Thursday, October 22, 2020

Become part of our community


Companies 318

Written by March 27 2020 0

Medellin-based multinational utilities giant EPM revealed in a March 27 filing with Colombia’s Superfinanciera corporate oversight agency that its full-year 2019 earnings before interest, taxes, depreciation and amortization (EBITDA) rose 17% year-on-year, to COP$6 trillion (US$1.5 billion).

EBITDA margin hit 33% -- best in five years, according to EPM.

Out of its 2019 earnings, COP$1.5 trillion (US$376 million) this year will go directly to the city of Medellin -- EPM’s sole shareholder.

Gross revenues rose 12% year-on-year, to COP$$18.4 trillion (US$4.6 billion) -- 64% of which was generated in Colombia and the remaining 36% in its foreign markets.

Investments in public-service infrastructure during 2019 totaled COP$3.2 trillion (US$803 million), according to the company.

In total, EPM provided utility services to 10.4 million clients in six countries last year, the company added.

Over the last 12 years, EPM’s profit transfers to the city of Medellin total COP$10.9 trillion (US$2.7 billion), enabling investments in public education, welfare, infrastructure, housing, health, security and environmental protection, according to the company.

During 2019, EPM also spent COP$1.5 trillion (US$376 million ) on goods and services, generating more wealth and employment for Colombians, the company noted. What’s more, EPM spent another COP$261 billion (US$65 million) in payments to local communities and for environmental projects.

Capital spending on the US$5 billion, 2.4-gigawatt Hidroituango hydroelectric plant in Antioquia (now more than 75% complete) totaled COP$$1.1 trillion (US$276 million) last year.

Assets grew 5%, to COP$54.9 trillion (US$13.8 billion), while liabilities rose 1%, to COP$30.7 trillion (US$7.7 billion).

Debt to EBITDA ratio improved to 3.49 in 2019 versus 3.86 in 219, while total financial debt dipped to 40% in 2019 versus 41% in 2018 -- mainly due to the COP$525 billion (US$132 million) insurance payment received as partial compensation for damages suffered at the Hidroituango hydroelectric project, the company added.

Written by March 25 2020 0

Medellin-based electric power giant EPM announced March 24 that Wall Street bond rater Moody’s just decided to maintain EPM’s “Baa3” investment-grade bond rating following its winning bid for the "CaribeMar” utility in Colombia’s Caribbean region.

“After the analysis of non-recurring issues that the company has been going through -- such as the [three-year start-up delay, to 2021] of the Hidroituango hydroelectric project since April 2018, and particularly considering the recent award of CaribeMar [auction] to EPM -- the rating firm Moody’s Investors Service reaffirmed the ‘Baa3’ investment grade rating for international bond issues and EPM’s corporate debt,” EPM revealed.

“Moody’s mentions that with the acquisition of CaribeMar, EPM further consolidates its leadership in the energy business in Colombia, going from a market share of approximately 23% to 35%. This will expand the provision of the energy distribution service in the northern departments of Bolívar, Cesar, Córdoba and Sucre.

“The rating firm also highlights operational synergies given the new acquisition in a geographic area adjacent to existing operations that will be of benefit to the entire business group,” EPM added.

XM: Coronavirus Cuts Power Demand

Elsewhere on the electric-power front, Medellin-based national power-market operator XM announced March 24 that Colombian power demand has fallen about 12% because of personal and corporate cutbacks since the emergence of the Coronavirus crisis.

“The implementation of preventive measures aimed at reducing the spread of COVID-19 has impacted the demand for electrical energy in the country, which during the [past] weekend had a reduction of up to 12% daily, compared to equivalent days” of the prior weekend, according to XM.

“In countries with similar conditions of social distancing as a consequence of COVID-19, [power-demand] reductions have been from 7% to 33%,”  XM added, citing new statistics from the U.S.-based Electric Power Research Institute.

Commenting on this phenomenon, XM general manager María Nohemi Arboleda stated: “The invitation to Colombians is that we continue to make responsible use of resources, abiding by the indications of staying at home as defined by the national government and, above all, protecting people’s health.”

Written by March 20 2020 0

Medellin-based multinational electric power giant EPM announced March 20 that it won the auction bidding for the “CaribeMar” assets formerly belonging to the financially troubled, state-owned “Electricaribe” power utility around the Caribbean coast of Colombia.

As a result, EPM “will be the new operator of the electric power service in Bolívar, Cesar, Córdoba and Sucre” departments, according to the company, 100% owned by the city of Medellin.

The addition of CaribeMar means EPM will expand its electric power service to 1.5 million more customers in Colombia. As a result, EPM will have a total of 19 million power customers in Colombia, or 35% of the entire Colombian electric power distribution and retail markets, up from 23% currently.

The deal will become final “in the coming months, when the national government completes the [sale] of CaribeMar,” according to EPM.

The national government has already assumed pension liabilities for retired and retiring employees of the former Electricaribe utility.  But EPM and (separately) Costa Energy Consortium -- which won a separate bid for the “CaribeSol” division of Electricaribe -- now will have to assume other liabilities, along with existing Electricaribe assets.

According to Colombia’s “Superservicios” (Superintendence of Public Utility Services) agency, EPM is expected to invest COP$5 trillion (US$1.2 billion) over the next 10 years to restore and upgrade faltering infrastructure left by an essentially bankrupt Electricaribe.

“During Electricaribe's intervention we have secured the resources for the continuity of the service, as is our constitutional obligation through the Business Fund,” Superservicios Superintendent Natasha Avendaño García stated.

The new operators of the former Electricaribe “will assume the investment and loss reduction plans aimed at improving networks, stations and substations and infrastructure in general, as well as the technification of [supply and demand] measurement systems,” she added.

Meanwhile, EPM general manager Álvaro Guillermo Rendón López stated that EPM is “committed to growth with sustainability in the energy commercialization and distribution market.”

“After the awarding of CaribeMar this Friday [March 20], the national government must close the financial transaction for the purchase of 100% of the shares, establish the new company and prepare and deliver the assets and liabilities included,” according to EPM.

“Meanwhile, the energy service will continue to be provided as it is today by the national government. It is important to remember that Electricaribe is a company intervened by the Superintendency of Public Services and in possession for liquidation purposes,” the company added.

EPM officers and executives “accompanied by an investment bank and external advisers, carefully studied and analyzed the viability and opportunity of the [CaribeMar] operation, always thinking of the company’s sustainability, in a business that will include investments of around COP$4 trillion [US$970 million] in the next five years,” according to EPM.

Electricaribe effectively went into bankruptcy following years of failing to recoup its heavy operating expenses, leading to frequent service instabilities -- largely the result of a decades-long culture of massive power theft in coastal cities, mainly in low-income neighborhoods.

Cleverly, EPM in recent decades pioneered the development and installation of a novel pay-as-you-go metering system – praised by power experts around the world – which enables low-income customers to buy subsidized “power cards” at neighborhood stores, letting them only buy the power they actually need rather than wasting “free” power via illegal connections -- connections that inevitably would destroy the ability of EPM (or any utility) to recoup investments in adequate generation and distribution infrastructure.

Written by March 05 2020 0

Medellin-based multinational electric power transmission, highways concessions and telecom service provider ISA announced March 4 that its full-year 2019 net income rose 7.5% year-on-year, to COP$1.6 trillion (US$457 million).

Revenues rose 12.5% year-on-year, to COP$8.1 trillion (US$2.3 billion), while earnings before interest, taxes, depreciation and amortization (EBITDA) rose 9.8%, to COP$5.3 trillion (US$1.5 billion), according to the company. EBITDA margin came-in at 64.9%.

Return on equity came-in at 13.2% for 2019, the highest in ISA’s history.

As for fourth quarter (4Q) 2019, net income fell 24% year-on-year, to COP$440 billion (US$126 million), while revenues rose 5.6%, to COP$2.3 trillion (US$658 million).

EBITDA in 4Q 2019 came to COP$1.4 trillion (US$400 million) and EBITDA margin was 61.7%; according to ISA.

Assets at year-end 2019 were COP$48.8 trillion (US$13.9 billion), up 8.5%, while liabilities rose 6.4%, to COP$27.6 trillion (US$7.9 billion). Meanwhile, investments during 2019 topped COP$2.6 trillion (US$744 million).

The net debt/EBITDA ratio and the EBITDA/financial interest indicators closed at 2.45 times and 5.96 times, respectively, “complying with the appropriate levels to maintain the current credit rating,” according to ISA.

Among 2019 operating highlights:
• ISA brought nine power-transmissions projects into operation in Colombia, Chile, Brazil, and Peru. “These projects will generate annual revenues of US$57.4 million,” according to ISA.

• In 4Q 2019, ISA CTEEP -- ISA’s affiliate in Brazil -- won three projects in a public auction held by the National Energy Agency of Brazil (ANEEL). “These energy transmission projects represent revenues close to US$20 million per year,” according to the company.
for the ISA’s Group.

• In October 2019, ISA signed a contract to buy 100% of the Cartagena-Barranquilla Coastal Concession, the company’s first highway concession asset in Colombia. “Through this transaction, the organization takes an important step towards its strategy of becoming as an important player in the Colombian road business,” according to ISA.

• Construction revenues for 2019 totaled COP$1.4 trillion (US$400 million), up 45.4% “This change was explained by an increase in construction dynamics of road concessions and energy transmission (COP$310 billion [US$88 million]), and higher gains from the capex optimization and schedules in advance in ISA CTEEP and its companies, for a total of COP$140 billion [US$40 million],” according to the company.

• The highway concessions business unit grew by 7.2% (COP$73 billion/US$20.8 million) “due to an increase in higher maintenance services (COP$30 billion/US$8.5 million) and the implementation of the ‘Free-Flow’ system in Ruta Del Maipo [Chile], plus the increase in management services (COP$37 billion/US$10.5 million),” according to ISA.

• In the telecommunications business unit, revenues rose 11.5% (COP$37 billion/US$10.6 million) “mainly due to the increase in the customer base for connectivity services in Colombia, Chile, and Peru,” according to ISA.

Written by March 04 2020 0

Medellin-based multinational gold mining giant Mineros SA on March 4 reported a 27% year-on-year profits drop for full-year 2019 -- due to an accounting calculation for costs of its Argentinian mining acquisition, which it got at a relatively favorable price in 2018.

Full-year 2019 net income came-in at COP$123 billion (US$35.6 million), with the dip “explained by the accounting effect we had in 2018 on the purchase of the Argentine operation in advantageous terms,” according to Mineros.

Despite the one-off accounting effect on profits, gold-equivalent production in 2019 actually rose 41% year-on-year, to 296,443 ounces, with Nicaragua contributing 43.2% of production, Argentina 32.8% and Colombia 23.9%, according to the company.

Gross revenues soared 67.7% year-on-year, to COP$1.35 trillion (US$391 million), “helped by the new operation in Argentina and a higher gold price and [COP-to-U.S. dollar] exchange rate,” according to Mineros.

Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 55% year-on-year, to COP$411 billion (US$119 million), with EBITDA margin at 30.5%.

Investments in 2019 totaled COP$188 billion (US$54 million), “mainly for maintenance, exploration, mine development, projects and the implementation of [advanced practices] in Nicaragua and Argentina,” the company added.

“We closed a satisfactory 2019, reflecting the results of our growth and diversification strategy,” said Mineros SA president Andrés Restrepo. “We see 2020 with optimism, hoping to maintain production levels, accompanied by a high gold price that allows us to continue working on the plans we have drawn up,” he added.

Page 5 of 25

About Medellin Herald

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.

Medellin Herald welcomes your editorial contributions, comments and story-idea suggestions. Send us a message using the "contact" section.

Contact US

logo def
Medellin Herald: Find news, information, reviews and opinion on business, events, conferences, congresses, education, real estate, investing, retiring and more.
  • COL (4) 386 06 27
  • USA (1) 305 517 76 35
  •  This email address is being protected from spambots. You need JavaScript enabled to view it. 
  • Medellin, Antioquia, Colombia

Medellín Photo Galery

Medellin, contrasting colors and styles by Gabriel Buitrago