Transportadora de Gas del Sur SA TGS

I'm Carlos Almagro, head of investor relations. I would like to welcome everyone to TCS third quarter 2025 earnings video conference. TCS issued its earnings release yesterday. If you didn't receive a copy of the release, please contact us at inversores at tcs.com.ar. Before we begin the call, I would like to inform you that this event is being recorded and all participants are in listen-only mode. Following the company's remarks, we will host a Q&A session. All questions will need to be submitted in writing through the Q&A chat box. I would also like to remind you that forward-looking statements made during today's video conference do not account for future economic circumstances industry conditions or company performance, and financial results. These statements are subject to a number of risks and uncertainties. All figures, included herein, were prepared in accordance with the International Accounting Report standard and IFRS, and are stated in Consonants and Pesos as of September 30, 2025. unless otherwise noted. Joining us today from DGS in Buenos Aires is Alejandro Basso, Chief Financial Officer. I will now turn the videoconference over to Mr. Basso. Alejandro, please begin.

Thank you Carlos.

Thank you Carlos for calling everyone and thank you for joining us today to discuss TGS's 2025 third quarter earnings and highlights. To begin the call today, I will start by sharing some of the most recent news about the company. As you remember, back in June 24, a private initiative was admitted to the government to expand the transportation capacity of the Perito Moreno pipeline by 14 million of kilometers per day. As a result, Enarsa launched a tender offer in May. By the closing of the tender on July 28, only TGS had presented a bid. The project was finally awarded to TGS on October 17. The expected capital amount is $560 million and it involves the construction of three compressor plants as well as the expansion of the Tratagen compressor plant. totaling an additional 90,000 horsepower. By April 2027, we must commission the incremental capacity while operating and maintaining the Berito Moreno pipeline for a 15-year period. We are also entitled to commercialize the incremental capacity and collect a dollar denominated unregulated tariff during the period, after which the facilities will be reverted to Enarsa. Last week, we filed this project with the REI authorities in order to obtain the approval soon and get the tax benefits this regime provides. In addition to that project, TCS will invest another $220 million to expand the capacity by 12 km per day for its regulated pipelines between Saliquelo and Red Buenos Aires by adding 20 km of pipeline and increasing compression capacity by 15,000 hp in one of the compressor plants. Moving to slide 4, I will briefly highlight the key financial results for the third quarter of 2025. Please keep in mind that all figures presented for this quarter and comparisons made with the previous quarters are expressed in constant Argentine pesos as of September 30th, 25th, following the provisions established by the FRAs for financial reporting in hyperinflationary economies. As seen in the slide, we reported a total net income of 112 billion during the third quarter of 25 compared to 68.8 billion reported in the same quarter of 24. These higher earnings were mostly explained by the better performance of the liquids business, which contributed with the higher EBITDA of 37 billion, and the continuous EBITDA growth in the mainstream business segment, which rose by 14.5 billion. In the quarter, we also recorded lower negative financial results, amounting to 31 million, which boosted our third quarter earnings, but were partially offset by the natural gas transportation EBITDA decline of 10.5 billion. Moving on to slide 5, EBITDA for natural gas transportation business in the third quarter of 2025 totaled 101. and 2.4 billion, which is slightly below the almost 113 billion recorded in the third quarter of 24. The 10.5 billion EBITDA reduction in the regulated business segment was mainly due to that the tariff adjustment from August 24 to August 25, which resulted in a 29.2 billion revenues nominal increase, were insufficient to offset the inflation adjustment effect of 42.2 billion. In addition, operating expenses rose by 2.4 billion, while revenues also increased by 4 billion, mainly due to incremental interoperable transportation services provided in the third quarter of 25. On slide 6, you can see how EBITDA for the liquid segment tripled, amounting to 55.2 billion during the third quarter of 2025, compared to 18.2 billion reported in the same quarter of 2024. Most of the EBITDA increase was explained by the higher volume exported of 61,000 metric tons, rising from 43,000 to 104,000 metric tons. which contributed to a higher EBITDA by 18 billion. In addition, higher ethane volumes of 38,000 metric tons were sold, rising from 53,000 to 91,000 metric tons and adding 11.7 billion to the third quarter EBITDA of 25. This higher volume is mainly related to the higher production, which increased from 173,000 tonnes to 315,000 metric tonnes, as a result of the higher richness of the natural gas process in this quarter, and the three-week programmed plant shutdown for maintenance works implemented during the third quarter of 2014. In addition, EBITDA increased by 13.2 billion due to higher Boutin prices in the domestic market following the deregulation of the Boutin price under the program AUGAR starting January 25, which allowed us to sell at export parity price. To a lesser extent, operating expenses decreased by 5.4 billion and monetary effects were positive by 1.1 billion. The positive effects on EBITDA were partially offset by 8.9 billion Australian expenses incurred as a result of the March 7 flood, which we expect to recover from the insurance company in the coming months. Additionally, the natural gas price increased from 3.1 to 3.4 dollars per million of BTU, which impacted negatively EBITDA in 4.3 billion. Turning to slide 7, EBITDA from Midstream and other services rose to 61.2 billion compared to 46.7 billion in the sub-quarter of 24. This increase was mainly driven by higher sales derived from the incremental build volume of natural gas transported and conditioned in Vatamuerta, totaling almost 21 billion. Transported natural gas build volume rose from an average of 29 million cubic meters per day in the third quarter of 24 to 32 million cubic meters per day during this quarter. The natural gas condition in volume also increased from an average of 16 million cubic meters per day to 29 million cubic meters per day. In addition, the monetary effect increased a bit by 3.2 billion. These effects were partially offset by 10.4 billion in higher operating expenses. As seen on slide 8, we recorded a positive variation in the financial results amounting to $31.1 billion. This was mainly due to a $43.4 billion increase in income from financial assets given the much higher yields achieved in the domestic financial investments. Additionally, inflation exposure loss decreased by $10.7 billion. These positive effects were partially offset by a higher foreign exchange loss amounting to $21.8 billion during the third quarter of 2025, following the central bank's decision to make the US dollar exchange rate float, starting early April and the consequent depreciation of 15%, compared to the 16% rate in the same quarter of 2024 and under the previous regime of 2% monthly crawling PEC. Finally, turning to the cash flow on slide 9, our cash position in real terms increased by 22%, or 160 billion, during the third quarter of 25 to 875 billion, equivalent to approximately 638 million dollars at the official exchange rate. EBITDA generation during the third quarter amounted to almost 219 billion, of which 47% was generated by the regulated transportation business, and 53% by the non-regulated businesses. CAPETs for the period amounted to 87 billion. Working capital decreased by $46.4 billion and we paid interest amounting to $29 billion and income tax payment totaled $61 billion. In addition, we obtained short-term loans by $28.6 billion. We finally recorded higher yields from our financial investment by 53 billion in real terms, resulted mainly due to the higher increase of the foreign exchange rate over inflation of this quarter. This concludes our presentation. I will now turn it over to Carlos, who will open the floor for questions. Thank you.