Good day, ladies and gentlemen, and welcome to Enel Chile's First Half 2020 Results Conference Call. My name is Olivia, and I will be your operator for today. During this conference call, we may make statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect only in our current expectations, are not guarantees of future performance and involve risks and uncertainties. Actual results may differ materially from those anticipated in forward-looking statements as a result of various factors. These factors are described in Enel Chile's press release reporting its first half 2020 results, the presentation accompanying this conference call and Enel Chile's annual report on Form 20-F, including under Risk Factors. You may access our first half 2020 results press release and presentation on our website, www.enel.cl, and our 20-F on the SEC's website, www.sec.gov. Readers are cautioned not to place undue reliance on those forward-looking statements, which speak only as of their date. Enel Chile undertakes no obligation to update these forward-looking statements or to disclose any development, as a result of which these forward-looking statements become inaccurate, except as required by law. I would now like to turn the presentation over to Mrs. Isabela Klemes, Head of Investor Relations to Enel Chile. Please proceed.

Thank you very much, Olivia. Good morning, ladies and gentlemen, and welcome to Enel Chile's Second Quarter 2020 Results Presentation. I hope you are all well and safe in your homes, and are following all the required safety measures that the prevailing circumstance request towards all. I am Isabela Klemes, Head of Investor Relations. Our presentation will be hosted by Paolo Pallotti, our CEO; and Giuseppe Turchiarelli, our CFO. In occasion of these events, we are still adopting appropriate prevention measures. We are all connected from our homes. Paolo will open with the main highlights and will give us an update on the global situation that we are facing and how the company is responding to it. Then Giuseppe will walk you through our financial results, our operational performance, and will give more details on our 2020 EBITDA guidance update. The usual Q&A section will follow. Please note that questions will be received only via chat available in our webcast at www.enel.cl, at the Investor Relations section. [Operator Instructions]. As always, our IR team will be -- will continue to be available to provide you with any detailed information you may need with respect to the figures included in this presentation. Thank you all for your presence. And now let me hand over the call to Paolo.

Thank you, Isabela, and good morning, ladies and gentlemen. Let's start by mentioning the highlights of the period on Slide 2. Today, the world is facing extraordinary difficult times. Since the beginning of the health crisis, Enel Chile had realized the severity of the situation, and implemented all necessary measures to continue offering a stable and safe energy supply service, safeguarding at all times, the safety and health of our employees, our clients and external providers. All our generation and network facilities are fully operational. Thanks to our commitment to digitization, we have developed a solid platform that has turned out to be key in meeting our customer needs in the current scenario, while they are struggling with the difficulties in accessing traditional precession channels of service. We have been promoting remote working methodologies since several years by evolving our systems towards the cloud. Today, a significant number of employees are working remotely in an efficient and effective way. As part of our commitment with the energy transition with the sustainable development of the country, on May 27, Enel Generación Chile announced its decision to anticipate the closure of Bocamina 1 by December 31, 2020 and Bocamina 2 by May 31, 2022. The decision implies closing much earlier than committed in the National Decarbonization Plan and will make Enel Chile the first utility to stop generating from coal in Chile. In line with the previous announcement, Enel Chile is progressing in the development of renewable project including in our strategic plan. This initiative seeks to add a total of 2,000 megawatt of renewably stored capacity by 2022, half of which is already under construction. This project reaffirms our position as the first renewable operator in Chile. Lastly, we have a safe liquidity position to continue executing our strategy and to…

Thank you, Paolo. Before starting, let me explain how we have adjusted our figures on both 2019 and 2020 on Page 21. For 2019, we are excluding some adjusted figures, the PPA early termination booked in first Q 2019 and the net impact of impairment of Bocamina 1 and Tarapacá booked in the second quarter 2019, largely commented in our previous calls. For the 2020 figures, we are adjusting the EBITDA and net income with the coal stock impairment, which consists in booking at once all the coal fuel that we have bought and not used yet for Bocamina 1 and Bocamina 2 that are assets that will be decommissioned soon. The impact on EBITDA would be around $50 million. In addition, we are also excluding the impact of the impairment of Bocamina 2 as a result of our decision to anticipate the closure of this coal facility. Let's now move to the financial summary for the first half 2020. First half 2020 adjusted EBITDA and net income are basically in line with the last year adjusted figures. Our total CapEx amounted $322 million, a 109% higher than previous year, focused on our decarbonization strategy and digitalization of our distribution business and new connections. The adjusted FFO increased 32%, mainly due to lower tax payments from previous period that will be further explained later on, partially offset by the impact of EBITDA. Our net debt in the period increased $448 million versus December 2019 figures, mainly due to the higher CapEx plan executed at June 2020, lower receivable from our company as a result of the energy stabilization mechanism and lower collection and distribution. I will give you more detail in the following slide. Now on Slide 22, let's start with the CapEx. Our total CapEx amounted $322 million, as…

Thank you, Giuseppe. The current situation represents a challenged scenario to the sector. Despite that, our period adjusted results show a steady and resilient performance based on safeguarding our people, business reliability, digitalization and quick reactions to external conditions. At the same time, we are confident on our mid- to long-term performance considering the strength of our diversified business model. Our focus on [indiscernible] and the development of our project in generation and distribution business demonstrate that our company continues to create value in this new environment. To respond and anticipate our clients' needs is the best way to ensure the quality and reliability of our services tied to the continuous improvement of our digital platform. Finally, the resilience of our business' sustainable strategy is supported by the strength of our balance sheet and by eventual additional liquidity measures to support eventual headwinds from external environment. Thank you for your attention, and let's now open the Q&A section. I will hand over to Isabela.

Paolo, many thanks. So we have received a lot of questions, okay? We're going to...

Yes. I've seen that. We have a lot of questions to manage.

Yes. So we're going to select some of them. And other questions, we're going to send the same information from me to all of you that asked questions to us. So the first question came from Murilo Riccini from Santander. He's asking us if we can give more details on the IDB factoring from the receivables of our companies from both generation and distribution segments. Is that...

Yes. I will leave -- yes, the answer to Giuseppe's side.

Yes. Thank you, Isabela. Let me say that the agreement with IDB is doing to add in a coordination also with all the other players in the market. The agreement basically consists a potential facility to sell to IDB and other banks, the receivable accumulated by all the generation companies of the market. And the factory has an availability period to sell periodically the receivable accumulated. And of course, we are talking about only the receivables that are recognized on the decree. We are still evaluating whether the conditions are good for us, but we believe that it makes sense in order to reduce the risk of possible changes in the regulation area.

Okay. Thank you, Giuseppe. We also have questions from -- also from Murilo Riccini from Santander. And also from Tomas Gonzalez from Scotiabank, asking a little more details on the delay on the Congress projects, and if you can give in -- for both of them a hint about how much we have already expended during on 2020, and what we are expecting in the next few years.

Yes. Regarding the evolution of Los Cóndores projects, as we mentioned in our previous calls, the project includes works on tunnels that the total amount is 14. And it includes also a vertical peak that connect to the higher and the lower section of the project. In the evolution, the critical parts, we found the geological challenges in the development of the vertical connection that require us to review the technology to implement this connection. We use international advisers to review this. At the end, we have decided to adopt the most -- the safest technology to connect the -- to have the vertical connection between the 2 tunnels. And the end -- all in all, this is in the critical part. During the realization of this connection, we will be able also to finalize the missing part of the horizontal connection towards the Laguna with the new boring machine. So this is the reason why this delay. That clearly brings together. With delays come additional CapEx. All in all, this year, we spent around USD 30 million. What we are doing now, we are replanning the CapEx spending in order to evaluate and to, let's say, according to the evolution of the project and to the evolution of the work, the civil works, that we are planning between 20 -- let's say, second part of 2020 until the end of 2023. Today, we have reached a total amount of $870 million.

Perfect. Thank you, Paolo. We also have questions from Javier Suarez from Mediobanca. He is asking some questions. The first one is that what we are seeing improvement in our working capital as a consequence of the completion of our digitalization process? Also, he asking more detail, if we can give on the likely impact of the basic services deal that [indiscernible] to favor the most vulnerable clients? And the third question is which is likely the impact of the suspension in peak power prices in August and in September that we also referred in our presentation. Thank you, paolo?

Okay. Let me manage, let's say, the -- let's make some clarity, first of all, regarding the basic service law. And then we can comment about the performance of the collection and leave Giuseppe to commenting the numbers. Regarding the basic services law, since the end of March, we have offered to the most vulnerable clients an agreement in order to suspend their payment regarding the bills, the consumption of the energy, and to have an agreement to start the payment when the country will exit from the emergency period, with 12 monthly installments without interest, and clearly, with no risk of cut-off of the service. These -- the -- let's say, the segment of clients that has been addressed to that problem, this voluntary proposal was referred to a percentage. At the time, was 40% percentage of the, let's say, poorest families that are counted in the social register -- social internal register of the country. Regarding this evolution, there was a discussion regarding proposing it as a law. The content of the law includes 60% of the same kind of vulnerable clients. And on June, when the President Piñera extend the 90 days or emergency period, adding additional 90 days, we extend the period of this offer, and we expand the perimeter of the potential -- the vulnerable clients according to the perimeter defined by law. And so 60% more some additional categories. And so today, when the discussion is ongoing still in the parliament and the Senate, we are offering this kind of agreement and this kind of benefits to the vulnerable clients. The law has been, let's say, approved by the Lower House and the Senate during recent -- sometime last week -- last weeks. And the -- at the end, the President decided to put…

Yes. So from Javier Suarez, is also regarding -- I think you summarized everything, was about the peak hours and also the...

The peak hours, yes. Correct, the peak hours. The peak hour. Yes, there was this also, the peak hour. There were 2 decisions regarding the winter peak hour. The first has been issued, if I remember correctly, at the end of March, and was referred to April and May period. And the second, this has been applied until the end of May. Then we came back to the normal regulatory approach during June and July. And recently, a new release coming from the regulator for defining -- so excluding August and September in the [indiscernible]. The impact on the first decision regarding April and May was negligible in terms of impact on our distribution income. Considering the period of August and September, considering that we are still in the -- during the winter time with potential temperature and weather effects, and considering also the current evolution of the pandemia, maybe that they will have a larger impact on this decision that is still pending because the executive decree is still missing, may have an impact in the range of $3 million on our accounts.

Perfect. Thank you, Paolo. So we have another question from Cesar Perez from BTG, also Andrés Castro from Credicorp and [indiscernible]. They are all asking more details regarding our guidance, okay, if you can give more details on the breakdown that we presented in our slides, and also if we can give more details on the dividends that we're going to be distributed for -- in 2021, regarding 2020 results?

Okay. Let me give you the answer on the dividends, and then I'll leave the answer to Giuseppe. Regarding dividends, you should take as an example last year. Last year, we had the impairment of Tarapacá and Bocamina 1 that has an impact -- an accounting impact on our results. And then we decided to -- let's say, to apply our dividend policy on a pro forma basis without taking into account the accounting impact of the commissioning. So we have the flexibility to do the same this year. Until now, we have not changed -- when -- we do not change the dividend policy. We will see the, let's say, evolution of the second half of 2020 in terms of cash generation in order to take the final decision on how to apply the dividend policy in which base. But the reference is what we decided last year. So if we can take a decision despite all the accounting impact of the impairment regarding the destabilization. And then leave to Giuseppe to provide details regarding the revised guidelines.

Okay. So for what concern the guidance. I mean, as you see in the slide, we have seen an effect. First one is the COVID. When we talk about the COVID impact that we are talking about basically or mainly about the impact on the demand, both on generation and distribution. And especially, we are talking about the part of the client that are the small businesses, like a small -- like a mall or other kind of small industries, and that can be also regulated. So it's not a matter of free -- or they are not only free client. And we have also -- as we mentioned, we have also took into the consideration the impact of losses that can be raised because of restriction in the cut of energy in case of unpaid bills. Now the importance in there in the scenario, the assumption that we are taking to the consideration is that we are going to have -- we seem to have a negative situation in all July, with a little bit of recovery in August that doesn't mean that we increase the demand, but just that the demand will be lower than what we had the previous months. And we assume to have a return to a normal situation in September. Of course, I mean, going back to a normal situation doesn't mean that the demand will be the same as we forecasted when we prepared the initial plan, of course, because some of the small business closed. And so will not be easy to going back easily. But of course, we assume to have a return to a normal demand at the end of the year. So what concerned the hydrology? Again, I mean, the impact that we consider was thinking about a hydrology…

Okay. Thank you, Giuseppe. We -- due to the time, we have this time just to do 2 more questions, okay? So the first one that we received from Tomas Gonzales from Scotiabank, Rodrigo Mora from Moneda and also Murilo Riccini from Santander, is to give more details on our LNG contracts. Considering that we saw in the presentation with the reduced price that will come online in the second half of the year, so we can give a color on this contract? And also if we can [indiscernible] and ask for more shipments on our contracts? Thank you.

Yes. I'll leave this question to Giuseppe. Just let me add an important point. And I think to clarify regarding the -- let's say, the development of the company, especially regarding the impact of the new time line for Los Cóndores. Because what we have planned in the development of the company from today until the end of 2022 is to grow through the 2,000 megawatt of renewable capacity that we are building and through the optimization of the portfolio regarding the decarbonization of the Bocamina, the coal-fire facility. This plan is not impacted by the delay of Los Cóndores in the sense that the project that we have on the pipeline to reach 2,000 megawatts are already identified. 1 giga is under construction. The other one are ready to start so there is no direct impact on the, let's say, development plan of the company, and to reach the target, to reach our position -- potential position in the market due to the delay of the new schedule regarding Los Cóndores. And just an additional clarification, because it is an element that I'm assuming is under the spot for this period, regarding -- we have planned with this effect of the basic service law. The -- we already offer these benefits to the vulnerable clients. It is clear that the impact of this laws is it will be issued in a situation where the country, and especially in the areas like Santiago, the impact of the economic crisis is very strong. We are waiting for the effect of the old plan issued by the government in terms of injecting liquidity in the system, especially to help the most vulnerable and the medium families. And we are working, struggle in order to help the clients to use our digital channels regarding payments. So the -- in terms of cash collection, we are performing as much as we can in terms of the company performance and support to our clients. Clearly, this law may have an impact, especially regarding the no cut off of bad payers out -- that are not considered as vulnerable clients. Now I leave to Giuseppe for the commenting of the energy contract.

Yes. Thank you, Paolo. I mean talking about the LNG contract, as you know, we have a long-term contract that is linked to -- which price is linked to the commodity. And of course, we use the contract mainly for supplying our power plant. But if it is convenient, we can also resell the amount of gas that we buy under this contract. Now last year, the price -- the international market price were pretty high, so we were able to make some trading with this -- with the amount of gas that we used to buy. And this is the reason because we had a very important result last year. So this year, the commodity drop, as you know. So the price, the final price of our contract reduced as well. And there is no big possibility to do this kind of trading. As a matter of fact that our contract price in the last -- let me say, in July, for example, is almost around $4 per million Btu. And I mean, this is the reason because we don't have such a positive asset like last year, on the other end, of course, we have cheaper gas available for our plants, of course.

Perfect, Giuseppe. Thank you very much. So we have other questions that we have received. Okay, we've tried to summarize the most remaining, let's say, the questions that we see the most. Due to the time, we're going to have to disconnect, okay? But I would like to conclude this results conference call, reminding you that our Investor Relations team will be available for any other doubts you may have. So I don't know, Paolo, if you want just to say the final word to our investors connected?

Yes. Let's say that just to confirm, first of all, I would like to confirm the resilience of the company. And the fact that considering the quite tough situation that we are leaving in the country from the health, first of all, and also from the economic point of view, we continue to, let's say, deliver and to develop our activity to -- and especial -- and with all the area where we are involved, starting from the, let's say, management and the construction of the new plants, management of the plant, construction of the plant, improvements and investment in the grid and also development of the activity is related to, let's say, the new electricity services? Even if we have to face with quite large difficulties in having the possibility to implement at full our, let's say, efforts, our activities on the ground. And so I think that we can give a specific answer to the many questions that we have received through our Investor Relations channel. And we are available for any additional details. Considering that the evolution is quite complex. So there are changes very, very frequently. There is the impact that may have on regulation on the management of the business. So please feel free to ask us additional information or comments on changes that are going on in order to give you the answers in the more transparent way.

Perfect. Thank you, Paolo. And now I give the call to the operator. Thank you very much for your participation. Stay safe, you all. Thank you.

Thank you very much to all of you.

Thank you.

Ladies and gentlemen, that does conclude conference for today. Thank you for your participation. You may all disconnect. Everyone, have a great day.