UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of November, 2023
EMPRESA DISTRIBUIDORA Y COMERCIALIZADORA NORTE S.A. (EDENOR)
(DISTRIBUTION AND MARKETING COMPANY OF THE NORTH )
(Translation of Registrant's Name Into English)
Argentina
(Jurisdiction of incorporation or organization)
Av. del Libertador 6363,
12th Floor,
City of Buenos Aires (A1428ARG),
Tel: 54-11-4346-5000
(Address of principal executive offices)
(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)
Form 20-F X Form 40-F
(Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)
Yes No X
(If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-.)
CONDENSED INTERIM FINANCIAL STATEMENTS
AS OF SEPTEMBER 30, 2023 AND FOR THE NINE
AND THREE-MONTH PERIOD ENDED SEPTEMBER 30, 2023
PRESENTED IN COMPARATIVE FORM
(Stated in millions of constant pesos - Note 3)
CONDENSED INTERIM FINANCIAL STATEMENTS |
Legal Information | 2 | |
Condensed Interim Statement of Comprehensive Income (Loss) | 3 | |
Condensed Interim Statement of Financial Position | 4 | |
Condensed Interim Statement of Changes in Equity | 6 | |
Condensed Interim Statement of Cash Flows | 7 | |
Notes to the Condensed Interim Financial Statements: | ||
1 | | General information | 9 |
2 | | Regulatory framework | 10 |
3 | | Basis of preparation | 12 |
4 | | Accounting policies | 13 |
5 | | Financial risk management | 14 |
6 | | Critical accounting estimates and judgments | 16 |
7 | | Contingencies and lawsuits | 16 |
8 | | Revenue from sales and energy purchases | 17 |
9 | | Expenses by nature | 19 |
10 | | Other operating income (expense), net | 20 |
11 | | Net finance costs | 20 |
12 | | Basic and diluted earnings (loss) per share | 21 |
13 | | Property, plant and equipment | 22 |
14 | | Right-of-use assets | 24 |
15 | | Inventories | 24 |
16 | | Other receivables | 24 |
17 | | Trade receivables | 25 |
18 | | Financial assets at fair value through profit or loss | 25 |
19 | | Cash and cash equivalents | 26 |
20 | | Share capital and additional paid-in capital | 26 |
21 | | Allocation of profits | 26 |
22 | | Trade payables | 27 |
23 | | Other payables | 27 |
24 | | Borrowings | 28 |
25 | | Salaries and social security taxes payable | 29 |
26 | | Income tax and deferred tax | 30 |
27 | | Tax liabilities | 31 |
28 | | Provisions | 31 |
29 | | Related-party transactions | 31 |
30 | | Shareholders' Meeting | 32 |
31 | | Events after the reporting period | 32 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Glossary of Terms
The following definitions, which are not technical ones, will help readers understand some of the terms used in the text of the notes to the Company's Condensed Interim Financial Statements.
Terms | Definitions |
AMBA | Buenos Aires Metropolitan Area |
BCRA | Central Bank of Argentina |
BNA | Banco de la Nación Argentina |
CABA | City of Buenos Aires |
CAMMESA | Compañía Administradora del Mercado Mayorista Eléctrico S.A. (the company in charge of the regulation and operation of the wholesale electricity market) |
CNV | National Securities Commission |
CPD | Distribution Own Cost |
edenor | Empresa Distribuidora y Comercializadora Norte S.A. |
ENRE | National Regulatory Authority for the Distribution of Electricity |
FACPCE | Argentine Federation of Professional Councils in Economic Sciences |
GWh | Gigawatt hour |
IAS | International Accounting Standards |
IASB | International Accounting Standards Board |
IFRIC | International Financial Reporting Interpretations Committee |
IFRS | International Financial Reporting Standards |
IGJ | Inspección General de Justicia (the Argentine governmental regulatory agency of corporations) |
MEM | Wholesale Electricity Market |
MULC | Single Free Foreign Exchange Market |
MWh | Megawatt hour |
PBA | Province of Buenos Aires |
PEN | Federal Executive Power |
RECPAM | Gain (Loss) on exposure to the changes in the purchasing power of the currency |
RTI | Tariff Structure Review |
SACME | S.A. Centro de Movimiento de Energía |
SE | Energy Secretariat |
VAD | Distribution Added Value |
1 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Legal Information
Corporate name: Empresa Distribuidora y Comercializadora Norte S.A.
Legal address: 6363 Av. Del Libertador Ave., City of Buenos Aires
Main business: Distribution and sale of electricity in the area and under the terms of the Concession Agreement by which this public service is regulated
Date of registration with the Public Registry of Commerce:
· | of the Articles of Incorporation: August 3, 1992 |
· | of the last amendment to the By-laws: April 10, 2023 (Note 30) |
Term of the Corporation: August 3, 2087
Registration number with the "Inspección General de Justicia" (the Argentine governmental regulatory agency of corporations): 1,559,940
Parent company: Empresa de Energía del Cono Sur S.A.
Legal address: 1252 Maipú Ave., 12th Floor - CABA
Main business of the parent company: Investment company and provider of services related to the distribution of electricity, renewable energies and development of sustainable technology
Interest held by the parent company in capital stock and votes: 51%
CAPITAL STRUCTURE
AS OF SEPTEMBER 30, 2023
(amounts stated in pesos)
Class of shares |
Subscribed and paid-in (See Note 20) | |
Common, book-entry shares, face value 1 and 1 vote per share | ||
Class A | 462,292,111 | |
Class B (1) | 442,566,330 | |
Class C (2) | 1,596,659 | |
906,455,100 |
(1) | Includes 30,852,251 and 30,994,291 treasury shares as of September 30, 2023 and December 31, 2022, respectively. |
(2) | Relates to the Employee Stock Ownership Program Class C shares (Note 20). |
2 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
edenor
Condensed Interim Statement of Comprehensive Income (Loss)
for the nine and three-month period ended September 30, 2023
presented in comparative form
(Stated in millions of constant pesos - Note 3)
Nine months at | Three months at | ||||||||
Note | 09.30.23 | 09.30.22 | 09.30.23 | 09.30.22 | |||||
Revenue | 8 | 378,811 | 323,574 | 138,357 | 113,333 | ||||
Energy purchases | 8 | (249,918) | (218,105) | (82,505) | (78,147) | ||||
Subtotal | 128,893 | 105,469 | 55,852 | 35,186 | |||||
Transmission and distribution expenses | 9 | (99,255) | (83,679) | (34,084) | (27,874) | ||||
Gross margin | 29,638 | 21,790 | 21,768 | 7,312 | |||||
Selling expenses | 9 | (42,435) | (36,449) | (11,706) | (13,145) | ||||
Administrative expenses | 9 | (30,911) | (27,287) | (11,599) | (7,114) | ||||
Other operating income | 10 | 11,859 | 9,957 | 5,340 | 3,515 | ||||
Other operating expense | 10 | (9,276) | (13,537) | (3,186) | (5,074) | ||||
Operating loss (profit) | (41,125) | (45,526) | 617 | (14,506) | |||||
Gain from interest in joint ventures | 6 | 15 | - | - | |||||
Agreement on the Regularization of Obligations | 2.b | 128,989 | - | 128,989 | - | ||||
Financial income | 11 | 111 | 121 | 53 | 25 | ||||
Financial costs | 11 | (161,291) | (112,989) | (46,431) | (47,605) | ||||
Other financial costs | 11 | (9,873) | (10,766) | (19,238) | (1,633) | ||||
Net financial costs | (171,053) | (123,634) | (65,616) | (49,213) | |||||
Monetary gain (RECPAM) | 215,912 | 146,562 | 72,382 | 57,105 | |||||
Profit (Loss) before taxes | 132,729 | (22,583) | 136,372 | (6,614) | |||||
Income tax | 26 | (79,813) | (20,561) | (60,333) | (7,913) | ||||
Profit (Loss) for the period | 52,916 | (43,144) | 76,039 | (14,527) | |||||
Comprehensive profit (loss) for the period attributable to: | |||||||||
Owners of the parent | 52,916 | (43,144) | 76,039 | (14,527) | |||||
Comprehensive profit (loss) for the period | 52,916 | (43,144) | 76,039 | (14,527) | |||||
Basic and diluted profit (loss) per share: | |||||||||
Profit (Loss) per share (argentine pesos per share) | 12 | 60.48 | (49.31) | 86.90 | (16.60) |
The accompanying notes are an integral part of the Condensed Interim Financial Statements.
3 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
edenor
Condensed Interim Statement of Financial Position
as of September 30, 2023 presented in comparative form
(Stated in millions of constant pesos - Note 3)
Note | 09.30.23 | 12.31.22 | |||
ASSETS | |||||
Non-current assets | |||||
Property, plant and equipment | 13 | 828,444 | 804,344 | ||
Interest in joint ventures | 49 | 43 | |||
Right-of-use assets | 14 | 1,363 | 1,436 | ||
Other receivables | 16 | 3 | 6 | ||
Total non-current assets | 829,859 | 805,829 | |||
Current assets | |||||
Inventories | 15 | 21,150 | 13,078 | ||
Other receivables | 16 | 23,585 | 37,987 | ||
Trade receivables | 17 | 76,832 | 56,863 | ||
Financial assets at fair value through profit or loss | 18 | 52,298 | 58,306 | ||
Cash and cash equivalents | 19 | 7,730 | 3,311 | ||
Total current assets | 181,595 | 169,545 | |||
TOTAL ASSETS | 1,011,454 | 975,374 |
4 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
edenor
Condensed Interim Statement of Financial Position
as of September 30, 2023 presented in comparative form(continued)
(Stated in millions of constant pesos - Note 3)
Note | 09.30.23 | 12.31.22 | |||
EQUITY | |||||
Share capital and reserve attributable to the owners of the Company | |||||
Share capital | 20 | 875 | 875 | ||
Adjustment to share capital | 20 | 221,787 | 221,765 | ||
Treasury stock | 20 | 31 | 31 | ||
Adjustment to treasury stock | 20 | 4,745 | 4,767 | ||
Additional paid-in capital | 20 | 3,078 | 3,050 | ||
Cost treasury stock | (18,230) | (18,230) | |||
Legal reserve | 15,409 | 15,409 | |||
Voluntary reserve | 149,222 | 149,222 | |||
Other comprehensive loss | (1,651) | (1,651) | |||
Accumulated losses | (67,033) | (119,949) | |||
TOTAL EQUITY | 308,233 | 255,289 | |||
LIABILITIES | |||||
Non-current liabilities | |||||
Trade payables | 22 | 1,350 | 1,870 | ||
Other payables | 23 | 140,621 | 35,524 | ||
Borrowings | 24 | 40,325 | 29,531 | ||
Deferred revenue | 8,674 | 7,468 | |||
Salaries and social security payable | 25 | 1,749 | 1,567 | ||
Benefit plans | 3,641 | 3,780 | |||
Deferred tax liability | 26 | 305,133 | 225,310 | ||
Provisions | 28 | 7,284 | 11,281 | ||
Total non-current liabilities | 508,777 | 316,331 | |||
Current liabilities | |||||
Trade payables | 22 | 145,737 | 365,271 | ||
Other payables | 23 | 23,763 | 12,846 | ||
Borrowings | 24 | 1,633 | 374 | ||
Deferred revenue | 102 | 90 | |||
Salaries and social security payable | 25 | 14,714 | 18,973 | ||
Benefit plans | 234 | 475 | |||
Tax liabilities | 27 | 6,005 | 2,676 | ||
Provisions | 28 | 2,256 | 3,049 | ||
Total current liabilities | 194,444 | 403,754 | |||
TOTAL LIABILITIES | 703,221 | 720,085 | |||
TOTAL LIABILITIES AND EQUITY | 1,011,454 | 975,374 |
The accompanying notes are an integral part of the Condensed Interim Financial Statements.
5 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
edenor
Condensed Interim Statement of Changes in Equity
for the nine-month period ended September 30, 2023
presented in comparative form
(Stated in millions of constant pesos - Note 3)
Share capital | Adjustment to share capital | Treasury stock | Adjustment to treasury stock | Additional paid-in capital | Cost treasury stock | Legal reserve | Voluntary reserve | Other reserve | Other comprehen- sive loss | Accumulated (losses) profits | Total equity | ||||||||||||
Balance at December 31, 2021 | 875 | 221,744 | 31 | 4,788 | 3,031 | (18,230) | 15,409 | 149,222 | - | (788) | (84,463) | 291,619 | |||||||||||
Other Reserve Constitution - Share-bases compensation plan | - | - | - | - | - | - | - | - | 19 | - | - | 19 | |||||||||||
Payment of Other Reserve Constitution - Share-based compensation plan | - | 21 | - | (21) | 19 | - | - | - | (19) | - | - | - | |||||||||||
Loss for the nine-month period | - | - | - | - | - | - | - | - | - | - | (43,144) | (43,144) | |||||||||||
Balance at September 30, 2022 | 875 | 221,765 | 31 | 4,767 | 3,050 | (18,230) | 15,409 | 149,222 | - | (788) | (127,607) | 248,494 | |||||||||||
Other comprehensive results | - | - | - | - | - | - | - | - | - | (863) | - | (863) | |||||||||||
Gain for the three-month complementary period | - | - | - | - | - | - | - | - | - | - | 7,658 | 7,658 | |||||||||||
Balance at December 31, 2022 | 875 | 221,765 | 31 | 4,767 | 3,050 | (18,230) | 15,409 | 149,222 | - | (1,651) | (119,949) | 255,289 | |||||||||||
Other Reserve Constitution - Share-bases compensation plan (Note 20) | - | - | - | - | - | - | - | - | 28 | - | - | 28 | |||||||||||
Payment of Other Reserve Constitution - Share-based compensation plan (Note 20) | - | 22 | - | (22) | 28 | - | - | - | (28) | - | - | - | |||||||||||
Gain for the nine-month period | - | - | - | - | - | - | - | - | - | - | 52,916 | 52,916 | |||||||||||
Balance at September 30, 2023 | 875 | 221,787 | 31 | 4,745 | 3,078 | (18,230) | 15,409 | 149,222 | - | (1,651) | (67,033) | 308,233 |
The accompanying notes are an integral part of the Condensed Interim Financial Statements.
6 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
edenor
Condensed Interim Statement of Cash Flows
for the nine-month period ended September 30, 2023
presented in comparative form
(Stated in millions of constant pesos - Note 3)
Note | 09.30.23 | 09.30.22 | |||
Cash flows from operating activities | |||||
Profit (Loss) for the period | 52,916 | (43,144) | |||
Adjustments to reconcile net (loss) profit to net cash flows from operating activities: | |||||
Depreciation of property, plants and equipments | 13 | 36,443 | 27,784 | ||
Depreciation of right-of-use assets | 14 | 1,410 | 1,553 | ||
Loss on disposals of property, plants and equipments | 13 | 456 | 531 | ||
Net accrued interest | 11 | 160,836 | 112,758 | ||
Income from customer surcharges | 10 | (6,209) | (4,532) | ||
Exchange difference | 11 | 9,400 | (2,045) | ||
Income tax | 26 | 79,813 | 20,561 | ||
Allowance for the impairment of trade and other receivables | 9 | 4,531 | 3,950 | ||
Adjustment to present value of receivables | 11 | 596 | 523 | ||
Provision for contingencies | 28 | 3,945 | 8,663 | ||
Changes in fair value of financial assets and financial liabilities | 11 | (7,738) | 4,169 | ||
Accrual of benefit plans | 9 | 3,696 | 2,283 | ||
Net loss from the cancelattion of Corporate Notes | 11 | - | 738 | ||
Loss on debt restructuring | 11 | - | 870 | ||
Income from non-reimbursable customer contributions | 10 | (75) | (102) | ||
Other financial results | 11 | 7,615 | 6,511 | ||
Gain from interest in joint ventures | (6) | (15) | |||
Agreement on the Regularization of Obligations | 2.b | (128,989) | - | ||
Monetary gain (RECPAM) | (215,912) | (146,562) | |||
Changes in operating assets and liabilities: | |||||
Increase in trade receivables | (45,220) | (20,120) | |||
Decrease (Increase) in other receivables | 5,483 | (12,867) | |||
Increase in inventories | (5,530) | (2,471) | |||
Increase in deferred revenue | 759 | 24 | |||
Increase in trade payables | 72,457 | 92,151 | |||
Increase in salaries and social security payable | 6,352 | 5,492 | |||
Decrease in benefit plans | (1,916) | (1,191) | |||
Increase (Decrease) in tax liabilities | 4,675 | (1,618) | |||
Increase in other payables | 3,997 | 920 | |||
Decrease in provisions | 28 | (556) | (965) | ||
Payment of income tax payable | - | (229) | |||
Net cash flows generated by operating activities | 43,229 | 53,620 |
7 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
edenor
Condensed Interim Statement of Cash Flows
for the nine-month period ended September 30, 2023
presented in comparative form(continued)
(Stated in millions of constant pesos - Note 3)
Note | 09.30.23 | 09.30.22 | |||
Cash flows from investing activities | |||||
Payment of property, plant and equipments | (59,466) | (37,693) | |||
Sale (Purchase) net of Mutual funds and negotiable instruments | 10,510 | (14,698) | |||
Net cash flows used in investing activities | (48,956) | (52,391) | |||
Cash flows from financing activities | |||||
Proceeds from borrowings | 11,259 | 10,532 | |||
Payment of borrowings | (229) | (6,171) | |||
Payment of lease liability | (2,259) | (1,830) | |||
Payment of interests from borrowings | (759) | (1,139) | |||
Payment of Corporate Notes issuance expenses | (480) | (1,239) | |||
Cancelattion of Corporate Notes | - | (1,125) | |||
Net cash flows generated by (used in) financing activities | 7,532 | (972) | |||
Increase in cash and cash equivalents | 1,805 | 257 | |||
Cash and cash equivalents at the beginning of the year | 19 | 3,311 | 12,552 | ||
Financial results in cash and cash equivalents | 2,705 | 4,180 | |||
Result from exposure to inflation | (91) | 17 | |||
Increase in cash and cash equivalents | 1,805 | 257 | |||
Cash and cash equivalents at the end of the period | 19 | 7,730 | 17,006 | ||
Supplemental cash flows information | |||||
Non-cash activities | |||||
Adquisition of advances to suppliers, property, plant and equipment through increased trade payables | (1,533) | (2,346) | |||
Adquisition of advances to suppliers, right-of-use assets through increased trade payables | (1,337) | (1,847) |
The accompanying notes are an integral part of the Condensed Interim Financial Statements.
8 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Note | 1 |General information |
Empresa Distribuidora y Comercializadora Norte S.A. (hereinafter "edenor" or "the Company") is a corporation (sociedad anónima) organized under the laws of Argentina, with legal address at 6363 Av. Del Libertador Ave - City of Buenos Aires, Argentine Republic, whose shares are traded on Bolsas y Mercados Argentinos S.A. (BYMA) (Argentine Stock Exchange and Securities Market) and the New York Stock Exchange (NYSE).
The corporate purpose of edenor is to engage in the distribution and sale of electricity within the concession area. Furthermore, among other activities, the Company may subscribe or acquire shares of other electricity distribution companies, subject to the approval of the regulatory agency, assign the use of the network to provide electricity transmission or other voice, data and image transmission services, and render advisory, training, maintenance, consulting, and management services and know-how related to the distribution of electricity both in Argentina and abroad. These activities may be conducted directly by edenor or through subsidiaries or related companies. In addition, the Company may act as trustee of trusts created under Argentine laws.
The Company's economic and financial situation
In the last few fiscal years, the Company recorded negative working capital, mainly as a consequence of the insufficient adjustments of the electricity rate since February 2019 -which did not comply with the terms agreed upon in the last RTI-, and the constant increase of both the operating costs and the costs of the investments necessary to maintain the quality of the service, in addition to the inflationary context in which the Argentine economy has been since mid-2018.
In contrast to what happened in the last few years, in which the changes made to the values of the Company's electricity rate schedules implied only the passing through of the seasonal prices without improving revenues from the CPD and were insufficient to cover the economic and financial needs of the Distribution Company, the last electricity rate adjustments implied the granting of increases in the CPD of 107.8% for the month of April and 73.7% for the month of June (Note 2.b to the Financial Statements as of December 31, 2022), which resulted in an improvement in the Company's gross margin for the first nine months of the year. Nevertheless, and in spite of the aforementioned context with constant increases in operating costs, the investments necessary, both for the operation of the network and for maintaining and even improving the quality of the service, have been made.
Additionally, the country's macroeconomic situation, in a context of growing inflation, with the annual rate surpassing 130%, with the widening of the gap between the official dollar exchange rate and the dollar exchange rate quoted in financial or free markets surpassing 100%, and the consequences of the agreement with the International Monetary Fund make it difficult to envisage a clear-cut trend of the economy in the short term.
This complex and vulnerable economic context is aggravated by the currency restrictions imposed by the BCRA, pursuant to which the BCRA's prior authorization is required for certain transactions, and differential tax rates, which apply to the Company's transactions associated with the payment of imports of goods that are necessary for the provision of the service and the payments to service the financial debt. Additionally, and with the recent agreement with the International Monetary Fund, not only has the scope of the PAIS tax been extended to include payment of imports of goods, in general, with the rate thereof amounting to 7.5%, but also the rate of the income tax or the wealth tax, as the case may be, on certain transactions subject to the PAIS tax has been increased from 35% to 45%.
Within the described context, the Company has recently begun to regularize the debt with CAMMESA for energy purchased in the MEM, as from the maturities taking place from March 2020 until February 2023, by means of the implementation of two payment plans of 96 monthly installments, pursuant to the Agreements on the Regularization of Payment Obligations signed by and between the Company and CAMMESA (Note 2.b).
9 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Despite the previously detailed situation, it is worth pointing out that, in general terms, the quality of the electricity distribution service has been improved, both in duration and frequency of power cuts. In view of the continuous increase of the costs associated with the provision of the service, as well as the need for additional investments to meet the demand, the Company has taken, and continues to analyze, different measures aimed at mitigating the negative effects of this situation on its financial structure, thereby minimizing the impact on the sources of employment, on the execution of the investment plan and on the carrying out of the necessary operation, maintenance and improvement-related works in order to maintain the provision of the public service, object of the concession, in a satisfactory manner in terms of quality and reliability.
Due to that which has been previously described, the Company's Board of Directors believes there is material uncertainty that may cast significant doubt upon edenor's ability to continue as a going concern, which may result in the Company's being obliged to defer certain payment obligations or unable to meet expectations for salary increases or the increases recorded in third-party costs.
Nevertheless, taking into consideration the signing of the Agreements on the Regularization of Payment Obligations with CAMMESA, the authorization by the ENRE of the increases in the VAD as from April and June, described above, and the approval of the RTI program for 2023 and the first quarter of 2024 (Note 2.a), these condensed interim financial statements have been prepared assuming that the Company will continue to operate as a going concern and do not include the adjustments or reclassifications that might result from the outcome of these uncertainties, inasmuch as this Distribution Company has historically been provided with transitional solutions that have made it possible to partially restore the economic and financial equation and ensure the operation of its distribution networks, due to the essential service it provides.
Note | 2 |Regulatory framework |
At the date of issuance of these condensed interim financial statements, there exist the following changes with respect to the situation reported by the Company in the Financial Statements as of December 31, 2022:
a) | Electricity rate situation |
On April 25, 2023, by means of Resolution No. 363/2023, the ENRE resolved to commence as from June 1, 2023 the Tariff Structure Review (RTI) Process for electricity distribution companies under national jurisdiction, in compliance with the provisions of Law No. 24,065 and Law No. 27,541 on Social Solidarity and Productive Reactivation in the Framework of the Public Emergency, as amended and complemented. In this regard, by means of ENRE Resolution No. 422/2023, the Tariff Structure Review program for 2023 and the first quarter of 2024 is approved.
Furthermore, on April 29, 2023, by means of SE Resolution No. 323/2023, the Winter Seasonal Programming for the MEM submitted by CAMMESA, relating to the May 1, 2023-October 31, 2023 period, is approved. In line with that, on May 4, 2023, by means of ENRE Resolution No. 399/2023, the values of the Company's electricity rate schedule effective from the billing relating to the reading of meters subsequent to 12:00 AM on May 1, 2023 are approved.
Additionally, on May 31, 2023, by means of ENRE Resolution No. 423/2023, the values of the Company's electricity rate schedule effective from the billing relating to the reading of meters subsequent to 12:00 AM on June 1, 2023 are approved.
On July 25, 2023, by means of SE Resolution No. 612/2023, the winter quarterly reprogramming for the MEM for the August 1, 2023-October 31, 2023 period is approved. In line with that, on August 1, 2023, by means of ENRE Resolution No. 574/2023, the values of the Company's electricity rate schedule effective from the billing relating to the reading of meters subsequent to 12:00 AM on August 1, 2023 are approved.
10 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Finally, on October 31, 2023, by means of SE Resolution No. 884/2023, the Summer Seasonal Programming for the MEM submitted by CAMMESA, relating to the November 1, 2023-April 30, 2024 period, is approved. In line with that, on November 2, 2023, by means of ENRE Resolution No. 784/2023, the values of the Company's electricity rate schedule effective from the billing relating to the reading of meters subsequent to 12:00 AM on November 1, 2023 are approved.
b) | Memorandum of Agreement on Regularization of Payment Obligations - Debt for the purchase of energy in the MEM |
With regard to the Memorandum of Agreement entered into on December 29, 2022 by the Company, the Federal Government and the ENRE, of which CAMMESA was notified, concerning the Regularization of Payment Obligations for the periods between September 30, 2020 and August 31, 2022 (Note 2.c to the Financial Statements as of December 31, 2022), on July 27, 2023, the SE instructed CAMMESA to define the Payment plan in accordance with the methodologies set forth therein. In this regard, on July 31, 2023, CAMMESA agreed to the payment plan by means of Note B-168538-1. The Company has recognized that it owes a sum of $ 32,985, which adjusted in accordance with the established procedures amounts to $ 52,276.
Pursuant to Article Six of the Memorandum of Agreement, the payment of all the obligations when due has as a condition precedent that the ENRE grant an increase in the VAD, which also implies the approval of the payment schedule, independently of the readjustment of the electricity rate.
Furthermore, on July 28, 2023, the Company and CAMMESA entered into an Agreement on the Regularization of Payment Obligations for the periods between September 1, 2022 and February 28, 2023 (SE Resolutions Nos. 56 and 555/2023), pursuant to which the Company recognizes that it owes CAMMESA a sum of $ 26,388, which adjusted in accordance with the procedure set forth in SE Resolution No. 56/2023 amounts to $ 42,391, for the past due periods from September 2022 through February 2023. The Company agrees to pay the aforementioned debt through a new Payment plan in 96 installments, with the value of each monthly installment being adjusted in accordance with the development of the MWh value in effect at each time.
As of September 30, 2023, the impact of the aforementioned agreements amounts to $ 108,723 (which at the current period purchasing power of the currency amounts to $ 128,989) relating to the agreements signed on December 29, 2022 and July 28, 2023, respectively, and is disclosed in the Agreement on the Regularization of Payment Obligations line item of the Statement of Comprehensive Income (Loss). The Payment plan liability, including both financial components accrued and payments made, amounts to $ 117,485, and is disclosed in the Other payables account of the Statement of Financial Position.
At the date of issuance of these condensed interim financial statements, the Company has delivered post-dated checks for $ 5,022 to pay the first four installments with maturities from September 2023 through January 2024.
c) | Framework Agreement |
On August 30, 2022, the Company, the Federal Government and the Province of Buenos Aires, entered into an Agreement to Renew the Agreement on the Recognition of Electricity Consumption in Vulnerable Neighborhoods.
With regard to the consumption of electricity between August and December 2020, the ENRE has validated receivables for $ 1,115, which the Company has recognized as the ENRE certified compliance with the degree of completion of the works of the Preventive and Corrective Maintenance Work Plan for the Electricity Distribution Network, as stipulated in the Agreement described in Note 2.d to the Financial Statements as of December 31, 2022.
11 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Furthermore, with respect to the consumption of electricity between January and December 2021, the Company has opted to offset it against the debts incurred for the purchase of energy from CAMMESA (Note 2.d to the Financial Statements as of December 31, 2022). On March 21, 2023, the Federal Government's portion had been effectively settled in accordance with CAMMESA's statement of accounts, with the relevant adjustments having been recognized.
For the consumption of electricity between January and December 2022, the Federal Government must make a contribution of $ 1,436, and the Province of Buenos Aires a contribution of $ 553, which total a receivable in favor of the Company of $ 1,989 that has been recognized along with the receivable mentioned in the preceding paragraph. In this regard, the Province of Buenos Aires' contribution will be made in six monthly installments, the first of which was collected by the Company on October 24, 2023.
Finally, on October 19, 2023, the ENRE validated receivables for $1,431 and $ 1,056 for electricity consumption between January and September 2023, which must be contributed by the Federal Government and the Province of Buenos Aires, respectively.
At the date of issuance of these condensed interim financial statements, the Company has recognized for the described concepts a total of $ 2,971, which is disclosed in the Other operating income line item of the Statement of Comprehensive Income (Loss).
Note | 3 |Basis of preparation |
These condensed interim financial statements for the nine-month period ended September 30, 2023 have been prepared in accordance with the provisions of IAS 34 "Interim Financial Reporting". They were approved for issue by the Company's Board of Directors on November 8, 2023.
By means of General Resolution No. 622/2013, the CNV provided for the application of Technical Resolution No. 26 of the FACPCE, which adopts the IFRS issued by the IASB, for those entities that are included in the public offering system of Law No. 17,811, as amended, whether on account of their capital or their corporate notes, or have requested authorization to be included in the aforementioned system.
These condensed interim financial statements include all the necessary information in order for the users to properly understand the relevant facts and transactions that have occurred subsequent to the issuance of the last Financial Statements for the year ended December 31, 2022 and until the date of issuance of these condensed interim financial statements. The Company's Management estimates that they include all the necessary adjustments to fairly present the results of operations for each period. The results of operations for the nine and three-month period ended September 30, 2023 and its comparative period as of September 30, 2022 do not necessarily reflect the Company's results in proportion to the full fiscal year. Therefore, the condensed interim financial statements should be read together with the audited Financial Statements as of December 31, 2022 prepared under IFRS.
The Company's condensed interim financial statements are measured in pesos (the legal currency in Argentina) restated in accordance with that mentioned in this Note, which is also the presentation currency.
Comparative information
The balances as of December 31 and September 30, 2022, as the case may be, disclosed in these condensed interim financial statements for comparative purposes, arise as a result of restating the annual Financial Statements and the Condensed Interim Financial Statements as of those dates, respectively, to the purchasing power of the currency at September 30, 2023, as a consequence of the restatement of financial information described hereunder. Furthermore, certain amounts of the financial statements presented in comparative form have been reclassified in order to maintain consistency of presentation with the amounts of the current periods.
12 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Restatement of financial information
The condensed interim financial statements, including the figures relating to the previous year/period, have been stated in terms of the measuring unit current at September 30, 2023, in accordance with IAS 29 "Financial reporting in hyperinflationary economies", using the indexes published by the FACPCE. The inflation rate applied for the January 1, 2023 - September 30, 2023 period was 103.2%.
Note | 4 |Accounting policies |
The accounting policies adopted for these condensed interim financial statements are consistent with those used in the Financial Statements for the last financial year, which ended on December 31, 2022.
Detailed below are the accounting standards, amendments and interpretations issued by the IASB in the last few years that are effective as of September 30, 2023 and have been adopted by the Company:
- IFRS 17 "Insurance contracts", issued in May 2017 and amended in June 2020 and December 2021. It replaces IFRS 4, introduced as an interim standard in 2004, which allowed entities to account for insurance contracts using their local accounting requirements, resulting in multiple application approaches. IFRS 17 sets the principles for the recognition, measurement, presentation, and disclosure of insurance contracts.
- IAS 1 "Presentation of financial statements", amended in January and July 2020, February 2021 and October 2022. It incorporates amendments to the classification of liabilities as current or non-current. It also incorporates the requirement that an entity disclose its material accounting policies rather than its significant accounting policies. It explains how an entity can identify a material accounting policy.
- IAS 8 "Accounting policies, changes in accounting estimates and errors", amended in February 2021. It replaces the definition of accounting estimates. Under the new definition, accounting estimates are monetary amounts in the financial statements that are subject to measurement uncertainty.
- IAS 12 "Income tax", amended in May 2021 and May and September 2023. It clarifies how an entity accounts for deferred tax on transactions such as leases and decommissioning obligations. It also provides a temporary exception to certain disclosure requirements regarding deferred tax assets and liabilities.
There are no new IFRS or IFRIC applicable as from this period that have a material impact on the Company's condensed interim financial statements.
Note | 5 |Financial risk management |
Note | 5.1 |Financial risk factors |
The Company's activities and the market in which it operates expose the Company to a number of financial risks: market risk (including currency risk, cash flows interest rate risk, fair value interest rate risk and price risk), credit risk and liquidity risk.
Additionally, the difficulty in obtaining financing in international or national markets could affect certain variables of the Company's business, such as interest rates, foreign currency exchange rates and the access to sources of financing.
With regard to the Company's risk management policies, there have been no significant changes since the last fiscal year end.
13 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
a. | Market risks |
i. | Currency risk |
As of September 30, 2023 and December 31, 2022, the Company's balances in foreign currency are as follow:
Currency | Amount in foreign currency | Exchange rate (1) |
Total 09.30.23 |
Total 12.31.22 | ||||||
ASSETS | ||||||||||
CURRENT ASSETS | ||||||||||
Other receivables | USD | 49.5 | 348.950 | 17,273 | 6,937 | |||||
EUR | 0.5 | 368.317 | 184 | - | ||||||
Financial assets at fair value through profit or loss | USD | 49.4 | 348.950 | 17,238 | 29,371 | |||||
Cash and cash equivalents | USD | 1.5 | 348.950 | 523 | 71 | |||||
TOTAL CURRENT ASSETS | 35,218 | 36,379 | ||||||||
TOTAL ASSETS | 35,218 | 36,379 | ||||||||
LIABILITIES | ||||||||||
NON-CURRENT LIABILITIES | ||||||||||
Borrowings | USD | 115.2 | 349.950 | 40,325 | 29,531 | |||||
TOTAL NON-CURRENT LIABILITIES | 40,325 | 29,531 | ||||||||
CURRENT LIABILITIES | ||||||||||
Trade payables | USD | 15.1 | 349.950 | 5,284 | 6,372 | |||||
EUR | 0.1 | 370.247 | 37 | 77 | ||||||
CHF | 0.3 | 382.328 | 115 | - | ||||||
Borrowings | USD | 4.7 | 349.950 | 1,633 | 374 | |||||
Other payables | USD | 1.4 | 349.950 | 479 | 463 | |||||
TOTAL CURRENT LIABILITIES | 7,548 | 7,286 | ||||||||
TOTAL LIABILITIES | 47,873 | 36,817 |
(1) | The exchange rates used are the BNA exchange rates in effect as of September 30, 2023 for United States dollars (USD), Euros (EUR) and Swiss francs (CHF). |
ii. | Fair value estimate |
The Company classifies the measurements of financial instruments at fair value using a fair value hierarchy that reflects the relevance of the variables used for carrying out such measurements. The fair value hierarchy has the following levels:
· Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
· Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. prices) or indirectly (i.e. derived from the prices).
· Level 3: inputs for the asset or liability that are not based on observable market data (i.e. unobservable inputs).
14 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
The table below shows the Company's financial assets and liabilities measured at fair value as of September 30, 2023 and December 31, 2022:
LEVEL 1 | LEVEL 2 | |||
At September 30, 2023 | ||||
Assets | ||||
Other receivables: | ||||
Assigned assets and in custody | 16,630 | - | ||
Financial assets at fair value through profit or loss: | ||||
Negotiable instruments | 692 | - | ||
Mutual funds | 51,606 | - | ||
Cash and cash equivalents: | ||||
Mutual funds | 6,475 | - | ||
Total assets | 75,403 | - | ||
Liabilities | ||||
Other payables: | ||||
Payment plan - CAMMESA | - | 63,713 | ||
Total liabilities | - | 63,713 | ||
LEVEL 1 | ||||
At December 31, 2022 | ||||
Assets | ||||
Other receivables: | ||||
Assigned assets and in custody | 9,497 | |||
Financial assets at fair value through profit or loss: | - | |||
Negotiable instruments | 27,863 | - | ||
Mutual funds | 30,443 | - | ||
Cash and cash equivalents | ||||
Mutual funds | 1,549 | - | ||
Total assets | 69,352 | - |
iii. | Interest rate risk |
Interest rate risk is the risk of fluctuation in the fair value or cash flows of an instrument due to changes in market interest rates. The Company's exposure to interest rate risk is mainly related to its long-term debt obligations.
Indebtedness at floating rates exposes the Company to interest rate risk on its cash flows. Indebtedness at fixed rates exposes the Company to interest rate risk on the fair value of its liabilities. As of September 30, 2023 and December 31, 2022 all the loans were obtained at fixed interest rates. The Company's policy is to keep the largest percentage of its indebtedness in instruments that accrue interest at fixed rates.
Note | 6 |Critical accounting estimates and judgments |
The preparation of the condensed interim financial statements requires the Company's Management to make estimates and assessments concerning the future, exercise critical judgment and make assumptions that affect the application of the accounting policies and the reported amounts of assets and liabilities and revenues and expenses.
15 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
These estimates and judgments are permanently evaluated and are based upon past experience and other factors that are reasonable under the existing circumstances. Future actual results may differ from the estimates and assessments made at the date of preparation of these condensed interim financial statements.
In the preparation of these condensed interim financial statements, there were no changes in either the critical judgments made by the Company when applying its accounting policies or the sources of estimation uncertainty used with respect to those applied in the Financial Statements for the year ended December 31, 2022.
Note | 7 |Contingencies and lawsuits |
The provision for contingencies has been recorded to face situations existing at the end of each period that may result in a loss for the Company if one or more future events occurred or failed to occur.
At the date of issuance of these condensed interim financial statements, there are no significant changes with respect to the situation reported by the Company in the Financial Statements as of December 31, 2022, except for the following:
- | AFIP's tax claim for Income Tax, Undocumented outflows and VAT |
On March 30, 2023, the Federal Court of Appeals of San Martín revoked the lower court decision and admitted the grounds contained in the appeal filed by the AFIP (Federal Administration of Public Revenues). Therefore, the case was sent back to the Court of original jurisdiction for further investigation.
Furthermore, on July 3, 2023, the Company was notified by the AFIP of the conclusions of the tax audit underway for the periods from January 2019 through October 2021, in connection with the transactions performed with the suppliers in question, concerning the added value tax, undocumented outflows and income tax concepts for the 2019 and 2020 tax periods.
In this regard, on July 10, 2023, the Company replied to the calculation of the concepts mentioned in the preceding paragraph, rejecting the proposed adjustment, based on the grounds given and the documentary evidence provided during the course of the tax audit conducted by the AFIP.
Finally, on July 11, 2023, the Company was served notice of the initiation of a new verification process in respect of the same suppliers in question, with a request for additional information on the transactions performed from November 2021 until June 2022.
In the Company's opinion, strong and sufficient arguments exist to make its position prevail at the judicial stage. Consequently, no liabilities whatsoever have been recorded for this matter as of September 30, 2023.
- Office of the Ombudsman of the City of Buenos Aires and other plaintiffs vs Edesur S.A. and other defendants, consumer relations
On April 4, 2023, the Company was served notice of the complaint brought by the Office of the Ombudsman of the City of Buenos Aires before Clerk's Office in charge of consumer relations No. 3 of the Court having jurisdiction over administrative matters of the City of Buenos Aires.
The ombudswoman requested the implementation of effective information channels with users and the imposition of a monetary fine on the distribution companies as punitive damages due to the alleged failure to comply with the users' right to information. In that framework, taking into consideration the petition filed for the granting of provisional remedies, it was ordered that a workgroup comprised of the parties involved in the case be set up and that hearings be summoned.
16 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
On April 14, 2023, the provisional remedy granted by the court was appealed and on May 19 the complaint was answered, while the discussion group meetings have continued to be held. In the Company's opinion, there exist strong and sufficient arguments in order for the proceedings to come to an end. Consequently, no liabilities whatsoever have been recorded for this matter as of September 30, 2023.
Note | 8 |Revenue from sales and energy purchases |
We provide below a brief description of the main services provided by the Company:
Sales of electricity
Small demand segment: Residential use and public lighting (T1) | Relates to the highest demand average recorded over 15 consecutive minutes that is less than 10 kilowatts. In turn, this segment is subdivided into different residential categories based on consumption. This segment also includes a category for public lighting. Users are categorized by the Company according to their consumption. |
Medium demand segment: Commercial and industrial customers (T2) | Relates to the highest demand average recorded over 15 consecutive minutes that is equal to or greater than 10 Kilowatts but less than 50 Kilowatts. The Company agrees with the user the supply capacity. |
Large demand segment (T3) | Relates to the highest demand average recorded over 15 consecutive minutes that is greater than 50 Kilowatts. In turn, this segment is subdivided into categories according to the supply voltage -low, medium or high-, from voltages of up to 1 Kilovolt to voltages greater than 66 Kilovolts. |
Other: (Shantytowns/ Wheeling system) | Revenue is recognized to the extent that a renewal of the Framework Agreement has been formalized for the period in which the service was accrued. In the case of the service related to the Wheeling system, revenue is recognized when the Company allows third parties (generators and large users) to access the available transmission capacity within its distribution system upon payment of a wheeling fee. |
The KWh price relating to the Company's sales of electricity is determined by the ENRE by means of the periodic publication of electricity rate schedules (Note 2.a), for those distributors that are regulated by the aforementioned Regulatory Authority, based on the rate setting and adjustment process set forth in the Concession Agreement.
Other services
Right of use of poles | Revenue is recognized to the extent that the rental value of the right of use of the poles used by the Company's electricity network has been agreed upon for the benefit of third parties. |
Connection and reconnection charges | Relate to revenue accrued for the carrying out of the electricity supply connection of new customers or the reconnection of already existing users. |
17 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Energy purchases
Energy purchase | The Company bills its users the cost of its purchases of energy, which includes charges for purchases of energy and power. The Company purchases electric power at seasonal prices approved by the SE. The price of the Company's electric power reflects the costs of transmission and other regulatory charges. |
Energy losses | Energy losses are equivalent to the difference between energy purchased and energy sold. These losses can be classified into technical and non-technical losses. Technical losses represent the energy lost during transmission and distribution within the network as a consequence of the natural heating of the conductors and transformers that carry electricity from power generation plants to users. Non-technical losses represent the remainder of the Company's energy losses and are mainly due to the illegal use of its services or the theft of energy. Energy losses require that the Company purchase additional energy in order to meet the demand and its Concession Agreement allows it to recover from its users the cost of these purchases up to a loss factor specified in its concession for each rate category. The current loss factor recognized in the tariff by virtue of its concession amounts to approximately 9.1%. |
09.30.23 | 09.30.22 | |||||||
GWh | $ | GWh | $ | |||||
Sales of electricity | ||||||||
Small demand segment: Residential use and public lighting (T1) | 10,717 | 229,735 | 10,026 | 179,137 | ||||
Medium demand segment: Commercial and industrial (T2) | 1,181 | 40,694 | 1,146 | 31,452 | ||||
Large demand segment (T3) | 2,790 | 92,850 | 2,790 | 95,943 | ||||
Other: (Shantytowns/Wheeling system) | 3,589 | 13,826 | 3,407 | 15,205 | ||||
Subtotal - Sales of electricity | 18,277 | 377,105 | 17,369 | 321,737 | ||||
Other services | ||||||||
Right of use of poles | 1,513 | 1,648 | ||||||
Connection and reconnection charges | 193 | 189 | ||||||
Subtotal - Other services | 1,706 | 1,837 | ||||||
Total - Revenue | 378,811 | 323,574 | ||||||
09.30.23 | 09.30.22 | |||||||
GWh | $ | GWh | $ | |||||
Energy purchases (1) | 21,567 | (249,918) | 20,684 | (218,105) |
(1) |
As of September 30, 2023 and 2022, the cost of energy purchases includes technical and non-technical energy losses for 3,290 GWh and 3,315 GWh, respectively. |
18 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Note | 9 |Expenses by nature |
The detail of expenses by nature is as follows:
Expenses by nature at 09.30.23 | ||||||||
Description | Transmission and distribution expenses | Selling expenses | Administrative expenses | Total | ||||
Salaries and social security taxes | 34,703 | 4,781 | 10,768 | 50,252 | ||||
Pension plans | 2,552 | 352 | 792 | 3,696 | ||||
Communications expenses | 1,037 | 1,224 | 6 | 2,267 | ||||
Allowance for the impairment of trade and other receivables | - | 4,531 | - | 4,531 | ||||
Supplies consumption | 5,696 | - | 441 | 6,137 | ||||
Leases and insurance | - | 1 | 1,366 | 1,367 | ||||
Security service | 1,312 | 114 | 760 | 2,186 | ||||
Fees and remuneration for services | 21,441 | 8,934 | 11,884 | 42,259 | ||||
Public relations and marketing | - | 2,997 | - | 2,997 | ||||
Advertising and sponsorship | - | 1,544 | - | 1,544 | ||||
Reimbursements to personnel | - | - | 2 | 2 | ||||
Depreciation of property, plants and equipments | 28,667 | 4,272 | 3,504 | 36,443 | ||||
Depreciation of right-of-use asset | 141 | 282 | 987 | 1,410 | ||||
Directors and Supervisory Committee members' fees | - | - | 104 | 104 | ||||
ENRE penalties | 3,702 | 8,111 | - | 11,813 | ||||
Taxes and charges | - | 5,291 | 221 | 5,512 | ||||
Other | 4 | 1 | 76 | 81 | ||||
At 09.30.23 | 99,255 | 42,435 | 30,911 | 172,601 |
The expenses included in the chart above are net of the Company's own expenses capitalized in property, plant and equipment as of September 30, 2023 for $ 7,657.3.
Expenses by nature at 09.30.22 | ||||||||
Description | Transmission and distribution expenses | Selling expenses | Administrative expenses | Total | ||||
Salaries and social security taxes | 33,452 | 5,061 | 9,962 | 48,475 | ||||
Pension plans | 1,576 | 238 | 469 | 2,283 | ||||
Communications expenses | 774 | 1,389 | 1 | 2,164 | ||||
Allowance for the impairment of trade and other receivables | - | 3,950 | - | 3,950 | ||||
Supplies consumption | 5,782 | - | 611 | 6,393 | ||||
Leases and insurance | - | 3 | 1,668 | 1,671 | ||||
Security service | 1,564 | 183 | 131 | 1,878 | ||||
Fees and remuneration for services | 14,410 | 8,780 | 10,344 | 33,534 | ||||
Public relations and marketing | - | 2,369 | - | 2,369 | ||||
Advertising and sponsorship | - | 1,220 | - | 1,220 | ||||
Reimbursements to personnel | - | - | 3 | 3 | ||||
Depreciation of property, plants and equipments | 21,854 | 3,258 | 2,672 | 27,784 | ||||
Depreciation of right-of-use asset | 155 | 311 | 1,087 | 1,553 | ||||
Directors and Supervisory Committee members' fees | - | - | 39 | 39 | ||||
ENRE penalties | 4,110 | 4,817 | - | 8,927 | ||||
Taxes and charges | - | 4,870 | 226 | 5,096 | ||||
Other | 2 | - | 74 | 76 | ||||
At 09.30.22 | 83,679 | 36,449 | 27,287 | 147,415 |
The expenses included in the chart above are net of the Company's own expenses capitalized in property, plant and equipment as of September 30, 2022 for $ 6,646.5.
19 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Note | 10 |Other operating income (expense), net |
Note | 09.30.23 | 09.30.22 | |||
Other operating income | |||||
Income from customer surcharges | 6,209 | 4,532 | |||
Commissions on municipal taxes collection | 1,125 | 1,056 | |||
Fines to suppliers | 325 | 188 | |||
Services provided to third parties | 1,064 | 767 | |||
Income from non-reimbursable customer contributions | 75 | 102 | |||
Expense recovery | 1 | 101 | |||
Framework agreement | 2.c | 2,971 | 3,062 | ||
Other | 89 | 149 | |||
Total other operating income | 11,859 | 9,957 | |||
Other operating expense | |||||
Gratifications for services | (758) | (284) | |||
Cost for services provided to third parties | (914) | (773) | |||
Severance paid | (104) | (169) | |||
Debit and Credit Tax | (3,271) | (2,992) | |||
Provision for contingencies | 28 | (3,945) | (8,663) | ||
Disposals of property, plant and equipment | (147) | (531) | |||
Other | (137) | (125) | |||
Total other operating expense | (9,276) | (13,537) |
Note | 11 |Net finance costs |
09.30.23 | 09.30.22 | |||
Financial income | ||||
Financial interest | 111 | 121 | ||
Financial costs | ||||
Commercial interest | (134,482) | (92,973) | ||
Interest and other | (26,453) | (19,893) | ||
Fiscal interest | (12) | (13) | ||
Bank fees and expenses | (344) | (110) | ||
Total financial costs | (161,291) | (112,989) | ||
Other financial results | ||||
Changes in fair value of financial assets and financial liabilities | 7,738 | (4,169) | ||
Loss on debt restructuring | - | (870) | ||
Net loss from the cancelattion of Corporate Notes | - | (738) | ||
Exchange differences | (9,400) | 2,045 | ||
Adjustment to present value of receivables | (596) | (523) | ||
Other financial costs (*) | (7,615) | (6,511) | ||
Total other financial costs | (9,873) | (10,766) | ||
Total net financial costs | (171,053) | (123,634) |
(*) As of September 30, 2023 and 2022, $ 7,615 and $ 5,838, respectively, relate to Empresa de Energía del Cono Sur S.A. technical assistance.
20 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Note | 12 |Basic and diluted earnings (loss) per share |
Basic
The basic earnings (loss) per share is calculated by dividing the profit (loss) attributable to the holders of the Company's equity instruments by the weighted average number of common shares outstanding as of September 30, 2023 and 2022, excluding common shares purchased by the Company and held as treasury shares.
The basic earnings (loss) per share coincides with the diluted earnings (loss) per share, inasmuch as there exist neither preferred shares nor Corporate Notes convertible into common shares.
Nine months at | Three months at | |||||||
09.30.23 | 09.30.22 | 09.30.23 | 09.30.22 | |||||
Profit (Loss) for the period attributable to the owners of the Company | 52,916 | (43,144) | 76,039 | (14,527) | ||||
Weighted average number of common shares outstanding | 875 | 875 | 875 | 875 | ||||
Basic and diluted profit (loss) per share - in pesos | 60.48 | (49.31) | 86.90 | (16.60) |
21 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Note | 13 |Property, plant and equipment |
Lands and buildings | Substations | High, medium and low voltage lines | Meters and Transformer chambers and platforms | Tools, Furniture, vehicles, equipment and communications | Construction in process | Supplies and spare parts | Total | |||||||||
At 12.31.22 | ||||||||||||||||
Cost | 22,557 | 211,131 | 524,338 | 230,701 | 59,838 | 182,479 | 2,446 | 1,233,490 | ||||||||
Accumulated depreciation | (5,131) | (76,910) | (216,787) | (97,945) | (32,373) | - | - | (429,146) | ||||||||
Net amount | 17,426 | 134,221 | 307,551 | 132,756 | 27,465 | 182,479 | 2,446 | 804,344 | ||||||||
Additions | 268 | 7 | 1,350 | 3,207 | 3,667 | 52,500 | - | 60,999 | ||||||||
Disposals | (17) | - | (209) | (230) | - | - | - | (456) | ||||||||
Transfers | 1,643 | 4,747 | 15,532 | 6,235 | 11,989 | (41,372) | 1,226 | - | ||||||||
Depreciation for the period | (604) | (6,861) | (16,062) | (8,197) | (4,719) | - | - | (36,443) | ||||||||
Net amount 09.30.23 | 18,716 | 132,114 | 308,162 | 133,771 | 38,402 | 193,607 | 3,672 | 828,444 | ||||||||
At 09.30.23 | ||||||||||||||||
Cost | 24,446 | 215,885 | 540,328 | 239,801 | 75,496 | 193,607 | 3,672 | 1,293,235 | ||||||||
Accumulated depreciation | (5,730) | (83,771) | (232,166) | (106,030) | (37,094) | - | - | (464,791) | ||||||||
Net amount | 18,716 | 132,114 | 308,162 | 133,771 | 38,402 | 193,607 | 3,672 | 828,444 |
· | During the period ended September 30, 2023, the Company capitalized as direct own costs $ 7,657.3. |
22 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Lands and buildings | Substations | High, medium and low voltage lines | Meters and Transformer chambers and platforms | Tools, Furniture, vehicles, equipment and communications | Construction in process | Supplies and spare parts | Total | |||||||||
At 12.31.21 | ||||||||||||||||
Cost | 22,467 | 201,728 | 502,334 | 218,281 | 47,219 | 172,604 | 1,906 | 1,166,539 | ||||||||
Accumulated depreciation | (4,785) | (69,730) | (201,059) | (89,747) | (28,079) | - | - | (393,400) | ||||||||
Net amount | 17,682 | 131,998 | 301,275 | 128,534 | 19,140 | 172,604 | 1,906 | 773,139 | ||||||||
Additions | 121 | 60 | 712 | 1,246 | 1,650 | 36,249 | 1 | 40,039 | ||||||||
Disposals | - | - | (281) | (250) | - | - | - | (531) | ||||||||
Transfers | 67 | 6,271 | 17,289 | 5,390 | 7,108 | (36,247) | 122 | - | ||||||||
Depreciation for the period | (355) | (5,461) | (12,587) | (6,288) | (3,093) | - | - | (27,784) | ||||||||
Net amount 09.30.22 | 17,515 | 132,868 | 306,408 | 128,632 | 24,805 | 172,606 | 2,029 | 784,863 | ||||||||
At 09.30.22 | ||||||||||||||||
Cost | 22,655 | 208,059 | 519,352 | 224,529 | 55,976 | 172,606 | 2,029 | 1,205,206 | ||||||||
Accumulated depreciation | (5,140) | (75,191) | (212,944) | (95,897) | (31,171) | - | - | (420,343) | ||||||||
Net amount | 17,515 | 132,868 | 306,408 | 128,632 | 24,805 | 172,606 | 2,029 | 784,863 |
· | During the period ended September 30, 2022, the Company capitalized as direct own costs $ 6,646.5. |
23 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Note | 14 |Right-of-use assets |
The leases recognized as right-of-use assets in accordance with IFRS 16 are disclosed below:
09.30.23 | 12.31.22 | ||
Right-of-use assets by leases | 1,363 | 1,436 |
The development of right-of-use assets is as follows:
09.30.23 | 09.30.22 | ||
Balance at beginning of year | 1,436 | 1,682 | |
Additions | 1,337 | 1,847 | |
Depreciation for the period | (1,410) | (1,553) | |
Balance at end of the period | 1,363 | 1,976 |
Note | 15 |Inventories |
09.30.23 | 12.31.22 | |||
Supplies and spare-parts | 21,150 | 13,077 | ||
Advance to suppliers | - | 1 | ||
Total inventories | 21,150 | 13,078 |
Note | 16 |Other receivables |
Note | 09.30.23 | 12.31.22 | |||
Non-current: | |||||
Related parties | 29.c | 3 | 6 | ||
Current: | |||||
Framework agreement (1) | 2.c | 553 | 5,626 | ||
Assigned assets and in custody (2) | 16,630 | 9,497 | |||
Judicial deposits | 302 | 423 | |||
Security deposits | 159 | 200 | |||
Prepaid expenses | 537 | 772 | |||
Advances to personnel | - | 3 | |||
Financial credit | 1 | 28 | |||
Advances to suppliers | 902 | 627 | |||
Tax credits | 2,507 | 19,967 | |||
Debtors for complementary activities | 2,035 | 825 | |||
Other | 11 | 107 | |||
Allowance for the impairment of other receivables | (52) | (88) | |||
Total current | 23,585 | 37,987 |
(1) | As of September 30, 2023 and December 31, 2022, $ 553 and $ 2,544 relate to the Framework Agreement related to the Recognition of consumption in vulnerable neighborhoods period 2022, respectively, and as of December 31, 2022, $ 3,082 relates to the Framework Agreement signed in December 2020 related to the Works Plan of the AMBA's network. |
(2) | As of September 30, 2023 and December 31, 2022, relate to Securities issued by private companies for NV 19,610,291 and NV 11,771,500, respectively, assigned to Global Valores S.A. As of December 31, 2022, included cash deriving from the collection of securities for USD 2,924,022. The Company retains the risks and rewards of the aforementioned assets and may make use of them at any time, at its own request. |
24 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
The value of the Company's other financial receivables approximates their fair value.
The non-current other receivables are measured at amortized cost, which does not differ significantly from their fair value.
The roll forward of the allowance for the impairment of other receivables is as follows:
09.30.23 | 09.30.22 | ||||
Balance at beginning of year | 88 | 117 | |||
Increase | 19 | 41 | |||
Result from exposure to inlfation | (55) | (48) | |||
Recovery | - | (21) | |||
Balance at end of the period | 52 | 89 |
Note | 17 |Trade receivables |
09.30.23 | 12.31.22 | ||||
Sales of electricity - Billed | 39,206 | 32,527 | |||
Receivables in litigation | 101 | 583 | |||
Allowance for the impairment of trade receivables | (6,884) | (9,414) | |||
Subtotal | 32,423 | 23,696 | |||
Sales of electricity - Unbilled | 41,873 | 31,149 | |||
PBA & CABA government credit | 2,534 | 2,014 | |||
Fee payable for the expansion of the transportation and others | 2 | 4 | |||
Total Trade receivables | 76,832 | 56,863 |
The value of the Company's trade receivables approximates their fair value.
The roll forward of the allowance for the impairment of trade receivables is as follows:
09.30.23 | 09.30.22 | ||||
Balance at beginning of the year | 9,414 | 23,768 | |||
Increase | 4,512 | 3,930 | |||
Decrease | (1,269) | (467) | |||
Result from exposure to inlfation | (5,773) | (10,239) | |||
Balance at end of the period | 6,884 | 16,992 |
Note | 18 |Financial assets at fair value through profit or loss |
09.30.23 | 12.31.22 | ||||
Negotiable instruments | 692 | 27,863 | |||
Mutual funds | 51,606 | 30,443 | |||
Total Financial assets at fair value through profit or loss | 52,298 | 58,306 |
25 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Note | 19 |Cash and cash equivalents |
09.30.23 | 12.31.22 | 09.30.22 | ||||
Cash and banks | 1,255 | 1,762 | 15,088 | |||
Mutual funds | 6,475 | 1,549 | 1,918 | |||
Total cash and cash equivalents | 7,730 | 3,311 | 17,006 |
Note | 20 |Share capital and additional paid-in capital |
Share capital | Additional paid-in capital | Total | ||||
Balance at December 31, 2021 | 227,438 | 3,031 | 230,469 | |||
Payment of Other reserve constitution - Share-bases compensation plan | - | 19 | 19 | |||
Balance at September 30 and December 31, 2022 | 227,438 | 3,050 | 230,488 | |||
Payment of Other reserve constitution - Share-bases compensation plan | - | 28 | 28 | |||
Balance at September 30, 2023 | 227,438 | 3,078 | 230,516 |
On April 14, 2023, 142,040 treasury shares were awarded, as part of the Share-based Compensation Plan, to executive directors, managers and other personnel holding key executive positions in the Company. The fair value of the shares at the award date amounted to $ 38 and has been recorded in the Salaries and social security taxes line item, with a contra account in Equity. The amount recorded in Equity is net of the tax effect.
Furthermore, on April 20, 2023, the Company's Ordinary and Extraordinary Shareholders' Meeting approved the conversion of 355,945 Class C shares into Class B shares, in the framework of the termination of the Employee Stock Ownership Program, which was authorized by the CNV.
As of September 30, 2023, the Company's share capital amounts to 906,455,100 shares, divided into 462,292,111 common, book-entry Class A shares with a par value of one peso each and the right to one vote per share, 442,566,330 common, book-entry Class B shares with a par value of one peso each and the right to one vote per share, and 1,596,659 common, book-entry Class C shares with a par value of one peso each and the right to one vote per share.
Note | 21 |Allocation of profits |
The restrictions on the distribution of dividends by the Company are those provided for by the Business Organizations Law and the negative covenants established by the Corporate Notes program.
If the Company's Debt Ratio were higher than 3.75, the negative covenants included in the Corporate Notes program, which establish, among other issues, the Company's impossibility to make certain payments, such as dividends, would apply.
Additionally, in accordance with Title IV, Chapter III, section 3.11.c of the CNV, the amounts subject to distribution will be restricted to the amount equivalent to the acquisition cost of the Company's own shares.
26 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Note | 22 |Trade payables |
09.30.23 | 12.31.22 | ||||
Non-current | |||||
Customer guarantees | 1,002 | 1,227 | |||
Customer contributions | 348 | 643 | |||
Total non-current | 1,350 | 1,870 | |||
Current | |||||
Payables for purchase of electricity - CAMMESA (1) | 91,434 | 289,859 | |||
Provision for unbilled electricity purchases - CAMMESA | 35,281 | 47,508 | |||
Suppliers | 16,977 | 26,237 | |||
Related parties | 29.c | 1,130 | 416 | ||
Advance to customer | 878 | 1,180 | |||
Customer contributions | 36 | 69 | |||
Discounts to customers | 1 | 2 | |||
Total current | 145,737 | 365,271 |
(1) As of September 30, 2023, includes $ 43,607 ($ 27,613 for principal plus $ 15,993 of interest) relating to post-dated checks issued by the Company in favor of CAMMESA.
The fair values of non-current customer contributions as of September 30, 2023 and December 31, 2022 amount to $ 43 and $ 79, respectively. The fair values are determined based on estimated discounted cash flows in accordance with a representative market rate for this type of transactions. The applicable fair value category is Level 3.
The value of the rest of the financial liabilities included in the Company's trade payables approximates their fair value.
Note | 23 |Other payables |
Note | 09.30.23 | 12.31.22 | |||
Non-current | |||||
Payment plan - CAMMESA | 2.b | 106,364 | - | ||
ENRE penalties and discounts(1) | 33,895 | 35,444 | |||
Financial Lease Liability(2) | 362 | 80 | |||
Total Non-current | 140,621 | 35,524 | |||
Current | |||||
Payment plan - CAMMESA | 2.b | 11,121 | - | ||
ENRE penalties and discounts | 11,452 | 11,345 | |||
Related parties | 29.c | 522 | 540 | ||
Advances for works to be performed | 13 | 26 | |||
Financial Lease Liability (2) | 634 | 931 | |||
Other | 21 | 4 | |||
Total Current | 23,763 | 12,846 |
(1) As of September 30, 2023 and December 31, 2022, $ 33,500 and $ 34,913 relate to penalties payable to users as stipulated in Article 2 of the Agreement on the Regularization of Payment Obligations signed in May 2019.
The fair value of the payment plan with CAMMESA that is adjusted in accordance with the development of the MWh value (Note 2.b) as of September 30, 2023 amounts to $ 63,713. Such value has been determined on the basis of the MWh monomic price published by CAMMESA at the end of each period. The applicable fair value category is Level 2.
27 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
The value of the rest of the financial liabilities included in the Company's other payables approximates their fair value.
(2) The development of the finance lease liability is as follows:
09.30.23 | 09.30.22 | ||
Balance at beginning of year | 1,011 | 1,372 | |
Increase | 950 | 1,382 | |
Payments | (2,259) | (1,830) | |
Exchange difference | 1,338 | 639 | |
Interest | 469 | 422 | |
Result from exposure to inflation | (513) | (543) | |
Balance at end of the period | 996 | 1,442 |
Note | 24 |Borrowings |
09.30.23 | 12.31.22 | |||
Non-current | ||||
Corporate notes (1) | 40,325 | 29,531 | ||
Current | ||||
Interest from corporate notes | 1,465 | 374 | ||
Financial borrowings (2) | 168 | - | ||
Total Borrowings | 1,633 | 374 |
(1) | Net of debt issuance, repurchase and redemption expenses. |
(2) | Relate to Import financing loans taken with ICBC bank, for USD 449,896. Annual interest rate: 14%. |
The fair values of the Company's Corporate Notes as of September 30, 2023 and December 31, 2022 amount approximately to $ 40,826.3 and $ 28,500.4 respectively. Such values were determined on the basis of the estimated market price of the Company's Corporate Notes at the end of each period. The applicable fair value category is Level 1.
On March 7, 2023, upon the expiration of the Tender Period of Class No. 2 Additional Corporate Notes, the Company approved the issuance and placement of the Additional Corporate Notes for a nominal value of USD 30,000,000, as set forth in the Prospectus Supplement dated February 28, 2023. The issuance was above par, with the issuance total value thus amounting to USD 30,945,000.
Furthermore, an amount of $ 480 was disbursed as issuance expenses of Class No. 2 Additional Corporate Notes.
The Company is subject to restrictions on its ability to incur indebtedness pursuant to the terms and conditions of Class No. 2 Corporate Notes due 2024 and Class No. 1 Corporate Notes due 2025, which indicate that the Company may not incur new Indebtedness, except for certain Permitted Indebtedness or when the Debt ratio is not greater than 3.75 or less than zero and the Interest Expense Coverage ratio is less than 2. As of September 30, 2023, the values of the above-mentioned ratios meet the established parameters.
Additionally, on March 22, 2023, the Company convened Meetings of the Holders of Corporate Notes to deal with a consent solicitation so that the Company can provide guarantees in favor of CAMMESA and thereby comply with the Memorandum of Agreement on the Regularization of Payment Obligations dated December 29, 2022 (Note 2.b).
28 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
In this regard, on April 25, 2023, the waiver of Section 9.1 of the Indenture pursuant to which the Company's Class No 1 Corporate Notes due October 2025 had been issued was approved. However, the Extraordinary Meeting of the Holders of Class No. 2 Corporate Notes was not constituted as the quorum required to call the meeting to order on first call was not present.
The Company believes that the 2022 Memorandum of Agreement lowers the risk in terms of reducing a significant account payable and, hence, solicited consents to approve the waiver because the 2022 Memorandum of Agreement requires a pledge of certain accounts receivable of the Company in order to secure at any time the payment of up to three installments of the agreed-upon Payment plan (Note 2.b).
The Company's Corporate Note debt structure, based on the Tender Orders received, the issuance of the New Corporate Notes and the repayment of Class No. 9 Corporate Notes -all that in the framework of the restructuring of the Company's financial debt according to Note 39 to the Financial Statements as of December 31, 2022-, is comprised of as follows:
in U$S | in millions of $ | ||||||||
Corporate Notes | Class | Debt structure at 12/31/2021 | Exchange | Issue | Payment / Repurchase | Debt structure at 12/31/2022 | Debt structure at 12/31/2021 | Debt structure at 12/31/2022 | |
Fixed rate par notes - Due 2022 | 9 | 98,057,000 | (52,695,600) | - | (45,361,400) | - | 40,607 | - | |
Fixed rate par notes - Due 2024 | 2 | - | - | 30,000,000 | - | 30,000,000 | - | 10,444 | |
Fixed rate par notes - Due 2025 | 1 | - | 55,244,538 | - | - | 55,244,538 | - | 19,461 | |
Total | 98,057,000 | 2,548,938 | 30,000,000 | (45,361,400) | 85,244,538 | 40,607 | 29,905 | ||
in U$S | in millions of $ | ||||||||
Corporate Notes | Class | Debt structure at 12/31/2022 | Exchange | Issue | Payment / Repurchase | Debt structure at 09/30/2023 | Debt structure at 12/31/2022 | Debt structure at 09/30/2023 | |
Fixed rate par notes - Due 2024 | 2 | 30,000,000 | - | 30,945,000 | - | 60,945,000 | 10,444 | 21,937 | |
Fixed rate par notes - Due 2025 | 1 | 55,244,538 | - | - | - | 55,244,538 | 19,461 | 19,853 | |
Total | 85,244,538 | - | 30,945,000 | - | 116,189,538 | 29,905 | 41,790 |
Note | 25 |Salaries and social security taxes payable |
09.30.23 | 12.31.22 | |||
Non-current | ||||
Seniority-based bonus | 1,749 | 1,567 | ||
Current | ||||
Salaries payable and provisions | 13,044 | 16,778 | ||
Social security payable | 1,532 | 2,137 | ||
Early retirements payable | 138 | 58 | ||
Total current | 14,714 | 18,973 |
The value of the Company's salaries and social security taxes payable approximates their fair value.
29 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Note | 26 |Income tax and deferred tax |
The breakdown of income tax, determined in accordance with the provisions of IAS 12 is as follows:
09.30.23 | 09.30.22 | |||
Deferred tax | (79,386) | (20,997) | ||
Difference between provision and tax return | (427) | 436 | ||
Income tax expense | (79,813) | (20,561) | ||
Deferred tax - Share-based compensation plan | (10) | (7) | ||
Total income tax | (79,823) | (20,568) |
The detail of the income tax expense for the period includes two effects: (i) the current tax for the period payable in accordance with the tax legislation applicable to the Company; and (ii) the effect of applying the deferred tax method on the temporary differences arising from the valuation of assets and liabilities for accounting and tax purposes.
The breakdown of deferred tax assets and liabilities is as follows:
09.30.23 | 12.31.22 | ||
Deferred tax assets | |||
Tax loss carry forward | 983 | 33,602 | |
Trade receivables and other receivables | 2,585 | 2,919 | |
Trade payables and other payables | 5,500 | 3,472 | |
Salaries and social security payable and Benefit plans | 1,880 | 1,998 | |
Tax liabilities | 233 | 88 | |
Provisions | 3,373 | 4,602 | |
Deferred tax asset | 14,554 | 46,681 | |
Deferred tax liabilities | |||
Property, plant and equipments | (258,796) | (233,051) | |
Financial assets at fair value through profit or loss | (9,030) | (3,566) | |
Borrowings | (95) | (403) | |
Adjustment effect on tax inflation | (51,766) | (34,971) | |
Deferred tax liability | (319,687) | (271,991) | |
Net deferred tax liability | (305,133) | (225,310) |
The reconciliation between the income tax expense recognized in profit or loss and the amount that would result from applying the applicable tax rate to the accounting profit (loss) before taxes, is as follows:
09.30.23 | 09.30.22 | |||
Gain (Loss) for the period before taxes | 132,729 | (22,583) | ||
Applicable tax rate | 35% | 35% | ||
Result for the period at the tax rate | (46,455) | 7,904 | ||
Restatement of equity and Gain on exposure to inflation of deferred tax | 28,987 | 9,986 | ||
Adjustment effect on tax inflation | (61,280) | (38,870) | ||
Non-taxable income | (648) | (24) | ||
Difference between provision and tax return | (427) | 436 | ||
Total income tax | (79,823) | (20,568) |
30 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
Note | 27 |Tax liabilities |
09.30.23 | 12.31.22 | |||
Non-current | ||||
Provincial, municipal and federal contributions and taxes | 1,736 | 720 | ||
VAT payable | 2,357 | - | ||
Tax withholdings | 1,147 | 1,153 | ||
SUSS withholdings | 77 | 118 | ||
Municipal taxes | 688 | 685 | ||
Total Tax liabilities | 6,005 | 2,676 |
Note | 28 |Provisions |
Included in non-current liabilities | |||
Contingencies | |||
09.30.23 | 09.30.22 | ||
Balance at beginning of year | 11,281 | 15,754 | |
Increases | 2,421 | 5,616 | |
Result from exposure to inflation for the period | (6,418) | (7,599) | |
Balance at end of the period | 7,284 | 13,771 | |
Included in current liabilities | |||
Contingencies | |||
09.30.23 | 09.30.22 | ||
Balance at beginning of year | 3,049 | 2,123 | |
Increases | 1,524 | 3,047 | |
Decreases | (556) | (965) | |
Result from exposure to inflation for the period | (1,761) | (1,141) | |
Balance at end of the period | 2,256 | 3,064 |
Note | 29 |Related-party transactions |
The following transactions were carried out with related parties:
a. | Expense |
Company | Concept | 09.30.23 | 09.30.22 | |||
EDELCOS S.A. | Technical advisory services on financial matters | (7,615) | (5,838) | |||
SACME | Operation and oversight of the electric power transmission system | (408) | (386) | |||
Andina PLC | Interest | (71) | - | |||
Estudio Cuneo Libarona Abogados | Legal fees | (4) | (7) | |||
Grieco Maria Teresa | Legal fees | (2) | - | |||
(8,100) | (6,231) |
b. | Key Management personnel's remuneration |
09.30.23 | 09.30.22 | |||
Salaries | 3,015 | 2,178 |
31 |
CONDENSED INTERIM FINANCIAL STATEMENTS |
The balances with related parties are as follow:
c. | Receivables and payables |
09.30.23 | 12.31.22 | ||
Other receivables - Non current | |||
SACME | 3 | 6 | |
Trade payables | |||
EDELCOS S.A. | (1,130) | (416) | |
Other payables | |||
Andina PLC | (479) | (463) | |
SACME | (43) | (77) | |
(522) | (540) |
Note | 30 |Shareholders' Meeting |
The Company's Ordinary and Extraordinary Shareholders' Meeting held on April 20, 2023 resolved, among other issues, the following:
- | To approve the Company's Annual Report and Financial Statements as of December 31, 2022. |
- | To allocate the $ 17,468 loss for the year ended December 31, 2022 (which at the purchasing power of the currency at September 30, 2023 amounts to $ 35,486) to the Unappropriated Retained Earnings account, in accordance with the terms of section 70, 3rd paragraph, of Business Organizations Law No. 19,550. |
- | To approve the actions taken by the Directors and Supervisory Committee members, together with their respective remunerations. |
- | To appoint the authorities and the external auditors for the current fiscal year. |
- | To consider the conversion of 355,945 Class C shares into Class B shares in the framework of the termination of the Employee Stock Ownership Program (Note 20). |
Furthermore, the amendment to Sections Nos. 4, 13, 23 and 33 of the By-laws, which had been approved by the Ordinary and Extraordinary Shareholders' Meeting held on November 2, 2022 and by the ENRE by means of Resolution No. 243/2023 dated February 28, 2023, was registered with the IGJ on April 10, 2023.
Note | 31 |Events after the reporting period |
The following are the events that occurred subsequent to September 30, 2023:
- | Electricity rate situation - Aproval of the Summer Seasonal Programming and the values of the Company's electricity rate schedules - SE Resolution No. 884/2023 and ENRE Resolution No. 784/2023, Note 2.a. |
- | Framework Agreement - Recognition of receivables for consumption of the 2023 period; collection of the first installment of the PBA's contribution for consumption of the 2022 period, Note 2.c. |
NEIL BLEASDALE |
Chairman |
32 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Empresa Distribuidora y Comercializadora Norte S.A. | ||
By: | /s/ Germán Ranftl | |
Germán Ranftl | ||
Chief Financial Officer |
Date: November 8, 2023
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EDENOR - Empresa Distribuidora y Comercializadora Norte SA published this content on 09 November 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 09 November 2023 11:06:49 UTC.