Good morning, everyone. Welcome and thanks for being with us today at the conference of results of ISA and its companies for this first quarter. We have our President, Juan Emilio Posada, Daniel Isaza, Vice President of Corporate Finances, Patricia Castaño, President of Corporate Strategy, and Andrés Villegas, Director of Planning and Evaluation, who are going to present today a very interesting chapter with a focus in energy transition. My name is Diana Cardona. I am from the team of Relationship with Investors. As always, during this presentation, you can ask questions through the window that you find in the right side of your screen.
Please write down your name, the organization you belong to. On the last part of this lecture, we will give answer to all your questions. Mateo is a person who will support us with this presentation. Mateo, please, let's go to the next slide. At the same time, I give the floor to Juan Emilio, who's going to present the highlighted facts of this first quarter.
Good morning. Welcome all. It's a pleasure to be here in this new occasion. To start, Mateo, please, next slide. Before starting with the highlighted facts of this period, I'm going to show you the dimensions of ISA 2030, based in the generation of sustainable value on one hand, because the results are going to show that that strategy takes care of these three dimensions that I'm going to mention. That generation of sustainable value has three dimensions. The first one is to generate value to the shareholder. In this dimension, we have challenges for 2030, preserving the financial discipline that has characterized us. The second is to create a social impact and environmental impact that is positive.
Our strategy contributes actively to caring for the planet and complying with the objectives of sustainability of the United Nations. The third one is to ensure the corporate sustainability. In this dimension, we seek that the creation of value to the shareholder and the positive social-environmental impact are sustainable and are permanent on the long term in our value proposal. Developing this way, no business is adjacent and permanent with energetic transition, with persistent innovation against digital information, developing new capacities of the human team. The strategy 2030 is bet to create value through time, transcending the economical value generation, including its social-environmental topics, being more dynamic, more collaborative, and digital. Next slide. Next, we will share three important facts of this quarter that validate our commitment to impact, in a measurable way, the growth of the countries and are going towards the strategic dimensions that we already mentioned.
ISA obtained from ICONTEC, the Colombian Institute of Technical Norms, a carbon neutral certificate for 11 of its companies. This fact supports the efforts of the company, not only to reduce and compensate the emissions created by its operation, but also creating a positive impact, social and environmental, facing the climate change. To achieve the certification, they considered our voluntary actions in circular economy, which are focused in less consumption of water and energy, residue management, sustainable mobility, use of renewable sources, and reduction of emissions of SF6, the gas used in the operation of some of our actives, specifically at the transformation substations. With this benchmark, ISA becomes the transmission company certified by ICONTEC with greatest geographical coverage in the LATAM region. Another important achievement in this quarter was obtaining the bronze medal delivered by S&P Global Sustainability Yearbook, which recognizes the most sustainable companies.
For this edition, S&P Global located ISA on the 13th place, locating it as one of the most sustainable within the industry. For the seventh year in a row, ISA became part of this list that considers the work of the companies according to the ESG criteria, where ISA has been doing through its programs, impacting positively the environment and generating progress within the region. Within the innovation initiatives of ISA, along with Rockstart, we selected 10 startups to approach challenges in the energetic field. These startups will strengthen the ecosystem within the energy tech sector of LATAM and will provide electromobility, access to renewable energies, digitalization of business, and energy efficiency. The investments executed gave value to the stakeholders and created a positive impact within the country.
During the first quarter, we invested COP 1.4 billion, number that becomes an upward of ISA to the energetic transition, as great part of these projects will allow the non-conventional renewable energy entrance to the interconnected systems of the nations and will contribute to the strengthening of the energy transmission network, improving its reliability and its capacities. Looking at it per country, the CapEx is distributed in the following manner. In Colombia, we concentrated 27% of CapEx, and we advanced in the construction of nine projects. Four connections were high-voltage connections with renewable energy sources, non-conventional sources, that were connected to the national transmission network. We increased our capacity, and 29% was focused in Brazil, where ISA CTEEP continued working in its reinforcement and improvement plans, executing six transmission projects that were acquired through different bids. We continue with our two main businesses, transmission of electric energy.
We worked in the increase of three groups in Chile, in Lagunas, 100% ISA, and Kimal-Lo Aguirre, which is 33% belongs to ISA. Now, we keep working, building the concession Rutas del Loa, as well as improving the road safety that generates new income and extension of our concessions. In Peru, finally, we advanced in eight projects that include three reinforcements, two substations, and a collections, and the projects Coya and Chincha. It's important to say that if we analyze these numbers, subtracting what belongs to minority shareholders of the affiliates we control, I mean, especially CTEEP in Brazil and Red de Energía del Perú, Consorcio Transmantaro at Peru.
The composition of the execution of investment of ISA in the first quarter was mainly in Colombia with 36%, followed by Chile with a 34%, Peru with 16%, and finally Brazil with 14%. The cost of this investment done in the first quarter, adjusted by minority participations of third parties in affiliates that we control, has its COP 1 billion. On the other hand, during that trimester, we had 13 expansions that will add a CapEx of $80 million and will add kilometers to the network. About these projects, besides reinforcement and 15 improvements in ISA CTEEP, Interconexión Eléctrica, we started commercial operation partial with the rights to 68% of its regulated annual income, equivalent to $8 million. Mateo, let's go to the next slide.
As I was sharing with you in the last meeting, one of our focus this year that working with our three strategic dimensions, in other words, a sustainable value to the stakeholder with positive and social environmental impact and corporative improvement, is to grow in a disciplined manner in order to be main characters of the energetic transition focused on the human being. Please recall that without transmission, there is no transition. Without transmission of electricity, there is no possible electric transmission. In the next transition, in the next 12 months, the organic opportunities to invest ascend to $20 billion. 72% belonged to the electric transmission business, and 28% to the business of roads.
Looking at it per country, Colombia, we expect to have convocatories from the planning unit by UPME that will go over $2 billion, and bids in roads for COP 1 billion that include a bid of the second wave of the 5G concessions. In Brazil, there is going to be a bid for a project estimated by ANEEL by $10 billion. This volume of bids for electric transmission in Brazil is 3.5 x greater than the average bidded in the last five years. At ISA, we will analyze this portfolio of opportunities in Brazil, and we will participate on the bids for an amount that is not very different from the previous years. In Chile, we have identified opportunities for $530 billion in electric transmission lines, substations, and a storage project of large-scale batteries.
Also in Chile, for the roads, we expect to work the bids for routes that already exist at the Ministry of Public Works for $4.8 billion. In Peru, finally, we have identified opportunities in bids in energy transmission for $1 billion, including the second bid for the interconnection between Peru and Ecuador. Now, we will give the floor to Daniel so he can present the financial results of this quarter. Thank you very much.
Thank you, Juan Emilio. Good morning to everyone. We will start to talk about the whole financial results of the first quarter of 2023. As a general comment, I am very happy to report the very positive results in the first quarter of 2023. We have incomes and EBITDA in the transmission and roads businesses growing over 30%. The total incomes of ISA the quarter were COP 3.9 billion, 41% more than the first quarter of 2022, and EBITDA to COP 2.7 billion, which is 38% more compared to first quarter of 2022. You look at these by businesses, as it is seen in the upper portion of the slide you have. On your screen, the incomes of transmission growth 35%, strengthened by the contractual escalators, greater income in Brazil, operation of projects in the whole geography, and also by efficiencies in energizing projects.
In Brazil, the business of roads grew 81% compared to the first quarter of 2022, and this increase is explained by greater income in construction in the lower routes of Ruta de la Araucanía and the Ruta de los Ríos. Also very relevant due to the change in the financial active in Chile. In the third quarter of 2022, we changed from Chilean pesos now to Unidades de Fomento in order to have a natural coverage with the cost of the debt, representing an increase in the income in the road business in Chile. In telecommunication, we had greater income, 16%. We had several contracts in dollars by indexation of the representative market. We had greater connectivity, internet services between Peru and Colombia. On the EBITDA, you can see the data on the lower right side of your slide.
I would like to mention that the EBITDA, without construction, that recognizes efficiency. So the profitability in the margin of operations of the operational business increased 0.84% on the first trimester to 85%. When we look at that total EBITDA margin, we see a decrease of two points, of 71% to 69%.
Please consider that what is happening is that here we're mixing construction and operational businesses. In a quarter where we have greater construction income that have a lower margin, in a combined margin, we will see a decrease. But the fundamentals behind these margins are still solid, and greatest part of our incomes come from the business of operation, where we still have 85% margins, one percentile point above what we had on the first quarter of 2022. Let's go to the next slide. In this slide that you see here, we're making a bridge between the gross income of ISA from the COP 433 million to the first trimester of 2023, which is COP 828 million. The increase is 92% in the net income. If we understand this, as return on the patrimony, this is a ROAE. That indicator comes from 11% to 15%.
Besides the EBITDA and income terms, the operational incomes without construction grow, and the incomes and the results that are controlled, even though there's an increase of 31% in the AOM that is explained by the operation of new projects between April 1st, 2022, and March 30, 2023. A little thing that we need to consider here is that all these new projects have associated income, so we have a positive margin, increase the income, even though we also increase the costs. We also need to consider the inflation of the AOM costs, which are complex or we need to be careful. But they are compensated in the fact that the base of our income have escalators that also reflect the changes in price levels. So even though we increase the AOM on the net, it has net results.
With the protection of this company towards inflation, we have more positive results. I would also like to mention that in the modification of the income, we have a modification in the way we change from pesos chilenos to UF. So this is an effect that has nothing to do with the cash flow. It has how we consider these in the financial flow. So we don't consider COP 97 million in the increase of the profits because accounting and IFRS does have an effect. So the profit will go from 91% to 70%, which is a very important number. Also, I want you to check in this presentation and that we showed at the shareholders meeting, is I wanted to present to the market our profitability considering the ROAE.
We wanted to use this in order to provide better information to the market and information that could be compared with that reported with other investment alternatives with peers from ISA. We are using that ROAE, that includes that A, which means it is an average patrimony to understand the profitability in terms of the. We also considered 2022 and 2023, we increased from 11% to 15%. In this slide, there is some information about the leverage level of ISA and how it varied from December 2022. We are comparing with March 2023. As you can see, the increase in absolute terms is 1%. We have a debt that is similar to what we have at December 2022. Nevertheless, we paid some debts in Brazil, Chile, Peru, Colombia, and we have not gotten new debts this first quarter.
Also, a convention effect because we decrease the value of the debt since there is a revaluation of the Colombian peso. The debt that we have in foreign currency is loaded on the balance in 2023 at a lower rate, aligned with what we announced in the report of the first quarter, of the fourth quarter of 2022, excuse me. We see the EBITDA going down from 4.2x, that we close that year to 3.9x, and the position has increased to COP 6.7 billion. Here, besides generating cash during the period, there is a reclassification of investors in short-term investments that became cash available, and if you add it to the short-term investments that are not within this cash, we will have a total liquidity at March of COP 7.1 billion.
The EBITDA here is 3.1x, and again, that debt is at the same level, so EBITDA increased, and the cash position is stronger. That index has a sensible lowered from the EBITDA that we had at the balance of 2022. Let us go to the next slide, and then I give the floor to Andrés Villegas, who is going to present a special chapter about energetic transition. Thank you very much.
Good morning. Thank you, Daniel. Yes. The next slide, we will talk a little bit about the infrastructure, and as Juan Emilio Posada mentioned in his initial message, the transmission infrastructure that needs to be understood within the energetic transition environment. Next slide. The infrastructure right now corresponds to 48 km, almost 49 km of circuit, and in total, around 106 MVA of transformer capacity. This capacity of transformation refers to the capacity that substations have to transfer that energy that travels to the high tension networks to the low and medium tension, and then to be distributed to the final customers.
If these same numbers are seen, considering not only the controlled and non-controlled companies, we are talking about 70,000 km of circuit and around 137,000 MVAs in transformer capacity. This network, which is in operation, grows, keeps growing in function of new projects due to the participation in bids, in expansion projects, and right now it implies a value of around 5,000 km of new transmission circuits and over 16,000 transformer capacity, MVA. This network in construction needs to be understood in a different environment, and here is where it makes sense to talk about transition and the role transmission has within transition. Let us go to the next slide, please.
About this topic, many things have been written. There is lots of information available. Here, we've taken the liberty to bring three examples to be able to present to you basic concepts, so you can understand the important role that transmission has within transition. Let's start with the first topic that refers to the paper on the left, which is our paper published January 2023, written by Bill Gates. This is surprising because Mr. Gates is writing about transmission, but the most interesting thing is that his definition of transmission as a key element in order to have a future of clean energies. The reasoning, and I hope you have the opportunity to read this, I invite you. It's a very short, simple document in very simple words. What he says, it's something very basic.
In a scenario of deep decarbonization, there's an interest of all countries and all systems to have access to renewable, non-conventional energy sources, understanding, of course, that some of these solutions can be developed and be delivered to the system in a distributed manner. The generation in great scale is usually far away from the demand centers, so this obligates to build new transmission infrastructure. Now, that generation that is inserted within the system also creates a change, which is part of the transition process that leads to some solutions that will be more electrified in a more electrified economy. So that would mean a greater increase of demand. That way, not only due to the connection of renewable energies, but the increase of demand due to the electrification of economy, the networks need to be updated. I call the attention on this.
In general, when we talk about the role of transmission, we need to understand it under a double concept: not only building new infrastructure, but also updating, modernizing, adapting that network for the new conditions. This is clear. If you don't recall, most of our infrastructure was created a long time ago. So we talk of infrastructure with over 50, 70 years. So updating is a very important priority. Now, this effort of updating the electric grid is not easy. Mr. [Graetz] even says, in a very simple way, he emphasizes that the challenges of the development of the grid is associated to three Ps. He talks about Ps, planning, payment, and permissions in order to develop the grids required by the transition. Finally, he concludes something that we place dear as the heading of these articles. If you care about climate change, you should care about transmission.
Because the human beings are wise enough to consider this, but if we are concerned about climate change, we need to be concerned about transmission. The first article is very simple, but it's very powerful about what it means, transition and transmission. Now, all these, what all of these lead us is to a transformation process within the grid, especially of the electric grid. The transition is a process, evolution process in a transformation scenario, which means that the grid, which is a basic component, also needs to be transformed, and the grids have to grow their capacity. The second article from The Economist, April this year, says that the expectation of a great grid development is expected during the following decades. So how much growth are we going to have?
Now we have this document on the right that talks about the expectation to grow between 2x and 3x , both the length of the grid as its capacity. It is not a growth that is measured only by kilometers, but also net grid capacity growth that is going to be very substantial in the emerging markets. All this vision of growth of transmission from ISA, we have prioritized through three important elements. The first one, in terms of the expansion, renovation, and modernization of the infrastructure that wants to have a better use of the available capacity. We are clear that our infrastructure is to grow in length, but we also need to grow in capacity. The second very relevant topic was the beginning of the justification of these grids. We need to connect new renewable energy sources, connect them through transmission infrastructure.
The third great priority within that vision of transmission as platform to transition is development of interconnections that will allow the growth of the regional market, expands the markets, and gives us access to new renewable sources. Our vision of transmission under this context launches solutions towards these three important priorities. Next slide. Being clear on these, let us go back on the numbers. Now they start to make more sense. We start in operation in 2019 to 2023, over 1,000 km per year. In total, 5,000 km of circuit, 11,800 MVA transformer capacities. Now we have another line we did not have before, which is with storage capacity, for batteries in Brazil. In the image at the left, you can see the substation with this project. We are not only adding kilometers, but storage.
If we go back and look with more detail, the 4,600 km and that 1,600 MVA transformer capacity, what we have now is a representative sample of solutions we are trying to identify in the previous slide. In other words, those 4,671 km are not only traditional expansion. We also have there new technologies, transmission technology with high tension in HVDC. Now we have a project that we are building, and we have in the portfolio opportunities, new projects in HVDC project. We also have flexible transmission that allow to direct the flow to increase the capacity and make a better use of the available infrastructure. In the portfolio, we have solutions that are being developed in Colombia.
I did not include them within the list, but we also have a project that is being executed to re-potentialize, to increase the capacity of conversion of a transmission line in Peru, which is changed from 220 kW to 500 kW, duplicating the capacity of the line without building one additional kilometer. Now we also have connection to renewable sources, contracts to integrate to the system, and 1,300 MW in Colombia. With capacity of 600 megas during this year, we have an expectation of other 600 next year. If we look at this in dimension terms, we are talking about expansion of the network, renewable connection, and in the portfolio, we also have several interconnection projects that we are working on, not yet being executed. We still are presenting some offers, especially in Ecuador and also in Colombia.
Simply, I summarize in these slides that we can measure our growth not only in kilometers, because that hides powerful messages of the type of solutions we are implementing, solutions like re-potentializing, do not add kilometers, but duplicate capacity. The transmission challenge as base of the transition, where you are going through it through solutions, and in the future, we hope to have greater diversity of these type of projects that we will not see reflected exclusively in terms of kilometers. Next slide, please. To conclude, our greatest challenge and our aspiration is to keep building our growth path. To the 70,000 we already have, and considering controlled, non-controlled companies, and facing the 10,000 we had over 20 years ago, the expectation to 2030 is to reach 100,000 km of grid. We have tried to reflect this here in these graphs.
They have a different color, they have a different taste associated to this challenge of developing infrastructure that will respond to superior attributes, not limited exclusively, but ensuring the resilience, the safety of the service as it is done from a fair, sustainable transition. If we consider what Bill Gates says, if you care about climate change, you should care about transmission. We must be concerned in transmission if we are really interested or concerned or in solving the issues of climate change. I finish and give the floor to Juan Emilio for the final messages.
Andrés, thank you very much. I would like to close with three messages that summarize this presentation. The first one, we had very solid financial results with growth over 30% in the main numbers, with growth in the profitability reflected in a ROAE of 15%. This is a reflection of ISA's resilience and the strength of the attributes of our business model, and especially of our human team and our talent. Of course, we generated value to our shareholders as is dictated by one of the dimensions of our ISA 2030 strategy to provide sustainable value.
The second message is that we have growth perspectives that are very ambitious, are supported on a portfolio of opportunities with $20 billion in the region, and we have the financial support to keep expanding ISA's footprint within the region and to deliver our sustainable value proposal. Third, we will continue giving important steps towards an energetic transition that would be inclusive, sustainable, focused in the human being, that at the same time will help us to move forward in a tangible manner in these three strategic pillars. Generating value to the shareholder, positive impact on social and environmental, and to maintain our corporative importance in all the countries, in all the region. We will go to the next slide to start the Q&A session. Again, Daniel, thank you, and I give the floor to Diana.
Thank you, Juan Emilio. Here we have several questions from the people who are with us today. We will start with the following, which is asked by Roberto Paniagua from Casa de Bolsa. He would like to know our opinion about the possible change of ISA's role in the energy chain due to the modifications of the National Development Plan.
Our strategy is the same. Our core is energy transmission and its adjacent businesses, and there are new businesses of electric energy adjacent to transmission. For example, the storage. We have the legal possibility to generate energy in other countries, different from Colombia. Up until now, we haven't used this legal possibility since the strategy has been to use these huge opportunities mentioned by Andrés Villegas in the energy transmission business. Please recall, the world needs to do great investments in the region, specifically to update its transmission grid and to increase, in several times, the energy transmission network as result of the needs of the electrification process in the world, in order to create an energetic transition that would lead us to reduce an increase to 1.5 degrees in the planet's temperature compared to the industrial area.
For us, it doesn't have a huge material impact, the fact that the Colombian Congress is successful or not with the article of the National Development Plan that will allow the vertical implementation of ISA in other phases of the productive chain in Colombia.
Thank you, Juan Emilio. Here, continuing with our friend Roberto Paniagua from Casa de Bolsa. He would also like to know which is the evolution and our expectations on the bids in Brazil. As we mentioned, we will have big lots in June and December 2023.
Thank you, Diana. Thanks, Roberto, for your questions. In Brazil, we have a possibility to participate up to $10 billion in different bids for electric energy business in 2023. Of course, we will not participate in all of them. We will prioritize those where we have greater synergies and competitive advantages, and we've always selected some of the bids in June and December, where we will focus our efforts to prepare in order to present our proposal in the bid this year. The pipeline is pretty large, COP 10 billion. Of course, we will have to be very selective in that prioritization. We are sure that that way, we'll be able to comply with and add a backlog and CapEx commitments to our business in Brazil. Since the dynamic of the bid in Brazil is pretty healthy.
The fact that we have many opportunities in Brazil due to the size of the economy, does not necessarily imply that we will participate in an incorrect manner. Because we have a very healthy performance. We will be coordinating and balancing these opportunities in Brazil with the good opportunities that we also see in Colombia, Chile, and Peru.
Thank you very much. I will continue with one question made by two person, Florencia and Agustin, related with the suppliers account that had an important increase this quarter, and they ask if they should continue in these high levels.
Florencia and Agustin, thanks for your question. I give the floor to Daniel Isaza, so he can give us a more detailed and professional answer, since he's specialist on this topic.
Okay. Thank you, Juan Emilio. Thanks for the question, which is pretty relevant because, yes, in the financial states of this quarter, both individually as consolidated, we see an increase that is relevant in the accounts receivables of the suppliers, but also the payments of dividends to the shareholders. As we mentioned, the General Assembly approved dividends of COP 1.3 billion. Those dividends, this capital, should be paid in March to the shareholders, so it increases the accounts payable of the company. We have the registry of these dividends. If you measure the account with those dividends, we see a decrease in the other accounts payable.
In a consolidated manner, we have to consider that we consolidate line per line, CTEEP and Red CTM. Also there, we add a component that needs to be paid of dividends to minority shareholders different from ISA, because the component that is to be paid to ISA are canceled in the consolidation line by line to the subsidiaries that we control. Thanks for that question. There is a second element in this question. How does this account behave from now? We need to recall that it has dividends. We pay 50% in March, COP 1.9 million will be paid in May, and the other 50% will be paid in December, where we have the second payment of dividends authorized by the General Assembly in 2023. Thank you.
Thank you, Daniel. Thank you, Juan Emilio. We have two questions related to the roads business, one from Ana María Guasca from Davivienda Corredores. She would like to know how you are going to compensate the suspension of the toll of Papiros, and Roberto from Casa de Bolsa, the impact of not paying tolls in Colombia.
We can summarize these two questions in one. I am going to give the floor to Eduardo to answer this question.
Thank you, Juan Emilio. First of all, in Papiros, not paying the tolls, the suspension of these tolls are regulated through resolutions that are contemplated on the contract. They will do partial adds every quarter that need to be paid on the following two months. The risk of no payment is covered within the contract and has little impact since the paying period is pretty short. Non-payment, in general, with the contracts, especially in the Concesión Costera Cartagena Barranquilla, which is called 4G, contemplates that the risk needs to use the mechanism of compensation through the accounts established for this reason. In summary, we will always have partial closures in the time where the difference are going to be compensated as the case of no increase in the toll rates.
Catherine from Davivienda and Ana María from Davivienda Corredores are asking about Taesa. They say that Taesa prepares a bond offer, so is ISA going to participate or wants to dilute its participation in Brazil?
Thank you, Ana and Catherine for these questions. I ask Daniel to answer Taesa's topic.
Thank you for this question. In fact, there was some news in Brazil, in the media, about a possible emission of bonds from Taesa, and the company already formally addressed this topic. Yes, the company is analyzing constantly different alternatives for financing and ways to optimize its capital structure, maintaining, of course, the strategic pillars on mind. Said that, up today, the company has not made any decision of making a public offer of bonds, and this is a decision of the administration council of the company, which is the board of directors of Colombia, comparable to the board of directors in Colombia, and that they also have the same control. That news has no decision within the company. It is not valid within the company.
Thank you, Daniel. Diana.
The following question, also from Florencia. She would like to know how they are working with the indexation of the income in Colombia if we continue with the scheme of the lowest IPP and IPC. Up until when are we going to continue using this scheme?
Thank you, Florencia, for your question. This is a very relevant topic. Andrés, please answer.
Yes, Florencia, according to the tariff path defined by CREG last year, up until September 2023, the indexation of the income, especially the actives that are not submitted to convocatory, continue having that minimal value between the IPC and the IPP of the industry. This measure could be extended voluntarily for the companies if at that date, they do not define the new indexator proposed by the CREG. The regulator is working parallelly to develop this new index that will reflect the specificity of the regulated sectors, and for the tranquility of all, this topic is one of the regulatory agenda topics for the first quarter this year. We are just waiting for this definition.
Andrés is talking about the component T of transmission that represents around 6% of the total invoice. Yes. Thank you, Andrés.
Thank you, everyone. Thanks to all our participants. We do not have more questions. We would like to thank your participation in this event. We wish you a great day, and we hope to see you in next opportunities. Have a good day, and thank you all.