Good morning. My name is Mateo Toro from the investor relations team. We would like to thank you all for joining us on this earnings call for the first quarter of 2025 of ISA and its companies. During the presentation, please be so kind to send your questions through the window that is on the right-hand side of your screens. On the dialog box, please provide your name and the company, and in the very last part of the event, we will be answering your questions. Next slide, please. Today, we are with Jorge Andrés Carrillo, CEO of ISA, Jaime Falquez, VP of corporate finance, Gabriel Melguizo, VP of Energy Transmission business, Patricia Castaño, VP of Corporate Strategy, and Natalia Pineda, VP of Road Concessions.
The agenda of this conference begins with the highlights of the first quarter of 2025, explained by Jorge Carrillo, followed by a chapter on energy transmission with Gabriel Melguizo, and then Jaime Falquez will provide quarterly financial results of ISA. We will go back with Jorge for closing remarks, and we will have the Q&A session. Let us look at the next slide, please, and begin with Jorge Carrillo.
Good morning, and thank you for joining us today again. Let us look at the next slide, please. In highlights in 2025, we were again included in the S&P Global Sustainability Yearbook, which acknowledges the companies with proven strengths in sustainability. The most relevant criteria are the climate strategy, ethical business, management with communities, human capital management, as well as OHS.
ISA ranks among the best 20 companies worldwide in sustainability practices in the power utilities industry, and it is part of the 11% of the best companies with environmental performance. As to financial performance, which Jaime will be explained ahead, we can say that the EBITDA of the first quarter was COP 2.4 trillion, up 8% compared to the first quarter of 2024, and the net profit was COP 695 billion, which represented a raise in 10% compared to the same period the year before. As we said in the prior webcast, on February 25th, there was an event on the transmission line, Nueva Maitencillo - Nueva Pan de Azúcar, in Chile, which operates at 500,000 V, and the origin was a technical failure of a teleprotection equipment. Its reinitiation, the operation unexpected and unforeseen of associated protections.
This technical failure was solved, and the authorities were given, by our experts, information for the ongoing investigation. What is the purpose of the investigation? To look at the non-availability of the service that the country had. Today, the SEC of Chile, which is part of the Superintendence of Household Utilities in Colombia, is reviewing all the report given by the SEN and all of the power companies involved. To date, it is important for you to know that no charges or sanctions have been made because of this event. Fitch Ratings confirmed the national short and long-term rating of AAA and confirmed the international ratings of risk on a long-term basis in foreign and local currencies at BBB. However, the outlook is from stable to negative. Why?
Because of the change of the outlook of the risk rating of Colombia and therefore of Ecopetrol, because according to Fitch, the rating of ISA cannot be separated more than two levels of the rating of its parent company. On March 26, we carried out the shareholders' meeting, and it is worth highlighting here that we approved in it the 2024 comprehensive management report, which includes individual and consolidated financial statements of ISA. We approved the profit distribution proposal of COP 1.4 trillion, which is an ordinary dividend of COP 1,265 per share, and we chose Deloitte & Touche as the external auditor for the company from April 2025 to March 2026. As far as investments in the first quarter of 2025, investments were executed for COP 1.4 trillion, showing more than in the first quarter of 2024, and this goes hand in hand with the current investment obligations.
The graph in the middle shows the distribution of CapEx consolidated. 90% of the investments were in the energy transmission business, 8% in roads, and 2% in telecommunications. As far as investments by country, Brazil represented 59%, advancing 179 reinforcements of the transmission line and six projects bidded and awarded by ANEEL in previous periods. Colombia represented 21% of the investments of ISA, especially by the projects of UPME and the connection projects which are currently underway. Chile represented 9% of the investments executed. In energy transmission, we advanced in the construction of five projects, including three expansions of the network, a renovation, and an awarded project. In roads, there are advancements in the projects awarded in 2024, Panamericana Este and Orbital Sur, plus the complementary works of Ruta El Maipo, Ruta de la Araucanía, and Ruta de Los Ríos.
Peru, instead, executed 10% of investments, advancing in the construction of transmission lines and grid net expansions. On the right-hand side, you can see the share of ISA and the CapEx, and it considers the percentage of shares in the different subsidiaries. Next slide, please. Here we would like to provide details of the projects awarded and put into operation in the first quarter of 2025. We were awarded 18 reinforcement projects for the grid in Brazil. In Chile, ISA won the Las Palmas - Centella project with a reference CapEx of $84 million or almost COP 30 billion. This project has a lot to do with innovation and will contribute to the National Grid of Chile, optimizing the energy infrastructure, and allow us to redistribute the power flows through the operation lines. This power flow control system is the first project that ISA has developed in Chile.
In the roads, ISA Intervial, along with the Ministry of Public Works, began to implement the Free Flow in the Ruta El Maipo and the access road to Santiago. Through this agreement for the compensations of the sectionary, this will be firm in the second half of 2025. During the quarter, the renovation of substations Guatiguará and Tasajero took place, which are set at Piedecuesta, Santander, and Cúcuta Norte, Santander, respectively. We can also underscore the replacement of three transformers and the implementation of an information exchange automation system in real time. In Brazil, six reinforcements were made, and in Peru, we have a commercial operation called the Ampliación 21, which is to reinforce the interconnected system in central and northern Peru. Ampliación 21 had an investment of $13 million, including the construction of a third circuit.
In roads, in the quarter, we ended the works of security and service at Ruta de la Araucanía and Ruta de Los Ríos. Next slide, please. If we look at the investments plan from 2025 to 2030, this has to do with investments of COP 26.7 trillion distributed, as you can see on the left-hand side. These investments consist on commitments to investments of bids awarded, reinforcements and improvements of the ISA Energía Brasil, capital contributions, and replacing equipments, among others. On the right-hand side, you look at the estimated annual projections to execute these investments without any additional projects, just what we have today. We also advanced building 37 transmission projects awarded that add up to 5,432 km of line and road interventions, 296 km of roads. Here we end, and let's give the floor to Gabriel Melguizo.
Jorge, thank you so much. Good morning to everyone. Next slide, please. As Jorge said, we're going to talk about energy transition focused on our main core, which is reliability. Next slide, please. In 24 years, our grids have multiplied by five, while the demand served has multiplied by 15, representing more demands and a commitment to reliability. To develop and manage the reliable transmission projects is a major contribution for a resilient energy transition, really to have efficient, sustainable, and accessible growth for power demand. From the commissioning of our first project in 1971, the growth of our grids has gone hand-in-hand with the electrical demand, initially in Colombia. In 2000, we began an international growth strategy, which multiplied by five our grids in 24 years from 9,529 km only in Colombia to 49,677 km in operation, and companies controlled in Colombia, Peru, Bolivia, Brazil, and Chile.
During this period from 2002 to 2025, ISA and its companies of transmission were awarded 50% of the expansion in Colombia, Peru, and Chile, and 10% in Brazil. This growth has meant also serving a demand of power 15 times more than what we served in the year 2000. That rises now to almost 600,000 GWh a year. The challenge of our activity is to ensure a reliable power transmission in these five Latin American countries. Next slide, please. On energy trans-- Here, can we talk about sustainability and really with energy transmission reliability, understood as the capability to supply constant and safe energy is managed throughout this life cycle of the business, going through the construction, commissioning, maintenance, and operation of life, and also the renovation and modernization of the grid, incorporating new technologies.
In the stage of planning and construction, which is what you can see on the top of the pie or the graph, you can see the figure, you can ensure there the sufficiency of the infrastructure to serve the power demand. Sufficiency is one of the biggest attributes of reliability, especially for energy transmission. Then in the stage of maintenance that you can see on the bottom of the figure, where it says operate and maintain, there we emphasize the safety of our service, ensuring the maximum availability of our networks and minimizing risks because of failures. In renovation, which is what you see in the figure on the left. But to be more resilient when it comes to the extreme conditions derived from climate change, which have to do with specifications of our network.
In all of the stages, we ensure as well flexibility that allows us to serve the changing conditions of the electrical energy system. Also, everything that has to do with the reliability has to be managed in processes, the organization, regulation, finance, settings, and most importantly, people. More than 16,000 people, employees, and contractors are responsible with their capacity, knowledge, and delivery in this cycle nonstop. Next slide, please. From 2019 to 2024, which has to do with the last stage before the one that we are managing now, we managed excellent results, not only allowing us to anticipate the compliance of our goals looking at 2030, but also meant major advances towards the higher demand and reliability that has to do with electricity. Firstly, we were awarded projects for $6.6 billion.
Again, we are talking from 2019 to 2024, we were awarded $6.6 billion to develop 10,608 km of circuit, not only to incorporate new renewable sources to the systems, but will back the growth and more safety of the electrical demand. Also in this period, from 2019 to 2024, we commissioned projects with an investment above $4 billion, including investments in reinforcements and improving the existing networks for $749 million, which again has to do with reliability. In total, these projects lent the expansion of our networks of 6,000 km of the circuit and infrastructure. Likewise, at the end of December 2024, we reached 49,677 km of circuit to serve the systems where we are present, a demand of electricity of 600,000 GWh a year, almost seven times the demand of Colombia. All of these efforts have allowed us to reach significant improvements in the reliability of our service.
When we look at reliability, we have to look at the index of energy not supplied. You can see that to users, we have not given 0.001%. Again, we have not provided 0.001% of the energy that covers our networks. This has to do with a very high reliability of 99.98%, which is excellent worldwide.
Next slide, please. Lastly, I would like to underscore that an energy transition that is challenging with significant growth for electricity demand for the next 25 years, that means more needs to generate power and grids really is a big challenge for us to remain with the high reliability as a core of our business, and as something fundamental for our ISA 2040 strategy project. Energy that gives life to transition, which is reliable, safe, and resilient. With this, I end, and let's give the floor to Jaime Falquez, who will talk about the financial performance.
Thank you, Gabriel. Let's look at the financial results of ISA as of March 31st, 2025. Next slide, please. I would like to begin this presentation about the results, highlighting a very positive financial performance as Jorge anticipated at the beginning of this call. Several of the highlights that had to do with the results of this first quarter were, firstly, in Brazil, we issued debentures, which are papers in the capital market, of BRL 1,400 million , which is COP 1 trillion, to cover the needs of investments in projects awarded as well as reinforcements and improvements of the grid, which are underway. Also, in Peru, ISA REP disbursed a credit for $22.5 million.
That is about COP 94 billion, also to serve its obligations of investments practically related to expansions of the system. The Colombian peso, compared to the same period of the year before, grew 10% compared with the Brazilian real, while instead it devaluated compared to the dollar and the Chilean peso 7% and 5%, respectively. In Colombia, transmission companies were recognized a portfolio impairment, mainly because of AIR-E and other energy suppliers for an amount of COP 84 billion during this first quarter. As Jorge also mentioned at the beginning of this presentation, Fitch, during this first quarter, ratified ISA's foreign and local currency ratings and revised the outlook from stable to negative, but also ratifying the BBB, international BBB, and AAA local. Next slide, please. Here, we can look at the main figures of the financial results. 2025 began with sound financial results.
On the top left, you can see the performance of the EBITDA consolidated for the first quarter of the year, while on the right-hand side, you could see the consolidated net profit. When it comes to the EBITDA, we can see in the first quarter that it ended at COP 2.4 trillion, which is up 8% compared to the first quarter displayed in 2024. This is mainly explained by the commissioning of new projects, as well as the positive effect of the contractual escalators and the higher yields of the financial asset on the roads concessions. When it comes to the distribution per business segment, 83% of the EBITDA is created from the business of energy transmission, 15% from road concessions, while 2% from telecommunications. When it comes to the net profit of the first quarter, it rose to COP 695 billion.
As a result, that shows a 10% rise compared to the first quarter of 2024, leveraged mainly by what we saw the increase of the EBITDA. Also, it is interesting to show you the distribution of the net profit per country. Here you can see 34% Brazil, 23% Colombia, 21% Chile, 19% Peru, and 3% other geographies, other countries. On the bottom, you can see the balance sheets, and here you can see that we are ending the quarter with assets at COP 78.6 trillion, 2% above what was displayed at the end of December 2024. This is explained by more investments made in energy and road transmission and more availability of cash flow because of the businesses and the financing operations. In terms of liabilities, these grew to COP 50.7 trillion, up 4% compared to what was displayed in December 2024.
Which is leveraged because of the needs of financing to serve the new investments and the acknowledgment of the dividends to be paid by ISA and its companies in 2025. Now, if we look at the minority interest, it adds up to COP 10.8 trillion, 4% above what we saw in December 2024, mainly because of the growth of the assets of Brazil and Peru. To end, at the end of the quarter, you can see that the equity is at COP 17 trillion, which represents a drop of 4% compared to the end of 2024. It reflects the net effect of higher profits seen in 2025 and the dividends decreed in the January shareholders meeting. Next slide, please. ISA and its companies continue to manage debt to promote investment projects.
At the end of the first quarter of 2025, the consolidated financial debt was COP 35 trillion, up 2% compared with the end of 2024. The net movement of the debt is explained because of the disbursements received, especially from the debentures from Brazil and the banking debt of Peru, as well as the amortizations because of the timetables of the payments of the debts contracted, which shows a variation of COP 648 billion. Also, we can look at the effect of conversion, which impacted the results, reducing them by COP 185 billion, explained mainly by the appreciation of the Colombian pesos compared to the U.S. dollar and other currencies of the region.
At the end of the first quarter of 2025, the consolidated mean life of the debt of ISA is 9.5 years, and this goes hand in hand with the nature of the business of the company on a long-term basis. When it comes to the gross debt over EBITDA, it ended the quarter at 3.9 times, similar to what we saw at the end of 2024 and consistent with the company's investment-degree risk rating. With this information, we give the floor now to Jorge for his closing remarks.
Next slide, please. Thank you, Jaime. These are several closing remarks that are relevant. This says we have a summary, really, of an excellent semester and quarter. Really, 2024 began with a sound financial performance with an EBITDA of COP 2.4 trillion, up 8%, and a net profit of COP 695 billion, up 10% compared to the first quarter of 2024.
We have all seen news of several global events that have shown the vulnerability of the power systems. We wonder why. In theory, we have got technology has advanced, everything has advanced, and here it is important to see a new challenge, it has to do with non-conventional renewable energies, and it is something in which all the players involved are learning still. Several countries are saying that the transmission of the systems should focus differently, that all the players, generators, sellers, and of course, transmissions, should adapt, and surely, this will allow us to have more reliable systems. We are focused on the reliability of the service. That is a priority now and will always be, and it is for an outlook for 2025, and we have the capability to keep supplying constant and safe energy.
We continue focused on an efficient execution of our Investments 2030 plan, which is COP 26.7 trillion. We have a sound balance to leverage the growth, keeping our investment degree rating. In the first quarter of 2025, sorry, we disclosed our ISA 2040 strategy to different stakeholders, and their response has been very positive. We are implementing this quickly. Of course, we have a margin of opportunities, and the strategy is good for this. Again, I would like to thank you all for joining us, and let us begin then the Q&A session.
Jorge, thank you. Let us continue with the Q&A session. I am going to add up three questions from Florencia and Ricardo Sandoval from Bancolombia, in which they ask us an update of the shutdown in Chile, the power shutdown in Chile, and if there is any novelty of fines because of what happened there. Gabriel, could you please give us a response about this?
Of course, Mateo. Thank you. And thank you Florencia, José, and Ricardo for your questions. As we said in our prior webcast, on February 25, there was an event in the transmission line at Pan de Azúcar, which is owned by ISA Interchile, which operates 500,000 V. The origin of this failure was technical. It was a teleprotection equipment, its re-energization, and the unexpected failure of subprotections. This technical failure was solved, and ISA contributed to the authorities' analysis made by experts that will contribute to the ongoing investigation. All this to see what really happened with the system in Chile. Today, the SEC, which is the authority that investigates and sanctions, if necessary, this event, is collecting all of the information of what happened and looking at all of the stakeholders.
We, in turn, provided all of the information required. To date, no charges or sanctions have been made because of this event, but we will keep you informed if this takes place. Thank you again for asking this question.
Thank you, Gabriel, for your answer. Let's continue with the question by Andrés Duarte, Corfi. Under the current management, should we understand the communications business will no longer be sold? Jorge, could you give us the answer, please?
Sure, Mateo. There are two things that are important. One, the ISA 2040 strategy ratified the decision made from our 2030 strategy to disinvest in our telecommunications business. However, this, of course, makes us see that we should not degrade our companies, and we have to be more efficient with them to try to capture the most value while it is under our portfolio. Here I see another question.
Let me answer it as well. We are having conversations with Ecopetrol, basically determining if we can reach an agreement with Ecopetrol . Of course, we are protected by a confidentiality agreement right now, but we will be disclosing more information to the market ahead.
Thank you, Jorge. We have a couple of questions made from Ricardo Sandoval, Bancolombia. The first is, how much of the variation of 9% of the revenue, how much is by contractual escalators and new projects? The second question, although it does not seem representative, what was the effect of exchange of the EBITDA and net profit and the variations with the neutral exchange rate?
Sure, Ricardo. Thank you for your questions. When it comes to revenue, the increase that leveraged the contractual escalators was 86%. The 14% remaining are the contributions made by new projects commissioned in the past 12 months. With regards to your second questions, the effect of the conversion rate, you could say that it is 2% of the results, meaning the increase of the EBITDA of 8%, if we look at the conversion rate, could have been 10%. The increase of the profit, instead of being 10%, could have reached 11%. So it does have an impact of 2% on the variation, approximately.
Thank you, Jaime. Let's continue with the question of Javier Becerra from La República. The 20%-30% investments plan, 13% is destined to Colombia. What projects specifically in Colombia? Gabriel Melguizo, could you please give us a hand with this question?
Sure, Mateo. Thank you for your question. The truth, there are different news when it comes to the growth of the grid in Colombia. UPME decided a plan called Misión Transmisión, which is led by the UPME to enhance and modernize the national grid and the original grid in Colombia. When it comes to this Misión Transmisión, we have an expansion plan to 2026 with works in La Guajira, Cesar, Magdalena, Córdoba, Sucre, Chocó, and Norte de Santander, which were adopted in December by the Ministry of Energy through Resolution 459, and which are under development now with ISA and its companies.
Also, part of this Misión Transmisión plan, in January, UPME published a proposal of an expansion plan 2024, 2038, and it was consulted by the Ministry until February 12. And a master planned for the expansion, which includes 98 works, some based on new technologies, and their development will be made in following years. ISA and its companies, of course, will be participating in these projects. That's where we're standing, and we'll be very busy with that investment plan. Thank you.
Thank you, Gabriel, for your answer. Okay, I'm going to add a couple of questions related to debt from Juan José Muñoz from BTG and from Andrés Duarte from Corfi and Florencia from MetLife. The question is, do you see if you have to issue equity or debt to cover the CapEx of the year? Could you tell us briefly of the evolution of the cost of the debt and your outlook in the banks in the market? Jaime, could you give us a hand with this?
Thank you, Mateo. Juan José, Andrés, Florencia, thank you for your question. Indeed, to finance the investments planned, as we saw in the presentation, it's going to be an interesting year. We're talking about COP 2 tr illion, and we expect a debt issue of COP 4 trillion in consolidated terms for Colombia. We're thinking COP 650 billion for bank loans and capital markets. It really depends on the market conditions. Right now, we do not have any issues of equity yet in mind. It's basically capital market.
But for the projects underway in different geographies, like in Chile, Peru, Panama, we're also structuring to finance the projects there. When it comes to cost, the cost has been stable. We haven't seen major movements in the cost of the debt in the past years. It's been fluctuating 7%, 8% in dollars, nominal, consolidated. It really depends on the currencies and geographies.
The expectation that we have is to maintain the situation stable, and it's important to highlight that for a big part of the projects that we have outside of Colombia, we already have hedges with exchange rates to maintain within our business cases.
Jaime, thank you for your answer. Let's continue with another question made. Good morning. In the past, when Colombia had so many difficulties of security, one of the things that were attacked mostly by the guerrilla were the power lines. We know that today, the towers are being attacked. Gabriel, could you give us an outline of what's happening with these attacks today?
Thank you for your question. Well, the truth, we haven't had attacks on our infrastructure and our substations. Of course, we're not saying that we're safe, but we have had lessons learned from the past. ISA has action plans, preventive and for contingencies in place to try to avoid these attacks. When they take place, we can solve them as quickly as possible. In short, there are no attacks so far, but we are prepared for anything that will happen. Thank you for your question.
Thank you, Gabriel, for your answer. We have another question from Andrés Duarte from Corfi. He asks, "Among the investment ideas of Ecopetrol in Monómeros and power generators, ISA will make any of these purchases?" Jorge, could you give us a hand with this?
Mateo, the answer is no. We have a discipline, a strong strategy, and the strategy does not include that business line. We have no discussions about that.
Thank you, Jorge. Let's continue with another question from Katherine of Corredores . She says, "Good morning. When it comes to energy transportation, you mentioned provisions because of the impairment of the accounts receivable. What does this correspond to? Is there an additional impairment ahead for the sector in Colombia?" Jaime, could you please give us a hand with this answer?
Sure. Thank you for your question. Indeed, the provisions of the accounts receivable made or reserves made in this first quarter are mainly to cover the debt of AIR-E, which is a seller in the northern area of Colombia. We have COP 75 billion reserved in this first quarter. We have been reserving since the intervention was made by the superintendents. We have reserved about COP 253 billion for this concept.
In total terms for the debt prior to the intervention and after the intervention, ISA and its companies have been looking at this directly, talking with the controller, the ministry, to meet all of the commitments, payments, for the transmission service. We trust that the proper decisions will be made by the different entities from the government so we can reestablish the payment for these services.
Thank you, Jaime. We have a last question here in the chat from Andrés Duarte from Corficolombiana. "Could you please explain why there's an increase of the tributation exchange rate this year compared to the year before?" Jaime, could you help us with this as well?
Sure, Mateo and Andrés, thank you for your question. The effect of the increased rate, the effective rate, is mainly because of the retention made from the dividends in Brazil and Peru, which we've really been causing more dividends than what we received at the same previous period, which has a direct relationship with the performance of the tributation rate.
Thank you, Jaime. With this question, we end the first earnings call of the first quarter of 2025 of ISA. Thank you all for joining us today and all of the directors. Have a great day.