Pampa Energía Announces Results for the nine-month period and quarter ended on September 30, 2019

BUENOS AIRES, Argentina, Nov. 11, 2019 /PRNewswire/ -- Pampa Energía S.A. (NYSE: PAM; Buenos Aires Stock Exchange: PAMP), the largest independent energy integrated company in Argentina, with active participation in the country's electricity and gas value chain, announces the results for the nine-month period and quarter ended on September 30, 2019.

The Company adopted the US Dollar as functional currency ('FC US$') for the reporting of its financial information, effective as from January 1, 2019. However, the information of the comparative periods is reported in local and constant currency ('L&CC') as of December 31, 2018, which are shown in US$ converted by closing nominal exchange rate ('FX').

Moreover, Edenor, Transener, OldelVal, Refinor and TGS continue recording their operations under L&CC, therefore their figures are adjusted by inflation. For further information, see section 2 of the Earnings Release or footnote 3 of Pampa's financial statements ('FS').

For the convenience of the reader, it is shown as supplementary information for each segment's quarterly comparative period the figures recorded in local currency and nominal terms ('L&NC') expressed in US$ at average FX, except for the distribution segment and subsidiaries subject to L&CC, which comparative quarter's figures are shown in L&CC as of September 30, 2019 and expressed in US$ at closing FX.

Main Results for the Nine-Month Period Ended on September 30, 2019 ('9M19')

Consolidated net revenues of US$2,134 million(1), 6% lower than the US$2,280 million recorded in the same period of 2018 ('9M18'), due to decreases of 7% in electricity distribution, 13% in oil and gas, 6% in petrochemicals, 44% in holding and others, and higher eliminations due to intersegment sales of US$195 million, partially offset by increases of 50% in power generation.

    --  Power Generation of 11,777 GWh from 15 power plants(2)
    --  Electricity sales of 15,228 GWh to 3.1 million end-users
    --  Production of 48.4 thousand barrels per day of hydrocarbons
    --  Sales of 253 thousand tons of petrochemical products

Consolidated adjusted EBITDA(3) for continuing operations of US$724 million, 13% lower than the US$828 million for 9M18, mainly due to decreases of 37% in electricity distribution, 29% in oil and gas, 26% in holding and others, and higher intersegment eliminations of US$1 million, partially offset by increases of 24% in power generation and US$13 million in petrochemicals.

Consolidated gain attributable to the owners of the Company of US$683 million, higher than the US$65 million loss in 9M18, includes an extraordinary non-cash gain for the settlement of Edenor's regulatory liabilities and lower accrual of losses from FX difference as a result of change of the functional currency, partially offset by decrease at operating margins in electricity distribution and oil and gas.

Main Results for the Third Quarter 2019 ('Q3 19')(4)

Consolidated net revenues of US$579 million, a 30% lower than the US$830 million recorded for the third quarter 2018 ('Q3 18'), explained by decreases of 44% in electricity distribution, 20% in oil and gas, 22% in petrochemicals, 56% in holding and others, and higher eliminations due to intersegment sales for US$71 million, partially offset by a 40% increase in power generation.

    --  Power Generation of 4,138 GWh from 15 power plants
    --  Electricity sales of 5,362 GWh to 3.1 million end-users
    --  Production of 49.8 thousand barrels per day of hydrocarbons
    --  Sales of 75 thousand tons of petrochemical products

Consolidated adjusted EBITDA for continuing operations of US$270 million, 15% lower compared to the US$319 million for Q3 18, due to decreases of 11% in electricity distribution, 39% in oil and gas, 46% in holding and others, and higher intersegment eliminations for US$2 million, partially offset by increases of 11% in power generation and US$3 million in petrochemicals.

Consolidated gain attributable to the owners of the Company of US$116 million, US$244 million higher than the loss of US$128 million in Q3 18, mainly due to lower recording of losses from FX difference as explained above.



       
              
                Consolidated Balance Sheet



       
              (As of September 30, 2019 and December 31, 2018, in millions)





       Figures in million                                                       FC US$ as of 9.30.2019                 L&CC as of 12.31.2018

    ---

                                                                                           
            AR$ 
     US$ FX 57.59                        
         AR$   
     US$ FX 37.7

                                                                                                                                                                    ---


       
              ASSETS



       Property, plant and equipment                                                           195,859           3,401                           125,005            3,316



       Intangible assets                                                                         8,465             147                             6,080              161



       Deferred tax credits                                                                      3,257              57                                80                2



       Participation in joint businesses and associates                                         25,591             444                            15,333              407



       Investments at amortized cost                                                             2,027              35



       Financial assets at fair value with changing results                                        645              11                               422               11



       Other assets                                                                                 48               1                                33                1



       Right-of-use assets                                                                         948              16



       Trade receivable and other credits                                                        4,260              74                             9,521              253



       
              Total non-current assets                                                     241,100           4,186                           156,474            4,151

    ---


       Inventories                                                                               8,655             150                             5,169              137



       Investments at amortized cost                                                             3,097              54                             1,330               35



       Financial assets at fair value with changing results                                     31,263             543                            15,273              405



       Financial derivatives                                                                       739              13                                 3                0



       Trade receivable and other credits                                                       35,341             614                            26,489              703



       Cash and cash equivalents                                                                 2,361              41                             9,097              241



       
              Total current assets                                                          81,456           1,414                            57,361            1,522

    ---




       
              Total assets                                                                 322,556           5,601                           213,835            5,672

    ---




       
              EQUITY



       Share capital                                                                             1,743              30                             1,874               50



       Adjustment to share capital                                                               9,826             171                             9,826              261



       Share premium                                                                            18,500             321                            18,499              491



       Repurchased shares                                                                          157               3                                25                1



       Adjustment to share capital in treasury                                                     134               2                               134                4



       Cost of repurchased shares                                                              (6,299)          (109)                          (1,490)            (40)



       Statutory reserve                                                                         1,753              30                               904               24



       Voluntary reserve                                                                        23,489             408                             7,355              195



       Other reserves                                                                            (742)           (13)                            (483)            (13)



       Retained earnings                                                                        49,929             867                            15,193              403



       Other comprehensive result                                                                9,240             160                             (314)             (8)



       
              Equity attributable to owners of the parent                                  107,730           1,871                            51,523            1,367

    ---


       Non-controlling interests                                                                28,254             491                            16,160              429



       
              Total equity                                                                 135,984           2,361                            67,683            1,795

    ---




       
              LIABILITIES



       Investments in joint ventures and associates                                                199               3                               153                4



       Provisions                                                                                9,165             159                             5,499              146



       Income tax and minimum expected profit tax liability                                        544               9                             1,034               27



       Deferred revenues                                                                           271               5                               275                7



       Tax payable                                                                                 435               8                               542               14



       Deferred tax liabilities                                                                 18,272             317                            15,354              407



       Defined benefit plan obligations                                                          1,484              26                             1,175               31



       Salaries and social security payable                                                        232               4                               163                4



       Borrowings                                                                              100,313           1,742                            69,189            1,835



       Accounts payable and other liabilities                                                    4,526              79                             8,162              216



       
              Total non-current liabilities                                                135,441           2,352                           101,546            2,694

    ---


       Provisions                                                                                1,254              22                               871               23



       Deferred income                                                                               5               0                                 5                0



       Income tax and minimum expected profit tax liability                                      3,876              67                             1,084               29



       Tax payable                                                                               3,260              57                             2,052               54



       Defined benefit plan obligations                                                            163               3                               162                4



       Salaries and social security payable                                                      2,681              47                             2,726               72



       Financial derivatives                                                                         3               0                                49                1



       Borrowings                                                                               13,735             238                            12,901              342



       Accounts payable and other liabilities                                                   26,154             454                            24,756              657



       
              Total current liabilities                                                     51,131             888                            44,606            1,183

    ---




       
              Total liabilities                                                            186,572           3,240                           146,152            3,877

    ---




       
              Total liabilities and equity                                                 322,556           5,601                           213,835            5,672

    ---



       
                
                  Consolidated Income Statement



       
                (For the nine-month period and quarter ended on September 30, 2019 and 2018, in millions)




                                                                                                               
     
     Nine-Month Period            
     
           Third Quarter




       Figures in million                                                                                               2019*                      2018**                              2019*         2018**



                                                                                                                      
              AR$ 
         US$                     
             AR$   
         US$    
          AR$     
       US$      
          AR$       
        US$




       Sales revenue                                                                                                        110,039      2,134                             85,933        2,280         44,500          579           31,270             830



       Cost of sales                                                                                                       (77,802)   (1,481)                          (55,840)     (1,481)      (31,010)       (371)        (19,532)          (518)





       
                Gross profit                                                                                             32,237        653                             30,093          799         13,490          208           11,738             312

    ---




       Selling expenses                                                                                                     (5,785)     (104)                           (4,612)       (122)       (2,102)        (17)         (1,935)           (51)



       Administrative expenses                                                                                              (5,886)     (121)                           (5,513)       (146)       (2,221)        (34)         (1,708)           (45)



       Exploration expenses                                                                                                   (155)       (4)                              (12)         (0)          (84)         (2)             (7)            (0)



       Other operating income                                                                                                 1,357         27                              6,079          161            407            5              753              20



       Other operating expenses                                                                                             (3,189)      (64)                           (5,839)       (155)       (1,232)        (17)         (1,098)           (29)



       Results for participation in joint businesses and associates                                                           3,429         62                                505           13            501          (7)           (200)            (5)



       Agreement from regularization of liabilities                                                                          15,296        266                                                        2,230         (42)





       
                Operating income                                                                                         37,304        715                             20,701          550         10,989           94            7,543             201

    ---




       RECPAM - Results from net monetary position                                                                            8,514        148                             17,217          457          2,689           11            9,804             260



       Financial income                                                                                                       3,659         83                              2,356           62          1,260           19            1,043              27



       Financial costs                                                                                                     (10,669)     (219)                           (8,229)       (218)       (3,518)        (49)         (3,501)           (93)



       Other financial results                                                                                                1,966         56                           (35,687)       (948)         1,428           50         (17,751)          (472)



       
                
                  Financial results, net                                                                     3,470         68                           (24,343)       (647)         1,859           31         (10,405)          (278)





       
                Profit before tax                                                                                        40,774        783                            (3,642)        (97)        12,848          125          (2,862)           (77)

    ---




       Income tax                                                                                                           (2,828)         7                                841           23        (3,987)        (29)             298               9





       
                Net income for continuing operations                                                                     37,946        790                            (2,801)        (74)         8,861           96          (2,564)           (68)

    ---




       Net income from discontinued operations                                                                                                                            3,021           80                                    (1,104)           (29)





       
                Net income for the period                                                                                37,946        790                                220            6          8,861           96          (3,668)           (97)



       
                
                  Attributable to the owners of the Company                                                 31,863        683                            (2,468)        (65)         8,159          116          (4,860)          (128)



       
                Continuing operations                                                                                    31,863        683                            (5,399)       (143)         8,159          116          (3,746)           (98)



       
                Discontinued operations                                                                                                                               2,931           78                                    (1,114)           (30)



       
                
                  Attributable to the non-controlling interests                                              6,083        107                              2,688           71            702         (20)           1,192              31





       
                
                  Net income per share attributable to the owners of the Company                           17.4115     0.3732                           (1.2414)    (0.0327)        4.5957       0.0653         (2.5653)       (0.0676)



       
                Basic and diluted income per share of continuing operations                                             17.4115     0.3732                           (2.7158)    (0.0718)        4.5957       0.0653         (1.9773)       (0.0520)



       
                Basic and diluted income per share of discontinued operations                                                                                        1.4743       0.0391                                   (0.5880)       (0.0156)

    ---


                            * FC US$ was adopted on April 1,
                             2019, effective as from January 1,
                             2019 for Pampa Energía stand-alone
                             and generation subsidiaries
                             Greenwind, Los Nihuiles
                             hydroelectric power plant
                             ('HINISA'), Diamante hydroelectric
                             power plant ('HIDISA'), Piedra
                             Buena thermal power plant ('CPB')
                             and Pampa Cogeneración, among other
                             subsidiaries. The 9M19 and Q3 19
                             results are disclosed in AR$
                             converted at transactional FX.




               L&CC applies as from July 1, 2018
                retrospectively and prospectively
                for subsidiaries Edenor
                (electricity distribution segment),
                OldeVal (oil and gas segment),
                Refinor, TGS and Transener (holding
                and others segment). Figures in AR$
                for 9M19 and Q3 19 are adjusted by
                average inflation as of September
                30, 2019 for approximately 15.9%
                and 5.9%, respectively, and the
                disclosure in US$ results from
                converting by a closing FX of
                AR$57.59 per US$.




                            ** Figures for 9M18 and Q3 18 are
                             recorded in AR$ and adjusted by
                             inflation as of December 31, 2018
                             for approximately 27.1% and 18.9%,
                             respectively, and shown in US$ at a
                             closing FX of AR$37.70 per US$.

For the full version of the Earnings Report, please visit Pampa's Investor Relations website: ri.pampaenergia.com/en.

Information about the Conference Call

There will be a conference call to discuss Pampa's Q3 19 results on Tuesday, November 12, 2019 at 10:00 a.m. Eastern Standard Time / 12:00 p.m. Buenos Aires Time.

The host will be Lida Wang, Investor Relations Manager at Pampa. For those interested in participating, please connect to http://bit.ly/PampaWebPhone or dial +54 (11) 3984-5677 in Argentina, +1 (844) 717-6837 in the United States or +1 (412) 317-6394 from any other country. Participants of the conference call should use the identification password 'Pampa Energía' and dial in five minutes before the scheduled time. There will also be a live audio webcast of the conference at http://bit.ly/PampaQ319Call. Please download the Q3 19 Conference Call Presentation from our IR website.

You may find additional information on the Company at:


            ri.pampaenergia.com/en www.sec.gov


       
     
     www.cnv.gov.ar         www.bolsar.com

    ---

For further information, contact:

Gustavo Mariani
Chief Executive Officer - CEO

Ricardo Torres
Executive Vice-president

Mariano Batistella
Executive Director of Planning, Strategy, Downstream & Affiliates

Lida Wang
Investor Relations Officer

The Pampa Energía Building, Maipú 1 (C1084ABA) City of Buenos Aires, Argentina
Tel: +54 (11) 4344-6000
investor@pampaenergia.com
ri.pampaenergia.com/en

(1) Under the International Financial Reporting Standards ('IFRS'), Greenwind, OldelVal, Refinor, Pampa Cogeneración, Transener and TGS are not consolidated in Pampa's FS, being its equity income shown as 'Results for participation in associates/joint businesses'.
(2) Includes the operation of Ensenada Barragán Thermal Power Plant ('CTEB') and Mario Cebreiro Wind Farm ('PEMC'), assets co-controlled by Pampa and of which holds 50% of equity stake.
(3) Consolidated adjusted EBITDA represents the results before financial results, income tax and minimum notional income tax, depreciations and amortizations, extraordinary and non-cash income and expense, equity income and other adjustments from the IFRS implementation, and includes affiliates' EBITDA at our ownership. For more information, see section 3 of the Earnings Release.
(4) The financial information presented in this document for the quarters ended on September 30, 2019 and of 2018 are based on FS prepared according to IFRS in force in Argentina, corresponding to the nine-month period of 2019 and 2018, and the quarters ended on June 30, 2019 and 2018, respectively.

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SOURCE Pampa Energia S.A.