Central Puerto S.A. Q1 FY2026 earnings call

Strategic Milestones

• Secured a 30-year concession renewal for the flagship Piedra del Águila hydro asset, extending the license to January 2056, and completed the share transfer transaction for the asset in the quarter.
• Acquired 100% of Patagonia Energy S.A. (PESA) for €50 million, gaining a 10-year conventional exploitation license for 27,000 oil-focused acres in the Vaca-Morta play, adjacent to de-risked producing blocks, with an existing 1,900 barrels per day oil treatment plant already in operation. The company notes potential unconventional hydrocarbon upside, with a maximum total investment of up to $600 million if development is successful.
• Received a credit rating upgrade to 3PA from Moody's Argentina.

Commercial Performance

• Under Argentina's new wholesale electricity market framework (Resolution 425/400-25), Central Puerto achieved the number 1 market share in MATP (contracted capacity for thermal/hydro) and number 2 market share in Amatei (contracted energy for thermal/hydro).
• The company is already fully contracted on the 20% of generation allowed for direct sale to private consumers, and is actively negotiating contracts for the remaining volume reserved for distribution companies.

Operational Progress

• The Brigadier López combined cycle plant reached commercial operation (COD) in January 2026, adding 140 MW of capacity to the company's portfolio.
• Full-quarter contributions came from solar assets (Capayate and San Carlos) acquired in 2025, alongside solid performance from the company's wind fleet.
• The company's BESS (battery energy storage system) project is 60% complete, with 32 concrete paths finished and phase 1 of 132kV infrastructure work completed.
• Completed maintenance on Central Costanera's combined cycle units, which had been offline during 4Q25, restoring full generation volume.

Central Puerto does not break out results by distinct product segments in this call. Aggregate company-wide 1Q26 results are as follows: total revenues reached $248.6 million, up 43.8% quarter-over-quarter (4Q25) and 26.7% year-over-year (1Q25). Adjusted EBITDA totaled $120.0 million, up 41.6% QoQ and 33.4% YoY. 44% of 1Q26 revenues were generated from contracted sales in the newly established term electricity market. Net financial debt was $390.8 million, resulting in a net leverage ratio of 1.06x against the last 12 months adjusted EBITDA of $367.2 million. Total generation hit 5,420 gigawatt-hours, up 54% QoQ, driven by new assets and completed maintenance on existing units. Installed capacity increased by 229 MW QoQ following the COD of the Brigadier López combined cycle plant.

• Management maintained a constructive 2026 outlook, expecting continued operational excellence and solid financial performance driven by ongoing electricity market normalization, which will deliver further revenue upside.
• The company expects incremental contracted PPA volume growth through new agreements with large industrial users and distribution companies as the newly liberalized market matures.
• BESS projects are on track to reach commercial operation by mid-2027.
• Management stated that the 2026 year-end net leverage ratio will depend on future M&A opportunities, but does not expect leverage to exceed 2.5x, with flexibility to pursue additional acquisition opportunities in the Argentine energy sector.

• Securing additional natural gas transportation capacity is challenging amid existing pipeline bottlenecks, with the company only receiving 400,000 cubic meters per day of the 1.6 million cubic meters per day it requested in the recent TGS auction, creating potential winter supply constraints.
• The Vaca Muerta unconventional development is still in the de-risking phase, with no guarantee of commercial reserves or successful development, and timing and costs are still subject to adjustment.
• PPA contracting with distribution companies is progressing gradually under the new market framework, with no guarantee of timely or favorable contract closures, which could leave more generation exposed to spot market price volatility in the near term.
• There is still uncertainty around the timing and terms of future CAMESA capacity auctions, which could impact the company's ability to secure new capacity contracts.

Q: Why was most 1Q26 generation rebound directed to the spot market, how is PPA migration progressing, what is the timeline for shale pilot drilling at PESA, and will development be standalone or with a partner?

A: The company is already 100% contracted on the 20% of generation allowed for direct sale to private consumers, and is in active negotiations with distribution companies for the remaining eligible volume, with updates expected next quarter. The company is working with a U.S. expert firm on the de-risking program for 2-3 shale pilot wells, and expects drilling to occur in 4Q26 or 1Q27, as lead times for drilling rigs are currently 4-5 months.

Q: How much additional gas transportation capacity does Central Puerto need to cover its fuel needs once it exits CAMESA planned gas, and how challenging will it be to secure this capacity?

A: The company consumes 10-12 million cubic meters of gas per day overall, but only needs contracted firm capacity for peak winter demand, for ~30-45 days per year. The company targets 1.6 to 2 million cubic meters per day of firm capacity, and will bid for additional capacity in the next TGS auction round after only receiving 400,000 m3/d in the first round; there is enough capacity for non-peak periods.

Q: What is the leverage ratio target for end-2026, and what are the near-term plans for the Vaca Muerta acquisition?

A: Leverage will depend on what M&A opportunities emerge in the Argentine energy sector, but management does not expect leverage to rise above 2.5x. The near-term focus is on de-risking the 27,000-acre position, confirming resource potential, and arranging for a drilling rig, with no immediate plans to expand the position in the near term.

Q: Is a new CAMESA thermal capacity auction a step back from electricity market liberalization, and what are the prospects for new contracts?

A: Management does not see it as a step back: capacity auctions are a standard regulatory tool used in other liberalized markets (such as Brazil and Chile) to secure sufficient system-wide capacity to meet long-term demand growth. The new auction will only cover capacity, not energy, so energy will still be contracted by private firms and distribution companies, aligned with the liberalization framework.