Enel Generacin Chile Investor Relations Presentation 9M 2016 - - PowerPoint PPT Presentation

▶

Oct 29, 2023 266 likes •501 views

Enel Generacin Chile Investor Relations Presentation 9M 2016 Organization structure Enel Generacin Chile (after Spin Off) ITALY ENEL SpA Committed Shareholders 61% CHILE Enersis S.A. ENEL CHILE 60% 18% Chilean Pension Funds 3%

SLIDE 1

Enel Generación Chile

Investor Relations Presentation 9M 2016

SLIDE 2

Organization structure

Enel Generación Chile (after Spin Off)

 PEHUENCHE, 93%  GASATACAMA, 97%

61% 60% ITALY CHILE  Transquillota ,48%  Electrogas, 43%  GNL Chile, 33% CHILE1

Committed Shareholders

Average volume traded (MMUS$) 2015 2016 Chilean Stock Exchanges 6.0 4.9 50% NYSE 4.4 5.0 50% Total 10.4 9.9 100%

ENEL SpA ENEL CHILE ENEL GENERACIÓN CHILE 60% 16% 3% 3% 18% Enersis S.A. Chilean Pension Funds ADRs (Citibank N.A.) Retail Institutional Investors

1 Recognized as equity method investments.

SLIDE 3

Key investment considerations

Best investment grade in the region. Stable ratings by Credit Rating Agencies (BBB+)

Attractive business in Chile

Well diversified portfolio of generation assets, including all types of technologies.

Hydroelectric assets prevailing in the Chilean Central Interconnected System SIC. Competitive thermal assets to reduce hydrological risks.

One of the largest electricity generation companies in Chile.

Proven track record with more than 70 years of experience

Conservative commercial policy to cope with hydrological risks. Stable regulatory framework to develop reliable long term business.

SLIDE 4

Well diversified generation assets

Most relevant player in hydro generation

Energy sales 9M16 : 17,962 GWh Energy sales 9M15 : 17,311 GWh Market Share 1 : 35%

55% 10% 34% 1%

HYDRO COAL OIL-GAS NCRE

55% of Endesa Chile’s installed capacity corresponds to hydro resources Installed Capacity 6,351 MW

Hydro : 3,456 MW Oil-gas : 2,173 MW Coal : 636 MW NCRE 2 : 87 MW

D. Almagro–

Taltal Bocamina Laja Maule Bio Bío Tarapaca Huasco San Isidro Los Molles Cachapoal Santiago

1:Calculated based on total sales of the country. 2: Non Conventional Renewable Energy.

SLIDE 5

Balanced comercial policy

Leading to revenue stability

Physical sales: 17,962 GWh

Spot Unregulated Customers Regulated Customers Spot Free Customers

Energy sales by type of customer (Million Ch$) Chile – Contracted energy with Regulated and Free Customers (GWh) Physical Sales 9M16 GWh Change1 REGULATED 14,080 8% UNREGULATED 3,087

SPOT 795

TOTAL 17,962 4%

Regulated Customers 78% 17% 5%

896,457 781,810 171,726 173,853 81,863 118,810 9M 2015 9M 2016

1,077,215 1,159,136

1 Compared with 9M15

2 4 6 8 10 12 14 16 18 20 22 2017 2018 2019 2020 2021 2022 2023 2024 2025

Regulated Costumers Free Costumers

SLIDE 6

Financial Highlights

Improving results in Chile

Consolidated Income Statement1 9M 2016 9M 2015 Change %2 MM US$3 2016

Revenues 1,276,246 1,131,398 13% 1,877 Costs (708,503) (712,864) (1%) (1,042) Contribution Margin 567,743 418,534 36% 835 EBITDA 439,528 320,527 37% 642 EBITDA Margin 34% 28%

EBIT 340,008 229,342 48% 500 Net Financial Expenses (22,741) (95,288) (76%) (33) Related Company Results 6,858 7,483 (8%) 10 Net Income from other Investments 121,405 4,309 2,717% 179 Taxes (82,549) (36,779) 124% (121) Net Income 442,587 364,432 21% 651 Attributable to shareholders of Endesa Chile 396,302 194,459 104% 583

1 Under IFRS, Endesa Chile has adopted the Chilean Peso as functional currency, comparisons between periods have been only made using Ch$. 2 When comparing 9M2016 with 9M2015 3 Referential average exchange rate was 680,08 Ch$/US$ as of September 30, 2016.

SLIDE 7

Healthy debt maturity profile

Solid financial ratios and Investment grade rating (BBB+)

Debt by T ype1 Debt by Currency1

Total Debt: US$ 1,443 MM Financial Debt Maturity1 as of September 2016

Cash:

US$ 167 MM

Committed Credit Lines:

US$ 364MM

Average life of debt:

10 years

International Credit Rating:

BBB+

8 8 28 87 45 1,089 3 3 3 153 3 12

200 400 600 800 1.000 1.200 < 1 year 1-2 years 2-3 years 3-4 years 4-5 years 5 years and beyond Bonds Banks and Other 93% 7%

US$ UF + CLP

12% 88%

Others Bonds

1 Includes arrangements and other consolidation adjustments.

SLIDE 8

Consolidated Cash Flow Generation (US$ million)1

Including discontinued operations

1. Referential average exchange rate was 680.08 Ch$/US$ as of Sept 30, 2016
2. Dividend payment considers cash outflows to Enersis and all minorities’ shareholders.

420 184 462 83 220 162

100 200 300 400 500 600 700 800 900

Cash and equivalents Sept-15 Funds from operations Capex Financing activities & Exchange rate effects Dividend payment ² Cash and equivalents Sept-16

SLIDE 9

Markets with high potential for growth

Annual growth of 3.4% in electricity demand in Chile*

Direct relation between GDP and electricity demand

ARGENTINA AUSTRALIA AUSTRIA BOLIVIA BRAZIL CANADA CHILE CHINA COLOMBIA FINLAND FRANCE GERMANY GREECE INDIA IRELAND ITALY JAPAN MEXICO PERU RUSSIA SPAIN UNITED KINGDOM UNITED STATES 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 10,000 20,000 30,000 40,000 50,000 60,000 Electricity consumption, per capita (Kwh per year) GDP per capita (current PPP, US$)

Data source: The World Bank.

Chile aims to be in the group of developed countries
There is no development without energy.

* Average for 2005-2015 period.

SLIDE 10

Evolution of Endesa Chile’s total installed capacity

Endesa Chile has more than doubled its capacity in the last 20 years

87% 72% 76% 62% 55% 55% 13% 28% 24% 37% 44% 44%

1% 1% 1%

1995 2000 2005 2010 2016 Under construction 2,513 4,035 4,477 5,611 6,351 6,501

GasAtacama 781 MW* Los Cóndores 150 MW

A well diversified generation matrix incorporating different types of generation technologies (Coal, LNG and NCRE), providing a better

position to cope with hydrological risks.

2% increase in installed capacity through projects under construction.

* Capacity added in 2014.

SLIDE 11

Projects under construction

To support growth of the country

Run-of-the-river, hydroelectric power plant.
Located in San Clemente, in Maule region, Chile.
150 MW of installed capacity.
Estimated generation of 600 GWh/year.
Estimated load factor: 46%.
Total CAPEX of US$ 662 million.
38% progress as of September 2016.
Total investment of US$ 233 million as of September 2016.

Los Cóndores

SLIDE 12

Projects under construction

General information (North dome)

Construction started : August 2015
Schedule ending construction: December 2016
Men Hours spent: 606,000 hours.
Cubic Meter of coal accumulated in field:

from 130.000 M3 up to 150.000 M3

Total Capex: US$MM 50 aprox. (north and south domes)

Bocamina II optimization – Coal field domes

Permits

Waiting for construction permits approvals for the south

dome. Current status

North dome is 76% complete.

To support growth of the country

SLIDE 13

Credit Rating Agencies’ Recognition

Attractive ratings since 2010

BBB+ Baa2 BBB+

Since: Affirmed:

Jan. 2010
Apr. 2011
Feb. 2010
Mar. 2016
Dec. 2015
Feb. 2016

AA (cl) AA

Jan. 2010
Apr. 2010
Mar. 2016
Jul. 2016

International market Chilean market

RATINGS BASED ON:

Well diversified and efficient assets
Leading market share in Chile
Transparent and stable regulatory framework in Chile
Solid financials, good cash flow generation and prudent financial

management

Conservative commercial policy

SLIDE 14

Strategic Plan 2017 - 2019

EBITDA Evolution

898 1.108 2016E 2019 23%

Hydrology Normalization of hydrology since 2018, favor an increase in hydro production, improving margin Sale price Contractual position allows to defend margins when spot prices fall down Assets Mix Diversified generation mix mitigates hydrology risk Drivers Additional capacity Commercial operations of Los Cóndores starting by the end of 2018, increasing our production in 600 GWh/year approx. Accumulated EBITDA 2017 – 2019: Th US$ 3,095 1,108

SLIDE 15

Total 2017-2019

Total investment for the period 2017 – 2019: US$ 687 MM:

New Capacity: Los Cóndores.
Higher environmental standards.
Maintain higher standard of operational efficiency.

Operational excellence in the generation capacity

248 439

Mantenimiento BD

Capex Maintenance and Business Development

85 61 101 264 158 18

349 219 119

2017 2018 2019 Mantenimiento BD

Strategic Plan 2017 - 2019

Maintenance Maintenance

SLIDE 16

16 50% 55% 60% 65% 70%

2016 2017 2018 2019 2020

Enel Generación Chile paid on May 24th a dividend of Ch$ 11.02 per share1.
Enel Generación Chile proforma dividend 2015 was Ch$ 23.95 per share.

1. Note: As of March 1, 2016, Enel Generación Chile Spin-Off became effective.

Pay-out ratio increasing to 70% in 2020

Dividend policy

SLIDE 17

Susana Rey Head of IR Enel Chile +56 2 2630 9606 susana.rey@enel.com

ir.enelgeneracionchile@enel.com

For further information, visit our IR site at:

www.enelgeneracion.cl

Catalina González Head of IR Enel Generación Chile +56 2 2630 9603 catalina.gonzalez@enel.com Guillermo Berguecio Analyst of IR Enel Generación Chile +56 2 2630 9506 guillermo.berguecio@enel.com Francisco Basauri Analyst of IR Enel Generación Chile +56 2 2630 9585 francisco.basauri@enel.com

Enel Generación Chile

SLIDE 18

Exhibits

SLIDE 19

Highlights 9M16

Chilean EBITDA amounted to 642 million dollars in 9M16, increasing 37%.
Net income attributable to shareholders rose 104% to 583 million dollars.
Total energy sales rose by 4% in 9M16.
Higher generation, despite lower hydrology, due greater coal generation (+961 GWh).
On October 4, 2016, it was changed the Company’s name to "Enel Generación Chile S.A.”.

The new name became official on October 18, 2016.

Enel Generación Chile S.A. sold all of its shareholding in GNL Quintero S.A. for Ch$

132,821 million on September 14, 2016.

SLIDE 20

Installed capacity and energy generation

20 1 : Compared with 9M15

Los Molles: 18 MW Rapel-Sauzal: 466 MW Maule: 875 MW Laja: 940 MW Ralco-Pangue: 1,157 MW

54% Hydro 3,456 MW 44% Thermal 2,808 MW

GasAtacama 780 MW Tarapaca 182 MW

D. Almagro–Taltal:

268 MW Huasco: 64 MW San Isidro 1 and 2: 778 MW Bocamina 1 and 2: 478 MW TG Quintero: 257 MW

2% NCRE1 87 MW

Canela: 18 MW Canela II: 60 MW Ojos de Agua: 9 MW

Installed Capacity: 6,351 MW Market Share*: 31% Total Generation: 13,389 GWh

Net Generation 9M16 GWh Change1

HYDRO

6,674 4%

COAL

2,296 97%

OIL-GAS

4,296 (17%)

NCRE

73 (22%)

Total

13,389 7% Historical energy generation by type of technology

* Based on installed capacity 1000 2000 3000 4000 5000 6000 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 2012 2013 2014 2015 2016 Hydro Coal Oil-Gas CHP / Renewables

SLIDE 21

Strong financial position

1Amounts translated into US$ using the exchange rate as of September (Ch$ 658.02 per US$).

*Financial ratio as of Sept 2016 compared with Sept 2015.

(Million Ch$) September 2016 Dec 2015 Chg. Chg % MM US$ 20161 Gross Debt 974,683 945,119 67,534 7% 1,479 Cash 110,174 37,425 66,737 64% 167 Net Debt 864,509 907,694 797 (5%) 1,312 Leverage 0.94 1.05 0.09 (10%)

Financial Expenses

Coverage 18.29 11.23 27.39 63%

ROE (%)*

22.1% 12.7% 9,4% 74%

ROA (%)*

10.9% 8.1% 2.8% 34%

SLIDE 22

DISCLAIMER This presentation does not constitute an offer to sell any securities and is not soliciting an offer to buy any securities in any jurisdiction. This presentation contains certain “forward-looking statements” regarding anticipated financial and operating results and statistics and other future events relating to Enel Generación Chile S.A. (Enel Generación) These statements are not guarantees of future performance and are subject to material risks, uncertainties, changes and other factors which may be beyond Enel Generación’ control or may be difficult to predict. These statements may constitute forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. The inclusion of these forward-looking statements should not be regarded as an indication that Enel Generación or any other person considers such projections to be material or to be a reliable prediction of actual future results. These forward-looking statements are subjective in many respects and there can be no assurance that they will be realized or that actual results will not be significantly higher or lower than described. As a result, the inclusion of any forward-looking statements in this presentation should not be relied on as necessarily predictive of actual future events. The projections and other forward-looking statements were based on numerous variables and assumptions that are inherently uncertain. Actual results may differ materially from those projected as a result of such risks and uncertainties. In addition, the financial projections do not necessarily reflect revised prospects, changes in general business or economic conditions, or any other transaction or event that has occurred or that may occur and that was not anticipated at the time the projections were prepared. Forward looking statements include, but are not limited to, information regarding: Enel Generación' business plans, Enel Generación' cost reduction plans, trends affecting Enel Generación ' 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 effect of any changes in the laws and regulations applicable to Enel Generación' or its affiliates. The principal assumptions underlying these forecasts and targets relate to: Economic and Industry Conditions, Commercial Factors, Political/Governmental Factors, Operating Factors, and Competitive Factors. The following important factors, in addition to those discussed elsewhere in this presentation, could cause actual financial and operating results and statistics to differ materially from those expressed in our forward-looking statements, including but not limited to: changes or developments regarding the applicable regulations (which may affect the investment plan of Enel Generación regarding the regulated activities), legal restrictions applicable to the implementation of the dividends policy, environmental regulations and other legal issues; price of electricity; price and supply of raw materials; interest rates or exchange rates; availability of fuel; ability to maintain relationship with suppliers, customers and consumer and user protection groups; changes in climate conditions; widespread adoption energy efficiency measures; inherent risks in the construction of new power generation and distribution facilities; changes in general economic, political, administrative and business conditions; operating hazards and risks; tax risks; loss of senior management and key personnel; insufficiency of insurance coverage or increase of insurance costs; failure of systems and information technology and processing; inability to access the capital markets to refinance its debt and finance its capital expenditures; and other factors that could adversely affect the business and financial results of the Company. No assurance can be given that the forward-looking statements in this document will be realized. Readers are cautioned not to place undue reliance on those forward-looking statements, which speak only as of the date of this presentation. Our independent registered public accounting firm has not audited, examined or compiled the forward-looking statements and, accordingly, does not provide any assurance with respect to such statements. Neither Enel Generación nor any of its affiliates intends, nor undertakes any obligation, to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.