Enel Chile S.A.

Good afternoon, ladies and gentlemen, and welcome to the second quarter to the second quarter and first half 2022 results conference call. My name is Victor and I'll be your operator for today. At this time, all participants on a listen only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during a session, you need to press star 11 on your telephone. Please be advised that today's conference is being recorded. 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 our current expectations, are not guarantees of future performance, and involve risks and uncertainties. Actual results may differ materially from those anticipated in the forward-looking statements as a result of various factors. are described in NL Chile's press release reporting its second quarter and first half 2022 results. The presentation accompanying this conference call and NL Chile's annual report on Form 20F included under the risk factors. You may access our second quarter and first half 2022 results press release and presentation on our website, www.nl.cl. and are 20F on the SEC's website, www.sec.gov. Readers are cautioned not to place underlines on those forward-looking statements which speak only as of their dates. NL Chile undertakes no obligation to update those forward-looking statements or 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 Ms. Isabella Clemes, Head of Investor Relations of NL Chile. Please proceed.

Isabella Clemes Many thanks, Victor. Buenas tardes, good afternoon, and welcome to NL Chile's second quarter and first semester 2022 results presentation. Thank you all for joining us today. Joining me this afternoon is our CEO, Fabricio Baderi, and our CFO, Giuseppe Turchiarelli. Let me remind you that your presentation and related financial information are available on our website, www.nl.cl, in the Investor Relations section, and in our app, Investors. In addition, our Play of the Call will be soon available. In the final of this presentation, there will be an opportunity to ask questions via phone or webcast chat. Through the link, ask a question. On this occasion, media participants are connected only in listener mode. In the following slides, Fabricio will open the presentation with our main highlights and strategy updates, and then Giuseppe will walk us through our financial results and our recent material facts released. Thank you all for your attention, And let me now hand over to Fabrizio.

Thank you, Isabella. Good afternoon and thanks for joining us. Let me now start with the highlights of the period on July 3. As you know, the market pressure remained over during the year's second quarter. Given this, we have been taking several management actions to offset this pressure and take advantage of the natural resilience of our assets. proving that our strategy is sustainable and resilient. I will give a detailed view of the actions contribution for this first half in the following slides. We had several rainfalls and snowing episodes during the first semester, bringing us the bright hydrological perspective for the second semester. Also, there have been some regulatory updates, like the approved second energy stabilization the distribution bed service flow that will enter into fourth in August, and some recent updates related to the 2020-2024 slide. Regarding our economic and financial performance, we have faced some temporary headwinds over the margins related to the commodity pressure. But thanks to many actions we have put in place and the positive hydrology perspective for the second half, we are comfortable that we shall execute our 2022 guidance as will be detailed in this presentation. Finally, as we have just released, the asset rotation process as part of our sustainable balance sheet proposition is ongoing and evolving as expected in terms of both timing and multiple supplies in the transition. confirming the quality of our assets and our proposal to unlock new values for all our shareholders. Today, we signed the Pays and Purchase Agreement with Sociedad Transnistora Metropolitana S.P.A., a company fully owned by Investiones Grupo Taesa, for an equity value of $1,345 million for the sales tax held by the Chair. We hope everything will be closed by the end of the year, as Giuseppe said. Now let's move to slide five to briefly talk about the market situation. The national electrical system has been impacted by a set of factors correlated with the Russia-Ukraine conflict and the last year's critical ideology. Commodities continue their uptrend, particularly coal prices, that associated to a lower annual dispatch resulted in the sharp increase of the spot price in the period. This scenario has been softened due to the presence of Argentinian natural gas up to April and several actions in terms of thermal grid optimization that we put in place. The four crises in the period were also negatively impacted by declared energy force measures in the system, thermal fleet maintenance and outages, and some transmission constraints. Despite this strong adverse scenario, we have been able to put in place several actions that contributed for around $130 million in the period. Our solid LNG supply position, which includes our long-term LNG contract with Shell and the Argentine gas supply, which was successfully delivered up to April this year, enabled us to increase the generation volume and optimize our operating natural gas thermal fleet, contributing to the first half of the year with $27 million, and some natural gas trading activities that contributed more than $34 million in the first half. In addition, our commodity hedging instruments contributed an additional $58 million in the first half. Complementing these short-term actions and also having in mind the new configuration of the market, we also decided to enter into long-term PPAs with some pure renewable as an anticipated move of the review of our portfolio strategy to reduce our non-hedge state position. Renewable growth has been one of the main pillars in the energy transition. So let's now look at how we are consolidating our renewable position on slide six. The current context has unquestionably meant an important challenge for the energy sector. and we have acted as necessary to adapt to this new environment. In that sense, we have been one of the principal driving forces in the energy transition process in the country. One proof of the aforementioned is our strong position in the renewable market, where we have consolidated our leadership, connecting more than 1,000 megawatts of renewable capacity since 2020 During this year, we have already connected 216 megawatts of solar capacity. Moreover, our efforts and capital are committed to connect until the end. A more significant part of our project in construction is exemplified in this slide. We are strongly convinced about the potential of Chile as a renewable development pool in the region. and we will continue contributing to consolidate this position, aiming for a clean energy metric. Now, on page 7, let's take a look at the neurological condition and the outlook for the second half of the year. During June and July, there has been a significant increase in rainfall and accumulated snow, especially in the south of the country. In fact, in the eight regions where the basins of Laja and Biobío are located, the rainfall recorded today is equivalent to one recorded in the area with normal hydrology, something that we haven't seen for a while in Chile. As you can see on the left side of this slide, the snow cover in the mountains is clearly better than the last year figures, and therefore, in the past statistics, highlights a very good situation. allowing us to foresee an optimistic hydro scenario for the rest of the year, especially for the fourth quarter. On the other hand, we have also been carrying out various actions to maintain our portfolio's resilience, mainly thanks to the higher availability of Argentine gas. During this year, we have been able to reroute our energy capacity, increasing our trading activities and optimizing our thermal generation. This year, we have rescheduled part of our LNG delivery from Quintero to the port of Mejillones. For the second half of the year, the presence of the Argentinian gas and the carbon we still receive will permit us to continue going forward with this optimization. On Argentinian gas, during June and July, the government has organized the three options in which several Argentinian gas suppliers have participated to deliver natural gas to Chile. Two of these auctions were focused on the electric of the electrical system. In both bids, we tackled 4.7 million m3 per day of natural gas from October 2022 to April 2023 at competitive prices that will allow us to maintain a resilient portfolio. All in all, we are convinced that there are signs that the world is leaving us behind. recovering our performance in second half and confirming our targets for the full year. Regarding the new stabilization mechanism project and other regulatory methods for the energy sector, let me highlight some topics on this on slide 8. On July 13, the second FECLU that creates an energy stabilization and emergency fund and also established a new mechanism for the transitory stabilization of energy price for regulated clients was approved. The approval of this law seems positive for our company and also for the sector as a whole, to bring back system rationality, since it means that the generators will not continue financing sectors to liquidity. Now, with the new mechanism, we expect to reduce the impact on our cash flow, as the retrievable shall be backed by the new energy stabilization mechanism. Regarding the basic service law in early February 22, a new law was approved to solve the problem of the debt accumulated between March 20 and December 21. An electricity consumption limit of 250 kilowatt hours per month was established to define the customers that will be vented. replacing the criteria of vulnerable profiles and other institutions. The collection system of this law shall begin in our concession area in August. In June, the contractor report was published on the distribution tariff review, and we have already addressed more than 100 comments to the regulators, who shall review it. Any potential discrepancies between the companies and the regulators shall be reviewed by the expert partners in the next phase. On transmission, the process is pretty completed. The larger sector of company arguments were attended by the panel of experts, and we expect a new bus to be published during the second half. Now, let me recap our strategy based on electrification and decarbonization. Despite all the temporary headwinds we see in our market, we continue pushing our long-term goals. Now, on slide nine. As you well know, Our strategy invests sustainability. That is why the quality and digitalization of our network remain a key enabler for the decarbonization and electrification of our final customers. As you can see in our main KPIs, we are improving in all qualities, digitalization, decarbonization, and electrification indicators, as demonstrated by our network and NLX business. All the strategy is backed by a solid ESG structure that is aligned with the UN SDG and is well recognized, confirming our leadership on the main SDG indices and in transparency and report. Let me now hand over the presentation to Giuseppe, our CFO.