Enel Chile(US:ENIC)2022-03-01 00:20Financial Data and Key Metrics Changes - Full-year 2021 adjusted EBITDA reached $0.8 billion, a 3% decrease compared to the previous year, while Q4 adjusted EBITDA was $258 million, aligning with 2021 guidance [21][24]. - Full-year adjusted net income was $0.2 billion, consistent with annual guidance, and Q4 payments reached $96 million [24]. - Capex for 2021 was $1.1 billion, with a 1% increase from 2020, primarily in line with guidance [25]. Business Line Data and Key Metrics Changes - Energy production in Q4 2021 was 5.2 TWh, a decrease from Q4 2020, while total production for 2021 was 19 TWh, slightly lower than 2020 due to poor hydrology [27]. - Energy sales increased by 2% as of December 2021, attributed to new contracts with clients [27]. - The distribution business showed a recovery in Q4, while transmission contributions were expected to decline [42]. Market Data and Key Metrics Changes - The Chilean electricity system faced significant challenges due to one of the driest periods in history, impacting hydrology and generation capacity [6][10]. - Gas prices more than tripled from Q4 2020 to the second half of 2021, leading to increased costs and pressure on margins [11]. - The demand for electricity rose by 5% in 2021 compared to 2020, with expectations for continued growth into 2022 [12]. Company Strategy and Development Direction - The company is advancing its renewable projects, having connected 900 MW of renewable capacity in 2021, with a total of 8 GW now connected [16]. - The focus on sustainability is evident, with 21% of total debt linked to sustainability targets, aiming for 52% by 2024 [9]. - The company is also enhancing its digitalization efforts, with 90% of client interactions conducted through digital channels in 2021 [18]. Management's Comments on Operating Environment and Future Outlook - Management noted that the hydrology situation remains challenging, but gas availability from Argentina has improved, aiding resource management [44]. - The company expects to maintain its EBITDA guidance for 2022, despite ongoing challenges in the market [66]. - The management expressed confidence in the recovery of the distribution business and the overall economic recovery post-pandemic [19]. Other Important Information - The company was included in the Bloomberg Gender Equality Index for the first time and received a B score in the CDT climate change assessment [9]. - Total outstanding debt as of December 31, 2021, was $210 million, with $140 million related to residential clients [15]. Q&A Session Summary Question: Regarding the evolution of EBITDA in the macro business from distribution and transmission - Management indicated that distribution saw a decline in 2021 but showed recovery in Q4, while transmission contributions were expected to decline [42]. Question: Update on hydrology outlook for 2022 and EBITDA guidance - Management confirmed that water availability remains low, but gas availability has improved, allowing for better management of resources [44][45]. Question: Clarification on asset rotation transactions - Management stated they are considering selling non-core assets as part of their strategy to address debt [46]. Question: Insights on the tariff stabilization mechanism - Management noted that alternatives for the stabilization mechanism post-June are being explored, but no definitive plans are in place yet [66]. Question: Status of Bocamina 2 retirement - Management confirmed plans to close Bocamina 2 by May 2020, but any delays would require careful management and community engagement [68]. Question: Confirmation of 2022 EBITDA target - Management reaffirmed the EBITDA guidance of $1 million to $1.1 million for 2022, indicating no significant issues anticipated [66].