working capital by the year-end, on when you are expecting that net working capital negative impact to be reabsorbed in your accounts? That would be the first question. The second question is on the cost of debt in slide number 14. We have seen a significant increase in the cost of debt that has been explained by higher cost of debt in Brazil and Colombia. The question for you is, how do you see that cost of debt for the rest of the year in 2023 and then in 2024, and which implication this has for the gearing of the company? Which is the level of net debt to EBITDA with which Enel Américas feels comfortable with? The final question is on that statement that you have made at the end of your presentation on the asset disposal plan. If you can give a little bit more of granularity on how the process is proceeding, and we may expect some significant news flow before the year-end. Thank you. Thank you. Thank you, Javier. Thank you for your questions. Regarding net working capital, Javier, there is an impact, right, that we are recovering, that was due to the, especially for the account CVA, regarding the hydrology in Brazil, right? This is the great part and also part of the physical thing issues. I mean, this is something that we are just correcting or adjusting effects from previous periods. I mean, this is not something that will repeat on next year. From 2026, half of this amount, roughly half of this amount is due to all the support that we had in the previous period, related to hydrology, related to the physical things issues that we are giving it back because it's not for the company, right? We are giving it back to the consumers, the consumers, the clients in Brazil. For this amount, this part it's not, it's extra generic. We're not repeating it in the coming periods, right? This is the mechanism that in Brazil, you see, that we have, this delay of one year of impact in terms of CVA, right? Different from, for example, if I can say in Colombia. Colombia, two months after you have it, you receive it or give it back. In Brazil, you have this delay of one year, regulatory delay. That's why we are seeing impacts. It's not due to this year, to the current EBITDA that was generated. It was from the previous period. Of course it affects our cash flow. Related to the cost of debt, yes, exactly. We follow the major part of our debt coming from variable cost. This is indexed basically in the Brazilian CDI and the benchmark also in Colombia, right? Of course it affects us. We are projecting a reduction. We are projecting a reduction like everybody in a different, let's say in a slower pace, but we are projecting a reduction. This is very important because we see more room to a reduction also in our capital or in our cost of capital. But this is not something that concern us. This is not our concern because we have a very low leverage of this company. I mean, we are talking about a company that is 1.4x net debt to EBITDA. Even if we include the pension fund of São Paulo, it is around 1.6 x, which is very low. I mean, this is something manageable. As Enel Américas, we have this possibility to better choose the way or where we increase the debts of our company. Of our perimeter, we see that Brazil and especially Colombia there are higher interest rates, but we can manage with this very low leverage level. This is something that of course we need to be very proactive also in the debt and liability management of this company, but something very manageable. Last but not least, the disposal questions, the asset disposal question. We are seeing that, well, as you know, we give all the information since our strategic plan of where we are advancing, and we are very proactive and give you from time to time information about this, you know. From the Peruvian side, the distribution business is advancing on the antitrust front. The generation, as announced, we are advancing on the negotiation front. We expect according to the time frame and the timeline that usually move in this kind of transactions. We expect that this transaction may be concluded by the first quarter of next year. Regarding the Argentinian assets, we launched the process and we are expecting also in parallel how the situation of the country evolves and to give you more color probably in the beginning of next year. In Brazil, we are moving the process of our distribution in Ceará. We are analyzing and seeing especially the condition for renewable concessions to have a more clear view of this process and analyzing the possibilities to give you more color of this process by the beginning of next year. They were launched. I repeat what I said in the previous call that of course we will not sell the assets at any price. We will sell if it's the right price, the correct price. We understand that this kind of situations in the countries can give more clarity of this process. We expect to give you more clear view in the coming months. Interesting. Many thanks. Thank you. 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, please press star one one again. Okay. Gigi, we have received some questions by email. The first one, Aurelio, is related to this is from Andrew McCarthy, Credicorp. The question is regarding generation in Colombia. Andrew underlined that the results in the third quarter 2023 benefited from higher sales volumes and a strong price realizations. Considering the presence of El Niño and the position of your reservoirs, how are you approaching the commercial strategy in the fourth quarter 2023? The second question is, should this trend to pressure margins during the final quarter of the year end and into 2024? Commercial strategy in Colombia, taking into account the situation with El Niño and the position of our reservoirs in the country. Thank you, Rafa. Thank you, Andrew, for your question. Yes, we anticipated this. Our reservoir, they are in a very good position in terms of hydrology, compared to other regions in Colombia, as you mentioned, affected very strongly by El Niño. But we manage very well the reservoir by the beginning of the El Niño season. We also benefit from the position of our small hydro near the consumption area in Bogotá. That's why we have this possibility to get this better results. We expect that these better results. Well, you know that the season ends in the first quarter and the first quarter of 2024. It will end the season. When it ends, part of these impacts will be consumed by the generation assets. By the end of 2023, we expect it to at least maintain these benefits during this period. This is something that we cannot control, but the homework we did it very well, as you well mentioned, because we entered in the season in the better position of hydrology, especially related to. Well, on the other side, we have the distribution, you know, business, which affects the purchase of energy from the distribution business. As I was explaining in the first question, this pass through, it's two months after the impact. Probably you have a picture, a worse picture, but then you recover in the following two months. This is something. And very fast, if you asked me. By the end of 2023, we'll have probably the negative impact in the distribution business, but on the other hand, compensated by the generation business. The negative impact in the distribution business will be recovered in the first quarter of 2024. Yeah. The Colombian assets, we have two important things here. First of all, you manage the reservoir. We did a very good job in terms of El Niño, right? That we can save some months before the El Niño season ends. On the other hand, we have this better or this fast recovery from the regulatory assets that compensates the distribution when we have a negative impact from the purchase side that we purchase energy more expensive in the distribution side. At the end of the day, this is a very good balance with the assets in the Colombian assets. I don't know if I answered. No, perfect. I think that you have, this is a very complete, answer. Thank you very much, Andrew McCarthy. We have a question from Scotiabank, Tomás Gonzalez. The question is the following. It's about the liability management plan once the M&A transactions will be completed. Particularly, Thomas is asking about the plans for the São Paulo's pension fund, and what are the strategy of Enel Américas at this, in this regards. Thank you, Tomás. Well, we still follow the same strategy since the beginning, right? We are working for the risk this plan, removing the sponsorship. We do not have any change on this. We are facing some opposition from the unions on this. We are pushing, and we are moving forward, probably in the next year. Well, we are starting to execute this strategy, but the impact will be probably in the coming year. Thomas, since we are moving lots of efforts, as I told you also, to manage this higher cost, we will present our financial strategy and our initiatives in terms of liability management when we'll publish our strategy plan. I ask you to wait for the end of this month that we're presenting in detail. There's no, I mean, no surprise or any issue related to this because we are moving exactly with this proactivity in terms of liability management from one side. In terms of pension fund, we are exactly moving the same direction to reduce our exposure to the financial or to the pension funds. I mean, especially related to the time of the discount rates, especially with the life table of retirees. I mean, this is not our business, so we want to de-risk and execute the final de-risk of this plan. Thank you. Perfect. Thank you, Thomas. Thank you, Aurelio. Now let's move to BTG Pactual, Fernán González. Three questions. The first question is the following one: What are your thoughts on the recently published technical report that outlines the renewable distribution concessions in Brazil, and in particular, the implications it may have on Enel Rio distribution concession? Second question, any update in the stewardship model in Brazil, any progress being made? The third question from BTG Pactual, Fernán González, on the total proceeds from the pending asset sales, how much will you actually get in cash after considering tax payments? Okay. Thank you. Thank you, Fernán, for the questions. Related to the concessions in Brazil, we advanced it a lot. Now, since we saw the first proposal from the government, which was not, let's say, a very good proposal. After all the public hearing and the discussions with the government, the government reached a better proposal. Of course, this is preliminary, and it's being analyzed. We have on the table a very good proposal in terms of concession renewals. We are confident that we'll move in the right way. I think the government is perfectly aware of the importance for the distribution business and to have it balanced and also an attractive business for investments in Brazil in this area. The distribution business needs investment, infrastructure needs investment, so it's important. The government correctly adjusted their proposal. We are confident that we are moving in the right way. You mentioned Enel Rio and of course it's aligned with other distribution which is Light in Rio. We have a different situation in Rio regarding the losses in the city. Well, the good thing is that Enel and also the Minister of Energy. There is an alignment that we have a different problem in Rio, and all the technical analysis is moving in the correct way of analyzing this as a specific concession area, which is something that we do not have a closed proposal yet. You know that the order to move this is to have this total, let's say, overall for other concessions, the model very well framed and in parallel establish a special model or special adjustments for the case of the concessions in Rio. We reinforce our interest in the concession of Rio. We are confident that we'll reach a good solution of this specific model for the concession of Enel Rio, especially in terms of areas of high complexity, let's say, or that we have lack of safety especially, where we have higher losses and the company cannot operate in these areas. That's the key issue. We know how to operate, we know how to reduce the losses. The problem is that there are areas in the state of Rio that we cannot operate. We are confident that from the regulatory aspect, this issue will be addressed in the next period. The government and also with the companies and with a strongly technical and independent view will address this situation. Well, second question was about the stewardship. We are advancing on this solution. We have a very good thing. We have a pipeline. In our pipeline, 25 GW-26 GW of mature pipeline, which means that there are excellent projects that are good projects. We are executing 1.4 GW. We enter into operation 400 GW. I mean, the figures, they are sound figures, they are strong figures. It makes sense to find a partner to do this alliance with us and to move forward with our projects. Why is this? Because we can do more. We can execute more of these good projects. We are in a process of finding interest on these projects. Of course, it's notorious that the cost of capital is not in a very good moment, but it's cyclical. It's something that will improve in the coming months. We are confident that again here is something that we use the same thing that we spoke in the last conference, in this conference. We will only sell the asset at the right price. Stewardship is nothing but selling projects, you know, selling assets at the end of the day. Of course we are looking for a partner that pay the right price for our asset. If not, we'll take more time to get the better partnership that we want. We want a win-win approach. We are working for a win-win approach. What we can offer? All our proven track records in terms of executing projects also in operating good projects, right? Last but not least, what's the other? The final one is about the pending asset sales. How much will you actually get in cash after considering tax payments in Peru? We already mentioned these figures. It doesn't change too much. The sale of the assets represents. Sorry, just one second. This is not. The question is the total of distribution generation or. Distribution. Distribution. Is $2.9 billion, right? The total. Yeah. He's asking about the tax rate of the local Peruvian corporation. 29.5%. 30% more or less. Yeah. Exactly. Yeah. This is more or less, well, this 30% over the $2.9 billion or $3 billion is $600 million. The tax for the distribution part and the generation part we are still analyzing, but it's not different from what we announced since the beginning, huh? Both assets, we're talking about $5 billion, right? Okay. Well, as there are no more questions, thank you, Aurelio Bustilho. We conclude the results conference call. Let me remind you, that Investor Relations team, as usual, is available for any doubt as you may. Thank you for your attention. Thank you, Gigi, for this call, and have a good day. Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.