Cfe Fibra E Series A · BMV:FCFE/18
Cfe Fibra E Series A — CFE Fibra E — Santander's 28th Annual Mexico Conference (January 2024)
48 slides from Cfe Fibra E Series A's conference presentation, January 2024
Slide 1: CFE Fibra E (FCFE18) - Santander's 28th Annual Mexico Conference
CFE FIBRA E (FCFE18) Santander’s 28th Annual Mexico Conference Cancun, Mexico January 2023
Slide 2: Disclaimer
DISCLAIMER IMPORTANT: You must read the following before continuing. This presentation has been prepared by CFECapital, S. de R.L. de C.V. (“CFECapital” or the “Manager”) and is being provided to you for informational purposes only. RESUMEN EJECUTIVO Neither the DE Manager nor any of its affiliates
Slide 3: Agenda
01 02 03 04 05 Mexican Electricity Comisión Federal de Transmission Sector CFE FIBRA E Annexes Sector Electricidad
Slide 4: Mexican Electricity Sector
01 02 03 04 05 Mexican Electricity Comisión Federal de Transmission Sector CFE FIBRA E Annexes Sector Electricidad
Slide 5: Generation and Consumption of Electricity
Generation and Consumption of Electricity During 2022, Mexico was ranked #13 for electricity generation in the country. Comparison of Electricity Generation and Consumption by Country 8,833 2022 |TWh 8,090 4,510 4,082 1,802 1,392 1,165 979 1,063 939 668 570 657 625 568 578 490 473 425 577 433 346 35
Slide 6: Generation Growth vs. GDP Growth
Generation Growth vs. GDP Growth Electricity Generation Growth Rate and Real GDP1 Growth Rate in Mexico 2000 – 2022 | % 180% 170% +62% 160% 150% 140% +42% From 2000 to 2022, GDP1 in 130% Mexico has grown by 42%, 120% while electricity generation has grown by 62% in the 110% same period. 100% 90% 200
Slide 7: Growth of the Mexican Electricity Sector
Growth of the Mexican Electricity Sector Mexico is in the third place for the differential indicator between GDP1 growth respect the growth of electricity generation. Comparison of the Cumulative Growth Rate of GDP1 and the Cumulative Growth Rate of Electricity Generation by Country 2000 – 2022 | %
Slide 8: Company Located in a Defensive Sector and with Favorable Prospects
Company Located in a Defensive Sector and with Favorable Prospects Factors that drive electricity demand and consumption in Mexico Sustainable Integration Nearshoring Population Economic with North Opportunities growth Growth America Regional Forecast of Electricity Consumption Forecast of Net Consu
Slide 9: Comisión Federal de Electricidad
01 02 03 04 05 Mexican Electricity Comisión Federal de Transmission Sector CFE FIBRA E Annexes Sector Electricidad
Slide 10: CFE: Leading Company in Mexico and Latin America
CFE: Leading Company in Mexico and Latin America • Comisión Federal de Electricidad (CFE) is the largest electricity company in Latin America in terms of installed generation capacity. • In Mexico, it is the largest company by total assets and total revenue, with a strategic role for Mexican society
Slide 11: Strategic Relevance and Unique Market Positioning
Strategic Relevance and Unique Market Positioning CFE Holding Generation Transmission Distribution Comercialization Others Nuclear Power Generation Transmission Distribution Basic Qualified Legacy Fuel Trade Fuel Trade Plant Companies Supply Supply Contracts (CFEnergia) (CFE International) (Laguna V
Slide 12: CFE Stronger Than Ever!
CFE Stronger Than Ever! Five years into the federal administration, CFE has consolidated its rescue, through the promotion of projects aimed at strengthen energy generation, the strengthening of electrical networks and the signing of strategic alliances with companies with extensive experience in th
Slide 13: Strengthen Energy Generation
Strengthen Energy Generation The program to strengthen the energy generation park is made up of four types of projects: Installed Investment Project Type Number of Projects Capacity (Million dollars) (MW) • 2 Photovoltaic Power Plants 1. Clean energies 6,925 3,191 • 20 Hydroelectric • 5 Combined Cyc
Slide 14: Clean Energies
1) Clean Energies Between 2019 and 2023, CFE With the implementation of these clean provided 206,962 GWh into the grid, energy projects, the CFE reaffirms that is, 55% of the accumulated itself as the largest generator of clean energy. clean energy in Mexico. 22 clean energy projects that will The e
Slide 15: Clean Energies: Photovoltaic Power Plants
1) Clean Energies: Photovoltaic Power Plants The CFE develops 2 photovoltaic projects for the use of solar energy in the country. PPP Puerto Peñasco PPP Nachi Cocom (Sonora) (Yucatán) • The largest in Latin America due to its capacity. • It will provide energy for electric buses of the Electric Tran
Slide 16: Renewal and Modernization of Hydroelectric Plants
1) Clean Energies: Renewal and Modernization of Hydroelectric Plants C.H. El Novillo The CFE invests $1.54 billion dollars for the renovation, modernization and equipment of 20 hydroelectric plants. C.H. Zimapán C.H. El Fuerte C.H. Sanalona 16 plants are modernized through C.H. Mazatepec C.H. Portez
Slide 17: Electric Power Generation Projects
Electric Power Generation Projects 10 Combined Cycle Power Plants (CCP), 2 Internal Combustion Power Plants (ICP), and 1 Turbogas Power Plant (TP) are being built. ICP Parque Industrial ICP Mexicali Oriente ICP Lerdo ICP San Luis Potosí TGC González Ortega CCP El Sauz II CCP Tuxpan Fase I CCP Mérida
Slide 18: Priority Generation Plants
2) Priority Generation Plants Capacity The construction of 5 Combined Cycle Central Advance (MW) Power Plants and 1 Turbogas Power Plant CCP Mérida 499 73% represents an investment of $3,445 million CCP Valladolid 1,020 71% dollars that will provide 4,047 MW. CCP San Luis Río Colorado 647 67% CCP Tu
Slide 19: Gas Supply
Gas Supply CFE, through its affiliate company CFEnergía, has positioned itself as the main marketer of natural gas in Mexico. The CFE guarantees the supply of natural gas to 92 generation plants, with a capacity of 44 thousand MW of generation capacity. Natural gas today represents 65% of the countr
Slide 20: Ranking of Natural Gas Marketers – United States of America
Ranking of Natural Gas Marketers – United States of America 19
Slide 21: Strategic Alliances
Strategic Alliances • Strategic alliances will allow the CFE to obtain economic benefits for the commercialization and transportation of natural gas. • CFE will become a natural gas exporter. Development of a new marine pipeline - Puerta del Sureste gas pipeline, which will transport natural gas fro
Slide 22: Transmission Sector
01 02 03 04 05 Mexican Electricity Comisión Federal de Transmission Sector CFE FIBRA E Annexes Sector Electricidad
Slide 23: National Transmission Grid (NTG)
National Transmission Grid (NTG) The CFE has +110 thousand kilometers of transmission lines, equivalent to 8.7 turns around the earth. • 2,279 substations2 with a transformation capacity of Simbología 165,541 MVA's • 61,778 km of Fiber Optic Network1 Notes: 1 Data as of the Third Quarter of 2023, 2
Slide 24: Transmission Projects
Transmission Projects In the period 2018-2022, an increase of 2,432 km of transmission lines at various voltage levels was achieved and 87 power substations were built , that increases the transformation capacity 2,939 MVA. Projects Instructed by SENER1 to CFE Transmission in Operation* Regional Con
Slide 25: Transmission Projects
Transmission Projects • Additionally, 182 projects instructed by the Energy Ministry (SENER1) to CFE Transmission are expected to come into operation, constituting a total of 4,324 km of Transmission Lines, of which the largest contribution will be in the states of Sinaloa, Hidalgo, State of Mexico,
Slide 26: Transmission Projects
Transmission Projects Length of the NTG1 expansion transmission lines instructed by SENER2 per year by entry into operation and voltage level • At 400 kV a total of 2,096.1 km will be added • At 230 kV 843.7 km • At 161 to 69 kV 1,384.9 km. Length of the NTG1 expansion transmission lines instructed
Slide 27: Volumes of Energy Transmitted Through NTG
Volumes of Energy Transmitted Trough NTG1 Electrical Energy Volumes 2019 – November 2023 | MWh 36,000 In 2023, electric energy 34,000 volumes2 have increased 32,000 annually: 30,000 6.30% vs. 2022 28,000 26,000 9.91% vs. 2021 24,000 13.89% vs. 2020 22,000 11.74% vs. 2019 20,000 2019 2020 2021 2022 2
Slide 28: Transmission Tariffs 2024
Transmission Tariffs 2024 Electricity Transmission Tariffs Formula for determining Electricity 2024 | MXN/ KWh Transmission Tariff Consumers Interconnected Entities 𝑅𝑒𝑞𝑢𝑖𝑟𝑒𝑑 𝐼𝑛𝑐𝑜𝑚𝑒 Voltage Level Generators Responsible for 𝑇𝑇𝑡 = Charge 𝐸𝑛𝑒𝑟𝑔𝑦 Voltage ≥ 220 kV 0.0599 0.0777…
Slide 29: Historical Revenues (2019-2023)
Historical Revenues (2019-2023) National Center for Energy Control (CENACE) Revenues 2019 – 2023 | Millions of pesos $2,200 $2,000 $1,800 $1,600 The average revenues increased 4.19% through 2023 in comparison to 2022 $1,400 and 9.52% to 2021. $1,200 $1,000 $800 2019 2020 2021 2022 2023 Note: The ave
Slide 30: CFE Fibra E
01 02 03 04 05 Mexican Electricity Comisión Federal de Transmission Sector CFE FIBRA E Annexes Sector Electricidad
Slide 31: Flow of Revenues
Flow of Revenues Distributions Distributions (93.22%) (6.78%) Promoted Administrator Trust CFE Fibra E Costs and expenses reimbursements Certificate Holders Owner of 100% of the assets of the NTG1 and sole operator and Series “A” Series “B” provider of the public service of 75% 25% electric power tr
Slide 32: Distributions of the CFE Fibra E
Distributions of the CFE FIBRA E Composition of income from distributions of Serie “A” certificates of the CFE FIBRA E 2018 – 2023 | Pesos 0.400 0.422 0.368 0.266 0.272 0.283 0.270 0.233 0.235 0.200 0.187 0.198 0.180 0.145 0.123 0.091 0.111 0.040 0.059 0.022 0.684 0.575 0.575 0.575 0.575 0.575 0.575
Slide 33: Dividend Yield
Dividend Yield Dividend Yield of CFE FIBRA E Dividend Yield of CFE FIBRA E vs. Peers 2019 – 2023 | % 2023 | % Year Dividend Yield Instrument Dividend Yield 2019 10.65% FCFE18 11.06% FUNO11 7.62% 2020 10.58% DANHOS13 8.59% FNOVA17 7.96% 2021 12.08% FIBRAMQ 6.32% 2022 12.52% FIBRAPL 2.52% TERRA13 4.72
Slide 34: Performance of the CFE Fibra E
Performance of the CFE FIBRA E Price and Volume of the CFE FIBRA E February 8th, 2018 to January 15th, 2024 | Pesos | Millions of CBFEs1 MXN Millions $35 2.0 $29.61* 1.8 $30 $26.69 1.6 $25 1.4 1.2 $20 $19.00 1.0 $15 0.8 $10 0.6 0.4 $5 0.2 $- 0.0 Volume Last Price IPO Daily Average Closing Price 02/0
Slide 35: Analyst Coverage
Analyst Coverage Target Observed Average Target Price Recommendation Price January 3rd, 2023 – January 15th, 2024 | Pesos $32.50 Buy $33.00 $32.00 $31.07 $34.00 Buy $31.00 $30.00 $27.00 Sell $29.00 +16.41% $28.00 $30.00 Hold $27.00 $26.00 $26.69 $29.00 Hold $25.00 $24.00 $33.00 Buy $32.00 Buy Target
Slide 36: Corporate Governance
Corporate Governance • Approve the budget and • Approve leverage rules and changes Promoted in the investment regime.2 distributions. Composition • Monitor budget and • Approve additional emissions. Trust • Approve independent members. reimbursements.1 Holders Technical Committee Meeting • Review th
Slide 37: Annexes
01 02 03 04 05 Mexican Electricity Comisión Federal de Transmission Sector CFE FIBRA E Annexes Sector Electricidad
Slide 38: Macroeconomic Indicators
Macroeconomic Indicators Growth of Mexico’s Gross Domestic Product Inflation in Mexico Real 2016-2022 | Estimates 2023 – 2025 | % Real 2016-2022 | Estimates 2023 – 2025 | % 7.9 6.04 5.8 5.69 5.45 -0.3 3.9 3.4 4.9 1.8 1.9 2 2.5 2 3.64 3.89 2.82 3.4 3.15 -8.7 Source: Organization for Economic Cooperat
Slide 39: Mexico Macroeconomic Outlook
Mexico Macroeconomic Outlook Real Growth Rate of Gross Domestic Product 2023 Countries of the OCDE1 | % Mexico is in fourth place among OECD countries1 in 5.1 4.9 terms of GDP growth rate for 4.5 3.4 the year 2023 and is even 2.9 above the world average. 2.4 2.4 2.4 2.3 2.2 1.9 Costa Iceland Turkey
Slide 40: Mexico Macroeconomic Outlook
Mexico Macroeconomic Outlook GDP’s Estimated Growth Rate for 2024 OECD Countries1 | % Estimates of 2024 GDP growth worldwide were reduced 3.5 2.9 2.7 2.6 2.5 regarding 2023. However, 2.4 2.4 2.3 2.0 2.0 1.9 Mexico remains in fourth place among OECD countries.1 Costa Turkey Global Poland Mexico Hunga
Slide 41: Foreign Direct Investment (FDI) in Mexico
Foreign Direct Investment (FDI) in Mexico • Mexico ranked fourth worldwide as a receiver of FDI in the first half of 2023. • In Mexico, the amount of FDI from January to September 2023 is 30.3% higher than the registered in the same period of 2022.* Top Ten FDI Receiver Countries in the World Januar
Slide 42: Monthly Indicator of Gross Fixed Capital Formation
Monthly Indicator of Gross Fixed Capital Formation • This indicator exhibits public and private investment in goods used in production processes, that is, showing how a large part of the new gross value in the economy is invested, mainly in the construction, machinery, and equipment sectors. • This
Slide 43: Investment Program
Investment Program Investments Program 2023-2029* Millions of pesos Total Process 2023 2024 2025 2026 2027 2028 2029+ Investment Generation 48,010 91,802 64,720 20,575 10,364 4,380 - 239,851 Transmission 21,201 24,577 36,062 38,947 6,034 2,583 - 129,406 Distribution 8,431 17,124 17,833 16,299 8,911
Slide 44: Regulated Tariffs of the Public Transmission Service of Electrical Energy
Regulated Tariffs of the Public Transmission Service of Electrical Energy To determine the regulated tariffs of the public transmission service, the Energy Regulatory Commission (CRE) has defined the process to request Regulatory Information from CFE Transmission, as well as for the review, validati
Slide 45: Activities to determine Transmission Tariffs
Activities to determine Transmission Tariffs CRE1 carries out different activities for the annual calculation of public transmission service tariffs following the long-term methodology, including: 1. Estimate 2. Approval 3. Notification 4. Publication Tariffs may experience periodic revisions to the
Slide 46: Methodology to Determine the Transmission Tariffs
Methodology to Determine the Transmission Tariffs The components for calculating the tariffs of the public transmission services are the following: OMAt0 Ket0 RInvt0 Ct0 OIt0 AFt OMA Cost Capital Cost Remuneration Cost for Other Income Adjustment on Associations Factors Costs Return on Investments a
Slide 47: Evolution of Transmission Rate Methodology
Evolution of Transmission Rate Methodology Expansion of the Initial Single Rate Agreement • 2019 Audited Financial Statements Initial Tariff Agreement • Costs updated by adjustment factors 90% • Initial Rate Agreement inflation, 10% exchange rate • Initial tariff period valid for three years. • OMA
Slide 48: Performance Indicator of the NTG
Performance Indicator of the NTG1 Performance 2019 2020 2021 2022 Transmission losses (%) 2.71% 2.71% 2.41% 2.37% Average Frequency Rate of Interruptions of the NTG (SAIFI) 0.091 0.063 0.109 0.079 (Interruptions) Average Interruption Duration Index of the NTG (SAIDI) 3.198 2.216 6.123 3.471 (Minutes
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