Pampa Energía Announces Year-end Results

(Pampa Energía, 10.Mar.2020) — Pampa Energía S.A., the largest independent energy integrated company in Argentina, with active participation in the country’s electricity and gas value chain, announces the results for the fiscal year and quarter ended on December 31, 2019.

The company adopted the US Dollar as functional currency (‘FC US$’) for the reporting of its financial information, effective as from January 1, 2019. However, the information of the comparative periods is reported in local and constant currency (‘L&CC’) as of December 31, 2018, which are shown in US$ converted by closing nominal exchange rate (‘FX’). Moreover, Edenor, Transener, OldelVal, Refinor and TGS continue recording their operations under L&CC, therefore their figures are adjusted by inflation (for further information, see section 2 of this Earnings Release or footnote 3 of Pampa’s financial statements (‘FS’)).

For the convenience of the reader, it is shown as supplementary information for each segment’s quarterly comparative period the figures recorded in local currency and nominal terms (‘L&NC’) expressed in US$ at average FX, except for the distribution segment and subsidiaries under L&CC, which comparative quarter’s figures are shown in L&CC as of December 31, 2019 and expressed in US$ at closing FX.

Main Results for the Fiscal Year 2019

Consolidated net revenues of US$2,836 million1, 3% lower than the US$2,920 million recorded in the fiscal year 2018, due to decreases of 15% in oil and gas, 5% in petrochemicals, 44% in holding and others, and higher eliminations due to intersegment sales of US$205 million, partially offset by increases of 35% in power generation and 1% in electricity distribution.

— Power Generation of 15,582 GWh from 15 power plants2

— Electricity sales of 19,974 GWh to 3.1 million end-users

— Production of 48.2 thousand barrels of oil equivalent (‘boe’) per day of hydrocarbons

— Sales of 343 thousand tons of petrochemical products

Consolidated adjusted EBITDA3 for continuing operations of US$915 million, 9% lower than the US$1,001 million for 2018, mainly due to decreases of 31% in electricity distribution, 34% in oil and gas, and 15% in holding and others, partially offset by increases of 20% in power generation, US$29 million in petrochemicals and higher intersegment eliminations of US$1 million.

Consolidated gain attributable to the owners of the Company of US$692 million, US$468 million higher than the US$224 million gain in 2018, mainly due to the on-time non-cash gain for the settlement of Edenor’s regulatory liabilities and lower accrual of losses from FX difference as a result of change to FC US$, partially offset by decrease at operating margins in electricity distribution and oil and gas.

Main Results for the Fourth Quarter 2019 (‘Q4 19’)4

Consolidated net revenues of US$702 million, a 10% higher than the US$640 million recorded for the fourth quarter 2018 (‘Q4 18’), explained by increases of 2% in power generation and 37% in electricity distribution, partially offset by decreases of 22% in oil and gas, 2% in petrochemicals, 45% in holding and others, and higher eliminations due to intersegment sales (US$10 million).

— Power Generation of 3,805 GWh from 15 power plants

— Electricity sales of 4,745 GWh to 3.1 million end-users

— Production of 47.7 thousand boe per day of hydrocarbons

— Sales of 91 thousand tons of petrochemical products

Consolidated adjusted EBITDA for continuing operations of US$170 million, 3% higher compared to the US$165 million reached at Q4 18, due to increases of 9% in power generation, US$8 million in electricity distribution, lower losses of US$18 million in petrochemicals and higher intersegment eliminations for US$2 million, partially offset by decreases of 56% in oil and gas and 11% in holding and others.

Consolidated gain attributable to the owners of the Company of US$9 million, US$280 million lower than the gain of US$289 million in Q4 18, mainly due to lower RECPAM recorded, due to the passive net monetary position allocated to the electricity distribution segment, lower gains from the participation in joint businesses and affiliates, and a higher loss from impairment of fixed assets.

Note: * FC US$ was adopted on April 1, 2019, effective as from January 1, 2019 for Pampa Energía stand-alone and generation subsidiaries Los Nihuiles hydroelectric power plant (‘HINISA’), Diamante hydroelectric power plant (‘HIDISA’) and Piedra Buena thermal power plant (‘CPB’), as well as affiliates Greenwind and CTBSA, among others. The 2019 and Q4 19 results are disclosed in AR$ converted at transactional FX.

L&CC applies as from July 1, 2018 retrospectively and prospectively for subsidiaries Edenor (electricity distribution segment), OldeVal (oil and gas segment), Refinor, TGS and Transener (holding and others segment). Figures in AR$ for 2019 and Q4 19 are adjusted by average inflation as of December 31, 2019 for approximately 21.2% and 5.5%, respectively, and the disclosure in US$ results from converting by a closing FX of AR$59.89 per US$.

Figures for 2018 and Q4 18 are recorded in AR$ and adjusted by inflation as of December 31, 2018 for approximately 19.2% and 5.4%, respectively, and shown in US$ at a closing FX of AR$37.70 per US$.

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