YPF Sociedad Anonima

Good morning, ladies and gentlemen. This is Margarita Chun, YPF IR Manager. Thank you for joining us today in our second quarter 2025 Earnings Goal. Today's presentation will be conducted by our Chairman and CEO, Mr. Horacio Marin, our CFO, Mr. Federico Barretta-Veña, and our Strategy, New Businesses, and Controlling VP, Mr. Maximiliano Weston. During the presentation, we will go through the main aspects and events that explain the quarter results And then we will open the floor for Q&A session together with our management. Before we begin, please consider our cautionary statement on slide two. Our remarks today and answers to your questions may include forward-looking statements, which are subject to risk and uncertainties that could cause actual results to be materially different from the expectations contemplated by these remarks. Our financial figures are stated in accordance with IFRS, but during the presentation, we might discuss some non-IFRS measures, such as adjusted VTA. I will now turn the call over to Horacio. Please go ahead.

Thank you, Margarita, and good morning, everyone. Despite international price volatility, we deliver not only solid results in Q2, but also significant progress in our 4x4 plan by achieving key remarkable milestones. This quarter's volatility actually demonstrated the right direction and implicit value of our 4x4 plan outlined since December 23. During this quarter, the international alloy market experienced significant volatility with low prices. As a result, our realization price of oil decreased by 12% sequentially. Our shale oil production remained largely unchanged even after selling our 49% stake in Aguadal-Chanar, which decreased its contribution by 6,000 barrels a day. Moreover, during July, we have just achieved record high production of roughly 165,000 barrels a day. In fact, On Tuesday, the daily production was 163.8 thousand barrels a day. Despite the challenging context, our continued delivery on our 4x4 plan substantially mitigated this negative price environment. During this quarter, we reached key milestones in the investing program of mature fields, particularly in Santa Cruz. As a material result of this project, we can show a 24-interannual reduction in our lifting costs. Another key milestone was achieved financial closing at BEMOS. After 18 months of hard work and dedication, today I would like to share with you the remarkable progress we achieved in our 4x4 plan. delivering important results across all our four strategic pillars, especially since our last call in May. As we have always said, our first pillar is to focus on our most profitable business, Oil Vaca Muerta. We have continued to expand our shale oil operations and made significant progress in advancing mistrain infrastructure projects to support future growth. YPF, as the largest shale oil producer in Argentina, continues to deliver solid performance. Back in November 23, YPF shale production was 110,000 barrels per day. By last month, production has increased to roughly 155,000 barrels per day. even after divestment 6,000 bodies per day in a while, as I mentioned before. We project further growth, aiming to close the year at around 190,000 bodies per day. This will represent an outstanding organic production ramp-up of over 70% in just 25 months. Moreover, in the last 18 months since 2024, our oil export revenue reached $1.5 billion. In terms of volume, this quarter we exported nearly 44,000 barrels per day. Moving to midstream expansion since day one, we were convinced that BEMOS represented the key and the best infrastructure vehicle to ramp up YPS production from 26 and beyond, and also for all the industry. This new pipeline completely unlocks YPS growth plan to achieve roughly 250,000 barrels per day by the end of 2026 and allowing to reach half a million barrels per day by 2030. To this end, YPS leading record in the development of this project in collaboration with the rest of the Shell industry. First, we align commitment that allow starting construction on January 25, Then, supported by a solid contractor structure, the project recently secured a syndicated loan for $2 billion to finance the construction of Demos. Besides economic benefits for YPF and the entire Shell industry, this transaction reopened the international project finance market for Argentina. It stands as the largest commercial loan for an infrastructure project in the country. It also one of the top five largest financing in Latin American oil and gas sector so far. The overall construction progress is 23% as you like, with welding works completed for around 120 kilometers. Additionally, assemblies of floor plates for the tanks have begun at both Allen and Punta Colorado export terminal. Let me now talk on pillar number two that focuses on active portfolio management. From the very beginning, we committed to create value for YPS through a dynamic portfolio management approach. Over the past 15 months, after receiving initial approval from our board, we already completed the transfer of 28 out of 30 mature blocks. identified in the initial plan called Andes. Moreover, we have successfully reverted 11 mature blocks to the provinces, one in Chubut and the others in Santa Cruz, the most challenging blocks in terms of complexity, achieving another key milestone in our 4x4 plan. During the past 18 months since 2024, The mature blocks that we already left produced roughly 61,000 barrels of oil per day and 3.2 million cubic meters of gas per day. However, it's worth noting that they were very mature and carried high lifting costs, around $42 per barrel. As a result, during this 18 months, the overall negative impact on our free cash flow was around $840 million. This amount includes the operational cash flow and the exit cash flow. Additionally, we have successfully divested our subsidies in Brazil and Chile, besides closing unprofitable chemical plants. All this milestone was critical to our 4x4 plan, as it simplifies our portfolio and enables us to concentrate our effort and the majority of our capital on our most profitable asset, Vaca Muerta. Regarding this exit program from mature fields, I want to highlight the constructive agenda that we were able to develop in collaboration with governors and unions. This represents an unprecedented level of cooperation among key stakeholders. I'm confident that with the same spirit, we will reach an agreement in ongoing negotiation with Tierra del Fuego during Q3. As a result of all these efforts, we can report today a remarkable reduction in leased costs of 24% interannually. With the decision to make YPF a very profitable company, we have recently decided to expand the scope of assets to be disvested to become next year a pure and conventional abstain company. We have identified the other 16 performing conventional blocks. We will open these assets for development with the superior objective to continue upgrading our portfolio and making YPF much more profitable and more resilient to low crude prices. Completely aligned with the same portfolio rationale, this week we execute a bidding agreement to acquire prime tier wine shell Acris from Total for $500 million, subject to certain conditions. This acquisition follows the same value dynamics of our active portfolio management, disvesting non-core, less profitable assets while securing long-term productive value for the company. In this case, La Escalonada-Mencon-La Ceniza blocks are located in the most promising area in the oil and wet gas window of North Vaca Muerta, close to Bajo del Choy-Quilambernada blocks that Plus Petrol has recently acquired from Exxon. La Escalonada is a first-class crude oil producing block that will generate synergy with the development of Vaca Muerta North Hub, Bencon de la Ceniza has strategic potential for the development of wet gas and the Argentina LNG project. We expect to assume the operating role of these two blocks, holding a 45% working interest, partnering with Shell and Cassie Petroleum. Together, these blocks at 100% encompass nearly 115,000 acres of Vaca Muerta, with an outstanding well inventory of over 500 wells. Wells drilled in the volatiloid window during the early stage of development demonstrate quite promising productivity levels that underscore their long-term potential. Our expectation is to accelerate the development plan to fast track the monetization of this production. This new asset increases our future oil production curve, extend the duration of our plateau, and reinforce our leading position in backup water reserves. Furthermore, when we complete the investment of our conventional asset, YPF will become a pure integrated shale player with superior size, synergy, and economical scale, as I mentioned before. Now, pillar number three focuses on maximizing our upstream and downstream efficiencies. Since our last call in May, we have inaugurated three real-time intelligence centers. Two of them are in La Plata and Lujan de Cuyo Refinery, respectively. The third one is based in our headquarters to support our downstream commercialization business. The latter one has been key for the implementation of micro-pricing and self-fuel projects. This real-time is unique in Latin America. We can follow the demand, but each gas stations with 24 hours. Besides, our all products are convenience store. We are changing the way of delivering fuel and products in the country. It's really a disruptive marketing change. We have an impressive positive image from the people in the polls. This 100% technology-driven and in-house management project was launched last month to seek a win-win strategy. Micropricing allows our gas station clients to access a different price of fuel at night from midnight to 6 a.m. CellFuel provides these clients with greater savings if the payment is made through the YPF application in certain gas stations. YPF has pioneered this method of pricing in Argentina with the objective of reducing our fixed costs and growing our nighttime sales and generate more profit for YPF. The results so far are impressive. In the first month since launching this project, our sales volume at the gas station 9 grew roughly 30% compared to Q2 this year. On the industrial efficiency side, we have reduced significantly the duration of program maintenance. Especially in La Plata Refinery, we complete the maintenance between 40 to 60% faster than historical records. Regarding Toyota well project, we have been able to reduce the construction cycle for a part of four wells for roughly 230 days, we represent a reduction of around 80 days compared to 2023 levels. The same methodology and focus are in the Aftin Real-Time Intelligence Center for drilling and completion that start to deliver results, as you will see in the next slides. We are the largest operator in Vaca Muerta working upstream Real-Time Intelligence Center 24-7 remotely from YPS headquarters. As a record, one of the biggest service company last week, it was the first time that delivered a work from remote all around the world. In the third week of August, we are opening the Afton Real-Time Intelligence Center for operation and maintenance. pooling and logistics in Neuquén to improve our efficiency and coordination in all the operations of Acamorta. This achievement reflects our integrated approach, working closely with our strategy suppliers at every stage of the well production process. Additionally, we enhance our operational dashboard to enable real-time anomaly detection and implement corrective action plans rapidly. All of these initiatives represent a critical to cultural change for YPF in time management and production processes. Finally, pillar number four is Argentina Energy Project, and since our last call in May, We signed the Heads of Agreement with E&I for the consolidation for free for 12 million tons per year, expecting the approval of final investment decision in Q1-26. In the same direction, we are working with Shell for Phase 2 in order to speed up the FID and obtain synergy between both projects in the Fed Structure. Moreover, this week our SPV CESA obtained the FID approval for the 20-year railroad charter agreement for its second floating LNG named Mark II. This vessel has a capacity of 3.5 million tons per year, as expected to be operational in 2028. We are also working on the project RIGI, as well as environmental and export permits for Mark II. consider the first vessel Healy, the total capacity amount to roughly 6 million tons per year. Let me mention that this second vessel allowed the contraction of a 100% dedicated pipeline from Vaca Muerta to the San Matias Gulf in the province of Rio Negro, available during the whole year, instead of the original plan of using existing pipeline idle capacity during off-peak season, operating only hilly. Now, moving on to Q2 results, revenue remained stable sequentially, reaching over $4.6 billion. We record high seasonal size on natural gas and fuels, and increased import volume of crude oil and agro products. However, the volatility international price negative impact our refined product prices, especially local fuels. Additionally, Q2 was affected by lower seasonal gasoline demand. Interannually, despite roughly 20% drop in Brent, revenues only declined by 6%. The drop in Brent prices were mitigated by operational efficiencies. increase of Shell export and a recovery in local fuel demand. Achat EBITDA was $1.12 billion in Q2, decreasing 10% sequentially. It was mainly explained by brain contraction impact in refined product prices, exit from mature field, and value of inventories. On the positive side, this negative effects were softened with lower lifting costs on the back of less exposure to mature fields. Interannually, adjuvant EBITDA declined by 7%, also reflecting BREN volatility, but it was partially mitigated by the significant ramp up in shale oil production and even better conventional lifting costs. Also, bear in mind that Q2 last year was affected by the strange weather conditions experienced in Patagonia. At this point, I would like to note that excluding the negative contribution from Macho Phil, our proxy adjust, EBITDA could have been $1.25 billion. Looking at the bottom line, Q2 net profit was $58 million. compared to a loss of $10 million in the previous quarter. This turnaround was mainly driven by one-off items related to mature fields in Q1. In third annually, net profit declined sharply, explaining by higher depreciation from shale activity expansion and lower gains from financial insecurities in 2024. Also, this quarter included an income tax charge due to higher future tax payable, while Q2-24 was the opposite. Much of it also impacted on the net results. Excluding them, our profit net result would have been a profit of $254 million. In the terms of investment, in Q2, we deployed $1.16 billion, remaining similar sequentially and interannually. It's very important to remark that 71% of the total was now directly allocated to unconventional assets. In Q2, we record a negative free cash flow of $355 million. It was mainly affected by $315 million of negative impact from mature fields. Moreover, we had negative working capital due to peak winter sales on natural gas and our subsidies paid income tax. However, the negative impact was sustained by dividend collection from affiliates. As a result, our net debt rose to $8.8 billion, reaching a net labor ratio of 1.9 times as expected while depressing mature fields. Please take into account our acquisition of this year and also in the rest of this year we are selling, performing conventional assets and Metro Gas after extension of the concession. Now I will turn the call over to Max.

Thank you Horacio and hello to everyone. Focusing on the upstream segment, the second quarter total hydrocarbon production was 546,000 barrels of oil equivalent per day. It remained stable both sequentially and inter-annually. Shale production keeps driving the growth, now representing an impressive 62% of the total output. It nearly offset the divestment of mature fields and to a minor extent, the lower working interest at Aguadera del Chañar. In the case of mature fields, hydrocarbon production decreased by 26% versus the previous quarter as we kept divesting them. It recorded 72,000 barrels of oil equivalent per day, representing only 13% of the second quarter total production. Crude oil production amounted to 248,000 barrels per day in the second quarter, decreasing 8% sequentially. It was primarily driven by lower mature fields and, to a lesser extent, Aguada del Chañar, as explained before. Interannually, while total crude oil production remained stable, The remarkable 28% expansion in shale output fully offset the decrease in exposure to mature fields. Let me mention that last month's shale oil production was approximately 165,000 barrels per day. We expect continuing significant growth in the second half of the year to achieve our 2025 annual target of over 165,000 barrels per day. Oil exports in the second quarter totaled 44,000 barrels per day, increasing by 20% sequentially. The main growth came from redirecting Escalante Heavy Oil to the foreign market as La Plata Refinery was under program maintenance. Interannually, it grew by 43%, also boosted by shale expansions. Natural gas production increased by 6% in the second quarter sequentially to 40 million cubic meters per day, primarily supported by higher seasonal demand. NGL production was 48,000 bars per day, a modest growth of 2% sequentially driven by high associated gas output in certain shale oil blocks. Total lifting cost was $12.3 per barrel of oil equivalent. This is a remarkable sequential reduction of 19%, reflecting further divestment of mature fields. Excluding mature fields, our proxy lifting cost for the second quarter would have been roughly $7.5 per barrel of oil equivalent. Zooming into our core hub blocks, lifting cost at 100% of working interest was $4.9 per barrel of oil equivalent. It grew by 7% sequentially due to higher pooling and maintenance costs. Regarding prices in the upstream segment, crude oil price was $59.5 per barrel, 12% lower sequentially in line with Brent volatility. Natural gas price was $4.1 per million BTU, growing by 38% sequentially, primarily influenced by the peak season plant gas price. Now, let me walk you through the performance of our shale activities. In the second quarter, we drilled 54 horizontal oil wells on a gross basis, mostly in operated blocks while maintaining our net working interest of 55%. In this sense, in the first half of the year, we drilled 105 horizontal oil wells on a gross basis. This is in line with our estimate of 205 wells for the year. In terms of completion and tidying of wells, we accelerated our activity. In the second quarter, we completed 70 horizontal wells and tied in 76 on a gross basis. They represented an increase of 35% and 69%, respectively, when compared to the second quarter last year. Shale oil production in the second quarter remained stable sequentially at 145,000 barrels per day. This is because the lower stake in Awal-Chanar block was fully compensated by the growing contribution from Langostura Sur 1 block. This block is 100% YPF located in the south hub with a shale oil production of 20,000 barrels per day in the second quarter. Considering the acceleration in our activities mentioned before and July's production level of 165,000 barrels per day, We are in good shape to reach the 2025 target of 165,000 barrels per day. In our unconventional core hub blocks, we achieved an average drilling speed of 331 meters per day. We remain optimistic about reaching our annual target of 360 meters per day. On the fracking side, we completed 259 stages per set per month in our unconventional operations, now very close to achieve our annual target of 260 stages per set per month. In our downstream segment, local few prices remain closely aligned with international parity, reflecting Brent volatility. As a result, local fuel prices measured in dollars were down 8% sequentially and 10% interannually. Also, second quarter local fuel prices were just 1% below improprieties. Fuel sales volume was 3.5 million cubic meters in the second quarter, growing by 4% sequentially, primarily explained by seasonality. Interannually, It increased by 3%, mostly driven by demand recovery. We also maintained our leading market share of 55%. In the second quarter, we processed 301,000 barrels per day, recording a 5% sequential contraction due to the maintenance stoppage at La Plata Refinery. This resulted in a refining utilization rate of almost 90%, as anticipated in our previous call. However, let me highlight that La Plata Refinery achieved a record high monthly processing level of the past 15 years, reaching nearly 201,000 barrels per day in April. Our refining and marketing margins declined by 17% sequentially. It was mostly due to lower prices combined with higher costs related to maintenance. However, it was mitigated by lower costs of oil on top of the OPEX efficiencies measures set before. Now, I will turn the call over to Fede.