Pampa Energía S.A. (NYSE:PAM) Q4 2023 Earnings Call Transcript
Pampa Energía S.A. (NYSE:PAM) Q4 2023 Earnings Call Transcript March 7, 2024
Pampa Energía S.A. isn't one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Raquel Cardasz: Good morning everyone and thank you for waiting. I'm Raquel Cardasz from IR, and we would like to welcome everyone to Pampa Energía's Fourth Quarter 2023 Results Video Conference. We would like to inform you that this event is being recorded. All participants will be in a listen-only mode, during the presentation. After the company's remarks, there will be a Q&A session. Questions can only be submitted in writing form. [Operator Instructions] Before proceeding, please read the disclaimer on the second page of our presentation. Let me mention that forward-looking statements are based on Pampa Energía's management beliefs and assumptions and information currently available to the company. They involve risks, uncertainties and assumptions, because they are related to future events that may or may not occur.
Investors should understand that general economic and industry conditions and other operating factors could also affect the future results of Pampa Energía and could cause results to differ materially from those expressed in such forward-looking statements. Now I'll turn the video conference over to Lida. Please go ahead.
Lida Wang: Hello everybody. Thank you for joining us to this another new quarter. I will make a quick summary of Q4. You may find more details - in our earnings release, or financial statements. Today we have for the Q&A our CEO, Gustavo Mariani; our CFO, Nicolás Mindlin; our Head of E&P, Horacio Turri; our Head of Finance, [Pito Zulegoulas], so full team here. Well, so let's quickly review 2023. This is another challenging year, but it did not prevent us from growing and delivering milestone. In 2023 we will reach again a new peak in gas production exceeding 16 million cubic meters per day. This is a remarkable 44% increase, compared to the 2022 record. Thanks to the new pipeline facilitating additional eastbound evacuation and our active campaign Vaca Muerta.
However, average production did not take off as expected, due to soft demand from mild weather and poor thermal dispatch. For the first time in nine years, we deliver below the take or pay. Pampa E&P is mostly gas production, but for now on we aim to diversify with shallow oil from Rincon de Aranda. Power generation did not stay quiet either. In 2023, we commissioned Ensenada Barragan's CCGT, PEPE number IV wind farm, adding 360 megawatts of efficient energy. We also will be inaugurated this year PEPE VI, which is total install capacity of 140 megawatts. So with all online we will be reaching 5.5 gigawatts, by the end of this year. EBITDA fell 12% year-on-year. This is mainly because of reduced gas sales mentioned before and the impact of the steep peso depreciation over our affiliates.
This is Transener and TGS. We will address this issue later. Our way of management helped us to gain efficiencies and be savvy over business and balance sheet. We used our robust cash flow, to enhance our portfolio, without neglecting our financial position, strengthening our liquidity and substantially reducing our leverage, by paying down debt or taking advantage of the local market. Overall 2023 was another remarkable year in PEPE's history. We look forward to delivering outstanding results going on. So we are in the quarter. We must highlight again, this net leverage reduction, which reached the lowest level in years, $613 million of net debt. The situation was coupled with a soft demand for gas and thermal energy. This is our main product.
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