Pampa Energía Announces Results for the fiscal year and quarter ended on December 31, 2019

BUENOS AIRES, March 10, 2020 /PRNewswire/ -- Pampa Energía S.A. (NYSE: PAM; Buenos Aires Stock Exchange: PAMP), the largest independent energy integrated company in Argentina, with active participation in the country's electricity and gas value chain, announces the results for the fiscal year and quarter ended on December 31, 2019.

The Company adopted the US Dollar as functional currency ('FC US$') for the reporting of its financial information, effective as from January 1, 2019. However, the information of the comparative periods is reported in local and constant currency ('L&CC') as of December 31, 2018, which are shown in US$ converted by closing nominal exchange rate ('FX'). Moreover, Edenor, Transener, OldelVal, Refinor and TGS continue recording their operations under L&CC, therefore their figures are adjusted by inflation (for further information, see section 2 of this Earnings Release or footnote 3 of Pampa's financial statements ('FS')).

For the convenience of the reader, it is shown as supplementary information for each segment's quarterly comparative period the figures recorded in local currency and nominal terms ('L&NC') expressed in US$ at average FX, except for the distribution segment and subsidiaries under L&CC, which comparative quarter's figures are shown in L&CC as of December 31, 2019 and expressed in US$ at closing FX.

Main Results for the Fiscal Year 2019

Consolidated net revenues of US$2,836 million¹, 3% lower than the US$2,920 million recorded in the fiscal year 2018, due to decreases of 15% in oil and gas, 5% in petrochemicals, 44% in holding and others, and higher eliminations due to intersegment sales of US$205 million, partially offset by increases of 35% in power generation and 1% in electricity distribution.

Power Generation of 15,582 GWh from 15 power plants²
Electricity sales of 19,974 GWh to 3.1 million end-users
Production of 48.2 thousand barrels of oil equivalent ('boe') per day of hydrocarbons
Sales of 343 thousand tons of petrochemical products

Consolidated adjusted EBITDA³ for continuing operations of US$915 million, 9% lower than the US$1,001 million for 2018, mainly due to decreases of 31% in electricity distribution, 34% in oil and gas, and 15% in holding and others, partially offset by increases of 20% in power generation, US$29 million in petrochemicals and higher intersegment eliminations of US$1 million.

Consolidated gain attributable to the owners of the Company of US$692 million, US$468 million higher than the US$224 million gain in 2018, mainly due to the on-time non-cash gain for the settlement of Edenor's regulatory liabilities and lower accrual of losses from FX difference as a result of change to FC US$, partially offset by decrease at operating margins in electricity distribution and oil and gas.

Main Results for the Fourth Quarter 2019 ('Q4 19')⁴

Consolidated net revenues of US$702 million, a 10% higher than the US$640 million recorded for the fourth quarter 2018 ('Q4 18'), explained by increases of 2% in power generation and 37% in electricity distribution, partially offset by decreases of 22% in oil and gas, 2% in petrochemicals, 45% in holding and others, and higher eliminations due to intersegment sales (US$10 million).

Power Generation of 3,805 GWh from 15 power plants
Electricity sales of 4,745 GWh to 3.1 million end-users
Production of 47.7 thousand boe per day of hydrocarbons
Sales of 91 thousand tons of petrochemical products

Consolidated adjusted EBITDA for continuing operations of US$170 million, 3% higher compared to the US$165 million reached at Q4 18, due to increases of 9% in power generation, US$8 million in electricity distribution, lower losses of US$18 million in petrochemicals and higher intersegment eliminations for US$2 million, partially offset by decreases of 56% in oil and gas and 11% in holding and others.

Consolidated gain attributable to the owners of the Company of US$9 million, US$280 million lower than the gain of US$289 million in Q4 18, mainly due to lower RECPAM recorded, due to the passive net monetary position allocated to the electricity distribution segment, lower gains from the participation in joint businesses and affiliates, and a higher loss from impairment of fixed assets.

Consolidated Balance Sheet
As of December 31, 2019 and 2018, in millions)

Figures in million	FC US$ as of 12.31.2019		L&CC as of 12.31.2018
Figures in million	AR$	US$ FX 59.89	AR$	US$ FX 37.7
ASSETS
Property, plant and equipment	210,056	3,507	125,005	3,316
Intangible assets	9,068	151	6,080	161
Right-of-use assets	930	16	-	-
Deferred tax assets	1,702	28	80	2
Investments in joint ventures and associates	30,638	511	15,333	407
Financial assets at amortized cost	1,048	18	-	-
Financial assets at fair value through profit and loss	671	11	422	11
Other assets	45	1	33	1
Trade and other receivables	4,711	79	9,521	253
Total non-current assets	258,869	4,322	156,474	4,151
Inventories	9,175	153	5,169	137
Financial assets at amortized cost	3,224	54	1,330	35
Financial assets at fair value through profit and loss	21,867	365	15,273	405
Derivative financial instruments	214	4	3	-
Trade and other receivables	33,583	561	26,489	703
Cash and cash equivalents	13,496	225	9,097	241
Total current assets	81,559	1,362	57,361	1,521

Total assets	340,428	5,684	213,835	5,672

EQUITY
Share capital	1,677	46	1,874	50
Share capital adjustment	9,826	260	9,826	260
Share premium	19,570	510	18,499	491
Treasury shares	71	1	25	-
Treasury shares adjustment	27	1	134	4
Treasury shares cost	(2,527)	(44)	(1,490)	(39)
Legal reserve	1,753	42	904	24
Voluntary reserve	17,727	422	7,355	195
Other reserves	(771)	(18)	(483)	(13)
Retained earnings	51,844	726	15,193	403
Other comprehensive income	15,668	(29)	(314)	(9)
Equity attributable to owners of the parent	114,865	1,917	51,523	1,366
Non-controlling interest	29,397	492	16,160	429
Total equity	144,262	2,409	67,683	1,795

LIABILITIES
Investments in joint ventures and associates	265	4	153	4
Provisions	8,703	145	5,499	146
Income tax and minimum notional income tax provision	590	10	1,034	27
Deferred revenue	270	5	275	7
Taxes payables	263	4	542	14
Deferred tax liabilities	22,068	368	15,354	407
Defined benefit plans	1,606	27	1,175	31
Salaries and social security payable	241	4	163	4
Borrowings	105,629	1,764	69,189	1,835
Trade and other payables	5,419	90	8,162	220
Total non-current liabilities	145,054	2,421	101,546	2,695
Provisions	1,206	20	871	23
Deferred revenue	5	-	5	-
Income tax and minimum notional income tax provision	3,154	53	1,084	29
Taxes payables	4,316	72	2,052	54
Defined benefit plans	230	4	162	4
Salaries and social security payable	3,834	65	2,726	72
Derivative financial instruments	204	3	49	1
Borrowings	10,974	183	12,901	342
Trade and other payables	27,189	454	24,756	657
Total current liabilities	51,112	854	44,606	1,182

Total liabilities	196,166	3,275	146,152	3,877

Total liabilities and equity	340,428	5,684	213,835	5,672

Consolidated Income Statement
(For the fiscal year and quarter ended on December 31, 2019 and 2018, in millions)

	Fiscal Year				Fourth Quarter
Figures in million	2019*		2018†		2019*		2018†
	AR$	US$	AR$	US$	AR$	US$	AR$	US$
Sales revenue	154,642	2,836	110,080	2,920	44,603	702	24,147	640
Cost of sales	(112,433)	(2,032)	(74,161)	(1,967)	(34,631)	(551)	(18,321)	(486)

Gross profit	42,209	804	35,919	953	9,972	151	5,826	154

Selling expenses	(8,645)	(148)	(6,451)	(171)	(2,860)	(44)	(1,839)	(49)
Administrative expenses	(9,179)	(174)	(7,751)	(206)	(3,293)	(53)	(2,238)	(60)
Exploration expenses	(463)	(9)	(45)	(1)	(308)	(5)	(33)	(1)
Other operating income	2,088	40	6,842	181	731	13	763	20
Other operating expenses	(4,617)	(86)	(7,526)	(200)	(1,428)	(22)	(1,687)	(45)
Impairment of PPE and intangible assets	(3,713)	(62)	(1,195)	(32)	(3,713)	(62)	(1,195)	(32)
Results for participation in joint businesses and associates	5,855	101	4,464	118	2,426	39	3,959	105
Results from sale of equity share in companies	-	-	1,052	28	-	-	1,052	28
Agreement from regularization of liabilities	17,095	285	-	-	1,799	19	-	-

Operating income	40,630	751	25,309	670	3,326	36	4,608	120

RECPAM	11,186	187	23,696	629	2,672	39	6,479	172
Financial income	4,483	96	3,751	99	824	13	1,395	37
Financial costs	(15,759)	(299)	(11,944)	(316)	(5,090)	(80)	(3,715)	(98)
Other financial results	4,891	113	(32,365)	(858)	2,925	57	3,322	90
*Financial results, net*	4,801	97	(16,862)	(446)	1,331	29	7,481	201

Profit before tax	45,431	848	8,447	224	4,657	65	12,089	321

Income tax	(6,124)	(48)	(658)	(17)	(3,296)	(55)	(1,499)	(40)

Net income for continuing operations	39,307	800	7,789	207	1,361	10	10,590	281

Net income from discontinued operations	-	-	3,019	80	-	-	(2)	(0)

Net income for the period	39,307	800	10,808	287	1,361	10	10,588	281
*Attributable to the owners of the Company*	33,012	692	8,435	224	1,149	9	10,903	289
Continuing operations	33,012	692	5,506	146	1,149	9	10,905	289
Discontinued operations	-	-	2,929	78	-	-	(2)	(0)
*Attributable to the non-controlling interests*	6,295	108	2,373	63	212	1	(315)	(8)

*Net income per share attributable to the shareholders*	18.35	0.38	4.31	0.11	0.68	0.01	5.73	0.15
From continuing operations	18.35	0.38	2.81	0.07	0.68	0.01	5.74	0.15
From discontinued operations	-	-	1.50	0.04	-	-	(0.00)	-

*Net income per share attributable to the shareholders*	458.76	9.62	107.65	2.86	17.00	0.13	143.37	3.80
From continuing operations	458.76	9.62	70.27	1.87	17.00	0.13	143.40	3.80
From discontinued operations	-	-	37.38	0.99	-	-	(0.03)	-
Note: * FC US$ was adopted on April 1, 2019, effective as from January 1, 2019 for Pampa Energía stand-alone and generation subsidiaries Los Nihuiles hydroelectric power plant ('HINISA'), Diamante hydroelectric power plant ('HIDISA') and Piedra Buena thermal power plant ('CPB'), as well as affiliates Greenwind and CTBSA, among others. The 2019 and Q4 19 results are disclosed in AR$ converted at transactional FX.

L&CC applies as from July 1, 2018 retrospectively and prospectively for subsidiaries Edenor (electricity distribution segment), OldeVal (oil and gas segment), Refinor, TGS and Transener (holding and others segment). Figures in AR$ for 2019 and Q4 19 are adjusted by average inflation as of December 31, 2019 for approximately 21.2% and 5.5%, respectively, and the disclosure in US$ results from converting by a closing FX of AR$59.89 per US$.

† Figures for 2018 and Q4 18 are recorded in AR$ and adjusted by inflation as of December 31, 2018 for approximately 19.2% and 5.4%, respectively, and shown in US$ at a closing FX of AR$37.70 per US$.

For the full version of the Earnings Report, please visit Pampa's Investor Relations website: ri.pampaenergia.com/en.

Information about the Conference Call

There will be a conference call to discuss Pampa's Q4 19 results on Wednesday March 11, 2020 at 10:00 a.m. Eastern Standard Time / 11:00 a.m. Buenos Aires Time.

The host will be Lida Wang, Investor Relations Manager at Pampa. For those interested in participating, please connect to http://bit.ly/PampaWebPhone or dial +54 (11) 3984-5677 in Argentina, +1 (844) 717-6837 in the United States or +1 (412) 317-6394 from any other country. Participants of the conference call should use the identification password 'Pampa Energía' and dial in five minutes before the scheduled time. There will also be a live audio webcast of the conference at http://bit.ly/PampaQ419Call. Please download the Q4 19 Conference Call Presentation from our IR website.

You may find additional information on the Company at:

ri.pampaenergia.com/en
www.cnv.gov.ar

www.sec.gov
www.bolsar.com

For further information, contact:
Gustavo Mariani
Chief Executive Officer – CEO

Ricardo Torres
Executive Vice-president

Mariano Batistella
Executive Director of Planning, Strategy, Downstream & Affiliates

Lida Wang
Investor Relations Officer

The Pampa Energía Building, Maipú 1 (C1084ABA) City of Buenos Aires, Argentina
Tel: +54 (11) 4344-6000
investor@pampaenergia.com
ri.pampaenergia.com/en

¹ Under the International Financial Reporting Standards ('IFRS'), the affiliates Greenwind, OldelVal, Refinor, CTBSA, Transener and TGS are not consolidated in Pampa's FS, being its equity income shown as 'Results for participation in associates/joint businesses'.

²Includes the operation of Ensenada Barragán Thermal Power Plant ('CTEB') and Mario Cebreiro Wind Farm ('PEMC'), assets co-controlled by Pampa and of which holds 50% of equity stake.

³ Consolidated adjusted EBITDA represents the results before financial results, income tax, depreciations and amortizations, extraordinary and non-cash income and expense, equity income and other adjustments from the IFRS implementation, and includes affiliates' EBITDA at our ownership. For more information, see section 3 of the Earnings Release.

⁴ The financial information presented in this document for the quarters ended on December 31, 2019 and of 2018 are based on FS prepared according to IFRS in force in Argentina, corresponding to the fiscal years of 2019 and 2018, and the nine-month periods ended on September 30, 2019 and 2018, respectively.

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