Enel Chile : 9M 2019 Results Presentantion

9M 2019 consolidated results

Key highlights of the 9M 2019

Renewable

Growth

Infrastructure networks & e-cities

Shareholders

sustainable

value

SDGs

Sustainable

Dev. Goals

Decarbonization on track

Tarapacá closure and Campos del Sol/Cerro Pabellón III started construction

Customers centricity and long-term partnership

BHP Billiton, Anglo America and Collahuasi agreements

Focus on EBITDA margin and sustainable growth

in Generation and Distribution businesses

Environmental, Social and Governance best practices

Presence in three Dow Jones Sustainability Indices and ISO 370011certification

Operations continues to contribute with our SDG targets

1.	ISO 37001: An international standard that recognizes the existence of an effective anti-bribery management system. Enel Chile, Enel Generación and Enel Distribución have been	1
	certified with this standard

Decarbonization

Enel Chile is leading the energy transition in Chile

Decarbonization update

Tarapacá Power Plant closure on track for

December 31st, 2019

Impairment accounting impact on Enel Chile Net Income of US$ 277 million¹

With no impact on Enel Chile

Dividends Distribution

Commercial Strategy aligned with decarbonization

• 3TWh/ year renewable15-year PPA (BHP as from Aug/21)

Up to 3 TWh/ year renewable 10-years PPA (Anglo American as from Jan/21)

Up to 1 TWh/ year renewable 10-year PPA

(Collahuasi as from Apr/20)

Phase 1Phase 2Robust Renewable Pipeline

Tarapacá	Bocamina I	Bocamina II	Geothermal	Wind	Solar
December 2019	Up to December 2023	Up to December 2040

1.

Average exchange rate for the period 685.61CLP/USD

2

Energy Transition

Smart solutions paving the future

Main updates on the period

Leadership consolidation on

sustainable mobility

Plan to install 1,200 EV charging

points over the next 5 years

Wood stoves replacement with more

efficient system (4,700 families benefited and 15k tons CO2emissions avoided)

2017 2018 9M

2019

Electric 2 76 285buses*

Charging 63 221312Points*²

2017 2018 9M

2019

Public234259 251lighting ('000)*

e-³Home31.0 50.8 54.8services ('000)

Latam' First Electric-Route¹

Inauguration of the "Electro Route Grecia" first of its kind in Latin America:

• 40 digital bus stops
• 183 newe-buses were launched, totaling a fleet of 285 for Enel.
• 3 new electro terminals

1.

Photovoltaic, lighting, cameras, LED publicity, information panels for users

3

1. Stock in 2017: 63 private and public charging stations for electric vehicles. Stock in 2018: 147 public and private charging stations plus 74 charging stations
2. Active contracts in the year for Micro insurance in B2C

• Accumulative figures

Capex allocation

Development capex focused on renewables

Enel X

9M 2019 Capex by business and by nature¹

28%	58%
	10%
USD	USD	1%
296mn	296mn
	60%
12%	31%
Asset management	Renewables

Asset development

9M 2019 Development capex

USD 88%

8%178mn

4%

Networks & Enel X

Customers

Thermal generation

Other

1.

Average exchange rate for the period 685.61CLP/USD

4

Generation portfolio

Continuous improvement on our mix and margins

Installed capacity (GW)			Production (TWh)
	9%							+11%
8%				14.4				16.0
								2.4
					1.5
	7.5							2.8
	47%			2.4				0.3
20%	GW	0.3
	3.0				3.2

Energy sales (TWh)

+1%

17.718.0

0.30.6

5.5

7.5

16%	7.2	7.3

11.9

9.8

								9M 2018	9M 2019
Hydro		CCGT¹		Oil-Gas		Coal		Wind, Solar, Geothermal & Mini-Hydro

9M 2018

9M 2019

Regulated Free Spot

1. Combined Cycle Gas Turbine

5

Distribution portfolio

Focus on digitalization to continuously improve our services and efficiency

Energy distributed (TWh)2

End users	1.90		1.96
(mn)

Telecontrol equipment installation (cumulated)

	+2%
12.6	12.9

1,733

1,481

1,161

1,902

9M 2018

9M 2019

SAIDI¹ LTM (minutes)

+14%

177203

2016

2017

2018

9M 2019

Energy losses (%)

-2p.p.

5.14.9

9M 2018

9M 2019

9M 2018

9M 2019

1.

SAIDI LTM: System Average Interruption Duration Index during the last twelve months

6

2. Energy distributed only in Enel Distribución concession area

Progress on SDGs

Engaging local communities1

		9M 2019	2021
High-quality, inclusive and fair education		48		107
Access to affordable and clean energy		197		175
Employment and sustainable and		369		447
inclusive economic growth
I&N, sustainable cities and cyber securities2
	9M 2019
E-buses		285
Charging points3		312
Web app with cyber security solutions		100%

Climate change	9M 2019
Emission free production, as % of total		61%
generation in MWh

1.

Cumulated data and targets from 2015 of thousand beneficiaries

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1. Cumulated data
2. Public and private charging stations

9M 2019 consolidated results

Financial results

Financial highlights

(USD mn)¹

		9M 2019	9M 2018		Var.
Revenues		3,046		2,580		+18%
EBITDA		1,181		825		+43%
Group Net Income		301		304		-1%
EBITDA Margin		39%		32%		+7 p.p.
Gross Margin		49%		43%		+6 p.p.
Gross CAPEX		296		296		-0%
Net Debt		3,406		3,333²		+2%

1.

Reported figures. Comparisons between periods in the Financial Income Statements are made using the average exchange rate for the period 685.61 CLP/USD;

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2. Jan 1st2019, adjusted by IFRS 16 adoption (USD 53 mn)

EBITDA

(USD mn)¹

3Q 2019 vs 3Q 2018

											+18%			(4.5)
330		58.3		7.2				391
72																79
264		(6)										(10)	322
		3Q 2018			Generation		Networks /	Holding	3Q 2019
EBITDAmargin											Enel X
+35%																	+40%
							Generation			Networks / Enel X		Holding

9M 2019 vs 9M 2018

					+43%
				161.8			19.7			(2.6)		1181
825		176.7															221
202																				986
647
	(23)												(26)
9M 2018		One - Off Generation	Networks /	Holding	9M 2019
						(PPA)	Enel X
	+32%																					+39%
							Generation		Networks / Enel X			Holding

1.

Average exchange rate for the period 685.61CLP/USD

10

Generation Businesses

Improving our operating margins

EBITDA evolution (USD mn)¹

Ebitda	40%				46%
Margin²
								Hydro production slightly above last year
				+52%

986

	647		177			- 10 % savings on cost of fuels
		809
				(lower price of coal and natural gas)
	647
						+6 p.p EBITDA Margin improvement due to
	9M 2018		9M 2019	optmized portfolio mix

One-Off PPA

1.	Average exchange rate for the period 685.61CLP/USD	11
2.	Excludesone-off effect on PPA early termination of USD 177 mn in EBITDA

Networks & Enel X Businesses

Focus on efficiency, network resilience and final customer

EBITDA evolution (USD mn)¹

Ebitda	15%				14%
Margin
									2 p.p reduction in energy losses
				+10%

202	221
	2% increase on energy distributed

			+ USD 11 mn related to Enel X
9M 2018	9M 2019		additional EBITDA on e-transportation

1.

Average exchange rate for the period 685.61CLP/USD

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Profit & Loss

(USD mn)¹

		9M 2019		9M 2018	∆ yoy
EBITDA²		1,181		825		+43%
D&A		(667)	(229)		+191%
of which Impairment³		(405)	-		N.A.
EBIT		514	596		-14%
Financial expenses		(157)	(108)		+46%
Results from equity investments		4	3		+18%
EBT		360	492		-27%
Income taxes		(40)	(129)		-69%
Minorities		(20)	(58)		-66%
Group net income		301		304		-1%

Higher D&A mainly due to impairment

of coal-fired power plants

Higher Financial Expenses related to Elqui project and the consolidation of EGP Chile

Lower tax expenses mainly related to the

impairment and corporate structure simplification

Lower Minorities due to

Enel Generación Chile tender offer

1.

Average exchange rate for the period 685.61CLP/USD

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1. Excludesone-off effect on PPA early termination of USD 177 mn in EBITDA
2. Impairment of the closure of thecoal-fired power plants

Cash flow

(USD mn)¹

	1,181
	177
		1,004
					768		(96)
					(413)
								672	(113)559		559
														(296)		263
														263
																				(78)
																	(342)
	Reported		Working	Income	Financial	FFO	Capex	FCF	Dividends	Net
			EBITDA		Capital	Taxes	expenses							paid	FCF
					& Others					One - Off (PPA)
9M18²		900			9		(122)		(89)		698		(323)		376		(358)		18

1.	2019 average exchange rate for the period 685.61CLP/USD	14
2.	Figures consider the average exchange rate for the period 628.69 CLP/USD, as reported in the 9M18

Debt and financial expenses

(USD mn)¹

Gross and net debt

ND/EBITDA

2.7x

2.1x

-3%

3,7703,650

303245

3,4673,406

Sep 2018	Sep 2019
		Net debt		Cash

Net debt evolution

								+2%
	3,333		(263)	342	(6)
IFRS 16		53
	590				3,406
	3,280

Jan 1st, 2019	FCF	Dividends	Fx	9M 2019
		paid	conversion

Sep/19 Average Maturity: 6.7 years (7.0 years in Sep/18)			Cost of gross debt: 5.4% (vs 5.2% Jan 1st, 2019)
1. Average exchange rate for the period : Sep/2019 (728.21CLP/USD), Jan 1st	2019 (65781CLP/USD), Sep/2018 (660.42CLP/USD)	15

Energy tariff stabilization mechanism

Mechanism Overview

Main takeaways

Regulated customers tariff will be reverted to 1H2019

level and kept fixed until Dec 2020, creating an accounting receivable in favor of the Gencos

Gencos receivables shall be accrued until July 2023,

capped by USD 1,350 million

Mechanism stablishes the recovery of the

balance by Dec 31st2027 at latest

Interest on balance accounts will be applied

from 01 Jan 2026 onwards (libor rate)

Expected mechanism evolution¹

	Up to Dec-20		Jan-21 to Jun-23		Jul-23 to Dec-25		Jan-26 to Dec-27
	Fixed prices		Fixed prices + IPC		Max (A; B)		Max (A, B) + readjustment

A

B

			Up to Jun-23:				Jul-23 to Dec-25			Jan-26 to Dec-27
			Genco' receivables accumulation				Receivables			recovery deadline
							refund period
		B	Stabilized tariff $/kWh (Customer price)	A	PNLP system $/kWh	(Average price PPA Gx)

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1. PNLP: Long-term average energy price; IPC: Chilean Consumer Price Index;

Closing remarks

Renewable

Growth

Shareholders

sustainable

value

Enel Chile continues to pursue a sustainable growth fostering customer satisfaction and responsible energy consumptions

Client long-term partnership, decarbonization, portfolio mix and

digitalization continues to driver our growth

SDG commitments on-track and best practices

on ESG, aligned with our strategy

Infrastructure

& networks

SDGs

Sustainable

Dev. Goals

Sustainable Margins and Cash-flow stability will continue to be one of our priorities onwards

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9M 2019 consolidated results

Contact us

Isabela Klemes

Head of Investor Relations Enel Chile

Investor Relations team

Catalina González

Claudio Ortiz

Pablo Contreras

Gonzalo Juarez

Contacts

Email [e-mail]

Phone [phone]

Channels

Website

Enel.cl

Follow us

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9M 2019 Results

Disclaimer

This presentation contains statements that could constitute forward-looking statements within the meaning of the Private Securities Litigation

Reform Act of 1995. These statements appear in a number of places in this announcement and include statements regarding the intent, belief or current expectations of Enel Chile and its management with respect to, among other things: (1) Enel Chile's business plans; (2) Enel Chile's cost-reduction plans; (3) trends affecting Enel Chile's financial condition or results of operations, including market trends in the electricity sector in Chile or elsewhere; (4) supervision and regulation of the electricity sector in Chile or elsewhere; and (5) the future effect of any changes in the laws and regulations applicable to Enel or its subsidiaries. Such forward-looking statements 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 of the United States or Chile, 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 Chile's Annual Report and Form 20-F. Readers are cautioned not to place undue reliance on those forward-looking statements, which state only as of their dates. Enel Chile undertakes no obligation to release publicly the result of any revisions to these forward-looking statements.

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