calidda investor's presentation q3 2014
TRANSCRIPT
Cálidda´s 3Q 2014 Results
I. Significant Developments
II. Commercial Performance
III. Operational Performance
IV. Financial Performance and Key Metrics
V. Questions and Answers Session
Annexes:
(i) Strong Sponsorship with Optimal Experience
(ii) Experienced and Proven Management Team & Board
2
Table of Contents
I. Significant Developments
II. Commercial Performance
III. Operational Performance
IV. Financial Performance and Key Metrics
V. Questions and Answers Session
Annexes:
(i) Strong Sponsorship with Optimal Experience
(ii) Experienced and Proven Management Team & Board
Table of Contents
3
In July OSINERGMIN published the resolution that sets Cálidda´s tariff regime for the next 4 years (from May 8th, 2014 to May 7th, 2018). The approved average distribution tariff was increased by 6.37% when compared to the 2010 – 2014 average distribution tariff.
In addition, OSINERGMIN resolution establishes an investment plan (capex) of US$ 428 MM for the period 2014 – 2017.
Also in July, Cálidda started to expand sales to the residential segment at regular sales price of installation services, without promotional discounts*
As part of our expansion plan, Cálidda has started working on the environmental impact study in the southern district of Lima called Cañete.
As of September, Cálidda has a client base of 235,000 customers, 67% more than in Q3 2013.
Significant Developments
1) Total Adjusted Revenues and Adjusted EBITDA Margin exclude Pass-through and IFRIC 12 revenues.
4
Significant Developments
6,889 15,945 29,048
39,543 60,097
71,452
19,188 35,133
64,181
103,724
163,821
235,273
0
50,000
100,000
150,000
200,000
250,000
0
25,000
50,000
75,000
100,000
2009 2010 2011 2012 2013 YTD 2014
Connections Performance
Period connections Collected connections
(*) Mechanism set up to increase residential sales in medium-low income households by discounting 50% the sales price of installation services. The 50% discount is known as “promotional discount” and is factored in the distribution tariff
Main Results - YTD Q3 2014 Q3 2013 Var %
Invoiced Volume (MMCFD): 672 558 20%
Total Revenues (USD MM): 443.6 296.8 49%
Total Adj. Revenues (USD MM) 1 : 139.6 102.5 36%
EBITDA (USD MM): 70.9 50.5 40%
Adjusted EBITDA Margin: 50.8% 49.3% --
Total Network Lenght (km): 4,450 3,094 44%
Accumulated Clients: 235,273 141,146 67%
I. Significant Developments
II. Commercial Performance
III. Operational Performance
IV. Financial Performance and Key Metrics
V. Questions and Answers Session
Annexes:
(i) Strong Sponsorship with Optimal Experience
(ii) Experienced and Proven Management Team & Board
Table of Contents
5
Client Base
Our clients in this segment have an installed capacity close to 3,500 MW, representing 37% of Peru’s overall power generation capacity (*).
Up to Q3, Cálidda has connected a total of 19 new industrial plants.
A new cluster of industries in northeast Lima has been identified (Puente Piedra), and one client has already been connected (Compañía Peruana de Vidrios) to Cálidda´s distribution system. In the first stage of expansion in this cluster, a group of 11 clients will be soon connected.
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Power Generation
Industrial
(*) Source: Executive Yearbook of Electricity of 2013 – MEM.
8
11 13 13
16 16
0
5
10
15
20
2009 2010 2011 2012 2013 Q3 2014
321 360
394 429
466 485
0
100
200
300
400
500
600
2009 2010 2011 2012 2013 Q3 2014
Client Base (Cont’d)
Up to Q3, Cálidda has connected to the distribution system a total of 9 new NGV service stations, and currently there are more than 188,000 vehicles already converted to natural gas running in the cities of Lima and Callao.
Further consumption in this segment is expected to come from the public transportation buses, as they gradually switch their fuel source from diesel to natural gas.
Up to Q3, Cálidda has added 71,424 clients to the Residential & Commercial segment.
In the Residential segment only, 70,645 new clients have been connected in 2014, and as a result a total of 231,341 households currently use natural gas.
In the Commercial segment, Cálidda has increased in 2014 its efforts to connect more businesses to the distribution system, reaching 779 new clients up to Q3 and therefore having a total of 3,216 commercial clients.
NGV Stations
Residential & Commercial
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103 143 172 192 206 215
81,029 103,712
126,586 151,781
171,541 188,124
0
50,000
100,000
150,000
200,000
0
100
200
300
400
2009 2010 2011 2012 2013 Q3 2014
NGV Stations Converted Vehicles
18,756 34,619
63,602
103,090
163,133
234,557
0
50,000
100,000
150,000
200,000
250,000
2009 2010 2011 2012 2013 Q3 2014
Volume Sold MMCFD
In Q3 Cálidda increased its volume sold by 20% compared to Q3 2013, mainly explained by the addition of Fénix Power (82 MMCFD) and Termochilca (45 MMCFD) since the 2H 2013. Additionally, Cálidda has agreed to distribute 20 MMCFD of additional volume to Kallpa power generator.
As of Q3, 76 % of the volume sold is explained by firm contracts (take or pay), the majority of them corresponding to the power generation clients.
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52.2%
63.9%
71.6% 71.6%
72.5% 69.9%
74.2%
13.4%
10.6%
8.8%
9.7%
9.6% 10.6%
9.2%
34.0%
25.0%
19.2%
18.1%
17.2% 18.8%
15.8%
182
303
457
508
577 558
672
2009 2010 2011 2012 2013 Q3 2013 Q3 2014
Residential &Commercial
Industrial
NGV Stations
Power Generation
Volume Sold by Client Segment MMCFD
NGV Stations Residential & Commercial
Industrial Power Generation
9
95
193
327 364
418 402
499
0
100
200
300
400
500
600
2009 2010 2011 2012 2013 Q3 2013 Q3 2014
62
76
88 92
99 98 107
0
20
40
60
80
100
120
2009 2010 2011 2012 2013 Q3 2013 Q3 2014
24
32
40
49 56 55
61
0
10
20
30
40
50
60
70
2009 2010 2011 2012 2013 Q3 2013 Q3 2014
0.8 1.3
1.9
2.9
3.9 3.7
5.5
0
1
2
3
4
5
6
2009 2010 2011 2012 2013 Q3 2013 Q3 2014
I. Significant Developments
II. Commercial Performance
III. Operational Performance
IV. Financial Performance and Key Metrics
V. Questions and Answers Session
Annexes:
(i) Strong Sponsorship with Optimal Experience
(ii) Experienced and Proven Management Team & Board
Table of Contents
10
Operational Performance
Distribution System Infrastructure
Network Efficiency
In the first nine months of 2014, Cálidda has built 18 km of steel high pressure network and 1,028 km of polyethylene secondary network, which is built in great extent to reach new household clients.
The pace of expansion in areas with polyethylene network built (rings) has increased considerably this year, reaching 111,997 rings in Q3 2014 compared to 53,066 rings in Q3 2013 .
Cálidda’s entire distribution system consists of 4,450 km of underground pipelines.
The network penetration rate has reached 53% in the last quarter.
The district of San Juan de Lurigancho is the one with the highest penetration rate at 71%.
This year Cálidda has planned on entering into 5 more districts: Callao, Ate, Puente Piedra, Imperial and Cañete.
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Clie
nts
(‘0
00
)
273 303 359 387 408 426 701
1,020 1,465
2,163
2,996
4,024
974 1,324
1,824
2,550
3,404
4,450
0
1,000
2,000
3,000
4,000
5,000
2009 2010 2011 2012 2013 Q3 2014
km
Steel Network Polyethylene Network Total
19 35 64
104
164
235
94 126
174
244
331
443
20%
28%
37% 42% 50%
53%
0%
10%
20%
30%
40%
50%
60%
0
100
200
300
400
500
600
2009 2010 2011 2012 2013 Q3 2014Total Clients Potential Clients*
(*) Clients who are adjacent to Cálidda's distribution
I. Significant Developments
II. Commercial Performance
III. Operational Performance
IV. Financial Performance and Key Metrics
V. Questions and Answers Session
Annexes:
(i) Strong Sponsorship with Optimal Experience
(ii) Experienced and Proven Management Team & Board
Table of Contents
12
Total Adjusted Revenues by Segment
2
1) Total Adjusted Revenues exclude Pass-through and IFRIC 12 revenues.
2) Installation Services Revenues include revenues from connection fees and financing.
3) Others: mainly derived from network relocation and other non recurrent services.
3
13
1%
16%
9%
74%
4%
15%
11%
31%
37%
3%
Residential & Commercial Industrial NGV StationsPower Generation Installation Services Others
Q3 2014 Total Adjusted
Revenues1 Q3 2014 Total Volume
(MMCFD)
As of Q3, our Total Adjusted Revenues are represented by 60% from distribution revenues (volume sold related revenues) and 40% from installation services revenues and other revenues.
Futhermore, over 68% of our Total Adjusted Revenues are not dependable on demand volatility because our firm contracts revenues account for 31% and installation services revenues account for 37%.
Firm contracts revenues account for 50% of our distribution revenues.
Financial Performance Million US$
Funds from Operations (FFO)1
EBITDA & Adj. EBITDA Margin (%) Total Revenues
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Debt & Net Debt / EBITDA2
43 64 103 125 146 103 140 116 125
201 245
315
194
304
160 188
304
370
461
297
444
2009 2010 2011 2012 2013 Q3 2013 Q3 2014
Total Adjusted Revenues Pass-through & IFRIC 12
19 29
59 64
72
92
44.5% 46.1%
57.6% 51.6% 49.3%
50.8%
2009 2010 2011 2012 2013 LTM Q32014EBITDA Adjusted EBITDA Margin
12
18
40 43
36
58
2009 2010 2011 2012 2013 LTM Q32014
3.9x 3.9x
2.8x 3.0x
4.4x
3.4x
3.1x 3.1x
2.3x 2.3x
3.0x 2.8x
2009 2010 2011 2012 2013 LTM Q32014Debt / EBITDA Net Debt / EBITDA
2) Net Debt = Debt - Cash Balance. 1) FFO = Net Profit + Depreciation + Amortization
Financial Metrics
Interest Coverage2 FFO / Net Debt
Debt / Capitalization (%) Total Debt1
2) In 2013 ratio does not include 2013’s debt prepayment penalties (USD 7.8
MM)
1) Total Debt: net of debt associated costs.
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41.4%
49.8% 54.1%
49.2%
56.6% 53.8%
2009 2010 2011 2012 2013 LTM Q32014
3.5x 3.8x
5.8x 5.5x 5.6x
6.4x
2009 2010 2011 2012 2013 LTM Q3 2014
20.9% 20.2%
28.9% 28.3%
16.8%
22.5%
2009 2010 2011 2012 2013 LTM Q32014
28 67
119 149
318 318
47
47
47 47
75
114
166 196
318 318
2009 2010 2011 2012 2013 LTM Q32014Senior Debt Shareholders' Subordinated Debt
CapEx
Financial Performance (Cont’d) Million US$
Net Income
Equity Total Assets
16
218
289
383
492
648 660
2009 2010 2011 2012 2013 LTM Q32014
106 115 141
202
244
273
2009 2010 2011 2012 2013 LTM Q32014
48 50 32
63
92
62
3 53
33
5
51 50
85
96 98
62
2009 2010 2011 2012 2013 Q3 2014
Secondary Network Main Network
7 10
26 27
17
29
2009 2010 2011 2012 2013 LTM Q32014
I. Significant Developments
II. Commercial Performance
III. Operational Performance
IV. Financial Performance and Key Metrics
V. Questions and Answers Session
Annexes:
(i) Strong Sponsorship with Optimal Experience
(ii) Experienced and Proven Management Team & Board
Table of Contents
17
For more information about Cálidda, please contact our Investor Relations team:
http://calidda.com.pe/inversionistas/
http://www.grupoenergiadebogota.com.co
Adolfo Heeren
CEO
Rafael Andrés Salamanca Rodriguez
Investor Relations Advisor GEB
+57 1 326 8000 – ext. 1675
Isaac Finger
CFO
+51 1 625 7310
Investor Relations
18
Mathius Sersen
Finance Director
+51 1 625 7390
I. Significant Developments
II. Commercial Performance
III. Operational Performance
IV. Financial Performance and Key Metrics
V. Questions and Answers Session
Annexes:
(i) Strong Sponsorship with Optimal Experience
(ii) Experienced and Proven Management Team & Board
Table of Contents
19
Strong Sponsorship with
Optimal Experience
– Leading energy holding company with interests across the electricity
and natural gas sectors in Colombia, Peru and Guatemala.
– Founded in 1896, controlled by the Distrito de Bogotá since 1956 with a
76.2% ownership stake.
– Leader in the Energy Sector: major player in the transmission and
distribution of electricity and natural gas.
– Only vertically-integrated and one of the largest natural gas distribution
and transportation companies in Colombia.
– Founded in 1974 by the government of Colombia. Currently controlled
by Grupo Aval.
– Major player in the gas distribution sector in Colombia through Gases
de Occidente, Surtigas and Gases del Caribe.
– Participation in the power distribution in Colombia and
telecommunications sector in Panama and Costa Rica.
– EEB has 15.6% stake in Promigas.
Controlling Investments
Non Controlling Investments
Non Controlling Investments
Controlling Shareholder – 60% Ownership in Cálidda
Shareholder – 40% Ownership in Cálidda
Controlling Investments
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Experienced and Proven Management Team & Board
Board of Directors
Management Team
PresidentSandra Stella
Fonseca Arenas
18 years of working experience in the
energy sector
Former Executive
Director of the Energy and Gas Regulation
Commission in
Colombia
Luis BetancurEscobar
Served as Director of Fondo Financiero Desarrollo Urbano
President of Colombia's
restructuring of the
Energy and Gas Regulatory
Commission
Jose Elias Melo Acosta
President of Corporación Financiera
Colombiana S.A
Minister of Colombia's Treasury and Public
Credit and Labor and Social Security departments.
Antonio CeliaMartínez-Aparicio
President ofPromigas
Served on the board of directors of various companies in the
natural gas sector.
Manuel GuillermoCamargo Vega
Management positions in distribution and
transportation utilities
of natural gas and project experience in
transportation of crude
oil and natural gas.
Felipe Castilla Canales
CFO in EEB
Previously CFO in ContourGlobal
Latinoamerica. He also held the position of CFO in REFICAR -
Refinería de Cartagena.
Luis ErnestoMejía Castro
Director of
Promigas
Minister of Mines and
Energy and Vice Minister of
Hydrocarbons and
Mines.
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Chief Operating
Officer
JorgeMonterroza
Years in industry:17 years
Years at Cálidda:3 years
Chief Executive OfficerAdolfo Heeren
Years in Industry: 17 yearsYears at Cálidda: 3 years
Chief Commercial
Officer
CarlosCerón
Years in industry:17 years
Years at Cálidda:3 years
ChiefProcurement
Officer
PatriciaPazos
Years in industry:17 years
Years at Cálidda:9 years
Chief FinancialOfficer
IsaacFinger
Months in industry:
2 months
Months at Cálidda:
2 months
Chief Human Resources
Officer
RosarioJiménez
Years in industry:5 years
Years at Cálidda:5 years
Chief External Affairs Officer
TaniaSilva
Years in industry:3 years
Years at Cálidda:2 years
Chief Legal and
Regulatory Officer
AmadeoArrarte
Years in industry:12 years
Years at Cálidda:10 years
Chief Strategy Officer
TatianaRivas
Years in industry:6 years
Years at Cálidda:6 years
Chief Internal Auditor
CarolinaHernández
Years in industry:8 years
Years at Cálidda:6 years
Disclaimer
The information provided here is for informational and illustrative purposes only and is
not, and does not seek to be, a source of legal or financial advice on any subject. This
information does not constitute an offer of any sort and is subject to change without
notice.
Cálidda and its Shareholders expressly disclaim any responsibility for actions taken or
not taken based on this information. Neither Cálidda nor its Shareholders accept any
responsibility for losses that might result from the execution of the proposals or
recommendations herein presented. Neither Cálidda nor its Shareholders are
responsible for any content that may originate with third parties. Cálidda or its
Shareholders may have provided, or might provide in the future, information that is
inconsistent with the information herein presented.
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