Good day, ladies and gentlemen, and welcome to Enel Chile's First Half 2020 Results Conference Call. My name is Olivia, and I will be your operator for today. During this conference call, we may make statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

Such forward-looking statements reflect only in our current expectations, are not guarantees of future performance and involve risks and uncertainties. Actual results may differ materially from those anticipated in forward-looking statements as a result of various factors.

These factors are described in Enel Chile's press release reporting its first half 2020 results, the presentation accompanying this conference call and Enel Chile's annual report on Form 20-F, including under Risk Factors.

You may access our first half 2020 results press release and presentation on our website, www.enel.cl, and our 20-F on the SEC's website, www.sec.gov. Readers are cautioned not to place undue reliance on those forward-looking statements, which speak only as of their date.

Enel Chile undertakes no obligation to update these forward-looking statements or to disclose any development, as a result of which these forward-looking statements become inaccurate, except as required by law. I would now like to turn the presentation over to Mrs. Isabela Klemes, Head of Investor Relations to Enel Chile. Please proceed..

Thank you very much, Olivia. Good morning, ladies and gentlemen, and welcome to Enel Chile's Second Quarter 2020 Results Presentation. I hope you are all well and safe in your homes, and are following all the required safety measures that the prevailing circumstance request towards all. I am Isabela Klemes, Head of Investor Relations.

Our presentation will be hosted by Paolo Pallotti, our CEO; and Giuseppe Turchiarelli, our CFO. In occasion of these events, we are still adopting appropriate prevention measures. We are all connected from our homes.

Paolo will open with the main highlights and will give us an update on the global situation that we are facing and how the company is responding to it. Then Giuseppe will walk you through our financial results, our operational performance, and will give more details on our 2020 EBITDA guidance update. The usual Q&A section will follow.

Please note that questions will be received only via chat available in our webcast at www.enel.cl, at the Investor Relations section. [Operator Instructions]. As always, our IR team will be -- will continue to be available to provide you with any detailed information you may need with respect to the figures included in this presentation.

Thank you all for your presence. And now let me hand over the call to Paolo..

Thank you, Isabela, and good morning, ladies and gentlemen. Let's start by mentioning the highlights of the period on Slide 2. Today, the world is facing extraordinary difficult times.

Since the beginning of the health crisis, Enel Chile had realized the severity of the situation, and implemented all necessary measures to continue offering a stable and safe energy supply service, safeguarding at all times, the safety and health of our employees, our clients and external providers.

All our generation and network facilities are fully operational. Thanks to our commitment to digitization, we have developed a solid platform that has turned out to be key in meeting our customer needs in the current scenario, while they are struggling with the difficulties in accessing traditional precession channels of service.

We have been promoting remote working methodologies since several years by evolving our systems towards the cloud. Today, a significant number of employees are working remotely in an efficient and effective way.

As part of our commitment with the energy transition with the sustainable development of the country, on May 27, Enel Generación Chile announced its decision to anticipate the closure of Bocamina 1 by December 31, 2020 and Bocamina 2 by May 31, 2022.

The decision implies closing much earlier than committed in the National Decarbonization Plan and will make Enel Chile the first utility to stop generating from coal in Chile. In line with the previous announcement, Enel Chile is progressing in the development of renewable project including in our strategic plan.

This initiative seeks to add a total of 2,000 megawatt of renewably stored capacity by 2022, half of which is already under construction. This project reaffirms our position as the first renewable operator in Chile. Lastly, we have a safe liquidity position to continue executing our strategy and to face this global challenge. Let's move to Page 3.

First of all, I would like to thank all our people for their positive and strong commitment, highlighting with their actions the resilience of our company. I want to expand my thanks to our contractors that have been supporting deeply our activities.

Since the beginning of this global crisis, we have taken all the necessary measures to guarantee the safety of our people, contractors and clients as well as ensuring the continuity of the service.

As mentioned in the previous quarter, we have created a committee to analyze the situation on a day-by-day basis and to coordinate all required actions we may need to take. Therefore, 100% of our plants and networks are fully operational. A large number of our people will continue to work remotely once the quarantine measure will be revolved.

For the ones that need to be in our facilities, the process will be gradual, taking all the security measures.

As of June 15, we have gradually restarted manual readings and billing distribution with all the corresponding preventive health measures that includes personal protection gear to safeguard the health of our customers, employees and the community.

Up to this date, following the regulation in place, we temporarily bill our clients using the average consumptions of the last 6 months.

To ease the impact of the total differences between the billing of estimated electricity usage and the actual reading, we voluntarily decided to apply payment solution to all our regulated clients to whom manual readings were suspended.

For instance, if a client consume more than what has been billed by the company, we will automatically split the difference in 5 months payment installments without interest rates, readjustments or any additional charges.

In addition to help our clients to cope with this crisis, we have voluntarily extended the benefits on deferred payments that we have offered to the most vulnerable clients until the end of the emergency period. Now on Page 4.

In these difficult times for Chile and for the world, we have reaffirmed our commitment to our communities, putting into action a voluntary campaign to respond to the challenge of COVID-19 and to support the most vulnerable communities, especially the ones most affected and closer to our activities.

Under this program, we have donated 2 electric ambulances to the Red Cross with their respective charging points. The e-ambulances are the first of its kind in Latam, and will represent an important cost reduction for the institution once compared to the diesel technology.

Thanks to a collaborative work with the Universidad Católica and with the UC CHRISTUS Health Network, we have implemented an electric bus that was adopted as a mobile laboratory to support detection of COVID-19 cases and enhance logistics for testing.

We will continue with several other projects with our local communities as we clearly understand the importance of our role in the country. Together, we will get higher of this situation. Now on Page 5.

Since the outbreak of COVID-19, volatility has spiked to levels last seen only during the global financial crisis and the uncertainty of the debt and duration of the economic crisis due to the pandemic. Oil and gas prices are falling sharply and during important declines once compared to 2019 figures.

Emerging market currencies are under stress, and although the Chilean Peso currency is considered one of the most resilient in Latam, we have observed a depreciation of around 80% year-to-date basis against the U.S. dollar. The index, Imacec, which measures the economic activity of the country, contracted by 15.3% in May '20 versus last year data.

Social distancing measures have impacted a larger number of workers and economic activities, especially in the main cities, bringing the unemployment rate at 11.2% in May. On government-side reaction, the Chilean Central Bank decided to leave the interest policy rate at 0.5% to continue supporting market liquidity and commercial lending.

In addition to this measure, it is also carrying out the U.S. dollar swap to align arrangements to reduce volatility of Chilean Pesos, particularly considering the recent approval law, which allow a 10% voluntary withdrawal of the Chilean pension funds by their contribution. Now on Slide 6.

The country's lockdown has impacted the electricity demand in many economic sectors related to the industrial activity and commerce. Several companies have reduced its operations to minimal levels, and to some extent, shutdown their operation, which resulted in an important decrease in demand.

As we can see on this slide, both our generation and distribution businesses face an important decrease, particularly concentrated since March 2020, as a result of the lockdown measures. The demand reduction in both generation and distribution businesses are mainly explained by the contraction of the regulated consumption.

We can see this effect, not only in Enel Distribution concession area, but also in other regions of the country. This reduction is primarily driven by commercial and industrial sectors as many stores, malls and small industries are closed.

On the Free Market perspective, at least in our generation business, we still see an increase in the demand versus last year, primarily driven by the resilience of our Free Market clients are the mining companies and by the new PPA secured by our company, especially in the first part of this year. On page 7, let's focus on distribution collection.

Our effort on digitalization allows us to ensure the continuity of our business without compromising the safety of our clients and collaborators. We have put all our attention to strengthen our digital channels, improving the experience of our clients.

As of June, our distribution client app was downloaded by 360,000 clients, a number 74% higher over last year figures. We have also increased the number of payment channels available to our clients. As a result, in June, 88% of the payments were made through digital channels.

By June 2020, we have executed more than 35,000 agreements with clients to modulate the payments and mitigate the impact on our collection, of which 10,000 have been described with the most vulnerable ones of March -- by March 2020.

As a result, we sustained the average collection level to 97% on the first semester of 2020 versus our historical levels of around 99%. Let's now focus on hydrology on Slide #8. As you can see in the first graph, until June, there was a significant rainfall deficit.

And therefore, the first semester of this year was the driest period registered in the country. To understand the performance of our company, we are presenting the accumulated drawings for our most significant river basins, Maule, Laja Bio-Bio and Rapel.

As shown on the right side of this slide, since mid-June, we have observed a recovery in rainfall, almost reaching normal levels to date. In addition, there has been an improvement in the levels of snow accumulated in the mountains since rains have been accompanied by a very low cold condition with various [indiscernible] at very low attitude.

The accumulated snow levels are higher than those observed last year. Under the current conditions, we expect the hydraulic generation of the second semester of 2020 to reach around 7 terawatt hour approximately. So in terms of hydro generation, 2020 would be very similar to the previous years, reaching around 10, 11 terawatt hour.

Let me remind you that generation with LNG natural gas, the current -- is currently the natural edge of Enel Chile portfolio to cope with the drought, as you will see in the following slides. To conclude this section, let me update you on a regulation framework evolution. We are at Slide #9.

On the contingency front, we included the decision made by the executive or by the Parliament. The Senate and the Congress have recently approved a new law known as Basic Services Billing that aims to benefit the most vulnerable clients of basic services industries.

This law includes benefits to vulnerable clients already voluntary offered by our company, and the obligation of not cutting off the domestic clients that are not paying their bills during the emergency period. This law has been opposed by the executive that applied its retort for unconstitutionality.

The Senate is expected to vote on this matter by today onwards, while the Lower House has already rejected the presidential veto. If the Senate will vote in line with the Lower House, the law will be effective. The other ministry decision is referred to the modification of the peak hours regulation during the winter period.

After the decision on suspending the April and May peak hour tariffs, a new regulation, pending executive decree, may suspend the peak hour tariffs during August and September. These changes will have a very marginal impact on generation, slightly more on distribution, especially for August and September period.

To respond to the economic effects of the crisis, since the lockdown, the Chilean government has proposed more than $30 billion on measures to boost the economy. For structural measures, the Ministry of Energy has recently illustrated the next step referred to the new distribution law, so called until now, Ley Larga redistribution.

According to the Ministry of Communication, it enforces a 3-step approach, dealing with opening of the market and definition of the figures of trader, quality of service improvement and distributed generation.

On the first point, the government will present a bill with the required measures to open gradually the market, creating the figures of energy generating company, and define the rules for the commercialization activities.

On the second, the third topics, the government is expected to propose a new measure to add the concept of incentive regulation that should reward high-quality distribution company and the new elements on distributed generation.

On the new distribution regulatory cycle, the government recently published the bidding process to hire external consultants to carry out the regulatory studies on the new reference model companies. We will share more details of the current framework in the next quarter as we expect that the first advisory report will be released by September 2020.

Finally, the government is expected to rule on flexibility of the represented system, creating mechanism to guarantee the continuity of the capitalization process and the renewable expansion in the country.

On the hydrogen development, a global internal team has been created to focus on this new technology to evaluate all the business opportunity arising from the European Commission New Green Deal, the agreement signed between the Chilean government and the European Union. Now let's go through our strategies, starting with our decarbonization progress.

We are in Page 11. On Slide 6, the CNE authorized us to proceed with the final decommissioning, disconnection and termination of Bocamina I operation on December 31, 2020. More recently, on July 24, the CNE has also authorized the early disconnection of Bocamina 2 by the end of May '22.

Let me remind you that the decommissioning of the 2 units of Bocamina will be finalized without accessing to the energy strategic reserve. With this achievement, we will become the first utility to phase out its coal fleet by 2022.

We are working on a redeployment plan for all the workers of the units and the conversion of this facility by circa economy perspective, with the aim of contributing to the development of this area where the EU has guided.

Within our decision about the phaseout of Bocamina, we confirm our commitment with the local community in the perspective of a just transition. Recently, we have financed the construction of a new school for the receptor community.

In addition, local groups or seasonal fishermen will have access during the next months, until the planned phaseout, to a special fund for project aimed at improving their fishing activities or eventually entering into new businesses. Furthermore, all the resettlement process for over 1,300 families has been aligned to international standards.

Our decarbonization strategy and just transition policy will improve the visibility of our sustainable model and our ESG profile. At the same time, we will reduce our exposure to commodity volatility and environmental risk, bringing better margins and allowing us to access new financing instrument reducing coal.

In addition, we also believe in medium-term that Enel Chile will benefit from potential increase in its liquidity and value, considering this derisking strategy. Let's now see more details on our decarbonization strategy on Page 12.

To cope with our decarbonization strategy and fit with our customer needs, we have under construction 1 gigawatt of renewable capacity and another 1 gigawatt ready to start the construction by 2021.

In addition to that, we have approximately 4 gigawatts of renewable capacity in different phases of development, representing an optionality for the future to continue derisking our generation portfolio from commodities and hydrology. On Page 13, let me give you an update on the status of our renewable project that's under construction.

During June 2020, we have started the construction of Renaico II wind power plant. With a total investment of USD 177 million, Renaico II will include 32 wind turbines of 4.5 megawatts each, reaching an installed capacity of 144 megawatts.

The environmental permits have been already issued, and the wind turbines will be shipped to Chile in the next month. Part of the project will be in operation this year, and the remaining part in 2021. On Cerro Pabellón, the expansion of the plant will bring the total net capacity to 69 megawatts.

Considering the COVID situation, we have reviewed the project time line and devoted special attention to define a safe number of persons in our facility, and to adjust properly our construction camp, limiting the number of person according it's to standards. Cerro Pabellón will be in operation next year. On Page 14, on solar projects.

Campos del Sol project has been already -- have already received the environmental licenses. We are now working on some specific cases with Ecological Institute of Chile to manage some findings encountered on-site when we have started the civil works. The main EPC and BoP contracts were already signed.

And particularly for Campos Del Sol and Azabache, we have already received the photovoltaic modules, indicating that our suppliers are in operation and committed with their contract timing. As our solar projects are constructed in [indiscernible] stage, part of this project will be online by 2020 and the remaining part by 2021.

Before we move on, let me give you a color on Los Cóndores project. We are on Page 15. Yesterday, Enel Generación released a material fact, indicating that the conclusion of full reassessment -- be getting the conclusion of a full reassessment of Los Cóndores project. Up to now, we have already completed 10.5 kilometers of project tunnel out of 14.

The remaining 3.5 kilometers will be excavated with a new tunnel-boring machine. The assembly of electromechanical equipment in the current powerhouse has been already completed.

Let me highlight that during the construction of the vertical tunnel that connects the upper and the lower tunnel section already built, we have encountered a very challenging geological condition that forced us to change structurally the construction pattern.

To guarantee technical efficiency and safety at work of our employees and contractors, we have decided to adopt a different but more affordable construction solution that requires more time and additional budget.

Therefore, these changes in the project -- with these changes in the project, we expect to finish the civil works construction of Los Cóndores power plant, by the end of 2023 followed by the commissioning and commercial operation of the International [indiscernible] project.

Now let me drive you through our main industrial KPIs over the period for our generation business. We are on Page 16. The total net production for the first half decreased by 14%, amounting to 9 terawatt hour, driven by minus 0.8 terawatt hour of lower generation in our hydropower plants, reflecting the hydrology performance.

And minus 0.6 terawatt hour of lower thermal production, mainly in our coal-fire plants due to the closure of Tarapacá power plant by December 1, 2019 and the impact of lower system marginal costs.

In terms of our energy balance, we remain a spot buyer in the market with a purchase of 2.2 terawatt hour in first half 2020, a variance of plus 0.8 terawatt hours versus first half 2019, also as a result of low hydrologic and marginal costs.

The lower system marginal cost is explained by the Argentina natural gas availability, new transmission line fully in operation starting from June 2019, addition of new renewable capacity and the reduction of country's demand.

As we saw in the previous slide, our physical energy sales decreased by 6% of -- or minus 0.7 terawatt hour, mainly played by minus 1.1 terawatt hour of lower consumption of distribution company, mainly associated to the termination of regulated PPAs with SAIDI and Enel secured by -- in 2006 auction and the lower demand in the second quarter, partially offset by 0.6 terawatt hour of higher Free Market sales as part of our strategy to capture new clients and the ones recently migrated to the Free Market.

Now moving to Slide 17 to explain the most relevant operating KPIs of our network business that are fundamental to our anchor electrification. The energy distributed in first half 2020 decreased by 6% when compared with the first half of 2019, mainly due to the lockdown measure applied by the government in Santiago.

Our customer base increased by 43,000 clients when compared to the first half of last year, with the last year reaching 1.99 million of clients. In the digitalization of our distribution business, we continue to improve the quality of our service. And we have reached 2,249 telecontrol equipment, installed in our grid.

In the next 2 years, we are planning to add 585 additional units.

To guarantee the system reliability and availability, we continue to focus on the critical area for SAIDI and SAIFI, replacing approximately 76 kilometers of cables in our low-tension rails and executing approximately 14 kilometers of medium-volt grid extension and reinforcement in the first half of 2020.

Despite the logistic restrictions coming from social unrest and lastly from the pandemic situation, our interruption index in SAIDI decreased by 13%. Finally, as part of our plan of system quality and resilience, we were able to reduce of 53% the power interruptions due to adverse weather condition in our networks.

On Page 18, let me go through our network's main projects. On the high-voltage investment plan, we have concluded important interconnection projects in our concession area, introducing different measures to continue improving the resilience and the management of our network.

On the middle-voltage side, during the first half of 2020, we have concluded the construction of 52 kilometers of network and the installation of 169 telecontrol equipment. We will continue to perform important civil works to cope with the expansion of e-mobility segment and to improve the electrification of the country.

Let's move to Enel X and digitalization on Slide 19. Despite COVID outbreak, we continue to consolidate leadership on electric mobility and on electrification. The first half of 2020, we have secured new contracts on public lighting, upgrading the lighting infrastructure, which will bring a more efficient system in favor of the local municipalities.

On supporting the e-mobility in the country, we have signed a partnership with [indiscernible] Shell, implementing fast chargers for e-vehicles in the NEx facilities. Our company will be responsible for the maintenance of all the charging units to be installed.

Moreover, we have secured new contracts with large real estate groups to provide new charging infrastructure to their projects. In June, we put into operation additional 150 electric buses in the metropolitan region of Santiago.

Additionally, we are promoting the use of more efficient and clean technologies as the use of electric buses, combined with solar energy and stored recharging system for the mining businesses.

Finally, and thanks to the collaboration with other public and private partners, we continued our effort to promote the use of efficient heating in order to replace the use of wood to contribute to the reduction of carbon emission and particulates in Chile. Almost 7,000 devices have been installed since 2017.

And we are estimating to avoid 22,000 tons of CO2 equivalents yearly. Now I will hand over to Giuseppe for the analysis of the results..

Lower spot prices, totaling $54 million; positive impact on PPA indexation, totaling $19 million; tariff harmonization of $20 million; and other costs for about $8 million, mainly associated with the insurance reimbursement booked in 2020.

In Slide 25, we have a summary of the performance of our generation business, including Enel Generación and Enel Green Power. On generation EBITDA, I have already walked you through the main variation in the previous slide.

What I would like to recall you is that in line with the last year results, we have produced 58% of our generation with renewable sources.

As a result of the already mentioned element, our generation adjusted EBITDA margin reached 47% in the second Q 2020, which is 8% higher than second quarter 2019 despite lower hydro production in commodity channel. The first half 2020 adjusted EBITDA margin was 2% points higher than the adjusted first half 2019 EBITDA margin.

Please let me explain the most relevant operating fact of our distribution and Enel X business. So moving to Slide 26.

The second Q 2020 EBITDA reached $46 million or 29% lower EBITDA comparing with the second Q 2019, mainly due to a lower energy consumption in both regulated and Free Market clients in the second Q 2020 versus second Q 2019, for about -- million dollar, mainly due to lockdown measures applied by the government to contain the spread of COVID.

Higher energy losses due to reduced activity because of logistic and safety restrictions, increase on commercial process costs to cope with the current difficult situation that our clients are facing.

As of June 2020, the EBITDA of Enel Distribution and Enel X had lower results due to the second quarter performance, as above mentioned, decreasing the EBITDA in 50% compared with the first half 2019. Now on Slide 27, let's go through the main drivers of our net operating income.

As already mentioned before, the 2019 EBITDA includes the PPA early termination.

Depreciation and amortization and bad debt reached $166 million, increasing by 12%, mainly due to higher provision of bad debt mainly on distribution business due to the 2019 social unrest and COVID-19 effects, higher depreciation in EGP Chile due to the depreciation of the Chilean Pesos against dollar in the first half 2020, higher depreciation of distribution business due to the higher investment in the last year and partially offset by the closure of Tarapacá on December 31 last year and the phase out of Bocamina 1 and 2.

The impairment increased by $530 million, mainly due to Bocamina 2 impairment booked in June 2020 related to the early closure of the plant planned in May 2022.

Financial results of $74 million, with a decrease of $90 million, mainly due to the lower average cost of our debts as a result of the renegotiation in Enel Green Power net debt with Enel Finance International and the foreign exchange rate appreciation in first half 2020 impacting positively in financial receivables in U.S. dollar.

Income tax and minorities reflects the lower results related to Bocamina 2 impairment effects. As a consequence of all the above, the reported first half 2020 net income reached a losses of $403 million. The first half 2020 adjusted net income by the Bocamina 2 impairment is in line with the results of the adjusted net income of first half 2019.

Now moving to the cash flow on Slide 28. Our first half 2020 adjusted FFO reached $166 million, strongly impacted by COVID-19 that resulted on lower collection in our distribution business, a lower EBITDA impacted by lower demand in our businesses.

Despite this challenging situation, our adjusted first half '20 FFO was $40 million higher than 2019 adjusted figures mainly due to a lower income tax paid in the first half of 2020, mainly due to the tax credit reimbursement from previous year and a lower monthly provisional payment, lower financial expenses, mainly by the debt renegotiation with Enel Finance International.

Partially offset by lower adjusted EBITDA in 2020 versus 2019 and lower net working capital, mainly due to lower collection on distribution business for about $62 million, and in generation business for $29 million due to the energy stabilization net lease, and Enel X buses payments held on 2020 that were in operation during the third quarter 2019.

Let's now take a look at the net and gross debt on Slide 29. Our gross debt increased by $567 million versus December 2019, amounting to $4.50 billion as of June 2020 due to Enel Chile new funding with Enel Finance International to finance our renewable CapEx planned and partially offset by Enel Generación Chile debt amortization.

Our net debt, as of June 2020, compared to January 1, 2020, increased $448 million, mainly due to our CapEx plan. Average cost of our net debt was reduced from 5.2% in December 2019 to 4.6% as of June 2020, showing an important improvement in our financial condition as a result of our constant efforts to optimize our financial expenses.

The average terms of our debt is almost 7 years. Finally, on our debt amortization on Slide 30. I would like to highlight our total liquidity position reached $0.9 billion, making us able to finance our CapEx plans and being in a comfortable position to face the possible worsening scenario in the country.

Our debt amortization, we don't see any concern considering the smooth debt profile in the next 2 years with an average of about $200 million. Moreover, we confirm our debt strategy to maintain our debt is in fixed rate and U.S. dollars. And now let me conclude this part of the presentation, driving you through our new EBITDA targets for the year.

Before moving to new guidance, let's take a look at what COVID-19 meant in the semester for our financial results. And now on Slide 32. On EBITDA, the main impact from COVID-19 associated with a sharp decline in volume in both generation and distribution business, particularly in the regulated demand.

The remaining impact on the EBITDA is related to the increase of losses and additional cost on our distribution businesses related to the customer care. All these costs have been partially offset by saving activities that we put in place. Moving down to the net income.

We recorded a negative impact on D&A of $6 million, driven by the increase of bad debt provisions in the second quarter. All in all, without the COVID impact, our adjusted net income by the cost of impairments should have been higher by $37 million.

And now let me conclude this part of the presentation, driving you through our new EBITDA targets for the year, always, net of coal stock impairments. As you can see in Slide 33, during our presentation, we have shown many factor that come up in the past period, which changed our scenario for this year.

Although, our company is strongly committed and working hard to mitigate the negative factors, some impacts are difficult to control and manage, as the hydrology, all the impact on COVID-19, as demand reduction and macro assumption as commodity price fluctuation aspects, and among others.

Seeking our transparency with our investors and all the interested parties, we have run several scenarios to reflect the deterioration of some variables that are extremely difficult to predict. Any possible changes on that could drive 2 different scenarios.

Therefore, our EBITDA is expected to have a devaluation from $350 million to $450 million, to be in a range of $1.20 billion to $1.3 billion for 2020. We are not yet anticipating our view on net income project as we are running several actions to offset most devaluations of our EBITDA.

On CapEx, we don't see important deviation as the larger part of our development CapEx is expected to deploy now on the second half of this year. Paolo, I will hand over to you for closing remarks..

Thank you, Giuseppe. The current situation represents a challenged scenario to the sector. Despite that, our period adjusted results show a steady and resilient performance based on safeguarding our people, business reliability, digitalization and quick reactions to external conditions.

At the same time, we are confident on our mid- to long-term performance considering the strength of our diversified business model. Our focus on [indiscernible] and the development of our project in generation and distribution business demonstrate that our company continues to create value in this new environment.

To respond and anticipate our clients' needs is the best way to ensure the quality and reliability of our services tied to the continuous improvement of our digital platform.

Finally, the resilience of our business' sustainable strategy is supported by the strength of our balance sheet and by eventual additional liquidity measures to support eventual headwinds from external environment. Thank you for your attention, and let's now open the Q&A section. I will hand over to Isabela..

Paolo, many thanks. So we have received a lot of questions, okay? We're going to....

Yes. I've seen that. We have a lot of questions to manage..

Yes. So we're going to select some of them. And other questions, we're going to send the same information from me to all of you that asked questions to us. So the first question came from Murilo Riccini from Santander.

He's asking us if we can give more details on the IDB factoring from the receivables of our companies from both generation and distribution segments. Is that....

Yes. I will leave -- yes, the answer to Giuseppe's side..

Yes. Thank you, Isabela. Let me say that the agreement with IDB is doing to add in a coordination also with all the other players in the market. The agreement basically consists a potential facility to sell to IDB and other banks, the receivable accumulated by all the generation companies of the market.

And the factory has an availability period to sell periodically the receivable accumulated. And of course, we are talking about only the receivables that are recognized on the decree.

We are still evaluating whether the conditions are good for us, but we believe that it makes sense in order to reduce the risk of possible changes in the regulation area..

Okay. Thank you, Giuseppe. We also have questions from -- also from Murilo Riccini from Santander.

And also from Tomas Gonzalez from Scotiabank, asking a little more details on the delay on the Congress projects, and if you can give in -- for both of them a hint about how much we have already expended during on 2020, and what we are expecting in the next few years..

Yes. Regarding the evolution of Los Cóndores projects, as we mentioned in our previous calls, the project includes works on tunnels that the total amount is 14. And it includes also a vertical peak that connect to the higher and the lower section of the project.

In the evolution, the critical parts, we found the geological challenges in the development of the vertical connection that require us to review the technology to implement this connection. We use international advisers to review this.

At the end, we have decided to adopt the most -- the safest technology to connect the -- to have the vertical connection between the 2 tunnels. And the end -- all in all, this is in the critical part.

During the realization of this connection, we will be able also to finalize the missing part of the horizontal connection towards the Laguna with the new boring machine. So this is the reason why this delay. That clearly brings together. With delays come additional CapEx. All in all, this year, we spent around USD 30 million.

What we are doing now, we are replanning the CapEx spending in order to evaluate and to, let's say, according to the evolution of the project and to the evolution of the work, the civil works, that we are planning between 20 -- let's say, second part of 2020 until the end of 2023. Today, we have reached a total amount of $870 million..

Perfect. Thank you, Paolo. We also have questions from Javier Suarez from Mediobanca. He is asking some questions.

The first one is that what we are seeing improvement in our working capital as a consequence of the completion of our digitalization process? Also, he asking more detail, if we can give on the likely impact of the basic services deal that [indiscernible] to favor the most vulnerable clients? And the third question is which is likely the impact of the suspension in peak power prices in August and in September that we also referred in our presentation.

Thank you, paolo?.

Okay. Let me manage, let's say, the -- let's make some clarity, first of all, regarding the basic service law. And then we can comment about the performance of the collection and leave Giuseppe to commenting the numbers.

Regarding the basic services law, since the end of March, we have offered to the most vulnerable clients an agreement in order to suspend their payment regarding the bills, the consumption of the energy, and to have an agreement to start the payment when the country will exit from the emergency period, with 12 monthly installments without interest, and clearly, with no risk of cut-off of the service.

These -- the -- let's say, the segment of clients that has been addressed to that problem, this voluntary proposal was referred to a percentage. At the time, was 40% percentage of the, let's say, poorest families that are counted in the social register -- social internal register of the country.

Regarding this evolution, there was a discussion regarding proposing it as a law. The content of the law includes 60% of the same kind of vulnerable clients.

And on June, when the President Piñera extend the 90 days or emergency period, adding additional 90 days, we extend the period of this offer, and we expand the perimeter of the potential -- the vulnerable clients according to the perimeter defined by law. And so 60% more some additional categories.

And so today, when the discussion is ongoing still in the parliament and the Senate, we are offering this kind of agreement and this kind of benefits to the vulnerable clients. The law has been, let's say, approved by the Lower House and the Senate during recent -- sometime last week -- last weeks.

And the -- at the end, the President decided to put the veto -- a veto right regarding the constitutionality of this law. The discussion is still ongoing. The Lower House rejected the veto, and now discussion is ongoing in the Senate.

Regarding the impact of their approval -- the potential approval of this law is, in terms of benefits to the vulnerable clients, we have already offered since last March. So we don't see any impact on this. We have already signed some thousand agreements with vulnerable of clients.

We don't see any problem, we don't see a material impact until now on our numbers. The problem is that the law includes also a statement regarding the inability to cut off the non-pay -- the non -- the clients that are not paying their bill, even if they are not vulnerable.

So this clearly may run the risk to enlarge the potential base of clients that may not pay the bills during the emergency period. Until now the law states 90 days after the issuing on this law. So this is the real situation, and it depends on the attitude of the non-vulnerable clients in respecting the deadlines in the payment of all their bills.

Then there is also another question regarding our collection. Since March, we improved a lot the -- our digital platform to switch all the services, including payment, into our digital channels through digital technical improvement and also through a strong communication to our clients.

And as we mentioned in the presentation, by June, we reached 88% of collection through these channels.

Regarding -- what are the other questions, Isa?.

Yes. So from Javier Suarez, is also regarding -- I think you summarized everything, was about the peak hours and also the....

The peak hours, yes. Correct, the peak hours. The peak hour. Yes, there was this also, the peak hour. There were 2 decisions regarding the winter peak hour. The first has been issued, if I remember correctly, at the end of March, and was referred to April and May period. And the second, this has been applied until the end of May.

Then we came back to the normal regulatory approach during June and July. And recently, a new release coming from the regulator for defining -- so excluding August and September in the [indiscernible]. The impact on the first decision regarding April and May was negligible in terms of impact on our distribution income.

Considering the period of August and September, considering that we are still in the -- during the winter time with potential temperature and weather effects, and considering also the current evolution of the pandemia, maybe that they will have a larger impact on this decision that is still pending because the executive decree is still missing, may have an impact in the range of $3 million on our accounts..

Perfect. Thank you, Paolo. So we have another question from Cesar Perez from BTG, also Andrés Castro from Credicorp and [indiscernible].

They are all asking more details regarding our guidance, okay, if you can give more details on the breakdown that we presented in our slides, and also if we can give more details on the dividends that we're going to be distributed for -- in 2021, regarding 2020 results?.

Okay. Let me give you the answer on the dividends, and then I'll leave the answer to Giuseppe. Regarding dividends, you should take as an example last year. Last year, we had the impairment of Tarapacá and Bocamina 1 that has an impact -- an accounting impact on our results.

And then we decided to -- let's say, to apply our dividend policy on a pro forma basis without taking into account the accounting impact of the commissioning. So we have the flexibility to do the same this year. Until now, we have not changed -- when -- we do not change the dividend policy.

We will see the, let's say, evolution of the second half of 2020 in terms of cash generation in order to take the final decision on how to apply the dividend policy in which base. But the reference is what we decided last year. So if we can take a decision despite all the accounting impact of the impairment regarding the destabilization.

And then leave to Giuseppe to provide details regarding the revised guidelines..

Okay. So for what concern the guidance. I mean, as you see in the slide, we have seen an effect. First one is the COVID. When we talk about the COVID impact that we are talking about basically or mainly about the impact on the demand, both on generation and distribution.

And especially, we are talking about the part of the client that are the small businesses, like a small -- like a mall or other kind of small industries, and that can be also regulated. So it's not a matter of free -- or they are not only free client.

And we have also -- as we mentioned, we have also took into the consideration the impact of losses that can be raised because of restriction in the cut of energy in case of unpaid bills.

Now the importance in there in the scenario, the assumption that we are taking to the consideration is that we are going to have -- we seem to have a negative situation in all July, with a little bit of recovery in August that doesn't mean that we increase the demand, but just that the demand will be lower than what we had the previous months.

And we assume to have a return to a normal situation in September. Of course, I mean, going back to a normal situation doesn't mean that the demand will be the same as we forecasted when we prepared the initial plan, of course, because some of the small business closed. And so will not be easy to going back easily.

But of course, we assume to have a return to a normal demand at the end of the year. So what concerned the hydrology? Again, I mean, the impact that we consider was thinking about a hydrology more or less in line with the last year, we are talking about 10.5 terawatt hours of hydro production. Clear -- I mean, the situation is getting better.

So also in this case, it's pretty difficult to understand how much will be the production. But as of today, we prefer to be a little bit conservative in order to have eventually a positive results in the following months. And the last part of our negative impact is coming from the macro scenario and others.

Here, of course, the variation is larger because we are talking about the impact of the foreign exchange aspect, U.S. dollar/pesos, for what concern our business that are fully in pesos like distribution. But we are talking about also about the commodity price fluctuation, the impact on our hedging activities.

And we are talking about the impact of exchange rate that has our financial hedging for what concerned the debt. So I mean, this kind of evaluation could have an important balances depending on the FX.

What I can tell you is that, as of today, the assumption that brings us to have $450 million, or in other words, that to have a $260 million in macro scenario and other, use an exchange rate of CLP 800 -- a little bit more than CLP 800 per USD 1.

Okay?.

Okay. Thank you, Giuseppe. We -- due to the time, we have this time just to do 2 more questions, okay? So the first one that we received from Tomas Gonzales from Scotiabank, Rodrigo Mora from Moneda and also Murilo Riccini from Santander, is to give more details on our LNG contracts.

Considering that we saw in the presentation with the reduced price that will come online in the second half of the year, so we can give a color on this contract? And also if we can [indiscernible] and ask for more shipments on our contracts? Thank you..

Yes. I'll leave this question to Giuseppe. Just let me add an important point. And I think to clarify regarding the -- let's say, the development of the company, especially regarding the impact of the new time line for Los Cóndores.

Because what we have planned in the development of the company from today until the end of 2022 is to grow through the 2,000 megawatt of renewable capacity that we are building and through the optimization of the portfolio regarding the decarbonization of the Bocamina, the coal-fire facility.

This plan is not impacted by the delay of Los Cóndores in the sense that the project that we have on the pipeline to reach 2,000 megawatts are already identified. 1 giga is under construction.

The other one are ready to start so there is no direct impact on the, let's say, development plan of the company, and to reach the target, to reach our position -- potential position in the market due to the delay of the new schedule regarding Los Cóndores.

And just an additional clarification, because it is an element that I'm assuming is under the spot for this period, regarding -- we have planned with this effect of the basic service law. The -- we already offer these benefits to the vulnerable clients.

It is clear that the impact of this laws is it will be issued in a situation where the country, and especially in the areas like Santiago, the impact of the economic crisis is very strong.

We are waiting for the effect of the old plan issued by the government in terms of injecting liquidity in the system, especially to help the most vulnerable and the medium families. And we are working, struggle in order to help the clients to use our digital channels regarding payments.

So the -- in terms of cash collection, we are performing as much as we can in terms of the company performance and support to our clients. Clearly, this law may have an impact, especially regarding the no cut off of bad payers out -- that are not considered as vulnerable clients. Now I leave to Giuseppe for the commenting of the energy contract..

Yes. Thank you, Paolo. I mean talking about the LNG contract, as you know, we have a long-term contract that is linked to -- which price is linked to the commodity. And of course, we use the contract mainly for supplying our power plant. But if it is convenient, we can also resell the amount of gas that we buy under this contract.

Now last year, the price -- the international market price were pretty high, so we were able to make some trading with this -- with the amount of gas that we used to buy. And this is the reason because we had a very important result last year. So this year, the commodity drop, as you know. So the price, the final price of our contract reduced as well.

And there is no big possibility to do this kind of trading. As a matter of fact that our contract price in the last -- let me say, in July, for example, is almost around $4 per million Btu.

And I mean, this is the reason because we don't have such a positive asset like last year, on the other end, of course, we have cheaper gas available for our plants, of course..

Perfect, Giuseppe. Thank you very much. So we have other questions that we have received. Okay, we've tried to summarize the most remaining, let's say, the questions that we see the most.

Due to the time, we're going to have to disconnect, okay? But I would like to conclude this results conference call, reminding you that our Investor Relations team will be available for any other doubts you may have.

So I don't know, Paolo, if you want just to say the final word to our investors connected?.

Yes. Let's say that just to confirm, first of all, I would like to confirm the resilience of the company.

And the fact that considering the quite tough situation that we are leaving in the country from the health, first of all, and also from the economic point of view, we continue to, let's say, deliver and to develop our activity to -- and especial -- and with all the area where we are involved, starting from the, let's say, management and the construction of the new plants, management of the plant, construction of the plant, improvements and investment in the grid and also development of the activity is related to, let's say, the new electricity services? Even if we have to face with quite large difficulties in having the possibility to implement at full our, let's say, efforts, our activities on the ground.

And so I think that we can give a specific answer to the many questions that we have received through our Investor Relations channel. And we are available for any additional details. Considering that the evolution is quite complex. So there are changes very, very frequently.

There is the impact that may have on regulation on the management of the business. So please feel free to ask us additional information or comments on changes that are going on in order to give you the answers in the more transparent way..

Perfect. Thank you, Paolo. And now I give the call to the operator. Thank you very much for your participation. Stay safe, you all. Thank you..

Thank you very much to all of you..

Thank you..

Ladies and gentlemen, that does conclude conference for today. Thank you for your participation. You may all disconnect. Everyone, have a great day..