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Medellin-based highway construction giant Construcciones El Condor announced November 14 that its third quarter (3Q) 2018 net income for its construction operations more than tripled year-on-year, to COP$53.5 billion (US$16.7 million), from COP$15 billion (US$4.7 million) in 3Q 2017.

The figures for the latest quarter “reflect a high level of project execution,” according to the company. "We note a 52.9% increase in construction services [in latest quarter] compared to the prior-year quarter.”

Likewise, earnings before interest, taxes, depreciation and amortization (EBITDA) improved along with a “very positive” boost in EBITDA margin, thanks mainly to efficient execution and favorable weather for outdoor construction, according to the company.

The improvement came despite a 7.6% decline this year in national construction activity in Colombia as measured by DANE, the national economic-statistics agency, El Condor noted.

Colombia’s “fourth-generation” (4G) highway construction projects continue to provide credits to construction companies, the company added.

Gross revenues so far this year are up 49%, hitting COP$676 billion (US$212 million), and the company expects similar growth in 4Q 2018.

Nine-month 2018 company-wide EBITDA dipped to COP$126 billion (US$39.5 million), from COP$252 billion (US$79 million), but this was because of a non-recurring, one-time sale of investments last year, El Condor noted.

If only measuring construction activity -- rather than including the one-time asset sale last year -- then nine-months 2018 EBITDA was up 40% year-on-year, the company added.

Similarly, nine-months net income corporate-wide was higher in 2017 that in 2018. But this was the result of the same non-recurring sales-of-investments last year, the company noted.


Medellin-based multinational retail giant Exito on November 14 posted a third quarter (3Q) 2018 net loss of COP$9.6 billion (US$3 million), but nine-months 2018 profits soared by 293%, to COP$119 billion (US$37 million).

Gross revenues as measured in Colombia pesos dipped 8.4% year-on-year in 3Q 2018, to COP$12.7 trillion (US$3.98 billion), but actually improved 9.5% if excluding Colombian peso weakening.

For nine-months 2018, gross sales are off 3.3% measured in Colombian pesos but up 8.2% if excluding the peso-weakness effect.

Sales in the four South American countries where Exito operates showed increases in local currencies: Colombia up 0.6%; Brazil 12.9%; Uruguay 4.7% and Argentina 23.5%, according to Exito.

Recurring earnings before interest, taxes, depreciation and amortization (EBITDA) were COP$661 billion (US$207 million) with an EBITDA margin of 5.2%.

In Colombia, nine-months sales hit COP$8.1 trillion (US$2.5 billion), spurred by new retail formats (“Exito Wow” and “Carulla FreshMarket,”) new strategies, growing credit-card sales, income from the “Viva” real-estate venture and growing “e-commerce” sales, the latter of which now account for 3.6% of all Colombian sales, according to Exito.

The gradual improvement in sales here during the latest quarter came despite a 0.7% decline in the Colombian consumer confidence index, which has been weak in seven of the last 12 months, Éxito noted.

In Brazil, 3Q 2018 food sales rose 12.9% year-on-year, thanks to strong growth at “Assaí” stores as well as improvements at the “Extra” and “Pão de Açúcar” outlets, according to Exito.

In Uruguay, sales so-far this year have grown 6.4% in local currency “amid a challenging economic situation in the neighboring countries,” Exito noted.

Operating profit margin in nine-months 2018 in Uruguay was 6.9% compared to 6.7% in the same period of 2017, while recurring EBITDA margin was 8% compared to 7.7% in the same period of 2017.

As for Argentina, the “Libertad” store chain in 3Q 2018 showed a “growth in its sales of 23.5%. Libertad had the best market performance, and according to Nielsen, to August of this year registered 18% of the market share in the territory where it operates. The recurring EBITDA margin in the third quarter was 4.7%, mainly leveraged by the real estate operation in its 15 galleries commercials that maintain an occupation close to 95%,” according to Exito.

At the end of 3Q 2018, Exito had 1,536 stores, of which 549 are in Colombia, 870 in Brazil, 88 in Uruguay and 29 in Argentina.


Medellin-based Grupo Orbis – which includes Pintuco paints, Andercol Chemicals and O-Tek water treatment technologies – on November 14 posted a COP$8 billion (US$2.5 million) net loss for 3Q 2018, compared to a COP$3.2 billion (US$1 million) net profit in 3Q 2017.

For the nine-months of 2018, Orbis posted a net loss of COP$35.5 billion (US$11 million), which was worse than the COP$6.5 billion (US$2 million ) net loss in nine-months 2017.

Revenues also declined year-on-year, to COP$367 billion (US$115 million) in 3Q 2018 versus COP$435 billion (US$136 million) in 3Q 2017, while nine-months 2018 revenues fell to COP$1.02 trillion (US$320 million) versus COP$1.2 trillion (US$376 million) in nine-months 2017.

“This result was impacted by the sales performance of the third quarter, decreasing by 2%,” according to Orbis.

“This situation is partly attributable to the slow performance during 2018 of the consumer, construction and industrial sectors, both in Colombia and in the other countries where we have a presence.

“In relation to the cost behavior, the group continues in its process of operational transformation with the transfer of its main chemical and piping business plants to the city of Cartagena, which has generated a temporary pressure on operating costs. Additionally, there has been a strong price increase in some strategic raw materials, which has temporarily affected the profitability of the businesses.

“To offset this performance, during the quarter adjustments were made in operating expenses, which are reduced by 12.3%. Accumulated [from January] to September 2018, the reduction in expenses is equivalent to 10.5% compared to the same period of 2017.

“Grupo Orbis continues with the goal of reducing its net debt, which in the last 12 months has been reduced 19%, or COP$95.9 billion [US$30 million],” according to the company.


Medellin-based insurance and asset manager Grupo Sura announced November 14 that its third quarter (3Q) 2018 net income fell 10.2% year-on-year, to COP$413 billion (US$139.2 million).

“The decrease is due to the impact of the difference in the rate of exchange [falling Colombian peso versus U.S. dollar],” the company noted.

However,  Suramericana insurance-division profits rose 33.2% year-on-year, while profit for the Sura AM division dipped 2.6%, as a results in differences in the rates of exchange.

Grupo Sura saw a 1.5% dip in assets, to COP$67.9 trillion (US$22.86 billion), while liabilities decreased by 1.4%, to COP$42.2 trillion (US$14.2 billion). Equity dipped 1.6%, ending at COP$25.8 trillion (US$8.68 billion).

“For the third quarter of 2018, we showed a positive operating performance for our subsidiaries, strategic decisions to not participate in some businesses, and external issues such as the volatility of capital markets,” according to the company.

For nine-months 2018, net income is up 0.7%, at COP$1.1 trillion (US$371.9 million), according to the company. The nine-month gain “is the result of a 7.7% increase in net income for Sura Asset Management, to COP$479 billion (US$161.3 million), plus a 0.5% increase for Suramericana, for a total of COP$394.8 billion (US$132.8 million),” as well as income from its partial holdings in Bancolombia and Grupo Nutresa.

Total revenue dipped 4.3%, to COP$14.5 trillion (US$4.48 billion), as a result of a “decision to not participate in pension insurance in Colombia, lower revenue from the investments in the portfolios of the subsidiaries, and the devaluation in Argentina,” according to Sura.

“These factors have been partially offset by higher revenue from commissions for the pension business, and the provision of health services in Colombia.

“Sura Asset Management, our subsidiary expert in pensions, savings, and investment, had a 6.6% increase in revenue from commissions in its mandatory pension business, while the voluntary savings business rose by 15.1% in comparable terms. It had a total of 19.8 million clients, an annual increase of 3.6%, while assets under management (AUM) represent COP$412.8 trillion (US$138.9 billion) and grew 7.5% compared to September 2017.

“In turn, Suramericana, our subsidiary specialized in insurance management, trends and risks, had increase revenue, in comparable terms, from all its segments: general (8.1%), life (13%), and health (20.5%).

“In addition, the rate of retained claims improved by going from 55.5% to 54.3%, and technical results increased to 8.3%, in spite of the decrease in premiums for not participating in retirement insurance in Colombia,” according to the company.


Argos 3Q 2018 Net Income Jumps 37% Year-on-Year

Thursday, 15 November 2018 09:52 Written by

Medellin-based cement, electric power and road/airport concessionaire Grupo Argos announced November 14 that its third quarter (3Q) 2018 net income rose 37% year-on-year, hitting COP$410 billion (US$128 million).

As for nine-months 2018, Argos has posted an accumulated profit of COP$864 billion (US$269 million), up 31%.

Consolidated revenues of Grupo Argos in 3Q 2018 were COP$3.6 trillion (US$1.1 billion), “which is in line with adjusted revenues in the same quarter of the previous year,” according to the company.

The revenues were “supported by positive contributions from all the strategic businesses -- cement, concessions and energy -- that were COP$97 billion [US$30 million] higher than the same quarter of the previous year,” according to Argos.

Earnings before interest, taxes, depreciation and amortization (EBITDA) hit COP$1.02 trillion (US$318 million) in 3Q 2018, with EBITDA margin at 28%.

Also in 3Q 2018, “Grupo Argos was recognized as the most sustainable company in the world of the construction materials industry by the Dow Jones Sustainability Index,” the company bragged.

The company added that it will start reporting during the next quarter “environmental, social and corporate governance” (ESG) data together with financial results.

On the electric power front, “Odinsa (through Opain) and Celsia, our subsidiaries in concessions and energy, began the installation of 10,000 solar panels that will generate 12% of the energy in [Bogota’s] El Dorado airport, which will consolidate it as the airport with the largest photovoltaic installation in Latin America,” according to Argos

Meanwhile, the under-construction “Pacifico 2” road concession in Antioquia “reached 100% of execution of ‘functional unit 1’ and has an overall works-compliance of 55%, with a 7% advance with respect to the schedule,” according to Argos.

On the cement front, “Cementos Argos closed a financing operation with a US$600 million syndicated loan which, in addition to the favorable impact in reducing the cost of debt without affecting the debt ratio, confirms the market’s confidence in the company,” according to Argos.

“Cement shipments grew 2% thanks to the better performance of the Colombian region, where we grew above the sector. At the same time, there were higher volumes of concrete sales, which grew by 3% in Colombia, thanks to higher shipments to civil works, demonstrating the leadership that Cementos Argos has taken in the infrastructure projects in the country,” the company added.


In a November 8 presentation to some 1,000 attendees for an annual construction-industry forum here, Camacol Antioquia executive director Eduardo Loaiza revealed that new-housing sales in Medellin have fallen 31% this year – mainly due to recent economic weakness in Colombia and investor uncertainly over the national elections earlier this year.

Aside from now-settled election uncertainties that previously rattled investors and “paralyzed” construction, Loaiza cited relatively weak economic growth in Colombia (just 1.7% GDP growth last year and around 2.6% growth this year) as a key reason behind relatively feeble construction growth in Antioquia.

While forecasted GDP growth in Colombia is seen rebounding to around 3.5% in 2019, new tax proposals by the national government could present further headwinds for construction growth next year and beyond, he warned.

So far this year, total construction licenses in Antioquia have fallen 10% in 2018 versus 2017, with residential licenses down 10% and non-residential down 11%, he showed.

On the other hand, Camacol Antioquia calculations indicate that it’s possible that construction licenses here could rise to as much as 4 million square meters of occupied space in 2019, up from just 2.4 million square meters this year, he estimated.

From January through September 2018, total new-housing sales in Antioquia (including Medellin, the Aburra valley suburbs, plus the western and eastern suburbs and the Uraba region) fell 15% year-on-year, he showed. Sales of non-residential buildings in Antioquia also fell 13% this year versus last, he showed.

Other than Envigado -- where 2018 new-home sales are up 25% this year versus last -- the “oriente” region (east of Medellin including Rionegro, El Retiro, Llanogrande, San Antonio de Pereira and La Ceja) and the northern suburb of Copacabana were the only other regions or municipalities in Antioquia showing new-home sales growth: up 15% in “oriente,” and up 13% in Copacabana (see chart, above).

In contrast, sales in Medellin and Sabaneta both fell 31% this year, while Bello was off 18% and La Estrella down 9%, he showed. Homes available for sale in Antioquia also have declined 4.2% this year versus last, he showed.

On the other hand, Camacol estimates that sales of new houses in Antioquia in 2019 could rise about 7% year-on-year, to nearly 22,000 units, he said.

Meanwhile, on the hotel construction front, 19 new hotels were announced this year as in-development for Antioquia, nine of which are in Medellin and three in Rionegro, he showed.

In a separate presentation here, Camacol president Sandra Forero Ramirez explained that subsidized “social housing” has been the one segment of the construction market that has shown the greatest resilience through economic cycles -- and this is the single-biggest market segment for housing construction growth, at 58% of the total.

In contrast, housing for middle-class and upper-income sectors have seen declines in construction over the past two years, she said. However, a Colombian national mortgage “stabilization fund” for housing construction has helped to slow the contraction in these markets, she added.

For 2019, Camacol expects continuation of more building in the subsidized “social housing” sector rather than in the middle and upper-income sectors.

So far in 2018, Colombia housing starts have fallen 7% year-on-year, she said. But that’s better than the 11% contraction in 2017, she pointed-out. Over-all Colombian housing demand also declined, to 155,000 units this year, compared to 170,000 in 2017, nearly 200,000 in 2016, and 180,000 in 2015.

Middle-income housing accounts for  30% of the total Colombian market, but demand in this sector could fall in 2019 if government interest-rate subsidies are trimmed. Construction in this sector has already fallen 14% this year, she showed.

Upper-income housing construction is 12% of the national market. This sector faces potentially devastating consequences in 2019 if the national government’s proposed 18% value-added tax (VAT) is imposed on all housing sales at or above COP$888.5 million (US$280,000 at today’s exchange rates) along with proposed curtailment of interest-rate deductions. Construction in this sector is already down 22% so far this year, she showed.

Velocity of housing sales also has slowed over the 2017-2018 period, with only 40% of newly constructed units sold within six months, compared to nearly 50% in the comparable 2016-2017 period. What’s more, only 55% of new units were sold within 12 months over 2017-2018, whereas 67% of new units were sold within 12 months during the 2016-2017 period.

The slowest sales rates are in the middle- and upper-income units; the fastest in the subsidized “social housing” sector, she showed.

In a separation presentation here, Victor Saavedra Mercado, Colombia’s Vice-Minister of Housing, stated that 4 million Colombians in urban areas continue to live in “inadequate” housing that may lack full water, sewer, gas and power utilities, lack legal property titles, occupy spaces that lack updated zoning, lack paved street access, and suffer from substandard building construction.

In total, some 44% of Colombians today live in rented housing, compared to 19% in Chile, 18% in Brazil, and 13% in Mexico and Peru, he said. Hence well-designed government programs could help a lot more lower-income Colombians move from renting to owning, he said.

To address this, new Colombian President Ivan Duque’s administration is putting more emphasis on subsidies for upgrading existing substandard housing, including rent-to-buy subsidy options, along with aid to municipalities that must update zoning to encourage investments, he said.

Construction: Huge Economic Engine for Antioquia

Antioquia accounts for 14% of Colombia’s entire gross national product (PIB), while the construction sector here by itself accounts for no-less-than 11.6% of Antioquia’s total GDP,  Saavedra said -- 6% of local PIB via buildings-construction, and 5.6% of local PIB in civil-works construction (roads, bridges, dams, airports), he explained.

While one-third of Antioquia’s population lives in rented housing, another 31% live in irregular housing and 35% are homeowners, he showed. Meanwhile, household formation (new marriages, new children) is running at a faster rate than new-housing construction, he warned. In addition, 80% of the municipalities in Antioquia lack updated zoning, which further complicates new-construction initiatives, he showed.

As for the densely-populated, densely-built land within Medellin, the city has now established plans to “renovate” 41% of its occupied lands with even higher-density housing, he showed.

Governor Perez Hails Tunnel Projects

In a final presentation here, Antioquia Governor Luis Perez cited several highway tunnel projects that will stimulate more residential and non-residential building in growing areas including Medellin's suburban “oriente” region, the “occidente” region (around Santa Fe de Antioquia), the northern suburbs and (eventually) the Uraba region, once the “Mar 2” and “Toyo Tunnel” projects are completed during the next decade.

Some 74% of the total length of all new highway tunnels in Colombia are in Antioquia, Perez boasted. At least in Antioquia, tunnel construction is moving at a much faster pace than the long-delayed, vastly over-budget “Tunel de la Linea” tunnel strategically connecting Bogota to highways heading south-westward toward the Pacific port of Buenaventura, he bragged.

The “doble calzada oriente” project linking the Las Palmas highway east of Medellin to the Rionegro airport highway (see Medellin Herald August 1, 2018) only lacks one more bureaucratic approval before the project can be put-out for bid. Once built, this highway will attract even more construction investment to the “oriente” region east of Medellin, he added.

On another front, a proposed 19.9-kilometers-long highway linking the southern Medellin suburb of Caldas to the “oriente” municipality of El Retiro – including an 8.6-kilometers-long tunnel – is in “pre-feasibility” stage, he said. That new highway potentially could efficiently redirect much southern-Antioquia traffic bound for the “oriente,” which currently is forced to travel through Medellin to get there.

‘Colombian Property’ Sees Huge Growth Coming in Oriente

On a related front, El Retiro-based, bilingual real-estate agency specialist Colombian Property (www.colombianproperty.com) told Medellin Herald in a separate interview that “huge” housing growth is coming to the “oriente” region over the next five to 10 years -- on top of tremendous growth over the past 10 years.

Colombian Property president Miguel Homsey – Colombian-born but New York-raised – pointed to the impact of new highways including the Tunel de Oriente linking Medellin to the international airport at Rionegro; the “doble calzada oriente” highway project between Sancho Paisa and the airport; the explosive growth of “parcelacion” gated community projects around El Retiro, Llanogrande, Rionegro and La Ceja; a newly proposed, upscale “wellness” retirement community project near La Ceja; a new highway that will link this area to Llanogrande and onward to Medellin; and future development of a second runway at the Rionegro international airport, triggering many more international flight connections.

“Foreigners are piling-in” to the oriente region thanks to its favorable climate, abundant “green” space, better air quality, relatively upscale neighborhoods and amenities, and a favorable dollar-to-peso exchange rate, he told us.

“El Retiro is going to change in a big way, with four to five thousand new luxury homes and apartments coming soon, and more properties coming later. There are 9,000 people living in El Retiro now but it’s going to double in population in the next few years.

“But people here don’t want to repeat the Sabaneta experience, where construction outran road and water infrastructure,” he said.

Asked about Colombian Property’s market focus, “we try to focus on certain mid-to-high-range properties in certain locations. We have a bilingual lawyer available to help the process, and an accountant that helps with certain documents, advice on doing foreign money transfers here, and the Colombian investor-residency process,” Homsey added.


Medellin-based banking giant Bancolombia announced November 7 that its third quarter (3Q) 2018 net income rose 20.5% year-on-year, to COP$543 billion (US$172 million).

However, this positive year-on-year result in 3Q 2018 was offset by an 8.2% decline in net income compared to 2Q 2018.

“Gross loans [in 3Q 2018] grew by 4.0% when compared to 3Q 2017 and 0.9% during the quarter. This annual growth shows moderation in the credit demand in Colombia,” according to Bancolombia.

Colombian peso-denominated loans grew 5.8% in 3Q 2018 versus 3Q 2017.

“Net interest income was COP$2.57 trillion [US$813 million] for 3Q 2018, increasing by 0.6% when compared to 3Q 2017. This positive performance is mainly explained by the growth in the loan book [as] net interest income increased by 0.9% during the [latest] quarter,” according to the company.

“The annualized net interest margin for the quarter was 5.8%. The margin decreased by 10 basis points during the quarter and registered the same number when compared to 3Q 2017, mainly affected by the reductions in the reference rate in Colombia that were reflected in the repricing of the loan portfolio.

“Provision charges for the quarter were COP$1.0 trillion [US$316 million] and the coverage ratio for 90-day past due loans was 160.7%. Provision charges increased by 4.3% when compared to 3Q 2017 and by 3.8% compared to 2Q 2018.

“These provisions allow us to maintain a solid coverage ratio amid a challenging environment [even as] new past-due loans totaled COP$847 billion [US$267 million] for the quarter.

“Net fees were COP$631 billion [US$199 million] and increased by 4.1% compared to 3Q 2017. This growth was mainly driven by an increase in fees related to credit and debit cards and trust services, [although] net fees decreased by 2.1% during the quarter,” the bank added.

Bancolombia “maintains a strong balance sheet supported by an adequate level of loan loss reserves,” according to the company. Allowances for the principal for loan losses were 5.7% of total loans at the end of 3Q 2018, increasing as compared to 2Q 2018, the company added.

 


ISA 3Q 2018 Net Income Jumps 30% Year-on-Year

Thursday, 08 November 2018 09:43 Written by

Medellin-based multinational electric power transmission and highway concessionaire ISA announced November 7 that its third quarter (3Q) 2018 net income rose 30.2% year-on-year, to COP$413 billion (US$131 million).

Gross revenues rose 8.3% year-on-year, to COP$1.9 trillion (US$605 million), with power transmission revenues showing the biggest yearly gain, by 16.7%, according to the company.

Earnings before interest, taxes, depreciation and amortization (EBITDA) hit COP$1.4 trillion (US$446 million), up 15% year-on-year, while EBITDA margin came-in at a hefty 71.7%, according to ISA.

The positive results don’t include any extra income from a one-time-only power-transmission tariff “regularization” program in Brazil last year, but do include power-tariff increases this year.

Revenues improved this year mainly thanks to recent entry-into-operation of power-transmission and highway-concession operations in Peru, power-transmission expansions in Colombia and Chile (since September 2017), and the incorporation of results from recently acquired Brazilian and Chilean power operations.

As for investments, ISA so far this year has invested COP$1.9 trillion (US$605 million) in infrastructure expansions and upgrades, according to the company.

Colombia revenues rose 8.4% year-on-year, to COP$447 billion (US$142 million), while Chile revenues rose 12.8%; Brazil revenues rose 12% and Peru operations declined 7.6%, according to the company.

Power transmision revenues in Colombia rose mainly because of a boost in national power tariffs, favorable COP/US dollar exchange rates, plus a new transformer connection, the company added.


Medellin-based electric-power giant Celsia announced November 6 that its third quarter (3Q) 2018 net profit dropped 31% year-on-year, to COP$64 billion (US$20 million).

However, nine-months 2018 net profits so far have risen 35% year-on-year, to COP$243 billion (US$77 million), according to Celsia.

Consolidated revenues for 3Q 2018 rose 8.5% year-on-year, to COP$852 billion (US$271 million), with Colombian revenues rising 18%, to COP$698 billion (US$222 million).

Earnings before interest, taxes, depreciation and amortization fell 12% year-on-year in 3Q 2018, to COP$259 billion (US$82 million), but nine-months 2018 consolidated EBITDA rose 0.5%, to COP$818 billion (US$260 million).

“In Colombia, accumulated energy demand during the [latest] quarter rose 4% with respect to the same period of 2017. The regulated market demand grew at a rate of 3% and the increase exceeded 6% in the unregulated market,” according to Celsia.

While Colombian average energy prices fell 4% year-on-year in 3Q 2018, the average marginal cost of energy in Panama was US$73 per MW-hour, 98% higher than in 3Q 2017, according to Celsia.

Commenting on the results, Celsia president Ricardo Sierra emphasized that the company “has a great emphasis on the development of renewable energies . . . The wind and solar projects that we have will lead us to add, over the next five years, 560-megawatts [MW] of renewable power in addition to the current 77-MW,” he said.

Four of the wind-power generation projects are in the Guajira region (northern Colombia), totaling 330-MW. These power projects already won environmental licenses and grid-connection approvals, according to Celsia.

In solar projects, Celsia Central America acquired in Panama its first photovoltaic plant, incorporating 33,000 solar panels, with a net capacity of 9.9-MW and a transmission line of 2.8 kilometers, according to the company.

“In Colombia, the Celsia Solar Bolívar photovoltaic farm is about to enter into operation. Located in Santa Rosa de Lima in Bolívar, Colombia, with a capacity of 8.06-MW and an estimated generation of 15,542-MW-hours per year, it will deliver the equivalent of the energy consumed by 7,400 households,” according to Celsia.


Medellin-based electric power giant EPM on November 4 heralded the start-up of the engineered spillway over the giant “Hidroituango” hydroelectric project in Antioquia (see photo, above).

That start-up soon will allow EPM to close a makeshift diversion tunnel through the dam, ensure steady, safe, adequate water-flow of the Cauca River downstream of the dam, and enable repairs to begin in the machine room -- temporarily used to evacuate water following a collapse of the main diversion tunnel last April.

The start-up also means that Medellin eventually would start to recover billions of dollars of future revenues expected to be generated by Hidroituango, as city-owned EPM supplies about 25% of the city’s annual revenues.

“With the start-up of the spillway, a new milestone is reached in compliance with the schedule set for 2021 for the recovery of the project,” according to EPM, which also posted a video of the initial water-flow through the spillway (see: https://www.facebook.com/epmestamosahi/videos/2116900111960032/?fref=ts).

“The structure of the dam remains stable and in optimal conditions to ensure the passage of water through the spillway and the safety of the communities downstream. EPM will close the water passage through the machine house once we are fully confident that the technical conditions of the project allow it.”

The reservoir behind the dam rose to 405 meters above sea level on the afternoon of Sunday, November 4, enabling safe evacuation of Cauca River water through the spillway.

The spillway has a horizontal length of 405 meters and includes four radial gates, 15.4 meters wide by 19.5 meters high. Opening more gates enables controlled increase of water-flow through the spillway. At the bottom of the structure is a settlement well, enabling smooth, continuous flow of the Cauca River downstream of the dam.

The left channel of the spillway was the first put into operation on November 4, initially enabling evacuation of 200 cubic meters-per-second of Cauca River water.

“These 200 cubic meters-per-second are now added to the 750 cubic meters-per-second of water flowing through the machine house, for a total of 950 cubic meters-per-second on average,” according to EPM.

“This ensures an ‘ecological flow,’ or what’s necessary for a normal flow of the Cauca River, which is 450 cubic meters-per-second -- and this also guarantees the safety of the communities that live downstream of the project,” according to EPM.


Page 3 of 33

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Medellin Herald is a locally produced, English-language news and advisory service uniquely focused upon a more-mature audience of visitors, investors, conference and trade-show attendees, property buyers, expats, retirees, volunteers and nature lovers.

U.S. native Roberto Peckham, who founded Medellin Herald in 2015, has been residing in metro Medellin since 2005 and has traveled regularly and extensively throughout Colombia since 1981.

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