Scotiabank Investor Roadshow COMPANY PRESENTATION

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Transcription:

Scotiabank Investor Roadshow COMPANY PRESENTATION AUGUST 217

AGENDA 1. Company overview 2. Market overview 3. Operations in Chile & Peru 4. Growth opportunities 2

1. COMPANY OVERVIEW 3

Company overview Leading position in Chile & Peru THE COMPANY Installed Capacity 3,852 MW 3,282 MW / 57 MW Power-Plants 24 23 / 1 Market Share 1 21% / 7% Transmission Lines ~9 km Ownership 49.96% Matte Group 9.58% Angelini Group 19.44% Pension Founds 21.2% Others KEY FINANCIALS Total Assets US$6.8 bn Cash US$681 mm EBITDA LTM US$594 mm US$541 mm / Net Debt / EBITDA 1.7 x US$53 mm Rating BBB Fitch BBB S&P Note: All figures as of Jun17 1 In terms of generation 4

Company Overview Well diversified generation assets 1 COLBUN S PRESENCE IN CHILE & PERU. 3,852 MW Inst. Capacity Hydro: 1,597 MW 4 Reservoir: 1,65 MW 12 Run-of-the-river: 532 MW 12,772 MW SEIN Fenix Power Peru: 57 MW Thermal: 1,685 MW 3 CCGT: 1,337 MW 4 Diesel: 568 MW 1 Coal: 35 MW 2 GENERATION MATRIX LTM. (%) 17,399 MW SIC CENTRAL ZONE: 21 MW / 1,128 MW CENTER-SOUTHERN ZONE: 1,24 MW / 454 MW SOUTHERN ZONE: 172 MW / 13 MW Hydro Coal Natural Gas Diesel 2% 21% 14% 54,26 GWh 34% 41% 3% 5% 48,783 GWh 51% Others SIC 29% SEIN Sources: Coordinador Eléctrico Nacional SIC (Chile) & COES (Peru) Note: All figures as of Jun17 5

Company overview Fenix Power: Most efficient CCGT in Peru 1 1 KEY OPERATING HIGHLIGHTS. 2 most efficient CCGT in Peru Based on fuel consumption 4 miles south of Lima Largest City and Capital of Peru 57 MW Gross Effective Capacity (1) 3.5 TWh Net Annual Generation 3 TWh / Year Long-term Contracts (8% Capacity) 2 GE Gas Turbines 192 MW Each LARGEST GENERATION PLANTS IN PERU Effective Capacity MW 979 852 719 616 57 569 Kallpa Chilca (Engie) Illo Noce (Engie) Gas Diesel Puerto Bravo 8% Contracted capacity though 223 Illo Cold (Engie) 6.9 years PPAs average life / Strong AAA Locally-rated off takers NG Supply Sufficient for 1% of the generation for the next 6 years 192 MW Steam Turbine With Chillers and Cooling Water System 5 kv Transmission Line Reducing Congestions Issues 1 st Gas-fired Plant in Dispatch Order Following hydro generators on a consistent basis 3 OWNERSHIP. (%) Colbún 51% ADIA 36% Sigma 13% Note: All figures as of Jun17 1 Based on fuel consumption Source: Colbún S.A. 6

2. MARKET OVERVIEW 7

Market overview Marginal costs & demand in Chile and Peru 1 DEMAND GROWTH. (12 month average %) 2 MARGINAL COST IN SIC & SEIN. (US$ / MWh) 12% 1% 8% 6% 4% 2% % SIC SEIN 4.4%.9% 15 12 9 6 3 Mg. Cost Sic Mg. Cost SEIN 96 19 Marginal costs in the SIC have fallen in the last years, mainly due to the entrance of NCRE, the drop in commodity prices and to the sluggish demand. Marginal costs in Peru are lower than in Chile, mainly due to the low cost of natural gas. However, marginal costs have been particularly low over the past years because of an oversupply due to the entrance into operation of relevant hydro projects. Sources: Coordinador Eléctrico Nacional SIC (Chile) & COES (Peru) 8

Annual Power Generation SIC TWh Market overview Generation and price development in Chile s central grid (SIC) 17,399 MW Inst. Capacity LNG re-gasification terminal since 29 6 5 Development based on hydro + competitive natural gas Fixed price power purchase agreements (set by regulator for distribution companies) Coal-fired power plants PPA tenders with price indexation 3 25 4 2 3 2 15 1 USD/MWh 1 ~9% of the energy is generated with base load power plants 5 2 21 22 23 24 25 26 27 28 29 21 211 212 213 214 215 216 2Q17 LTM Hydro Coal Gas & LNG Diesel-Fuel Others Marginal Cost Source: Colbún S.A. & CDEC-SIC 9

M 3 /sec M 3 /sec Market overview Main reservoirs condition 1 HYDRO GENERATION. (GWh) 3 WATER FLOWS. (m 3 /sec) 7, 6, 18,289 25, 2, 15, 3 25 2 5, 4,478 1, 5, 15 1 4, 211 212 213 214 215 216 2Q17 LTM Colbún Hydro Generation SIC Hydro Generation 5 214 215 216 1H17 Colbún Reservoir 2 STORED ENERGY. (%) 8 25% % of máximum capacity 6 2% 4 15% 2 1% 5% 214 215 216 1H17 % ene-14 Jun-14 Jun-15 ene-15 Jun-16 ene-16 Jun-17 ene-17 Chapo Reservoir Colbún System Source: Colbún S.A. & CDEC-SIC 1

Company Overview Stable EBITDA 1 despite sevear hydrological conditions COLBUN S EBITDA VS. HYDRO GENERATION. (US$ million & TWh) US$ million 8 TWh 8. 6.7 6.5 6 537 582 546 541 4.8 4.5 6. 4 4. 2 2. 211 214 9 1 212 215 11 12 213 216 13 132 2Q17 LTM 2Q17 LTM 14. EBITDA Hydro Generation Note: All figures as of Jun17 1 Excludes EBITDA s contribution from Fenix. Source: Colbun S.A. 11

Avg. Awarded Price (US$/MWh) Market overview Decreasing prices in the last regulated auctions in Chile 16 14 12 1 8 6 4 2 Year 213 214 215 216 Energy (TWh) 4.7 12. 1.2 12.5 Avg. Awarded Price (US$/MWh) 126 18 79 48 Supply starting 216/219 216/219 223 223 Duration (years) 15 15 2 2 12

Market Overview Relevant regulatory changes in Chile 1 TRANSMISSION AND COORDINATOR LAW. Enacted in July, 216. Pricing and remuneration mechanisms were modified. The former coordinators, Centers of Economic Dispatch (CDEC) were replaced by a single National Electric Coordinator, with a new structure and functions. New attributions were given to the CNE and the functions of the Experts Panel were reduced. 2 WATER CODE. Under discussion. Water rights extinction if they are not used. Setting of a retroactive ecological flow for already granted water rights. 13

3. OPERATIONS IN CHILE & PERU 14

Operations in Chile & Peru Balanced commercial position in Chile CONTRACTUAL COMMITTMENTS VS GENERATION. (TWh) TWh 14 12 1 8 6 2,2,5 2.2 2.9 3.2 1.9 2.6 4.4,5,2 3. 3.4 3.8 2.6 2.4 4.4,3,4 3.6 4.5 3.9 2.5 2.6 4.6 5% 45% 4% 35% 3% 25% 2% 4 2 6.9 7.2 6.7 7.2 6.5 6.6 6.5 6.5 5.2 4.9 4.8 4.5 212 213 214 215 216 2Q17 LTM Hydro Coal LNG Diesel Regulated Sales Unregulated Sales EBITDA Mg (%) 15% 1% 5% % Source: Colbún S.A. Unregulated Sales, excludes sales to Codelco at Marginal Cost 15

Operations in Chile & Peru Ensured long-term regasification capacity and LNG supply 1 Long-term strategy: leveraging our efficient natural gas power facilities and diversifying our supply sources; contributing to provide competitive, flexible, secure and sustainable power supply GWh MEDIUM-TERM LNG SUPPLY: METROGAS AND ENAP 2,5 2, 1,5 2, 2, 2, Optional LONG-TERM LNG SUPPLY: REGASIFICATION CAPACITY SECURED 1, 5 1, 217 218 219 2 Long-term regasification capacity and supply contract with ENAP: On May, 217, Colbún and Enap entered into a contract for the supply of natural gas with regasification capacity from LNG. Effective as of January 1, 218, for a period of 13 years. GNL supply with Enap and international providers. Capacity for up to two combined cycle units per year. 16

Commercial Strategy High quality clients In Chile 1 SALES BY TYPE OF CUSTOMER. (%) 2 AVERAGE MONOMIC PRICE 2. (US$/MWh) 17% 2% 1% 3% 29% Codelco (A+) Chilectra (BBB+) CGED (Local AA) Saesa (Local AA+) AngloAmerican (BB+) 21% Others 12 1 8 Regulated Unregulated Long-term energy supply contracts with creditworthy counterparties. 6 214 215 216 2Q17 3 PPAs IN CHILE. (TWh) Regulated Customers 15 12 9 6 3 Unregulated Customers 12.9 12.8 12.7 ~1 YEARS AVERAGE MATURITY PPAs expired: Saesa: 2.1 TWh Note: All figures as of Jun17 1 Cumulative, base 217. 2 Average monomic prices are calculated by dividing the total amount of sales in US$, by physical energy sales in MWh 1.7 PPAs expired: Anglo American: 1.2 TWh 9.5 PPAs expired: CGE-26:.7 TWh Chilectra:.5 TWh 8.3 8.3 217 218 219 22 221 222 223 contracts expired (%) 1 1% 1% 17% 27% 36% 36% (TWh) 1..1.2 2.2 3.4 4.6 4.6 Source: Colbún S.A. 17

Commercial Strategy PPAs renewal opportunities in Chile 1 UPCOMING REGULATED AUCTIONS 1. 15.4 TWh 2. TWh 1.6 TWh 8. TWh 3.8 TWh Year Supply starting Duration (years) 217 218 219 22 224 224 225 226 2 2 2 2 2 UNREGULATED CLIENTS. In the coming years there is a relevant amount of energy for large unregulated clients to be re-contracted. Colbun is currently participating in auctions with unregulated customers (mining and industrials). Opportunities in medium-size clients: In the last months, Colbun has signed new contracts with medium-size clients for a total of ~8 GWh/year and average tenor of ~ 6 years. The prices and volumes offered reflect the current market conditions and the cost structure of the Company. 1 Latest available information. 18

Financial Review Consolidated financial results 1 OPERATING REVENUES. (US$ million) 3 NET INCOME. (US$ million) 2, 1,6 1,2 8 1,696 1,53 1,314 1,436 1,479 25 2 15 1 63 12 82 Hidro Aysén 2 25 216 4 5 213 214 215 216 2Q17 LTM 213 214 215 216 2Q17 LTM 6 4 2 2 EBITDA & EBITDA MG. (US$ million & %) EBITDA Chile EBITDA Fenix EBITDA Mg 36% 21% 45% 45% 4% 56 53 537 582 546 541 352 213 214 215 216 2Q17 LTM 5% 4% 3% 2% 1% % 4 DEBT/EBITDA & NET DEBT/EBITDA. (x) 6 Debt/EBITDA 4.8 5 Net Debt/EBITDA 4.1 3.8 4 3.5 3 2.8 2.9 2 2. 2. 1.7 1.7 1 213 214 215 216 2Q17 Source: Colbun S.A. 19

Financial Review Consolidated Debt Profile 1 FINANCIAL DEBT. Avrg. Maturity: 4.6 years 2 DEBT PROFILE. Peru 363 US$ 1,73 million Avrg. US$ Interest Rate: 4.95% Chile 134 Banks 21% Local Bonds 2% Variable 3% Int. Bonds 59% Fixed 97% UF 6% US$ 94% 3 AMORTIZATION STRUCTURE. (US$ million) 6 5 4 348 532 525 Fenix Term Loan Colbún's Bonds 3 2 1 12 28 32 33 25 25 25 25 25 16 4 217 218 219 22 221 222 223 224 225 226 227 228 229 Note: All figures as of Jun17 Source: Colbún S.A. 2

4. GROWTH OPPORTUNITIES 21

Growth opportunities Growth opportunities in Chile & the Region 1 SPECIAL FOCUS IN PERU AND COLOMBIA. Growing electricity consumption Well established regulatory framework Diversification: - Hydrological conditions - Generation technology 9 MW PMGD Solar Photovoltaic - Fuel access - Regulation Guaiquivilo Melado Reservoir / Run-of-the-river El Médano Run-of-the-river ~316 MW 6 MW 34 MW La Mina Run-of-the-river / NCRE (Completed as of Apr17) 2 GROWTH OPPORTUNITIES IN CHILE: BASE LOAD CAPACITY AND RENEWABLES. Hydro projects NCRE under study San Pedro Run-of-the-river 17 MW ~93 MW Los Cuartos Run-of-the-river 22

Concluding remarks 1. 1 Size: Second-largest generation company in Chile s largest electricity grid and a relevant presence in Peru. 2. 2 Customers: Diversified, solid and creditworthy portfolio of clients. 3. 3 High standards of environmental and social management: Complete integration with all of our Stakeholders. 4. 4 Shareholders: Strong, reliable controlling group with a strategic and longterm vision of the business. 5. 5 Management: Experienced management and high standards of corporate governance. 6. 6 Financial flexibility: Strong metrics, conservative financial strategy and ample access to financial markets. 23

Disclaimer And contact information This document provides information about Colbún S.A. In no case this document constitutes a comprehensive analysis of the financial, production and sales situation of the company. To evaluate whether to purchase or sell securities of the company, the investor must conduct its own independent analysis. This presentation may contain forward-looking statements concerning Colbún's future performance and should be considered as good faith estimates by Colbún S.A. In compliance with the applicable rules, Colbún S.A. publishes on its Web Site (www.colbun.cl) and sends the financial statements of the Company and its corresponding notes to the Superintendencia de Valores y Seguros, those documents should be read as a complement to this presentation. INVESTOR RELATIONS TEAM CONTACT Miguel Alarcón malarcon@colbun.cl + 56 2 246 4394 Verónica Pubill vpubill@colbun.cl + 56 2 246 438 Soledad Errázuriz serrazuriz@colbun.cl + 56 2 246 445 24