Celsia 2Q 2019 Profits Fall Due to Tolima Power Acquisition Costs
Medellin-based electric power giant Celsia reported August 8 that its second quarter (2Q) net income fell 56% year-on-year, to COP$43 billion (US$12.6 million), mainly because of financing costs for its purchase of Tolima departmental power company EPSA.
Another COP$19 billion (US$5.6 million) of the difference between 2Q 2019 versus 2Q 2018 profits was the one-time 2Q 2018 cancellation of foreign credits, according to the company.
The EPSA purchase involved issuance of ordinary bonds totaling COP$1.1 trillion (US$324 million) as well as contracted loans with national and international banks for COP$800 billion (US$235 million), according to Celsia.
“Additionally, on July 11, the first issue and private placement of EPSA shares since its establishment was completed, in which resources were obtained in excess of COP$450 billion (US$132 million), which will be used for early payment of short-term loans,” according to Celsia.
“The results of this [latest] quarter reflect, to a large extent, the profound strategic changes we have made in the last 18 months and, additionally, are greatly influenced by the recent acquisition of the distribution and commercialization operation in Tolima,” said Ricardo Sierra Fernández, Celsia director.
Consolidated 2Q 2019 revenues rose 11% year-on-year, to COP$913 billion (US$269 million), while earnings before interest, taxes, depreciation and amortization (EBITDA) rose 7%, to COP$287 billion (US$84.6 million), according to the company.
“Colombia represents 83% of the consolidated revenues and Central America 17%,” according to Celsia.
“Revenue from retail [power] sales was COP$338 billion (US$99 million), up 35%, also favored by higher revenues from Tolima’s assets (COP$78 billion/US$23 million),” according to the company.
“The operation of the assets acquired in Tolima contributed favorably,” the company added. “With the integration of Tolima, the company reaches nearly 1,135,000 customers, meeting our goal of exceeding 1 million customers by 2025 — well in advance” of its earlier forecast.
“The priority in the [Tolima] department is to improve indexes in quality and reliability in the provision of power service, for which COP$600 billion [US$177 million] will be invested in the first five years of operation,” the company added.
During the latest quarter, Celsia also hit a total capacity of 100 megawatts of solar energy in Colombia and Central America. The company also exceeded its goal of 3 million trees planted in the “ReverdeC” program, designed to offset “global warming” emissions from fossil-fueled power production.
