Presentación de PowerPoint...Edenor Investor Day 2017 3 Relevant Events Tariff Maintenance...

EARNINGS RELEASE

Third Quarter 2019

November 11, 2019

Edenor Investor Day 2017

E a r n i n g s R e l e a s e | 3 Q 2 0 1 9 2

The material that follows is a presentation of general background information about Edenor as of the date of the presentation. It is

information in summary form and does not purport to be complete. No representation or warranty, express or implied, is made

concerning, and no reliance should be placed on, the accuracy, fairness, or completeness of this information.

This presentation contains forward-looking information and statements. Forward-looking statements are statements that are not

historical facts. These statements are only predictions based in our current assumptions, expectations and projections about future

events. Forward-looking statements may be identified by the words “believe,” “expect,” “anticipate,” “target,” or similar expressions. While

Edenor's management believes that the expectations reflected in such forward-looking statements are reasonable, investors are

cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to

predict and are generally beyond the control of Edenor, which could cause actual results and developments to differ materially from those

expressed in, or implied or projected by, the forward-looking information and statements.” Further, if Edenor’s actual results are less

favorable than those shown in the projections or if the assumptions used in the projections prove to be incorrect, Edenor may not be able

to make dividend payments in the amount forecasted, or at all. Edenor undertakes no obligation to publicly update its forward-looking

statements, whether as a result of new information, future events, or otherwise, nor makes any representation or warranty, expressed or

implied, as to the accuracy or completeness of the information contained herein, and nothing contained herein is, or shall be relied upon

as a promise or representation. Management is not making and you should not infer any representation about the likely existence of any

particular future set of facts or circumstances.

This presentation does not constitute or form part of, and should not be construed as, any offer or invitation to subscribe for,

underwrite or otherwise acquire, any securities of Edenor nor should it or any part of it form the basis of, or be relied on in connection

with, any contract to purchase or subscribe for any securities of Edenor. Persons who intend to purchase or subscribe for securities of

Edenor in any potential future offering are reminded that any such purchase or subscription may be made solely on the basis of the

information contained in the prospectus or offering circular in connection with such proposed offering. In particular, this presentation and

the information contained herein are not an offer of securities for sale in the United States.

The market and competitive position data, including market forecasts, used throughout this presentation was obtained from internal

surveys, market research, publicly available information and industry publications. Although we have no reason to believe that any of this

information or these reports are inaccurate in any material respect, we have not independently verified the competitive position, market

share, market size, market growth or other data provided by third parties or by industry or other publications. Edenor does not make any

representation as to the accuracy of such information.

Disclaimer


3

Relevant Events

Tariff Maintenance Agreement | September 19, 2019

• Kept in effect tariff schemes effective as of Aug 1, 2019 for all tariff categories

• Postponed to Jan 1, 2020 the 19% increase of the CPD adjustment corresponding to the first semester of 2019

• Increased seasonal prices of energy for larger users will be passed through to tariff as from Jan 1, 2020

• The deferral effect of the application of CPD and seasonal prices will be recoverable on an updated basis, in seven monthly installments

payable as from Jan 1, 2020

• Postponed the payment of penalties until Mar 1, 2020

Determination of the Seasonal Price of Energy | October 22, 2019

• Resolution No. 38/2019 issued by the Secretariat of Renewable Resources and Electricity Market

• Provided the continued application of the Stabilized Price for Energy established in Resolution No. 14/2019 dated Apr 29, 2019

• Period of application: Nov 1, 2019 - Apr 30, 2020

Framework Agreement

• An extension of the New Framework Agreement with the Federal Government was performed from Jan 1, 2019 to May 31, 2019

• The Federal Government committed to pay the amounts for the supply of electricity to low-income neighborhoods

• As of Sep 30, 2019, recognized revenues ascend to ARS735MM

• Edenor onerously assigned to Edesur the receivables acknowledged in its favor under this extension, in order to allow its collection

E a r n i n g s R e l e a s e | 3 Q 2 0 1 9


4

Relevant Events

Contractual Termination of Real Estate Asset | September 30, 2019

• Edenor would receive from the insurance company as total, final and conclusive compensation, the amount of USD15MM

• And, the assignment of the insurance company’s right to subrogate to the rights of the insured party for the amount paid against

the policy holder, Ribera Desarrollos

Change in Ratings | September 2019

Moody’s:

• Downgrade in edenor´s local corporate ratings from Aa3.ar to Baa3.ar, as well as global ratings from B1 to Caa1, placing the

credit rating under review for a possible downgrade

• Downgrade in edenor´s shares ratings to Category 2 from Category 1

• Reflects the strong credit links and the edenor’s exposure to Argentine regulations and operating environment

• However Argentine regulated companies shows relatively strong credit indicators combined with comfortable debt profiles

S&P Global Ratings:

• Downgrade in edenor´s local ratings from raA to raBBB with a negative outlook

• Reflects a more challenging macroeconomic, financial and business context for the corporate sector



5

3Q Results | Revenue from Sales (ARS billion | %)

3Q

20

18

3Q

20

19


(2.1)

+200%

Revenue

from sales

Energy

purchases

Gross

marginOpex Other Opex

Net operating

income (loss)

Financial

resultsRECPAM

Income

tax

Net income

(loss)

Labilities

regularization

agreement

+1.7% +14.7% -16.9% -25.4% +0.9% NA+27.1% -51.7% -14.4% -92.5%

Revenue

from sales

Energy

purchases

Gross


Net operating

income (loss)

Financial

resultsRECPAM

Income

tax

Net income

(loss)

Labilities

regularization

agreement


GROSS MARGIN(in ARS million)

13E a r n i n g s R e l e a s e | 3 Q 2 0 1 9


3,008

3,094

Sep '18 Sep '19

7

Energy Sales Evolution

Turnover b/ type of customer │ QoQ (in GWh)

Customers Evolution(in thousands)

Energy Sales Breakdown | 3Q 2019

Medium Commercial

Residential

Small Commercial

Others

Industrial

Wheeling System

5,626(4.7%)

(118) (29) (26) (31)(53) (7)

5,362

(6.3%) (6.3%) (3.4%) (5.7%) (1.7%)


44.9%

8.0%7.2%

16.4%

16.2%

7.2%


8


3Q

20

18

3Q

20

19


(2.1)

+200%

Revenue

from sales

Energy

purchases

Gross


Net operating

income (loss)

Financial

resultsRECPAM

Income

tax

Net income

(loss)

Labilities

regularization

agreement

+1.7% +14.7% -16.9% -25.4% +0.9% NA+27.1% -51.7% -14.4% -92.5%

Revenue

from sales

Energy

purchases

Gross


Net operating

income (loss)

Financial

resultsRECPAM

Income

tax

Net income

(loss)

Labilities

regularization

agreement


OPEX(in ARS million)

(17%)

Salaries & social security taxes Allowance for the impairment of trade

(29%)

ENRE penalties

(102%)

Taxes and charges

(62%)

2019 | (1,806)2018 | (2,165)

2019 | (388)2018 | (545)

2019 | 172018 | (999)

2019 | (175)2018 | (457)

15E a r n i n g s R e l e a s e | 3 Q 2 0 1 9


10


3Q

20

18

3Q

20

19


(2.1)

+200%

Revenue

from sales

Energy

purchases

Gross


Net operating

income (loss)

Financial

resultsRECPAM

Income

tax

Net income

(loss)

Labilities

regularization

agreement

+1.7% +14.7% -16.9% -25.4% +0.9% NA+27.1% -51.7% -14.4% -92.5%

Revenue

from sales

Energy

purchases

Gross


Net operating

income (loss)

Financial

resultsRECPAM

Income

tax

Net income

(loss)

Labilities

regularization

agreement


Financial Results(in ARS million)

3Q 2018

Other

Financial

Expense

(RDSA Claim)

Commercial

Interest

CAMMESAExchange

differences Others 3Q 2019

Changes in

fair value of

Financial

Assets


Financial

Interest


12


3Q

20

18

3Q

20

19


(2.1)

+200%

Revenue

from sales

Energy

purchases

Gross


Net operating

income (loss)

Financial

resultsRECPAM

Income

tax

Net income

(loss)

Labilities

regularization

agreement

+1.7% +14.7% -16.9% -25.4% +0.9% NA+27.1% -51.7% -14.4% -92.5%

Revenue

from sales

Energy

purchases

Gross


Net operating

income (loss)

Financial

resultsRECPAM

Income

tax

Net income

(loss)

Labilities

regularization

agreement


3,509

3,860

3Q 2019 3Q 2018

Adjusted EBITDA(in ARS million)


(*) The liabilities regularization agreement discontinues the updating of penalties corresponding to the transition

period (2006-2016) in future quarters

3Q 2019 3Q 2018

Net operating income 2,301 2,280

(+) Depreciations 1,070 956

EBITDA 3,371 3,235

(+) Penalties - Retroactive effect - 65

(+) Penalties - Actualization (*) - 460

(+) Commercial Interests 138 99

Adjusted EBITDA 3,509 3,860


2,002

1,381

1,433

787

-

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

3Q2018 3Q2019

14

Capital Expenditures(in ARS million & %)

3,435

Expansion

Maintenance

New connections

Grid enhancements

Network maintenance and improvements

Legal requirements

Communications and telecontrol

Other investment projects

Capex Breakdown Capex Evolution(% | ARS million)


18%

45%

22%

1% 8%5%

2,168


15

Quality of service


SAIDI Path hrs │ year │ customer

SAIFI Path times │ year │ customer

Requested quality standardsReal

31.5

27.7

33.0

26.6 25.8

27.6

22.7

16.3

30.328.9

27.626.3

21.8

13.7

2012 2013 2014 2015 2016 2017 2018 LTMsep-19

2019E 2020E 2021E

8.68.0

9.58.9 8.7

9.0

6.9

6.1

9.79.1

8.88.4

7.4

6.0

2012 2013 2014 2015 2016 2017 2018 LTMsep-19

2019E 2020E 2021E


16.3%

18.6%

20.4%

17.1%

17.4%

19.2%

23.1%

1Q 2Q 3Q 4Q

16

Energy Losses

Per Quarter TAM

20192018

In GWh


In Percentage

Per Quarter Per Period

17.1%17.5%

18.0% 18.2%

18.5% 18.6%

19.4%

1Q 2Q 3Q 4Q

461

621

805

445 498

607

1,000

1Q 2Q 3Q 4Q

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