Enel Chile Sa · BCS:ENELCHILE
Enel Chile Sa — Investor Day (November 2022)
70 slides from Enel Chile Sa's investor day presentation, Nov 28, 2022
Slide 1: Enel Chile
Enel Chile November 28th 2022, Santiago
Slide 2: Agenda
Agenda Market context CEO 2023-2025 management goals Our journey How we achieve our goals 2023-25 Strategic Plan Plan in numbers CFO Financial management Earnings evolution Financial targets We empower sustainable progress 1
Slide 3: The change is now
Climate change There is no room for delays Customer empowerment Digital age boosting clients' expectations THE CHANGE Commodities pressure Global issue affecting the commodity markets IS NOW and the energy transition is right there… Technology advances Innovation is changing increasingly faster the
Slide 4: Market context
Market context enel
Slide 5: Chile today and country's potential
Chile today and country’s potential Net ZERO: the unavoidable journey for Chile ~2 TW of renewable energy potential in Chile1 80% Renewable generation by 2030 +28% expected increase of energy New vehicle sales to be A champion demand by 20302 only electric cars by in the 2035 transition to Total pop
Slide 6: The new scenario brings challenges and opportunities
The new scenario brings some challenges and several opportunities for the following years Even though the energy market is experiencing challenges… ….there are opportunities arising from the current context An increasingly Energy back up to cope with Transmission’s New regulation complex expansions
Slide 7: Management goals
2023-2025 Management goals 6
Slide 8: Integrated strategy to fulfill customer needs through electrification
Integrated strategy to fulfill our customer needs through electrification INTEGRATED STRATEGY beyond commodities Fostered by an efficient and digitalized grid 7
Slide 9: Our strategic managerial actions
Our strategic managerial actions 1 2 3 4 Foto clients Enhance the resiliency Maximize the value for Grids digitization to Sustainable growth, and flexibility of our our clients through continue enabling the portfolio mix supporting with stronger electrification energy transition balance sheet the de
Slide 10: Our journey
Our journey enel
Slide 11: Our consistent journey is paving the way for a sustainable future
Our consistent journey is paving the way for a sustainable and brighter future Sustainable growth > Consolidating growth in Renewables Speeding up decarbonization by a selective and flexible portfolio > Coal phase-out > Reducing risks and volatility of our > +1.8 GW of renewable capacity portfolio c
Slide 12: Recent actions focused on unlocking value
Recent actions, focused on unlocking value, are proving that we are on the right track Adj. EBITDA (USD bn)1 and credit Managerial actions to compensate market disruptions metrics evolution A • Optimization of natural gas sources to guarantee Trading and Thermal generation flexibilization initiative
Slide 13: Positioning Enel Chile as a unique, integrated and resilient utility
Positioning Enel Chile as a unique, integrated and resilient utility in Chile 2022E figures Integrated commercial strategy supported by solid and diversified assets 8.6 GW Net installed capacity 13.8 TWh Energy distributed1 Enablers of decarbonization and electrification in Chile 2.1 mn End users 30
Slide 14: How we achieve our goals
How we achieve our goals enel
Slide 15: Rebalancing our portfolio for better risk-return
1 2 3 4 Rebalancing our portfolio to have a better risk-return and faster response in a new market context Coal phase-out, poor hydrology and transmission … therefore, we need to act quickly to shield our constraints brought high volatility to spot market… margins and profitability in a new market c
Slide 16: Renewables development to continue
1 2 3 4 Renewables development to continue targeting a cleaner, flexible and balanced matrix… Renewable net capacity Net capacity by technology Renewables pipeline by evolution (GW) by 2025 technology and maturity (GW)1 +1.9 GW 79% BESS 2025 vs. 2021 renewable ~4 21% 7.5 +0.4 6.5 ~11 39% 5.6 +1.2 2%
Slide 17: New PPAs purchases to reduce spot exposure
1 2 3 4 … that complemented by PPAs purchases will bring us additional flexibility in terms of sourcing and … New PPAs purchases to reduce the spot exposure Recent renewable PPAs purchases already signed Evolution of projected PPAs purchases (TWh) +2.1 TWh Solar PPA Wind PPA 4.7 2.6 1.1 TWh / year (
Slide 18: Better balanced portfolio with optimized risk/return
1 2 3 4 … resulting in a strategy that will better balance our portfolio, landing in an optimized risk/return profile Additional flexibility Continue reducing Spot exposure to be concentrated initiatives spot exposure in solar hours (TWh) Enhance modulation -10 pp -26% capabilities to better allocat
Slide 19: Fresh green start with -0.6 GW of coal capacity
1 2 3 4 All in all, as a fresh-new green start, with -0.6 GW of coal capacity CO2 emissions Scope 1 Generation (gCO2e/kWh) 2021 2022E 2025 2040 < 273 <215 <105 0 Tarapacá Bocamina I Bocamina II December 2019 December 2020 September 2022 The road towards The first Chilean generator to complete the ZE
Slide 20: Commercial strategy with long-term visibility and diversification
1 2 3 4 Commercial strategy supported by long-term visibility, geographic diversification and solid client portfolio … Portfolio by off-taker PPAs geographic location PPAs by residual duration 2022E 2022E 2025 +4% 21% 23% 23% 26% 34% 30.9 TWh 25% 45% 39% 32.0 44% 62% 67% TWh 31% 32% 16% 10% Free mar
Slide 21: Innovative technologies bringing value added services to clients
1 2 3 4 … paired with innovative technologies to bring value added services to all clients B2B We are boosting B2G B2C electrification for smarter, more efficient and Enabling cities to become Helping our clients to give the We are energy partners in the greener energy use more circular, supporting
Slide 22: Grid infrastructure evolution key to energy transition
1 2 3 4 Grid infrastructure evolution is key to enable the energy transition, focused on efficiency and quality… Main KPIs1 Distributed Electricity1 (TWh) 2022E 2025 Grid Blue Sky End users A new operating model (mn) 2.1 2.2 +2% We are implementing technology Losses developments to boost our service
Slide 23: Improving client journey through digitalized channels
1 2 3 4 … improving our client's journey through new digitalized channels… Main KPIs Commercial service at a glance 2022E 2025 Customer centricity Clients App as a core strategic pillar 653 1,085 Our journey in numbers2 users1 (´000#) Platformization and We are enhancing our grids and digitization C
Slide 24: Leading the decarbonization and electrification
1 2 3 4 …all these trends will guide us into 2025 while being ready to take advantage of potential new opportunities .... 2022E 2025 RES Capacity 6.5 7.5 (GW) RES Capacity 76% 79% % on total Leading the GHG free 65% 79% % production on total decarbonization and Grids end users 2.1 mn 2.2 mn the elec
Slide 25: Creating value for all our stakeholders
1 2 3 4 …creating Value for ALL our stakeholders 2025 Financial community Dividend payout ratio1 Min 50% New connections on grids Clients (‘000) +101 Planet Scope 1 - CO2 Reduction vs 2021 -62% Beneficiaries from projects with communities2 Communities (SDGs 4,7 & 8) 5.6 mn Employees Women in selecti
Slide 26: Plan in numbers
2023-2025 Plan in numbers enel
Slide 27: New plan investments to improve portfolio resiliency
1 2 3 4 New plan investments to improve our portfolio resiliency Investments centered on clients’ needs… …focused on SDG goals CAPEX allocation (USD bn) SDG 0.8 1% 13% 0.7 1% 1% 8% 18% 16% 10% 2023-25 2023-25 10% 1.7 USD bn 1.7 USD bn 0.3 77% 3% 73% 34% 71% 13% 90% 50% 2023 2024 2025 Renewable Grids
Slide 28: Generation CAPEX driven by decarbonization strategy
1 2 3 4 Generation CAPEX driven by decarbonization strategy… Generation CAPEX 2023-2025 (USD bn) Renewable’s development CAPEX (USD bn) Total CAPEX by type Total CAPEX by year 1% 0.7 14% 22% 0.1 0.5 0.1 14% 2023-2025 2023-2025 47% 1.4 USD bn 1.1 USD bn 0.5 0.2 0.4 78% 0.1 25% 0.1 2023 2024 2025 Deve
Slide 29: Additional flexibility to our portfolio
1 2 3 4 … will bring additional flexibility to our portfolio... Production evolution (TWh) Energy balance (TWh) Portfolio Mix evolution (TWh) Spot exposure reduction (TWh) +2% +4% -26% 23.0 23.4 32.0 32.0 30.9 30.9 -47% 3.9 5.2 5.3 5.3 Non-solar 8.8 4.7 2.6 18.8 22.2 2.4 3.9 9.7 1.3 9.7 23.0 23.4 1.
Slide 30: Integrated margin strategy EBITDA improvements
1 2 3 4 … resulting in our integrated margin strategy EBITDA improvements Integrated EBITDA evolution (USD bn) Main performance indicators 2022E 2025 CAGR +41% Avg. PPA price 74 64 -5% 1.4 (USD/MWh)2 0.2 (0.2) 1.3 EBITDA (0.5) (0.04) adjusted1 46 -5% 0.9 0.6 (USD/MWh) (0.2) EBITDA 39 proforma1 29 +1
Slide 31: Grids investments to support electrification and performance
1 2 3 4 Grids investments to support electrification and performance Tariff review process CAPEX tailored to improve EBITDA evolution (USD bn) performance and electrification VAD 2020-24 Regulatory Period +17% 6% Returns (real terms post tax) 31% Consultant (0.01) 0.11 report 44% 2023-2025 0.09 0.02
Slide 32: Consolidated EBITDA increase in a more conservative scenario
1 2 3 4 Consolidated EBITDA increase in a more conservative scenario EBITDA evolution (USD bn) EBITDA Old vs. New Plan (USD bn) +30% +3% 1.5 0.2 (0.2) 1.3 4.0 4.1 0.5 (0.2) (0.5) 0.0 1.0 0.5 (0.1) 0.6 (1.6) 0.9 (0.2) 0.4 USD bn (+42% yoy) Adj. Gas 2022E EBITDA Energy Sourcing Growth Gas Grids & 2025
Slide 33: Financial management
2023-2025 Financial management 32
Slide 34: Strong cash generation financing diversification strategy
1 2 3 4 Strong cash generation financing our diversification strategy, with available optionality… Source of funds allocation 2023-2025 Net debt/EBITDA evolution Strategic plan scenario (USD bn) (Times) Net Debt/EBITDA 2022 Old Plan 4.8x 3.0-3.2 ~3.4x ~1.1x 2.8x-3.0x (1.7) ~2.4x 2.3x-2.5x (1.0) 0.3-
Slide 35: Sustainable instruments to fund our growth
1 2 3 4 … supported by sustainable instruments to fund our growth Financial flexibility & main ratios Debt maturity evolution by year with managerial actions (USD bn) YE 2022E YE 2025 SDG-linked gross 0.9 0.9 debt USD bn 3.3 Share of sustainable 3.1 22% 27% finance Avg. term of debt (years) 7 6 1.3
Slide 36: Earnings evolution
2023-2025 Earnings evolution 35
Slide 37: Earnings recovery supported by growth initiatives
1 2 3 4 Earnings recovery supported by growth initiatives and managerial action Net Income evolution 2022E Net Income evolution 2022E-2025 (USD bn) (USD bn) 2022 Adj. Net Income 1 1.4 1.5 +38% 0 Gas valorization 0.4 one-off2 Net Tx 0.7 (0.5) sale2 1.0 2022 Adj. Net 0.3 Income Proforma (0.3) (0.2) (0
Slide 38: Financial targets
2023-2025 Financial targets 37
Slide 39: Strategic plan targets
Strategic plan targets 2022E 2022E1 proforma1-2 2023 2024 2025 Adj. EBITDA 1.5 1.0 1.0-1.2 1.3-1.5 1.2-1.4 (USD bn) Adj. Net income 1.4 0.3 0.3-0.5 0.5-0.7 0.3-0.5 (USD bn) Dividend payout 30% Min 50% Min 50% Min 50% (%) 1. Adjusted by coal stock impairment: EBITDA: 0.06 USD bn and Net Income: 0.04
Slide 40: Closing remarks
Closing remarks Decarbonization Integrated and electrification commercial Strong financial Creating value for remain as strategy boosted position and ALL our priorities to our by several optionality for stakeholders sustainable diversification future growth strategy actions 39
Slide 41: Annexes
2023-2025 Annexes enel
Slide 42: Annexes
Annexes 2023 – 2025 Financial and Operational annexes Main assumptions and Macroeconomics Main sensitivities for 2023-2025 figures Gross Capex per Business Lines Generation installed capacity, production and PPA portfolio Enel Chile Corporate information Credit Ratings Organization Structure Project
Slide 43: Main assumptions
Main assumptions GDP Demand Growth CPI Macroeconomics (%) (%) (%) 2023 2024 2025 2023 2024 2025 2023 2024 2025 -1.1% 2.4% 2.6% -0.5% 2.9% 3.9% 5.3% 3.2% 3.1% Commodities Henry Hub Brent (USD/MMbtu) (USD/bbl) 2023 2024 2025 2023 2024 2025 5.7 5.0 4.3 93.0 80.0 70.0 Quillota marginal cost Crucero marg
Slide 44: Main sensitivities for 2023-2025 figures
Main sensitivities for 2023-2025 figures Annual Impact on 2023-2025 EBITDA (USD mn) System demand +10% +1% Hydrology ~53 ~32 -10% ~(45) ~(22) -1% GAS +60% -38% Commodities (Henry Hub) ~156 OIL (Brent) +62% -40% ~(162) COAL (API2) +33% -30% 43
Slide 45: Capex by Business line
Capex by Business line Gross CAPEX (USD bn) CAPEX 2023-2025 allocation (USD bn) 0.8 0.0 0.1 0.7 0.0 Business line 2022E 2023 2024 2025 0.1 0.1 Renewable 0.8 0.6 0.5 0.2 0.1 Thermal 0.1 0.1 0.1 0.0 0.3 Grids 0.1 0.1 0.1 0.1 0.6 0.0 0.5 0.1 Enel X 0.0 0.0 0.0 0.0 0.0 Others 0.0 0.0 0.0 0.0 0.2 2023 20
Slide 46: Installed capacity and Production by Technology
Installed capacity and Production by Technology Net installed capacity (GW) Net production (TWh) 2022E 2025 2022E 2025 +11% +2% 1% 7% 5% 5% 20% 16% 17% 25% 42% 39% 41% 8.6 9.5 23.0 42% 23.4 GW GW TWh TWh 6% 35% 40% 37% 23% Coal1 CCGT2 Oil&Gas Hydro Renewable (ex - Hydro + BESS) 1. Includes Bocamina
Slide 47: Generation PPAs portfolio
Generation PPAs portfolio PPAs profile (TWh) PPAs by residual duration 33.1 32.0 30.9 30.9 23% 61% 63% 65% 69% 45% 37% 32% 39% 35% 31% 2022E 2023 2024 2025 2022-2025 2026-2030 >2030 Regulated Customers Free Market 7 years avg. duration 46
Slide 48: Credit Ratings
Credit Ratings Enel Chile and Enel Generación Chile International market Chilean market Enel Chile Enel Chile Standard & Poor’s Fitch Ratings Fitch Ratings Feller Rate Ref. January/2022 Ref. January/2022 Ref. January/2022 Ref. June/2022 Enel Generación Enel Generación Standard & Poor’s Fitch Ratings
Slide 49: Organization structure
Organization structure Enel Chile shareholders1 64.9% 1.6% 6.5% Chile 22.5% Pension Funds Market Cap2 Institutional Investors USD 2.8 bn ADR’s 4.5% Enel SpA 64.9% Others 100.0% 93.5% 99.1% 99.1% 100.0% 49.0% Green Power Generación Chile Transmisión Chile Distribución Chile Enel X Chile Non-consolida
Slide 50: Projects under development
Projects under development As of September 2022 Net installed capacity 7% 74% Renewable Central zone 18% PMGD1 86 MW Southern zone 8.0 44% GW Los Cóndores 150 MW Renaico II 144 MW 31% La Cabaña 106 MW +34 MW BESS Rihue 120 MW Hydro CCGT2 North zone +34 MW BESS Wind, Solar & Geothermal Oil-Gas The hi
Slide 51: Enel Chile businesses
Enel Chile businesses Largest utility player in Chile in installed capacity and number of clients Integrated commercial strategy supported by Leading the renewable sector in Chile Grid infrastructure to solid and diversified enable electrification assets 6.0 GW Renewable capacity net installed Enabl
Slide 52: Management of the Company
Management of the Company Management Team F. Barderi Sustainability & Community Chief Executive Officer M. Palomar (CEO) Relations G. Turchiarelli Chief Financial Officer R. Puentes Procurement (CFO) L. Schnaidt People and Organization A. Barrios Digital Solutions D. Gomez Regulation M. Rinchi Servi
Slide 53: ESG Annexes
= 7, , ESG Annexes
Slide 54: Corporate governance structure
Corporate governance structure Shareholders’ meeting Audit firm 14% 43% BoD’s composition Board of Directors (7 members) 43% Non executive Executives of Enel Group Functions: Independent Directors Committee Audit committe Sustainability committe Related parties transactions 53
Slide 55: Board composition
Board composition Board of Directors Board of Directors’ diversity Herman Chadwick Chair 29% Monica Girardi Director 57% Age Gender diversity diversity Isabella Alessio Director 43% 71% 41-50 Over 50 Male Female Salvatore Bernabei Director Directors’ Committee (C) Fernán Gazmuri 43% Director. Tenure
Slide 56: 2022 CEO's short-term variable remuneration
2022 CEO’s short-term variable remuneration Macro objective Objective Type of target Weight Range Maximum Profitability Net Income Chile 15% Economic 120% Integrated gross Maximum Profitability 15% Economic margin Chile 120% Maximum Financial FFO Chile 20% Financial 120% Maximum Business Strategy Ch
Slide 57: Our strategy for sustainable progress
Our strategy for sustainable progress We create long-term value with and …promoting the protection of 1 for all our stakeholders, helping them natural capital and biodiversity… 2 to grow and meet challenges… Just Transition Biodiversity Inclusion & Uniqueness Sustainable Supply Chain Sustainability
Slide 58: Long-term strategy recognized by leading ESG raters
Our long-term strategy is recognized by the leading ESG raters1 4.6 4.8 84 88 88 88 AA AA B A 3.2 3.4 2019 2020 2021 2022 2021 2019 2020 2021 2019 2020 2021 2022 Scale from D- to A Scale from 0 to 5 Scale from 0 to 100 Scale from CCC to AAA B 87 68 83 54 57 B- -B 49 77 C 72 2019 2020 2021 2022 2019
Slide 59: Just Transition for people, communities and suppliers
Just Transition for Enel Chile’s People, Communities and suppliers Strategy for a Just Transition promotes sustainable and human rights approach for all stakeholders Enel Chile People Communities Suppliers & Contractors Internal redeployment and upskilling/reskilling Fostering Green Jobs through ded
Slide 60: Inclusion & uniqueness
Inclusion & uniqueness Inclusion of people’s multiple and unique talents is an essential factor in Enel Chile’s approach to create long term value for all stakeholders Purpose Enel Chile puts in place an organic set of actions aimed at: allowing expression of people uniqueness ensuring nondiscrimina
Slide 61: Sustainability and Innovation in the Procurement Process
Sustainability and Innovation in the Procurement Process - Suppliers and Contractors + Innovation by vendors Health & Safety Partnerships Procurement involves Environment Circular Economy Human Rights & Social with suppliers suppliers in some innovation challenges Performance Scouting Qualification
Slide 62: Sustainability initiatives with local communities
Sustainability initiatives with local communities An approach along the entire value chain: business Key pillar of our strategy is to establish development, supply chain & design, engineering and solid, long-lasting relationships with local construction, operation and maintenance up to the end of li
Slide 63: Valuation of Ecosystem Services - Natural Heritage
Environmental Sustainability Biodiversity Valuation of Ecosystem Services - Natural Heritage of Enel Chile IDENTIFICATION PHASE I PHASE II PHASE III PHASE IV Definition of the logistics Identification of relevant Hierarchy, Materiality, and Management Plan based strategy properties' group environmen
Slide 64: Health & Safety
Health & Safety Health & Safety Management system is based on hazard identification, on qualitative and quantitative risk analysis. Certification of the whole Group according to ISO 45001 and relative implementation Data driven Data-driven approach based on digital tools, dashboard and analytics, us
Slide 65: Circular economy: some examples
Circular economy : some examples 2022 Circular economy main project streams: Decommissioning Sale and Internal reuse of materials, spare and grid mining parts and equipment Sale of waste water enables efficiency Industrial improvement at San Isidro power plant, symbiosis resulting in savings of fres
Slide 66: Innovation: Haru Oni H2 plant
Innovation : Haru Oni H2 plant – First of its kind 3.2 MW 5,000 EOH 1.2 MW The project Integration of variable renewable energy generation for hydrogen production using PEM technology Green hydrogen delivered to our partner for e-Methanol and e-Fuels production Under construction with expected COD b
Slide 67: Environmental Sustainability
Environmental Sustainability CO2 emissions targets 2021 2022E 2023 2024 2025 2040 SCOPE 1 GENERATION (gCO2e/kWh) 273 <215 <100 <90 <105 0 Zero Emissions Main actions Accelerate renewables deployment Exit from Gas by 2040 Pushing electrification of our clients 66 No use of carbon removal
Slide 68: Policies, principles and codes
Policies, principles and codes Ethics, Integrity, Human Rights, and Diversity • Ethical code • Zero Tolerance Plan for Corruption • Global Compliance Program on Corporate Criminal Liability • Criminal Risk Prevention Model • Compliance Program for Free Competition Regulations • Human Rights Policy •
Slide 69: Disclaimer
Strategic Plan 2023-2025 Disclaimer This presentation contains statements that could constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements appear in a number of places in this announcement and include statements regarding t
Slide 70: Contact us
Strategic Plan 2023-2025 Contact us Contacts Email ir.enelchile@enel.com Phone +56 2 2630 9606 Channels Follow us Website Isabela Klemes Enel.cl Head of Investor Relations Enel Chile Investor Relations team Mobile App Catalina González Enel Investors Claudio Ortiz Pablo Contreras Download app Franci