Edenor Announces First Half 2007 Results
August 10 2007 - 8:06AM
PR Newswire (US)
BUENOS AIRES, Argentina, Aug. 10 /PRNewswire-FirstCall/ -- Empresa
Distribuidora y Comercializadora Norte S.A. (NYSE: EDN; Buenos
Aires Stock Exchange: EDN) ("EDENOR" or "the Company"), Argentina's
largest electricity distributor, today announced its results for
the six months ended June 30, 2007 (first half of 2007). All
figures are stated in Argentine Pesos and have been prepared in
accordance with Argentine GAAP. Solely for the convenience of the
reader, Peso amounts as of and for the six-month period ended June
30, 2007 have been translated into U.S. Dollars at the buying rate
for U.S. Dollars quoted by Banco de la Nacion Argentina (Banco
Nacion) on June 30, 2007 of Ps. 3.093. 1H07 Highlights -- Net Sales
increased 59.2% to Ps. 1,066.0 million in the first half of 2007,
compared to Ps.669.8 million in the first half of 2006, mainly due
to the application of the increase in our distribution margin (VAD)
from February 1, 2007 and the recording of the retroactive portion
of the VAD increase charged to our non-residential customers for
the period from November 1, 2005 through January 31, 2007, which
totals Ps. 218.6 million. As of June 30, 2007 we had already
invoiced Ps. 20.6 million of that amount while Ps. 198.0 million
remains unbilled. Excluding the unbilled amount of retroactive
portion of the VAD increase, net sales in the first half of 2007
would have been Ps. 868.0 million, representing a 29.6% increase
compared to the same period of 2006. This increase is also driven
by an increase in the volume of energy sold compared to the first
half of 2006. -- Volume of Energy Sold increased 9.6% to 8,892.3
GWh in the first half of 2007, compared to 8,114.8 GWh in the first
half of 2006. This increase was due mainly to a 7.8% increase in
average GWh consumption per customer and to a 1.8% increase in the
number of customers. -- Gross Margin increased 117.3% to Ps. 622.7
million in the first half of 2007, compared to Ps. 286.6 million in
the same period of 2006. This increase is also largely due to the
increase in net sales attributable to the application of the VAD
increase and the recording of the retroactive VAD adjustment, as
described above. Excluding the unbilled amount of retroactive
tariff portion of the VAD increase, our gross margin would have
been Ps. 424.7 in the first half of 2007 representing a 48.2%
increase when compared with the same period of 2006. -- Net
Operating Income increased significantly to Ps. 322.7 million for
the six months ended June 30, 2007, compared to Ps. 19.9 million in
the same period of 2006. In the first half of 2007, net operating
income was positively affected by the application of the VAD
increase and the recording of the retroactive VAD adjustment (Ps.
218.6 million). Excluding the unbilled amount of retroactive tariff
portion of the VAD increase, net operating income for the first
half of 2007 would have amounted to Ps. 124.7 million (an increase
of 526.6% compared to the first half of 2006). -- Net Income
reached Ps. 114.8 million in the first half of 2007, compared to
Ps.404.2 million in the first half of 2006. In the first half of
2007, net income was positively affected by the application of the
VAD increase and the recording of the retroactive portion of the
VAD increase, which were partially offset by the accounting impact
of our net exchange losses (Ps. 11.6 million) related to our debt
(which is denominated in US dollars), the adjustment to present
value of the retroactive portion of the VAD increase and certain
trade receivables (Ps.36.7 million), the adjustment to present
value of our restructured debt (Ps.27.8 million) and the recording
of a non cash tax charge (Ps. 89.9 million) generated by a
significant increase in our taxable income, which partially offset
our tax loss carry forward allowance booked in 2006. In the first
half of 2006, net income was positively affected by the gain
resulting from our debt restructuring, including the adjustment to
present value of the restructured debt (Ps. 266.8 million) and the
recognition of the partial reversal of the valuation allowance of
our net deferred tax assets (Ps. 189.2 million). Comments from the
Chief Executive Officer Alejandro Macfarlane, the Company's Chief
Executive Officer, stated, "During the first half of 2007 we were
able to grow our sales and expand margins, not only from the VAD
increase which took effect in February 1, 2007, but also from the
increase in the volume of energy and capacity sold." "Regarding our
Integral Tariff Revision (RTI), on April 30, 2007, the Secretary of
Energy published Resolution No. 434/2007, which indicates the time
frame for the application of the new tariff structure resulting
from the RTI. The RTI will be implemented on February 1, 2008 in
two installments, in February (67% of the increase) and August 2008
(33% of the increase). In the second half of the year, we expect to
present our integral tariff proposal to the ENRE. We currently
expect that the RTI will result in a revised tariff structure that,
at a minimum, will maintain our then current distribution margins
adjusted by the increases granted under the Adjustment Agreement
(including CMM adjustments)" Financial Highlights: Six months
period ended June 30* (without Six Six the un- months months billed
period period % Change retro- % Change ended ended vs.2006 active
VAD vs.2006 June 30* June 30* adjustment) 2007 2006 2007 Net Sales
1,066.0(1) 669.8 59.2 % 868.0 29.6 % Electric power purchases
(443.3) (383.2) 15.7 % (443.3) 15.7 % Gross margin 622.7(1) 286.6
117.3 % 424.7 48.2 % Net Operating Income (loss) 322.7(1) 19.9
1,521.6 % 124.7 526.6 % * In millions of Argentine Pesos (1) As of
June 30, 2007, energy sales include the retroactive portion of the
VAD increase, which amounts to Ps. 218.6 million and is being
invoiced and collected in 55 consecutive monthly installments,
starting in February 2007. Of this amount, Ps. 20.6 million were
invoiced as of June 30, 2007. About Edenor Empresa Distribuidora y
Comercializadora Norte S.A. (Edenor) is the largest electricity
distribution company in Argentina in terms of number of customers
and electricity sold (both in GWh and Pesos). Through a concession,
Edenor distributes electricity exclusively to the northwestern zone
of the greater Buenos Aires metropolitan area and the northern part
of the city of Buenos Aires, which has a population of
approximately 7 million people and an area of 4,637 sq. km. In
2006, Edenor sold 16,632 GWh of energy and purchased 18,700 GWh of
energy, with net sales of approximately Ps. 1.4 billion and net
income of Ps. 293.1 million. This press release may contain
forward-looking statements. These statements are statements that
are not historical facts, and are based on management's current
view and estimates of future economic circumstances, industry
conditions, Company performance and financial results. The words
"anticipates", "believes", "estimates", "expects", "plans" and
similar expressions, as they relate to the Company are intended to
identify forward- looking statements. Such statements reflect the
current views of management and are subject to a number of risks
and uncertainties, including those identified in the documents
filed by the Company with the U.S. Securities and Exchange
Commission. There is no guarantee that the expected events, trends
or results will actually occur. The statements are based on many
assumptions and factors, including general economic and market
conditions, industry conditions, and operating factors. Any changes
in such assumptions or factors could cause actual results to differ
materially from current expectations. A LONGER VERSION OF THIS
PRESS RELEASE WITH FINANCIAL STATEMENTS AND DETAILED INFORMATION
WILL BE FILED WITH THE UNITED STATES SECURITIES AND EXCHANGE
COMMISSION, AND CAN BE FOUND AT WWW.EDENOR.COM IN THE INVESTOR
RELATIONS/FINANCIAL REPORTS SECTION. Conference Call Information
There will be a conference call to discuss the Edenor's quarterly
results today, Friday, August 10, 2007, at 11:00 a.m. Buenos Aires
time / 10:00 a.m. New York time. For those interested in
participating, please dial (888) 802- 8577 in the United States or,
if outside the United States, (973) 935-8754. Participants should
use conference ID# 9086706, and dial in five minutes before the
call is set to begin. There will also be a live audio webcast of
the conference at http://www.edenor.com/ in the Investor Relations
section. The conference call will become available for review on
Conference Replay one hour after its conclusion, and will remain
available through August 17, 2007. Please dial (877) 519-4471 or
(973) 341-3080, and follow the instructions. The Conference ID# for
the replay is 9086706. For more information, please access
http://www.edenor.com/ DATASOURCE: Edenor S.A. CONTACT: investors:
Buenos Aires, Ivana Del Rossi, +5411-4346-5127, Veronica Gysin,
+5411-4346-5231, both of Edenor, , fax, +5411-4346-5358; New York,
Melanie Carpenter, or Maria Barona of i-advize Corporate
Communications, +1-212-406-3690 or (fax) +1-212-509-7711, Web site:
http://www.edenor.com/
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