Enel Chile S.A. Q4 FY2025 earnings call

• Market context: Chile's energy landscape is evolving with electrification, system complexity, and resilience becoming essential. The power sector is a key enabler of net-zero ambition. - 2025 performance: Successfully achieved 2025 guidance with robust business fundamentals, deployed CAPEX for flexibility and resilience, maintained comfortable liquidity, and confirmed dividend policy. - 2026-2028 strategic plan: Further optimize commercial strategy, strengthen integrated offering, reinforce active portfolio management, and have disciplined renewable investments. Focus on commercial strategy with nationwide platform, integrated offering, and customer-led service model. CAPEX strategy focuses on flexibility, technology, and geographic diversification with around $1.6 billion for generation and $0.5 billion for grids over 2026-2028, aiming to reach around 80% renewables in generation mix by 2028. Distribution business focus on disciplined and value-driven decisions, digitalization, and customer-led service model.

In 2025, net production decreased by 12% compared to 2024 due to lower hydro dispatch, reduction in renewable energy production, and higher containment levels, partially offset by higher contribution from more efficient CCGT power plants. Energy sales amounted to 30 TWh compared to 33.3 TWh in 2024, with regulated sales lower following expiration of regulated options and free market sales stable. EBITDA totaled $1,473 million, up $52 million from 2024. Net income was $538 million, 14% lower than 2024. FFO reached $1067 million. Gross debt was $3.8 billion as of December 2025, a 2% decrease from 2024, with average debt term and cost adjusted. Generation business had changes in PPA sales, sourcing FX, and gas trading contribution. Grids business had positive impacts from tariff expectations and settlement, partially offset by increased expenses.

• Expect to reach about $1.8 billion of integrated margin by 2028, driven by revenue increase despite regulated contract expirations, commercial sourcing, and new bays. - Net income expected to range between 0.5 and 0.7 billion dollars in 2028, mainly from EBITDA growth. - Plan to allocate $2 billion for 2026-2028 investment, with around $1.6 billion for generation and $0.5 billion for grids. - Expect funds equivalent to $3.4 billion from operations over 2026-2028, including full recovery of PEC receivables, to finance investments and maintain financial strength. - Dividend payout ratio to remain at least 50%, with potential increase depending on future opportunities.

• Geopolitical uncertainty can influence expectations for higher spot prices, potentially affecting the Chilean spot market and energy players. - Regulatory developments in Chile's energy sector, such as changes in distribution regulatory model, system operation and coordination rules, and technical standards, pose risks to the company's operations and investment plans. - Cost risks related to gas supply, including potential impacts from geopolitical tensions and price indexation, although currently not seeing material cost risk but monitoring the situation. - Uncertainty regarding the concession revocation process in the distribution segment, with the study by the SEC on energy distribution concession potentially taking 6 to 18 months and the company closely monitoring and defending its position.

Q: About gas supply volumes and indexation, how much gas secured for this year, source of gas, and timing of indexations?

A: Large majority of thermal gas needs secured through former Argentina gas contracts and LNG contracts. Energy contracts indexed to hurry up and rent, most exposure secured with PPA index to commodities and financial products.

Q: Cost risk under current situation, firm gas contract with Argentina, prices indexed?

A: No material cost risk currently, firm gas supply agreements with Argentina have six-month term and fixed price.

Q: Spot prices impact on Chilean spot market, higher thermal dispatch driving up prices affecting short in energy market?

A: Geopolitical uncertainty can influence expectations for higher spot prices, but impact on Chilean energy spot prices not seen as important currently.

Q: Geopolitical tensions effect on Chilean spot market and company?

A: Geopolitical uncertainty can influence spot price expectations, but company's impact limited due to contracted gas supply and commercial balance.

Q: Natural gas reliance for thermal generation, impact of Middle East conflict on energy supply?

A: No material impact on operations or cost structure currently, thermal generation relies on Argentina gas with long-term contractual arrangements mitigating short-term volatility.

Q: Lower energy purchase costs per MWh, trend continuation?

A: 2025 was peculiar year, expecting more standard year with continued growth in price reduction.

Q: Distribution segment top line increase, one-off nature?

A: 2025 results affected by multiple factors including regulatory remuneration and one-off effects, with differences in performance between 2024 and 2025 explained by various effects.

Q: Concession revocation process in distribution segment?

A: Not notified of administrative or legal proceeding, SEC studying energy distribution concession taking 6 to 18 months, company monitoring and defending position.

Q: Capex per megawatt, BES unitary capex trend, hours duration in projects?

A: CAPEX mix with BES and wind, BES unitary capex with decreasing price curve, first wave BES 4-hour duration, second wave 4.5-6 hours.

Q: CAPEX increase, dividend payout?

A: CAPEX increased, dividend payout ratio at least 50% currently, potential to increase depending on company value creation opportunities.

Q: Hydro production by 2028, projection mechanism?

A: Using statistical models based on historical trend, weather forecast, and improving hydro fleet productivity.

Q: Generation business PPA auctions and sales growth?

A: There are opportunities in market, studying to increase sales beyond 32 TWh but matching buy side and production with risk management.

Q: New capacity details, location, COD, existing assets?

A: Majority CAPEX new capacity focused on north of Chile, existing plant retrofit, site construction in 2026, COD expected in 2027, additional BES investments in 2027-2028.

Q: Distribution investment in smart meters, remuneration?

A: Smart meters not automatically remunerated, cost recovery depends on CNEE regulatory approvals, inclusion justified by service improvement.

Q: PPA expiration strategy, regulated auctions participation?

A: Strategy adjusts to market, participating in regulated auctions as competitive opportunity with diversified production portfolio.

Q: Wind penetration region, cost change impact?

A: Main investments in best technology, north of Chile likely for wind penetration, new wind power plant cost higher but considering opportunities.

Q: PPA prices under geopolitical tension, impact estimate?

A: Too soon to estimate impact of current geopolitical tension on PPA prices, monitoring situation.

Q: Parent company focus on tier one market impact on Enel Chile?

A: Enel group supports Chile, strategy of fully integrated group in value chain.

Q: Data centers, CapEx acceleration, constraints?

A: Working on data center infrastructure, key elements include electrical capacity, permitting, renewable energy support, progressing to attract new investment.

Q: Refinance expensive debt, short-term opportunity?

A: Looking at refinancing opportunity, most important operation refinancing 1 billion yen bond, no immediate short-term opportunities but monitoring.

Q: TTF gas price impact on gas trading opportunities?

A: Evaluating current market opportunities, TTF prices increasing but not at 2022 crisis levels, considering to maximize results while meeting generation needs.