Earnings Call: Q1 2024

May 7, 2024

Welcome everybody to today's quarterly report. We have with us our top leadership. We have a space for Q&A at the end of the session. We are also broadcasting through an X Space. You are able to ask questions through the Zoom chat. We have simultaneous interpretation from English to Spanish. You can click on the interpretation button at the lower right-hand corner of your screen. We thank you for being here with us. We will now hear from Ricardo Sierra, our leader at CELSIA. Yes. Good morning, everybody, and hello to the team as well. I am here to resolve any doubts, any questions that you might have, and also go into detail about what we have done in our first quarter and what is expected for the rest of the year. We are broadcasting through Zoom. We are also here live on our X Space. I want to start by talking about the stock repurchase program. It is very important to talk about the independent mechanism through the modality of book building that we closed yesterday. We received total acceptances for 7.1 million shares. The cut-off price defined by the commission was 4,300 COP. We awarded therefore 4.56 million shares for a total of 20,000 million COP, which was equal to what was offered. We want to say that we received a relatively low number of acceptances to our offer. We thought that was going to be different. The range was pretty dispersed, so the investors might be seeing more value in the company. With this award, the stock buyback program has reached 3.37 thousand million COP, which is equivalent to the 12.47% of the 300 thousand million COP approved by the assembly. Once we have completed the buyback through the independent mechanism, we will resume the transactional mechanism. That would be on May 9. This transactional mechanism will allow us to be present in the market to continue to provide liquidity to the stock. We can buy back approximately 460 million COP per day. We are very satisfied with the way this program has been developed and how the market has responded. Since we announced the start of the buyback, CELSIA's share price has increased more than 60%. The average daily traded volume has grown by 3.7 times compared to 2023. That is one of the most relevant factors for the assembly when they made that decision to award resources for 300 thousand million COP for 3 years for this buyback program. This buyback program has also been accompanied through a pedagogic program, which is that through our social networks, on X and LinkedIn, we have provided all of the details of how the program is developed on a daily basis. We have also worked hard on developing content on the company so that everybody can become more familiarized with us. As I said, we bought back 37,000 million COP. Our average price is 4,300 COP per share. Let's talk about the El Niño phenomenon. We are crossing a threshold. We are leaving behind the El Niño phenomena for 2023, 2024. It is a difficult time for the company, I wanted to recall what we went through in 2015 and 2016 with the El Niño phenomena, what we learned, and which we can apply to this year. At the time, the company went through great challenges, and that led us to report very bad results here in Colombia. We had an EBITDA of only COP 298 billion, with a margin of 2.7% and a net loss attributable to the parent company for COP 82 billion. 2015, 2016 were a very hard year. That led us to cash flow problems that to overcome these, we had to start decisions. We had to sell one of our portfolio investments, 2% of Grupo Sura, and for the only one time in history, we declared a stock dividend. The shareholders had it at COP 3,300 at the time, and that allowed us to overcome our cash flow problems derived from the El Niño phenomena. That was very tough that year. This experience led us to rethink our competitive strategy for the Colombia operation and plan for a future El Niño. Over the past seven years, we set out to make this company a more resilient company. We sold thermal assets like Zona Franca Celsia, 610 MW capacity. We developed solar projects. We were pioneers in this segment here in Colombia. We built Tesorito, a gas thermoelectric with 2 MW capacity. But it's highly flexible because of its setup. It's completely different to Zona Franca Celsia, which was a big thermal plant with combined cycle, pretty complex operation. Additionally, we saw an expansion with the business in El Tolima, and this allowed us to move forward with a pretty vibrant performance. El Niño for our type of business will always bring a lot of problems. Every time we have the El Niño phenomena, we have to tighten our belts. However, because we reconfigure our assets, our team, our setup, our operation, because we always aim to have good results even through El Niño. Now let's look at what happened this year through the El Niño. In 2015, 2016, as you can see, it was pretty tough. We reconfigured, and now I will compare 2015 to 2023. Celsia has, in May, a 44% from 23% of our water reserves in the south of Colombia. This does not even meet the minimum conditions, but we are still in a better position than we were in 2015. We expect to have better possibilities to generate electricity. For our main resources, we have a stabilization near the historic levels by the half of the year. Based on international climate agencies, between April and June, the El Niño phenomenon is going to be more neutral. It's the famous spring predictability barrier, which makes predictions a bit difficult. We expect to move into an La Niña phenomena, where a probability of 62% for this between June and August of 2024. From a very dry period, we're going to move into a very wet period or above average period of rain. During the six months of the El Niño, our income was COP 2.9 billion, 24% above 2015, 2016. However, costs were barely 8% higher, and gross profit was COP 709,000 million, 143% more than in the previous El Niño. Our EBITDA was COP 754,000 million, 153% higher, and the margin was on average 25.7%, which was more than twice of that in 2016, 2015. This operation performance allowed us to go from a net loss of COP 10,000 million to a profit of COP 182,000 million in 2023, 2024, even considering that the financial expenses for the indexers were twice of those in 2015 and 2016. Even when comparing only the first quarter of the year with 2015 and 2016, EBITDA was 56% higher. The net result in the parent company went from net losses of COP 6,000 million and COP 26,000 million, respectively, to profits of COP 35,000 million and COP 25,000 million pesos. We wanted to share these results because they are a clear example of the power of our strategy, especially at that crucial moment, and this allowed us to move forward with very good performance. We are celebrating that we survived the El Niño with positive results, and this allows us to celebrate a first quarter that cannot be compared to the first quarter of last year, logically, because one El Niño can only be compared to another El Niño. That's why I had this detailed exercise and to tell you that we are celebrating. When Esteban gives us the financial report, we can talk a bit about the perspectives for the rest of the year and a bit about how we expect things to go for the rest of the year. This chapter, we wanted to accompany it with regulatory matters, which have been on the news in recent weeks. The different CREG resolutions have been published that seek to increase the supply of energy in the face of El Niño, addressing the situation of reservoirs at the national level and mediating the use of energy. We are going to invite Carlos Solano, our Regulatory Affairs leader. Welcome, Carlos. Please tell our investors and listeners what is happening on the regulatory front. Thank you, Ricardo, and good morning to everyone. As you said, in the recent weeks, we have seen great regulatory activity on the part of the Ministry of Mines and Energy and by the CREG, which recently had a recent quorum to deliberate again. But we insist that the government has to name all the commissioners so that the institution can operate properly. Most of the regulations issued, as you said, are related to the condition of the low levels of the reservoirs and the hydrological contributions that occurred at the end of March and beginning of April, were the main effects of these measures. On the one hand, we had a measure that tried to incorporate into it a minimum thermal generation in a forced manner, where the amount that will not be achieved in the dispatch obtained through the daily offers to the energy exchange by companies was programmed as a security generation. Which implies that this additional generation needed to be paid for by all Colombians through the restrictions package independent of the level of contracting of the entity that served these clients. The minimum thermal generation goal was once at the maximum of the available thermal capacity, and recently, given the increase in rainfall, it has been decreased to zero. It is important to mention that CELSIA and the majority of companies in the sector recommend to the government that it considered it pertinent to intervene, it was better to do so by activating the shortage statute, a measure existing from years previous, which gathers lessons learned from a previous El Niño phenomenon, which allows us to include in the thermal generation that is considered necessary to be incorporated into the daily dispatch, but in a more technical way. Additionally, it was decided to force the generation of hydro plants that had more than 20 days of storage generation in their reservoir, a measure that is still maintained and produces the surpluses in the market. Finally, I want to highlight a measure that sought to encourage energy savings by defining a consumption baseline for each client, where those who consumed less were rewarded and those who consumed more were punished. However, they dismantled the measure before it could be applied by the companies. We consider that in recent days, as you said, rains have been coming back, so the market should be allowed to operate without intervention so that each company can manage its resources, seeking a balance between recovering the level of their reservoirs and avoiding discharges at the end of the year, given the forecast of the occurrence of La Niña for the second half of the year. Thank you, Carlos. Yes, maybe in the Q&A we can give you more detail about these measures, and if somebody wants more detail, we can provide it. Let's look now at the results of the first quarter, highlighting the most important factors. At the energy services business, we had 661 gigawatts hour generated from our water plants. Meriléctrica reached 48 gigawatts hour, Central America, 57 gigawatts hour, for a total of 766 gigawatts hour. The generator's commercial commitments were 1,249 gigawatts during the quarter, 8% more than the last year, which left us with a net buyer exposure in the stock market after the contract purchasing commercial representations was 128 gigawatts hour. In 2023, the same exposure was a net seller of 287 gigawatts for the quarter. In the marketing segment, sales from the regulated, non-regulated, and photovoltaic energy markets totaled 1,064 gigawatts hours for the quarter, which is an increase of 13.6% compared to the same quarter last year. In our asset management business, we highlighted the results of the C2 Energía platform that, with its 300 megawatts in operation, recorded generation of 97 gigawatts hour with a growth of 119%, with an additional COP 44,000 million in our revenue represent an increase of 152% and an EBITDA of COP 33,137 million. This platform has another 308 megawatts under construction and 502 megawatts in the development phase that will allow more connection points by the middle of this year. With the Caoba platform, in this quarter, we sold two projects in the Department of El Valle and one in Tolima with a BOT contract. These are sales that were assets that were developed and built in Celsia Colombia and were transferred to the Caoba platform once they enter into operation. At the end of March, the platform's total assets amount to COP 2.8 billion. Revenues in the quarter totaled COP 86,000 million, with a positive variation of 34.1%, and an EBITDA of COP 74,196 million. For its part, our thermal platform, El Tesorito, generated energy based on compliance of its OEF and reached 98 gigawatts hour, which was less than 2023. The platform had revenues for COP 89,000 million, with a year-on-year reduction of 35.8%, and reached an EBITDA of COP 35,878 million. This platform, we still complied with our gas commitments with our suppliers, and we were able to act when we were required by the system to be able to comply with our requirements. For the Laurel platform, this platform is the small solar energy platform below 8 megawatts, which has more than 90 photovoltaic systems, and we reached COP 390,000 million in revenue, a 29% growth. This system represents 34 megawatts of installed capacity and accumulated generation for 2024 of 10.13 gigawatts hour. Now, we will hear from Esteban, our financial leader, who will tell us about the financial details. Thank you, Ricardo, and good morning to everybody who joins us on this call. As always, the detailed analysis of the income statement and other financial information can be found in the reports published on our investors' website. In the first quarter, consolidated revenues totaled COP 1.37 billion, decreasing 8.7% compared to the same period in 2023 as a result of the lower availability of water to generate electricity, of which you already spoke, which explains a lower volume of energy sold both on the stock market and in terms of contracts. On the other hand, the use and connection of networks, involving Toluviejo, which belong now to the Caoba platform, and we will see them included in the income of the MPP. On the market segment side, revenues increased 23.4% due to a greater demand from both the regulated and non-regulated markets, given the high temperatures and also the entry of new clients, especially into the regulated market. In the distribution of total income by the business, 86% is contributed by the energy services business, and the asset management business contributes 14% with COP 190,000 million. The sales costs for the quarter were more than COP 1 billion, registering an increase of 6.4%, due mainly to the increase in generation costs due to the El Niño phenomenon, higher fuel consumption, and higher depreciations and amortizations due to the capitalization of our assets related to the loss management and also the amortization of usufruct of solar farm operations. Administrative expenses were COP 37,000 million, with an increase of 5.8%, 160 basis points below the annual variation of the IPC. The increase is mainly due to fees for legal and financial consultants and the deterioration of our accounts receivable. EBITDA was COP 325,000 million, and the EBITDA margin was 23.7% for the quarter. It is important to mention that the expected margin for a quarter within an El Niño phenomenon should be in a range between 10% and 15% due to the prevalence of thermal generation and the decrease of the hydro component. Although EBITDA and the margin were below that of last year, it exceeds expectations, thanks to the preparation of our assets from the lessons learned from previous years. In total, of EBITDA, a 91.6% is contributed by the energy services business with COP 298,000 million, and the EBITDA margin in that segment is 26%, and then the asset management business contributes 8.4% with COP 27,000 million. This corresponds to the EBITDA, which repaves the asset management business and does not correspond to the EBITDA that each of the investment vehicles obtained for the quarter, which was COP 112 billion that are not reflected in this EBITDA that I just explained. In total, the EBITDA that we managed, considering the consolidated EBITDA and the EBITDA that each of the investment vehicles, is around COP 433 billion, and what we are seeing is only 26% of that total. Net financial expenses, including exchange differences, reach COP 163 billion, with a decrease of 30% compared to the same quarter last year. During this quarter, we improved the credit conditions that added to the behavior of the indexers, allowed for these 3 months to reduce by 150 basis points the cost of our debt compared to the same quarter last year and puts us on a decrease trend in our debt that we expect to consolidate at the end of this year. Income taxes were COP 21 billion, which decreased by 67.6% due to the lower profit before taxes. The results of the first quarter for 2024 led to a net profit of COP 29 billion, with a decrease of 75.7% compared to the same period of the previous year due to the effects of El Niño, and the net profit attributable to the controllers of the holding company reached COP 21.5 billion. I hadn't mentioned, I did not do it for the individual items, but the financial results for this year. This year, we have a strong comparison to the first quarter of last year, which is the divestment of the assets in Central America last year. In pro forma, if I compare this pro forma to last year, we have this for this region in terms of income, is lower 23%. EBITDA is 73%. Financial cost and net profit, it improved by 13% compared to the first quarter of last year. In terms of our leverage, the company closed the quarter with a consolidated debt of COP 5.27 billion, and a leverage ratio of 2.82 times net debt to EBITDA. The average life of the company is 5.8 years, and the quarter closed with a consolidated cash flow close to COP 585 billion. Taking into account the sale of assets in Central America and the effects of El Niño, we estimate as an organization that the consolidated EBITDA for 2024 should decrease by 20% compared to the number of 2023. However, it is very important to note that thanks to the investments in El Tesorito, in Celsia Energía, in Caoba, as in other financial instruments that we created to face the situation and the reduction of the cost of our debt, as I just mentioned, we estimate that net profit and net profit for the controlling company should see similar amounts to last year, which shows us the resiliency of our asset portfolio that we have set up to be able to face a year that, as Ricardo Sierra said, is one of the most difficult years that we have to face given the climate conditions. That is my analysis for the financial side. Yes, we can go deeper into the expectations that you gave us, which is a decrease of 20% in EBITDA, but our net profit should be similar to last year. That, for us, is a win, especially for an El Niño year. Over the next months, we also expect, as I said, the weather to stabilize, rains to come back. We expect EBITDA to be between 30%-35%, and as usual, and we are also very optimistic that we will have a greater reduction in the financial expense by the end of the year. Maybe, Esteban, we didn't mention this, but the estimate is that our net debt should be the same as last year. Now let's move to ESG issues. We want to tell you that we are carrying out an ecological protection program for the Tolima and the river basin. This work seeks to take care of the water levels, protect our forests, and repair. We estimate to add 2.5 million trees in El Tolima. In total, around the country, we have planted 16 million trees, and we are planting many more right now. In this region of Colombia, we have 1,000 inhabitants in the Sahagún rural area in the San Antonio del Laurel town, where we operate the El Tesorito. These are 2 towns to which the arrival of our productive activity has changed the social conditions and the infrastructure conditions that they usually had. And we had a big success, which was to deliver a 24/7 water service. They had very bad aqueduct, but now it's much better, and now they have drinking water at their home and also aqueduct service regularly. We have a lot of social environmental investment projects in that area of influence, among which we have free community Internet for those 2 towns, and road improvements, sewage. We are also working on another sewage system there. We are creating sports field, and we are also providing water filters and school kits, as I said, among others, training, education, et cetera, and also job creation, which is quality job creation, which is very important for that area. We have an upcoming new phase, which is the improvement or maybe the rebuilding of a school that allows the kids to take the next step in their lives. So we conclude the first quarter report here. We invite you to a Q&A session. Thank you, Esteban, Carlos. We are open to questions. Please raise your hand through Zoom. And also on the X Space, we have a mechanism to be able to type in your questions and raise your hand. So we have a first question here through Zoom, which is by Joselito Gomez, and he's talking about the buyback program. What is the percentage of progress for the buyback program, and what are the price expectations for the first quarter? Thank you for your question. I can tell you that, as Ricardo said, I think we have already published the award bulletin. We had 4.6 million shares, which means we bought back COP 37,000 million of the COP 300,000 million that the assembly authorized. As Ricardo said, the important thing is that we've multiplied the daily average traded volume by 4 times, and liquidity is important in the market and in this process. By Thursday of this week, we will start again the transactional method for further buybacks. Thank you, Esteban. Now we will hear from Ricardo Sandoval through Zoom. Ricardo, go ahead, please. Good morning, everybody. Can you hear me? Yes, Ricardo. I have several questions, several doubts regarding El Tesorito. I wanted to know if the decrease of thermal generation at El Tesorito for the first quarter of 2024 had something to do with the decrease of gas supplies in the Canacol production fields. I wanted to know if you have guaranteed the supply of gas for El Tesorito with Canacol, in spite of the decrease in gas production by that company. My last question regarding El Tesorito is, given that Canacol wanted to sell their shares in El Tesorito, would you be interested in acquiring them? If that is so, at what EBITDA would it be reasonable to do so? Those are my first questions regarding Tesorito. The second question is more for Carlos. I want to know if the CREG resolution that forces daily generation on thermal plants has some sort of negative effect for you in terms of real income or if it's just in accounting terms. My last question, if it is possible, maybe, to give us an update on the execution plan for C2 Energía, that, as I have understood it, has, at a maximum goal of 600 installed megawatts, of a solar capacity, but I'm seeing that you're aiming at 1,130. I wanted to know that difference of 130. What's the execution plan for that? What is the CapEx that you are expecting? What's the timeline? Those are my questions. Thank you. Thank you, Ricardo. I'm going to paraphrase your questions because I think that on X, we didn't hear you well, but there are three very relevant questions. The first is on the situation of the generation capacity at El Tesorito, given the decrease, if this was due to the gas supply from Canacol. The second question, if the gas supply is guaranteed by Canacol. The next question, if Canacol decided to share the 10% stake they have in Tesorito, if we would be interested to buy it. I'm going to start answering your questions, and we will give Carlos Solano the opportunity to answer the other questions and also about the solar panels. We have a gas contract with Canacol that is activated when we are at 95% of hitting the threshold for scarcity price. When we touch that scarcity price, we've always had that gas available. Additionally, when we had to do security generation, we also had available gas. What this means is that at no time, El Tesorito was not complying with their obligations, given the problems at Canacol. That is very relevant, yes. We built Tesorito so that it could kick in when the system required it. That's what it was designed for. It's been working very well. What we did not have, to cap off the question, is that we did not have a lot of available gas to compete, delivering energy when the prices were high, not at the scarcity level, but at high prices that could provide good income to El Tesorito. There we did have problems. To solve the problems of availability for Meriléctrica, not for our main obligations, we are talking with different producers, which are in the area, looking at the possibility of ensuring a potential expansion at the gas plant in the North Coast. We are talking with the thermal teams and generation teams to ensure gas that will allow us to have a competitive position when the prices in the stock market are good. That is on the supply side. We are good there. Through El Niño, we passed the test. I wanted to say it again, the Colombian system definitely showed its resilience in the matrix where we have different technologies. It is an ideal energy matrix. This is what we should have in all our countries to be able to go through the climate variability, the less climate issues that are going to be more prevalent in the upcoming years. That is an important factor. I think that we need more thermal plants for the 2027, 2028 period. Additionally, if Canacol, if they would sell, yes, if Canacol decides to sell their stake, I think that the partners at El Tesorito would be interested in acquiring it, but I couldn't tell you at what EBITDA we would consider it. On the second question, which is for Carlos Solano, on the CREG resolution in terms of thermal generation plants. Yes, to be able to talk about the effects of this resolution, we have to divide the periods in two. The first period, which coincided with low rain, and the market naturally was having a lot of thermal generation. So at that time, the effect of that resolution in the market, even for CELSIA, was practically innocuous. But as hydraulic came in, there was a distortion because there was less space for hydro, and that competition for the hydro competitors distorted the stock price and artificially lowered it. This meant that all of hydro generation was security generation. So for us in El Tesorito at the time, at that plant, that normally, because of its efficiency, has good margins, well, the margins came down basically to zero, and we had some negative impact because of that. Well, this just was for a short period because after a few days, the government reviewed the thermal goal to zero, which is where we are now. So that is why we are not suffering any impacts of that measure that is still valid up until the end of this month. Yes, Carlos Solano, this measure is very complex because when thermal generation moves into a security generation, all of all Colombians pay that cost. Yes, Ricardo Sierra, yes. I mentioned it when I talked about the regulatory issues. This intervention is not the most accurate intervention because thermal generation that we want to force to guarantee supply in the country is not creating the price that it needs to be paid at, but it needs to be paid at through restriction payments, and this is going to be paid by all Colombians. This will be reflected in the energy bills next month. Should we move on to an expression? Yes, everything is clear up to now. Thank you. Esteban, let us explain to our listeners on the Celsia Energía platform, which is going very well. Celsia is at 300 megawatts in operation. We are in the process of building 300 more megawatts. This includes several solar farms, which includes the biggest complexes, which is a complex of six farms in Tolima, 120 megawatts. Those are the farms that are under construction that are added to the farms that are in operation. That means the 600 megawatts by the end of the year. By the end of the year, the extra 443 megawatts. The development plan of the company includes this, and we have different phases there, and we expect to have approvals for connectivity this month. Given the conditions of today, the market conditions of today, we have to say it because the solar panel price is variable. We can be at COP 705 kilowatt hour, which would depend on the complexity of the solar farm, which could be. The 600 megas, those addition, that with the dates of entry into operation that we have asked for, would be by 2025 or 2026. The next wave of construction would be after we put into operation the 300 megas that we are currently building. Just to clarify, by the end of this year or beginning of next year, we will have 600 megawatts of solar energy built, and between 2025 and 2027, we have the second wave of construction, which will be the 443 additional megawatts. Almost 530 megawatts. Thank you, Edgar. Our strategy has been a B2B strategy, and a large part of the solar farms that we have built are directly connected to industrial clients or commercial clients. This allows us to generate a lot of competitivity for these clients. We have to invite all the clients to jump onto this bandwagon. This is the most efficient technology, and that puts us in a position for this energy not to have to go into the stock market. When we see our contract level are below 90% of energy generation, which means that we are highly contracted. If you look at the stock price, Celsia is at 90% contracts, and stock price variability does not impact us a lot. Those more than 1,000 homes that we serve in Valle y Tolima throughout the El Niño phenomenon, did not have any variation in their generation cost because we were highly contracted. That is another success of our strategy. Muchísimas gracias. Gracias, Ricardo. [Foreign language] We are going to X, where there is a question from Diadrinacio Hernandez. Let's go to X for a question. Taking into account the pension reform, how can this affect us if the pension funds hold a large number of shares? Perfecto, Edgar. [Foreign language] I can tell you that we have been keeping an eye on the impact on the capital markets given this reform. Capital markets are a source of funding that is very interesting for us, not only because, as you said, we have the pension funds there, but also we have exposure through our bond issues. They are important as well. We have been reviewing what different analysts have been producing with regard to the investment issue, and what we foresee is a relatively low impact. We have been trying to gather several opinions from fund managers, investors on the issue, and it seems that if the current stock of pension funds continues as is, there should be no impact. If the pensions migrate to the government, they would develop a new investment regime, and we clearly expect that there will be more TES issued and lower exposure to foreign assets. At the end of the day, we expect not a lot of impact on the stake of pension funds in us, is about 25%. They are maxed out. I don't know, Esteban, if you can add something. I think that you hit on the most important point, and at least from the bill of the reform, what we see is that we are talking about COP 70 billion that will continue to be managed by Colombian pension funds with some adjustments, and we do not expect a lot of movement in those portfolios. The government has said that those resources become part of the market, and as Ricardo said, more participation of TES. We expect that one of the assets that could suffer are the investment assets outside of Colombia, which involve stocks in other markets and those sort of components. Those could suffer the greatest impact in this context. Right now, we are keeping an eye on it and how the bill passes through Congress, and to see if it is modified or not and how it will be passed as law. Bueno, vamos ahora a la transmisión en Zoom. [Foreign language] I am seeing that many people have entered X at this moment. We will come back to Zoom. There's a lot of people on X right now. I welcome you to the first quarterly report for Celsia. We are in the Q&A session right now, and we have a question from Ana Guasca. Good morning. I want to know if you can give us a bit more detail on the environmental costs of the Albán and Prado plants. Is this an issue with regards to licenses, is the question. Santiago will answer this question. Before, Santiago, I want to say that people might think that operating a thermal plant has a lot of cost, but the social environmental costs in Colombia have gone up in these plants. What we are seeing is the reflection of a new decision as a country to provide more importance to environmental issues. Yes. These plants were built before 1999, and so they have an environmental management plan, and they do not have a license. Albán, we are forced to do water quality issues. As Ricardo said, those measures are being complied, but given security issues and community issues, the work is suspended, but that represents most of the cost. In Prado, this also involves the environmental management plan that involves building roads around the reservoir. Those are the two issues that you can see reflected in the cost. With regard to what Ricardo said, yes, effectively, between mandatory and voluntary investments, we have increased costs. Last year, we closed with an investment of more than COP 1,000 million between mandatory and voluntary investments. The investments have increased, and that does not even include the development of new projects. I think that is interesting. Our environmental plan is very good in this company, but we have to look at it within certain limits because eventually some projects could leave the viability range. Question: is there some projection about the impact that the El Niño phenomena will have on the results of the company? I think this phenomenon will be very different because the company's contracting level is very high. In terms of our historical mean, which is around 70% of our energy to be contracted out, right now, we are closer to 90% of our total energy being contracted out, and most of our energy is delivered to long-term contracts. This El Niño phenomena comes after an El Niño phenomena, so it will help the recovery of the reservoir levels. We need to see how intense it will be, because when we talk about El Niño and the El Niño phenomena, one of the variables that we do not know is the intensity or the duration of it. We have to wait to see how El Niño phenomena behaves. What we can foresee is that we are very high contracted energy production. We have another question. Now, we have Sebastian Gallego. He thanks us for our presentation, and he has several questions. Number one, can you give us your opinion on possible processes of wind farms in Guajira? Can you share the medium-term strategy for the platforms? Could we expect divestment from these vehicles, or how can we achieve that the market recognizes these assets and the evaluation of CELSIA? Thank you, Sebastian. Yes, you asked about wind farms and what is happening in Peru. Yes. In Guajira projects, we are moving on in terms of licenses. We had some bad press, but we managed to get some licenses that we want. We are expecting, and we are still on our timeline, and the authorities are reviewing the information to finish the licensing process. We are optimistic for the end of the year or maybe first quarter of next year to have all of the licenses. Yes, we have two licenses pending, one in Corpoguajira for the Acacia project. This was the license that Ricardo just mentioned that has been issued, and we expect to get it before the end of the year. The other licensing process, which we are undergoing right now, is for the transmission line for Camelia, which, in the worst-case scenario, we will have it by the end of the year or in the worst-case scenario, it is the second quarter of next year. Once we have those two environmental licenses, we could start building the project. Yes, I want to talk about if we are going to build or not. Well, we want to have all of the options available to us as a company. We have open options, like building it, partnering, or selling it. Those are the choices that we have. Which leads into the next question, which is: what should we expect in the medium term for the platforms? Yes, this is platform management, because if in these platforms, we have the opportunity to sell them, which are interesting options that allow to bring in good value for the company, for you, the shareholders, we would logically develop these. This is important because, Sebastian, what you are asking is if the stock price is reflecting the value of these platforms, the intrinsic value, which it is clearly not. We did an exercise with ISA and the leaders here, with the investors, of transmitting to you what these platforms mean, what assets we have there, what is the future of these assets, because we have a lot of value there that is very interesting for you to understand and be aware of what could exist there in the medium term. So the cherry on top is twofold. We started to build a small wind farm between Atlántico and Boyacá, 10 megawatts, two generators, which should be built by the end of the year. This is interesting because it is an experiment that we have to hold in that area to see how construction goes, to see how operation goes, in an area that has less strong winds, but have more certainties in terms of construction and operation than what we have in Guajira. Esteban will talk about what is happening in Peru. Before I talk about Peru, I have something with regards to the platforms and value, which is that we want to invite you to ask us, as you have in the past, because there is a lot of value there. We said that 26% of our EBITDA comes through the platforms, and that is not part of our consolidated EBITDA. On the back of your question, please ask us more questions about the platforms. We want to help you understand the value that we have there. You heard the EBITDA reports, so I invite you. That would be more work for the PR team, but we are ready because we understand that a large part of the company's value lies with those investment vehicles. We continue to have progress in the Peru strategy. We are closer to executing the wind projects there. We overcame an important hurdle that we had in the purchase of the Caravelí project, and we were able to present it together with the seller and together with a company that had land rights in a place that we needed. We were able to present to the Peruvian government for them to award the land use concession, and thereby close the purchase of the project. We are very ready to build those wind farms there in Peru. I would say that we are developing the Peru strategy. We are increasing it. We are bringing more, and we are in a very interesting process that we expect to finish by the end of the year to maybe have a platform that involves more than one project in Peru. Well, very good. At this point, with these answers, I think we were also able to answer Saul Degrado's question on X, who was asking about other investment projects. Saul, on X, asked about further investment projects, so I think that we have answered that question as well. We have somebody on Zoom that asks the following: "I have three questions. You have a leverage of 2.82 times net debt to net EBITDA. Do you have a goal for the future to have a lower indicator? In the financial statements of the first quarter, we have an increase of the pressures of the debt on the short term. What is Celsia planning on this? And respect to commercial debtors or debts payable." This is an anonymous question, but yes, we can answer it. Yes, the 2.8 times debt to EBITDA, according to Fitch and S&P, we have a AAA rating, and we will continue with a AAA If we do not cross the 3.5 threshold, we will continue to de-leverage as planned. Now that the debt cost will come down, we will see that component of the net debt will decrease for this year. As we said before, we expect net debt to be at 4.1. This will involve debt repayment, which leads to the second question, which is short-term pressure. Yes, we have working capital for two fronts. One is those debts for the rest of the year, which are going to be repaid as part of the use of the cash flow for the company. In terms of the best use of resources, we have to see if we extend these debt payments or if we pay them this year. Our structural debt is the debt that represents the 5.8-year horizon that corresponds to debts that normally cannot be repaid. For example, the corporate bond program, where we have COP 2 billion in bonds issued, which is the custom in this market. They are not repayable. In terms of other debtors, one of the effects of El Niño that we haven't mentioned, but one of the big effects that El Niño has, is the effect on working capital, because we are buying a lot of energy to cover shortages in hydro and fulfill our contracts. So we transform our working capital through this period. We are seeing a snapshot of this period right now. But as an organization, we expect that this was a short-term effect, and when we go back to normal and we have La Niña, the working capital will come back slowly to normal. Thank you, Esteban. Pablo Castro asks us, in terms of the buyback, what is the threshold for the stock buyback program? The strategy and the mandate that we have from the shareholders' assembly is to provide liquidity in the market so that we have correct prices. This objective, we think that we are doing very well in this. We moved from a liquidity below COP 300 million, COP 400 million daily, now up to COP 2,000 million daily. We multiplied liquidity by five times. This is very important so that we don't have those pressures again that we had in the past, where transactions below COP 50 million could drop the price of the stock, which were completely tied to the lack of liquidity. That's the main objective. The commission is reviewing what we are doing, and we will continue to act and consolidate our liquidity point. We still have COP 260,000 million to invest as mandated by the assembly, and we will continue to use them as a source for liquidity, but we are not correlating at the time the thresholds. But we see that the value of the company has room to grow the fundamental value. So we emphasize that you should look at the energy services and other business lines, that it should increase the value of the company. That will allow you to determine what is the threshold for the buybacks, so that it does not destroy value for the program or the company. What we want to act is to provide liquidity for the market, which is our main mandate. We have a question from Juan Francisco Jaramillo. He says, "Good morning. Why do we see a low collection from. What is being done about it? Our collection is from our distribution business. That portfolio has no problems. That portfolio collects 98% without any problems, and is one of the best that we have in the system. Our clients in Valle and Tolima are very good clients. Here, I would like to talk about what happened in the quarter. I think that Esteban touched upon it, which is that we had Easter at the end of March, and that led to our collections for March to come down to around 94%-95%. Today, we are up to 97% again. As of April, we are recovering our collection without any problem. Logically, we have some areas and some towns where we have problems with regards to losses, but I think that they could be understood in light of the economic situation of some vulnerable groups. We also have a commercial portfolio that we have at CNC, which was completely resolved. Yes, from the technical point of view, Juan Francisco, I can tell you that when the company. We do not have a lot of portfolio losses. We estimate collections, and we average them on a historical basis. This is a recurring exercise following the technical rule, which is a projection of collections, but it is not actual numbers. As I said, we had some issues, but we solved them already. Financial costs were above COP 170,000 million and profit below COP 30,000 million. Do you have a way to reduce debt? Our debt stock has not grown over the past three or four years. If you look at the growth of our EBITDA, it has multiplied. Our ratings are AAA. Our level today is 2.8 net debt over EBITDA, which is very healthy and very manageable. When you look at the impact we had last year of COP 800,000 million in financial costs, that is very painful, yes, because that is more than twice of what we usually have. We are convinced that we will reach a financial expense that is manageable with regards to the size of our company, which is around COP 350,000 or COP 400,000 million, and this will allow us to recover our net profit. That is our vision. If we look at the next two or three years with the growth of our platforms and we look at the investment requirements and how we are funding them, clearly our operating cash flow, which is positive and is very interesting, possibly we could have resources to strategically lower some of the debt, but that is more of a two, three-year horizon. We have a question from Ricardo Sandoval. The indexed financing strategy, would you like to change it after the market conditions come back to normal? The stocks that have been bought back, what treatment are they given? Are they kept, are they eliminated or brought back into circulation in the market? With regards to the indexed financing strategy, the indexed strategy corresponds to our indexed income, both in terms of contracts and they all have an annual indexation formula. This is tied to our income. We always are looking at opportunities to provide more coverage and fix some of rates in the short term. But we have to recall that the structural debt is 20-year bonds and other bonds. Those, yes, we can't do much about that. Our indexation corresponds to normal income cycles. It is very correlated with regards to the stock. What we want to do with those stocks, we have Ricardo. These shares are suspended, especially their rights. The right of these shares to receive dividends and political rights are not part of the company today, which means that the company is not a shareholder of itself. We can sell them again, we can cancel them and decrease our equity. But we haven't decided yet on a mechanism or on what we are going to choose. As I said, these shares are suspended. We have a question from Hugo Pacheco. With regards to the buyback of COP 20 billion in the book building strategy, you approved a price of COP 4,300 per share. Why is this price not reflected in the value of the platforms? It's a very simple explanation, which is that the independent or the book building mechanism is considered an off-market operation, and it is not part of the price or the volume of the platforms. This is on the margin of the stock market and you need to comply with regulation. So you won't see this COP 20 billion on the price of the platforms, because these are by the external independent mechanism. Thank you, Estela and Ricardo. Final comments, because right now we don't have more questions. I want to thank everybody that was here with us today. We have very interesting times ahead. We have the regulatory issues that we have to sort out. We have to solve structural problems in the system. This will surely be discussed, but from the point of view of the company, we are convinced that this country needs much more energy availability. We need to build more generation plants. If we want the energy transition, we need a lot of transition energy and more transmission because there's no transition without transmission, because the demand for energy is high around the world. The world is electrifying. We are talking about 2, 3 times the energy demand. We are in a business where the future is very interesting, where we will have a lot of opportunities to grow. In this company, we will surely have the first projects in wind farms beyond La Guajira, which is an interesting outlook for the country. I can also tell you that our projects in enerBit, our digital and our home internet business show important progress. They are reaching their goals, operational progress, and that is very good for us. In our energy front, where we are having annual sales between COP 200 billion and COP 300 billion, depending on if we include solar or not. This is another business where we look at the energy prices, where people start to ask for energy, which becomes an obligation for the commercial and industrial businesses. We have interesting strategies in that segment that we expect to be able to share with you shortly. We believe in this country. We believe in the future. We will leave it on that note. We thank the team and all of you on this call. Have a good rest of your week.