AGUAS ANDINAS Corporate Presentation Credicorp Breakfast June 9 2016
01. OUR COMPANY 2
AGUAS ANDINAS Chile’s Largest Sanitation Company TARIFFS (Potable Water, Sewerage, and Sewage Treatment US$/m3) Oslo 7,09 Belin 6,6 Syndey 5,93 2.145.122 clients Copenhagen 5,33 100% coverage in Representing 43% of Ottowa 5,12 potable water and the clients in the Paris 3,88 sewage treatment industrY London 3,65 Mexico City 3,23 Washington 2,74 Madrid 2,56 Stockholm 2,33 50.5 % of potable One of the lowest tariffs in Athens 1,62 water billed in the Chile Santiago 1,39 industry Rome 1,36 Seoul 1,24 Tariffs as of December 2014 considering US $1= $607.38 3 Source: SISS' 2014 Management Report
CORPORATE STRUCTURE World Class Controlling Shareholders SUEZ is one of the leading water Chilean Pension Funds CORFO Chilean Pension Funds and sewage treatment players ADRs 0,1% 5,0% 2,8% Others 0,0% worldwide 12,1% 100% Stock Brokers 8,7% AGBAR is an international Stock Brokers Aguas 13,2% IAM Others benchmark in the sanitation business Andinas Ownership 8,1% IAM Ownership with more than 150 years of May 31 st 50,1% IAGSA May 31 st 56.6% 56,6% 2016 experience in the sanitation 2016 industry, with a presence in 14 countries International 50.1% International Shareholders Shareholders 18,0% 25,3% 100% 100% 53.5% 100% 100% 100% 100% REGULATED COMPANIES NON-REGULATED COMPANIES 4 Source: Aguas Andinas
SUSTAINABILITY Leading Company in Emerging Markets Sustainability efforts strongly linked with the Company’s stakeholders, with open and permanent communication with Stakeholders Key Issues them Career development and training; equal opportunities; good During 2015, the Company reported to the CDP (Carbon Collaborators labor conditions and communication; health and safety Disclosure Project) initiative for the first time Quality and continuity of supply; customer service, service Clients channels and complaints management; transparency and Due to the Company’s sustainable management, in 2015 Aguas accuracy in billing Andinas joined the select group of Chilean companies which compose the Dow Jones Sustainability Index (DJSI) Emerging Profitability; investment stability; risk management; Markets and DJSI Chile Shareholders transparent management Suppliers and Transparent and equal conditions; timely payments; In addition to this, in November of the same year, Aguas contractors development opportunities Andinas was selected as a component of the Euronext-Vigeo EM 70 Index Legal Compliance; collaborative relationships; contribution to Authorities local development Neighboring Impact management; dialogue and relationships; local Communities development opportunities 5 5
02. OUR INDUSTRY AND REGULATORY FRAMEWORK 6
WATER & SEWERAGE INDUSTRY IN CHILE XV y I Region / Iquique Aguas Del Altiplano An example of a successful public-private alliance II Region / Antofagasta Aguas De Antofagasta III Region / Copiapó Aguas De Chañar IV Region / La Serena Aguas Del Valle TWO CONCESSION MODELS 1998 BEGINNING V Region / Valparaíso Indefinite concession Esval R.M. / Santiago OF THE Aguas Andinas VI Region / Rancagua PRIVATIZATION Essel Concession for 30 years VII Region / Talca PROCESS Aguas Nuevo Sur VIII Region / Concepción Essbio IX Region / Temuco Clients breakdown by Economic Group Aguas Araucania Los Ríos / Valdivia X Region de Los Lagos y XIV Region AGBAR SUEZ 43.0% Aguas Décima de Los Ríos / Pto.Montt Essal ONTARIO TEACHERS PP 31.1% Indefinite Concessions: 6 MARUBENI 9.2% Xi Region / Coyhaique INV. AGUAS RIO CLARO 5.1% 30 years Concessions: 8 Aguas Patagonia SMAPA 3.9% EPM 3.3% 96% OF CLIENTS served by a HIDROSAN-ICAFAL-VECTA 2.6% privately-held operator OTHERS 1.9% Xii Region / Pta.Arenas Aguas Magallanes 7 Source: SISS' 2014 Management Report
HIGHLY REGULATED SANITATION INDUSTRY Proven, Stable, and Transparent Framework MODEL COMPANY vs. REAL COMPANY Regulatory framework in place for more than 25 years Superintendence of Sanitation Services (SISS) acts as the regulator counterpart in MODEL COMPANY AGUAS ANDINAS the tariff setting process, which lasts for 1 year approximately Greenfield operation Existing infrastructure Tariffs are reset every five years, based on an unbiased and technical model: Combination of new and Latest technology – Based on the long term total cost of a model company existing technologies – Discrepancies are solved by an independent experts committee Cost efficiency Real costs – Minimum real return on assets of 7% after taxes – Automatic interim adjustments linked to polynomials based on CPI and WPI 100% coverage in all services Real coverage indexes Self-financing of investments Self-financing of investments through tariffs through tariffs Government subsidies for low-income clients Ability to use debt to finance Minimum Capex and enhance return on The regulatory framework of the Chilean water industry has been fundamental to Return on Assets equity the development of the sector 8
RESOLUTION OF SIXTH TARIFF NEGOTIATION PROCESS An Agreement Was Reached with the SISS Maintain Aguas Andinas’ and Aguas Cordillera’s current tariffs from December 31 st 2013 On November 14 th 2014, Aguas Andinas and its subsidiaries Aguas – The new tariff decree will apply from March and July 2015 Cordillera and Aguas Manquehue, respectively came to an agreement with the Superintendence of Sanitary Services Reduce Aguas Manquehue’s tariffs by 5% in comparison to those (the "SISS") within the framework of applicable on December 31 st 2013 the sixth tariff-setting process for the period 2015-2020 on the following – The new tariff decree applies from May 2015 terms: The indexation polynomials will remain the same 9
RESOLUTION OF SIXTH TARIFF NEGOTIATION PROCESS Changes In Tariffs When New Services Go Into Operation In addition to the indexation Additional tariffs when new works come into operation: polynomial, during the next five years, tariffs will change when new services Turbidity safety works: +1.1% in 2019 that have previously been negotiated with the SISS enter into operation Quality improvement works WWTP Farfana + Trebal: +1.4% in 2018 Tariff discounts for Non-Regulated Businesses: Alto Maipo Project: -1.2% in 2018 (estimated) 10
ESSAL TARIFF-SETTING PROCESS Technical and Negotiation Process For One Year Agreed list of candidates for Definitive the Expert Bases Committee Parameters and Committee SISS Comments on SISS calls SISS answers Background Exchange of the Methodology The company Tariffs gives sets new the parameters Committee to the Comments delivery of the Tariff Studies Publication highlights Tariff Expiration its are made of Experts Tariff Study Discrepancies answer Formulas Process JUNE AUGUST MARCH APRIL APRIL JUNE AUGUST SEPTEMBER SEPTEMBER OCTOBER 12 2015 11 2015 8 2016 7 2016 26 2016 5 2016 12 2016 11 2016 25 2015 29 2015 30 days 16 days 30 days 30 days 11
03. INVESTMENTS 12
2015 INVESTMENTS Investing an Equivalent Amount to 98% of the Year’s Earnings In 2015, the invested amount is equivalent to 98% of the year’s earnings. For the period between 2011 & 2015, the invested ammount is equivalent to 90% of the earnings of the period. OTHER Activities DISPOSAL 9% INVESTMENT EVOLUTION Of Sewage NON-REGULATED 36% Companies 144.171 4% 126.858 92.307 88.844 86.000 PRODUCTION Of Potable Water 20% COLECTION Of Potable Water DISTRIBUTION 10% Of Potable Water 2011 2012 2013 2014 2015 21% 13
2015 -2020 INVESTMENTS Ensuring the Continuity of Service INVESTMENTS 2015-2020 Investment plan of USD$ 900 MILLION SEWAGE 40% 2015-2020 MAIN PROJECTS 60% Investments in potable water Replenishment and operational improvement plans. POTABLE WATER Growth, safety and quality of service Potable Water Safety Infrastructure Works Phase 2 Investments in sewage treatment Growth, safety and quality of service Collection of sewage Sewage treatment Replenishment and improvement plans 14
DROUGHT MITIGATION PLAN Guaranteeing Water Supply For the Sixth Consecutive Year Drought Mitigation Plan 2010-2015 EL YESO RESERVOIR VOLUME New capacity in wells 120% Purchase of raw water Renting of water rights 100% 99% Agreements with other users of the river Monitoring and control of illegal water usage/extraction 80% Initiation of the Drought and Climate Change Plan 2015-2030 Volume (% of capacity) Preliminary studies in development: 60% Demand projection Demand management 40% International experiences in drought Other actions: 20% Actions to increase supply Water supply projection 0% ene feb mar abr may jun jul ago sep oct nov dic Synergies at a user level 2010 2011 2012 2013 2014 2015 2016 15
Recommend
More recommend
