11 Nov 2009 07:00
Andes Energia plc ("Andes")
(AIM:AEN)
Unaudited results for
Empresa Distribuidora de Electricidad de Mendoza Sociedad Anonima ("EDEMSA")
for the nine months ended 30 September 2009
EDEMSA, the electricity distributor for the province of Mendoza in which Andes has a 51 per cent. indirect interest, has published its financial results for the nine months ended 30 September 2009. This information, which has been prepared under Argentine GAAP and in Spanish, is available from the web-site of the Argentine Comision Nacional de Valores at www.cnv.gov.ar. This announcement sets out the unaudited financial information of EDEMSA for the same period prepared under IFRS in Argentine Pesos (AR$).
Financial Overview of EDEMSA
EDEMSA reported a loss for the nine months of AR$14.3 million (9 months to 30 September 2008: AR$7.1 million profit)
Sales in the period increased by 17.3% over the equivalent period last year, to AR$361 million. This increase resulted primarily from a 2.2% increase in the demand for energy, the pass through of increases in the cost of energy purchased and the benefit of the increase in electricity tariffs implemented on 1 August 2009.
Although the gross profit has increased to AR$86.2 million from AR$76.2 million, the increase in operating expenses resulted in an operating profit of AR$14.1 million down from AR$24.6 million in the equivalent period last year, with EBITDA of AR$35.1 million (9 months to 30 September 2008: AR$45 million).
The finance costs for the year have been adversely impacted by the weakening of the AR$ against the US$, resulting in a non-cash exchange loss of AR$28.1 million for the period. EDEMSA has established a trust with the objective of investing in US$ denominated assets and at the end of the period the carrying value of investments held in the trust was AR$61.3 million.
As referred above, the first new tariffs for the third review period were implemented on 1 August 2009. This resulted in an average increase of between 0% and 15% for residential users and between 12% and 22% for commercial users, representing an average total increase of approximately 12%. Furthermore, the second stage of the tariff increase is due to be implemented with effect from 1 December 2009 and the increases are expected to be at levels similar to the increases implemented on 1 August 2009.
Neil Bleasdale, EDEMSA President commented, "We are pleased the first increase in the tariffs has been approved and look forward to the further tariff adjustments that have already been established for the third review period becoming effective."
balance sheet
(All amounts in Argentine Pesos (AR$))
| At | At | At | |
| 30 September 2009 | 30 September 2008 | 31 December 2008 | |
| (Unaudited) | (Unaudited) | (Unaudited) | |
| ASSETS | |||
| Non-current assets | |||
| Property, plant and equipment | 513,256,617 | 508,686,728 | 515,966,820 |
| Intangible assets | 156,705,088 | 156,705,088 | 156,705,088 |
| Available for sale investments | 1,565,787 | 1,592,490 | 847,632 |
| Other investments | 61,297,342 | - | 21,594,778 |
| Deferred income tax assets and other credits | 43,045,934 | 21,041,448 | 32,265,713 |
| 775,870,768 | 688,025,754 | 727,380,031 | |
| Current assets | |||
| Inventories | 16,145,719 | 22,270,580 | 16,139,939 |
| Trade and other receivables | 96,214,554 | 89,613,889 | 99,517,552 |
| Available for sale investments | 1,055,293 | 923,740 | 480,647 |
| Cash and cash equivalents | 9,255,390 | 25,927,417 | 6,117,900 |
| 122,670,956 | 138,735,626 | 122,256,038 | |
| Total assets | 898,541,724 | 826,761,380 | 849,636,069 |
| EQUITY | |||
| Capital and reserves | |||
| Share capital | 462,585,254 | 462,585,254 | 462,585,254 |
| Fair value and other reserves | 464,919 | 439,436 | (301,905) |
| Retained earnings and other reserves | (40,561,157) | (10,745,900) | (26,254,831) |
| Legal reserve | 16,856,263 | 16,856,263 | 16,856,263 |
| Total equity | 439,345,279 | 469,135,053 | 452,884,781 |
| LIABILITIES | |||
| Non-current liabilities | |||
| Borrowings | 237,684,877 | 206,153,841 | 228,720,522 |
| 237,684,877 | 206,153,841 | 228,720,522 | |
| Current Liabilities | |||
| Trade and other payables | 146,707,180 | 111,561,701 | 120,935,572 |
| Borrowings | 42,520,331 | 15,788,272 | 17,111,903 |
| Provisions | 32,284,057 | 24,122,513 | 29,983,291 |
| 221,511,568 | 151,472,486 | 168,030,766 | |
| Total liabilities | 459,196,445 | 357,626,327 | 396,751,288 |
| Total equity and liabilities | 898,541,724 | 826,761,380 | 849,636,069 |
income statement
(All amounts in Argentine Pesos (AR$))
| Nine months ended | Nine months ended | Year ended | |
| 30 September 2009 | 30 September 2008 | 31 December 2008 | |
| (Unaudited) | (Unaudited) | (Unaudited) | |
| Sales | 360,648,299 | 307,353,676 | 427,580,215 |
| Cost of sales | (274,469,343) | (231,109,431) | (327,651,213) |
| Gross profit | 86,178,956 | 76,244,245 | 99,929,002 |
| Selling and marketing costs | (32,184,453) | (26,737,751) | (36,862,395) |
| Administrative expenses | (42,206,456) | (28,798,823) | (42,641,391) |
| Other operating expenses | 2,274,037 | 3,862,961 | 4,726,706 |
| Operating profit | 14,062,084 | 24,570,632 | 25,151,922 |
| Finance costs | (34,809,477) | (13,632,677) | (39,597,163) |
| (Loss)/profit before tax | (20,747,393) | 10,937,955 | (14,445,241) |
| Income tax | 6,441,067 | (3,891,563) | 5,982,702 |
| (Loss)/profit for the period | (14,306,326) | 7,046,392 | (8,462,539) |
statement of changes in shareholders' equity
(All amounts in Argentine Pesos (AR$))
| Share capital | Fair value and other reserves | Retained earnings | Legal reserve | Total equity | |
| Balance at 1 January 2008 (Unaudited) | 462,585,254 | 674,635 | (939,033) | 3,004 | 462,323,860 |
| Net expense recognised directly in equity | - | (235,199) | - | - | (235,199) |
| Transfer from retained earnings | - | - | (16,853,259) | 16,853,259 | - |
| Gain for the period | - | - | 7,046,392 | - | 7,046,392 |
| Balance at 30 September 2008 (Unaudited) | 462,585,254 | 439,436 | (10,745,900) | 16,856,263 | 469,135,053 |
| Net expense recognised directly in equity | - | (741,341) | - | - | (741,341) |
| Loss for the period | - | - | (15,508,931) | - | (15,508,931) |
| Balance at 31 December 2008 (Unaudited) | 462,585,254 | (301,905) | (26,254,831) | 16,856,263 | 452,884,781 |
| Net income recognised directly in equity | - | 766,824 | - | - | 766,824 |
| Loss for the period | - | - | (14,306,326) | - | (14,306,326) |
| Balance at 30 September 2009 (Unaudited) | 462,585,254 | 464,919 | (40,561,157) | 16,856,263 | 439,345,279 |
cash flow statement
(All amounts in Argentine Pesos (AR$))
| Nine months ended | Nine months ended | Year ended | |
| 30 September 2009 | 30 September 2008 | 31 December 2008 | |
| (Unaudited) | (Unaudited) | (Unaudited) | |
| Cash flows from operating activities | |||
| Net cash generated from operating activities | 64,145,446 | 34,450,124 | 40,049,636 |
| Cash flows from investing activities | |||
| Purchases of property, plant and equipment | (10,514,376) | (9,720,422) | (11,695,779) |
| Purchase of financial assets | (40,228,542) | (892,757) | (22,040,925) |
| Grants received | 5,363,596 | 2,565,209 | 2,565,209 |
| Net cash used in investing activities | (45,379,322) | (8,047,970) | (31,171,495) |
| Cash flows from financing activities | |||
| Debt repaid | (15,628,634) | (6,213,555) | (8,499,059) |
| Net cash used in financing activities | (15,628,634 | (6,213,555) | (8,499,059) |
| Net increase in cash and bank overdrafts | 3,137,490 | 20,188,599 | 379,082 |
| Cash and bank overdrafts at beginning of the period | 6,117,900 | 5,738,818 | 5,738,818 |
| Cash and bank overdrafts at the end of the period | 9,255,390 | 25,927,417 | 6,117,900 |
1. Basis of preparation
The report for the nine months ended 30 September 2009 is unaudited and has been prepared in accordance with International Financial Reporting Standards ("IFRS") on a basis consistent with the accounting policies used in the preparation of the financial information of the ultimate parent company, Andes Energia plc, for the year ended 31 December 2008.
Enquiries:
Andes Energia plc Tel :020 7495 5326
Neil Bleasdale, Chairman
Nigel Duxbury, Finance Director
Arbuthnot Securities Tel: 020 7012 2000
James Steel
Antonio Bossi
Bishopsgate Communications Tel: 020 7562 3350
Nick Rome
Michael Kinirons