EX-99.1 2 ex99-1.htm EX-99.1

Table of Contents 

 

Pampa Energía, an independent company with active participation in Argentina’s electricity and gas value chain, announces the results for the fiscal year and quarter ended on December 31, 2021.

 

Buenos Aires, March 10, 2022

 

Stock information

 

 

 

Share capital net of repurchases and reductions,
as of March 9, 2022:
1,383.6 million common shares/
55.3 million ADSs

Market capitalization:
AR$248 billion/US$1,281 million

Information about the videoconference

Date and time: Friday, March 11, at 10 AM Eastern Standard Time/
12 PM Buenos Aires Time

Access link:
bit.ly/Pampa4Q21VC

For further information about Pampa

 

· Email:

investor@pampaenergia.com

· Website for investors:

ri.pampaenergia.com/en

· Argentina’s Securities and Exchange Commission:

www.argentina.gob.ar/cnv

· Securities and Exchange Commission:

sec.gov

    

Basis of presentation

Pampa’s financial information adopts US$ as functional currency, and it is expressed in AR$ at transactional FX. However, our affiliates Transener, TGS and Refinor report under local currency. Hence, their figures are adjusted by inflation as of December 31, 2021, except for previous periods already reported.

Main results from the quarter1

42% year-on-year increase in sales, recording US$406 million2 in Q4 21, explained by the rise in prices of gas, oil and petrochemical products, increased physical volume sold in all our businesses and higher legacy energy sales, offset by the PPA maturity at CTLL’s steam turbine.

             
    Pampa's main operational KPIs Q4 21 Q4 20 Variation
    Power Generation (GWh) 4,670 4,400 +6%
      Gross margin (US$/MWh) 26.1 33.2 -21%
             
    Hydrocarbon Production (k boe/day) 58.1 43.7 +33%
      Gas over total production 91% 90% +1%
      Average gas price (US$/MBTU) 3.1 2.1 +47%
      Average oil price (US$/bbl) 58.6 41.3 +42%
             
    Petrochemicals Volume sold (k ton) 114 107 +6%
      Average price (US$/ton) 1,266 795 +59%
             
   

8% year-on-year increase in the adjusted EBITDA3, recording US$199 million in Q4 21, explained by an increase of US$27 million in oil and gas, and US$5 million in holding and others, offset by decreases of US$16 million in power generation and US$1 million in petrochemicals.

Pampa recorded a consolidated profit attributable to the Company’s shareholders of US$39 million, vs. a net loss of US$463 million in Q4 20, mainly due to the impairment of assets from discontinued operations in Q4 20, better operating margin in oil and gas, and lower stock of debt, offset by losses from the holding of financial securities in Q4 21.

Consolidated net debt decreased to US$866 million as of December 31, 2021, recording a continuous and significant reduction compared to the US$1,148 million recorded by the end of 2020.

1 The information is based on FS prepared according to IFRS in force in Argentina. Only continuing operations are considered.

2 It does not include sales from the affiliates Greenwind, OldelVal, Refinor, CTBSA, Transener and TGS, which at our ownership account for US$147 million. Under IFRS they are not consolidated in Pampa, thus shown as ‘Results for participation in joint businesses and associates’.

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 further information, see section 3 of this Earnings Release.

 

 

Pampa Energía ● Q4 21 Earning release ● 1

 

Table of contents

Basis of presentation 1
Main results from the quarter 1
Table of contents 2
1.   Relevant events 3
1.1   Power generation segment 3
1.2   Oil and gas segment 3
1.3   Transport.Ar program 4
1.4   Other businesses 5
2.   Financial highlights 6
2.1   Consolidated balance sheet 6
2.2   Consolidated income statement 7
2.3   Cash and financial borrowings 8
2.4   Buyback of own financial securities 10
3.   Analysis of the Q4 21 results 11
3.1   Reconciliation of consolidated adjusted EBITDA 11
3.2   Analysis of the power generation segment 12
3.3   Analysis of the oil and gas segment 14
3.4   Analysis of the petrochemicals segment 17
3.5   Analysis of the holding and others segment 18
3.6   Analysis of the fiscal year, by subsidiary and segment 20
3.7   Analysis of the quarter, by subsidiary and segment 21
4.   Appendix 22
4.1   Power generation main operational KPIs 22
4.2   Oil and gas production in the main areas 23
4.3   Electricity distribution segment, discontinued 23
5.   Glossary of terms 24

 

 

Pampa Energía ● Q4 21 Earning release ● 2

1.Relevant events
1.1Power generation segment

PEPE III expansion

In the fourth quarter of 2021, Pampa announced PEPE III’s expansion project, which will increase the existing gross capacity from 53.2 MW to 134.2 MW, with an estimated investment of US$128 million. Its output will be sold in the MAT ER through a US$-denominated PPA with private parties, and it is estimated to be commissioned in stages, fully commissioning in the second quarter of 2023.

PEPE III is located in Coronel Rosales, 45 km from the City of Bahía Blanca, Province of Buenos Aires. Currently, it comprises 14 Vestas wind turbines and during 2021 its load factor reached 58%, highlighting the outstanding wind quality in the area. The expansion project consists of the assembly and installation of 18 wind turbines of the same brand.

As of today, Pampa owns three wind farms: PEMC (100 MW), and PEPE II and PEPE III (53.2 MW each). Once works are completed, our wind farms will contribute to the national grid a total of 287.4 MW of renewable energy.

This expansion, in addition to the closing to CCGT at CTEB and the investments committed under Plan Gas.Ar, are part of the Company’s strategy to focus its investments on our core businesses: power generation and natural gas production.

Issuance of Pampa’s first Green Bond

In order to finance PEPE III’s expansion, on January 18, 2022, Pampa issued the first Green Bond (Series VIII CB) for a AR$3,107 million FV, at a variable interest rate of Badlar plus 2%, maturing in July 2023 with American amortization system, after receiving offers of purchase for more than AR$9,646 million, more than three times compared to the issued nominal value.

This is the first green bond issued by Pampa, which reflects the commitment to finance projects with a positive impact on the environment and diversify the country’s energy matrix. The issuance was distinguished by Fix Ratings, an affiliate of Fitch Ratings, with a Green Bond (BV1) rating, one of the best ratings, as it is in line with ICMA’s four core components of the Green Bond Principles (GBP). Moreover, this bond joined ByMA’s SGS Bonds Panel (Social, Green and Sustainable Bonds), which promotes the conditions for the Capital Markets of Argentina to become more sustainable.

1.2Oil and gas segment

Plan Gas.Ar and expansion at El Mangrullo

Thanks to the Plan Gas.Ar implementation, in December 2021 Pampa achieved a 38% year-on-year net production increase, reaching 9.1 million m3/day. This increase is equivalent to more than double the nation-wide growth for the same period (16%).

Moreover, as one of the only two producers participating in all the rounds of Plan Gas.Ar, Pampa will add 2 million m3/day as from May 2022, awarded in the third round. It is worth mentioning that in this last round, Pampa’s awarded volume represented 2/3 of the total.

 

Pampa Energía ● Q4 21 Earning release ● 3

In line with our production commitment under Plan Gas.Ar and the outstanding productivity of our leading block, El Mangrullo, it is estimated to increase this block’s processing capacity in stages: (i) the 2.5 million m3/day expansion of the temporary production facility as from May 2022, the beginning of winter; (ii) the commissioning of our 4.8 million m3/day gas treatment plant as from the third quarter of 2022; and (iii) the usage extension of the facilities at Rincón del Mangrullo for 2.0 million m3/day until January 2025. Therefore, the production capacity at El Mangrullo will reach a maximum of 13.6 million m3/day.

El Mangrullo is one of the largest gas-bearing blocks in the Neuquina Basin with almost 200 km2 area and access to Mulichinco and Agrio formations (tight sands or tight gas), and Vaca Muerta (shale gas). Pampa operates and holds 100% working interest of the exploration and explotation concession until 2053.

Exports of natural gas

In December 2021, Pampa obtained permits to export natural gas to different clients in Chile on a firm basis for a maximum volume of 1.22 million m3/day between January – April 2022. Considering the permit granted for the October 2021 – April 2022 period, as from January 2022 the maximum volume exported on a firm basis amounts to 2.72 million m3/day, which allowed to maintain a constant level of production above 9 million m3/day, despite the lower local demand due to off-peak period.

1.3Transport.Ar program

The SE Res. No. 67/22 of February 7, 2022 created the Transport.Ar National Production program to execute gas transportation works allowing, among others: (i) natural gas self-supply; (ii) development of unconventional reserves in the Neuquina Basin on a large scale; (iii) replacement of imports of gas, LNG, and liquid fuel (FO or GO); and (iv) increase in natural gas exports, primarily to neighboring countries.

 

Pampa Energía ● Q4 21 Earning release ● 4

Moreover, the construction of Presidente Néstor Kirchner main gas pipeline and its supplementary works as a strategic project was declared of national public interest, after witnessing a substantial increase in the production of gas due to Plan Gas.Ar, especially in the Neuquina Basin, in addition to the bottleneck on the existing gas pipelines connecting the Neuquina Basin with the large consumption areas, as well as the lower availability of gas in the Noroeste Basin and from Bolivia.

Through PEN Executive Order No. 76/22 of February 11, 2022, a 35-year concession for this gas pipeline was granted to IEASA, and the FONDESGAS (Fondo de Desarrollo Gasífero Argentino) trust was created, being IEASA the trustor and beneficiary, and BICE the trustee.

This pipeline will connect the town of Tratayén, Province of Neuquén, with the City of Salliqueló, Province of Buenos Aires (I Phase), and Salliqueló with the City of San Jerónimo, Province of Santa Fe (II Phase). IEASA will lead the works, which could be performed on its own account or through third parties, giving the priority to YPF. If a call for tenders is launched, TGS will evaluate the suitability to participate for the operation and maintenance.

1.4Other businesses

Transener and TGS’s tariff situation

The PEN Executive Order No. 871/21 of December 23, 2021 extended the term of the Executive Branch’s power to intervene administratively the ENRE and ENARGAS, established in the Solidarity Law, until December 31, 2022.

Moreover, on February 25, 2022, ENRE Res. No. 68/22 and 69/22 were issued, granting a transitionary tariff adjustment of 25% and 23% to Transener and Transba, respectively, retroactive to February 1, 2022. Due to the existing differences between the tariff proposals of said companies and the final tariff schemes, Transener and Transba filed a request to review the proceeding and a preliminary challenge, and will appeal to both resolutions.

On the other hand, through PEN Executive Order No. 91/22 and ENARGAS Res. No. 60/22 of February 2022, the 60% transitionary tariff adjustment was granted to TGS, effective as from March 1, 2022. Among other conditions, the grating of said adjustment did not establish a mandatory investment plan and it has forbidden to: (i) distribute dividends; and (ii) to prepaid financial and commercial debt with shareholders, to acquire other companies or to grant credits.

Pursuant to the 2022 Transitional Agreement, TGS has committed not to initiate any new claims, motions, actions, lawsuits or appeals; and/or to suspend, remain or extend the suspension of all filed motions and claims related to the Comprehensive Tariff Review Renegotiation in force, the Law No. 27,541 and PEN Executive Order No. 287/20 and DNU No. 1020/20.

It is worth mentioning that the tariff schemes of Transener and Transba, and TGS had been unchanged since August and April 2019, respectively. Moreover, during their respective public hearings held in 2022, they informed that their transportation costs represented around 2% and 13% of the residential user’s final bill (comprised of the raw materials, the transportation, the distribution and the tax).

TGS: midstream service expansion at Vaca Muerta

The increase of natural gas activity and production in the Neuquina Basin, promoted by the Plan Gas.Ar, allowed TGS to move forward with two projects approved in the last quarter of 2021, comprised of the installation of: (i) two gas conditioning modular plants, with a capacity of 3.5 million m3/day each, and a gasoline stabilizer tower; and (ii) a conditioning plant with a capacity of 6.6 million m3/day. The estimated investment amounts to US$22 million and US$82 million, commissioning in 2022 and mid-2023, respectively.

 

Pampa Energía ● Q4 21 Earning release ● 5

 

2.Financial highlights
2.1Consolidated balance sheet
Figures in million   As of 12.31.2021   As of 12.31.2020
  AR$ US$ FX 102.72   AR$ US$ FX 84.15
ASSETS            
Property, plant and equipment   170,390 1,659   135,445 1,610
Intangible assets   3,956 39   3,455 41
Right-of-use assets   1,231 12   867 10
Deferred tax assets   8,675 84   9,082 108
Investments in joint ventures and associates   79,500 774   46,229 549
Financial assets at amortized cost   10,821 105   8,428 100
Financial assets at fair value through profit and loss   2,998 29   942 11
Other assets   61 1   57 1
Trade and other receivables   3,379 33   3,631 43
Total non-current assets   281,011 2,736   208,136 2,473
Inventories   15,888 155   9,766 116
Financial assets at amortized cost   537 5   2,062 25
Financial assets at fair value through profit and loss   47,026 458   27,382 325
Derivative financial instruments   16 0   1 0
Trade and other receivables   40,892 398   28,678 341
Cash and cash equivalents   11,283 110   11,900 141
Total current assets   115,642 1,126   79,789 948
Assets classified as held for sale   - -   123,603 1,469
Total assets   396,653 3,861   411,528 4,890
             
EQUITY            
Equity attributable to owners of the company   183,431 1,786   120,247 1,429
Non-controlling interest   609 6   28,631 340
Total equity   184,040 1,792   148,878 1,769
             
LIABILITIES            
Investments in joint ventures and associates   386 4   161 2
Provisions   14,444 141   9,326 111
Income tax and presumed minimum income tax liabilities   19,287 188   11,004 131
Taxes payables   - -   128 2
Deferred tax liabilities   - -   93 1
Defined benefit plans   2,419 24   1,460 17
Borrowings   139,630 1,359   115,428 1,372
Other payables   1,340 13   1,418 17
Total non-current liabilities   177,506 1,728   139,018 1,652
Provisions   560 5   1,379 16
Income tax liabilities   2,098 20   897 11
Taxes payables   2,314 23   3,030 36
Defined benefit plans   515 5   298 4
Salaries and social security payable    2,876 28   1,935 23
Derivative financial instruments   18 0   40 0
Borrowings   8,165 79   20,377 242
Trade and other payables   18,561 181   9,778 116
Total current liabilities   35,107 342   37,734 448
Liabilities associated to assets classified as held for sale   - -   85,898 1,021
Total liabilities   212,613 2,070   262,650 3,121
             
Total liabilities and equity   396,653 3,861   411,528 4,890


 

Pampa Energía ● Q4 21 Earning release ● 6

2.2Consolidated income statement
    Fiscal year   Fourth quarter
Figures in million   2021   2020   2021   2020
    AR$ US$   AR$ US$   AR$ US$   AR$ US$
Sales revenue   144,641 1,508   76,775 1,073   40,901 406   23,106 286
Cost of sales   (91,342) (955)   (46,850) (663)   (28,690) (289)   (14,481) (181)
                         
Gross profit   53,299 553   29,925 410   12,211 117   8,625 105
                         
Selling expenses   (3,156) (33)   (1,828) (26)   (1,404) (15)   (472) (6)
Administrative expenses   (9,507) (99)   (6,588) (93)   (3,206) (32)   (1,740) (22)
Exploration expenses   (61) -   (29) -   (11) -   (8) -
Other operating income   10,196 105   3,628 51   1,332 13   1,122 14
Other operating expenses   (5,360) (58)   (2,550) (36)   (737) (8)   (769) (10)
Impairment of financial assets   (220) (2)   (560) (9)   9 1   291 4
Impairment of PPE, intangible assets and inventories   (332) (4)   (10,351) (139)   (160) (2)   (6,035) (72)
Results for part. in joint businesses and associates   11,567 117   6,551 85   3,436 32   1,741 19
                         
Operating income   56,426 579   18,198 243   11,470 106   2,755 32
                         
Financial income   847 10   686 9   228 3   157 1
Financial costs   (17,512) (185)   (12,528) (177)   (3,384) (34)   (3,930) (50)
Other financial results   (1,545) (14)   6,131 84   (4,358) (43)   2,778 36
Financial results, net   (18,210) (189)   (5,711) (84)   (7,514) (74)   (995) (13)
                         
Profit before tax   38,216 390   12,487 159   3,956 32   1,760 19
                         
Income tax   (7,301) (77)   (3,122) (35)   485 6   (391) (1)
                         
Net income for continuing operations   30,915 313   9,365 124   4,441 38   1,369 18
                         
Net income (loss) from discontinued operations   (7,129) (75)   (49,333) (592)   - -   (47,568) (569)
                         
Net income (loss) for the period   23,786 238   (39,968) (468)   4,441 38   (46,199) (551)
Attributable to the owners of the Company   27,097 273   (31,447) (367)   4,520 39   (38,603) (463)
Continuing operations   30,823 312   9,952 132   4,520 39   1,851 24
Discontinued operations   (3,726) (39)   (41,399) (499)   - -   (40,454) (487)
Attributable to the non-controlling interests   (3,311) (35)   (8,521) (101)   (79) (1)   (7,596) (88)
                         
Net income (loss) per share attributable to shareholders   19.38 0.20   (20.40) (0.24)   3.26 0.03   (26.53) (0.32)
From continuing operations   22.05 0.22   6.46 0.09   3.26 0.03   1.27 0.02
From discontinued operations   (2.67) (0.03)   (26.85) (0.32)   - -   (27.804) (0.335)
                         
Net income (loss) per ADR attributable to shareholders   484.61 4.88   (509.97) (5.95)   81.51 0.70   (663.30) (7.96)
From continuing operations   551.25 5.58   161.39 2.14   81.51 0.70   31.81 0.41
From discontinued operations   (66.64) (0.70)   (671.36) (8.09)   - -   (695.11) (8.37)
                         
Average outstanding common shares   1,397.9 1,397.9   1,541.6 1,541.6   1,386.3 1,386.3   1,455.0 1,455.0
Outstanding common shares by the end of period   1,386.0 1,386.0   1,453.9 1,453.9   1,386.0 1,386.0   1,453.9 1,453.9

 

Pampa Energía ● Q4 21 Earning release ● 7

2.3Cash and financial borrowings
As of December 31, 2021,
in US$ million		   Cash1   Financial debt   Net debt
  Consolidated
in FS		 Ownership adjusted   Consolidated
in FS		 Ownership adjusted   Consolidated
in FS		 Ownership adjusted
Power generation   261 257   418 418   156 161
Petrochemicals   - -   - -   - -
Holding and others   91 91   - -   (91) (91)
Oil and gas   220 220   1,021 1,021   801 801
Total under IFRS/Restricted Group   573 568   1,439 1,439   866 871
Affiliates at O/S2   101 101   339 339   238 238
Total with affiliates   674 669   1,778 1,778   1,104 1,109

Note: Financial debt includes accrued interests. 1 It includes cash and cash equivalents, financial assets at fair value with changing results and investments at amortized cost. 2 Under IFRS, the affiliates Greenwind, OldelVal, Refinor, CTBSA, Transener, and TGS are not consolidated in Pampa.

Debt transactions

Pampa’s financial debt at the consolidated level under IFRS decreased to US$1,439 million as of December 31, 2021 (-US$175 million vs. closing of 2020). In terms of net debt, the reduction amounts to US$282 million. The average interest rate for US$-bearing indebtedness was 7.8%, currency in which 99.2% of the Company’s gross debt is denominated, mainly at a fixed rate. AR$ indebtedness’s average interest rate was 33.0%. Pampa’s consolidated financial debt averaged 4.4 years.

The following chart shows principal maturity profile, net of repurchases, in million US$ by the end of Q4 21:

 

 

 

Note: It only considers Pampa consolidated under IFRS; it does not include affiliates TGS, OldelVal, Transener, Greenwind, CTBSA and Refinor.

 

In Q4 21, Pampa paid bank calls for a total of AR$546 million and borrowings for US$3.9 million. After the closing of the quarter, to finance PEPE III expansion, Pampa issued its first Green Bond4 (Series VIII CB) for a AR$3,107 million FV, at a variable interest rate of Badlar plus 2%, maturing in July 2023 with American amortization system. Moreover, Pampa paid borrowings for AR$1,178 million.

Regarding our affiliates, in Q4 21, Transener paid at maturity loans for AR$83 million and Greenwind paid US$3.5 million of the credit facility executed with IDB Invest. Moreover, CTBSA issued Series IV CB in US$-link for US$96 million at 0% nominal annual rate maturing in 36 months, paid at maturity US$33.2 million of the syndicated loan and prepaid the VRDs for US$94 million.

After the closing of the quarter, CTBSA paid at maturity US$6.4 million of the syndicated loan and Transener paid at maturity borrowings for AR$56 million.

4 For further information, see section 1.1 of this Earnings Release.

 

Pampa Energía ● Q4 21 Earning release ● 8

As of this Earnings Release issuance, the Company complies with the covenants established in its debt agreements.

Summary of debt securities

Company
In million		 Security Maturity Amount issued Amount outstanding Coupon
In US$          
TGS1 CB at discount at fixed rate 2025 500 478 6.75%
Pampa CB Series T at discount & fixed rate 2023 500 390 7.375%
CB Series I at discount & fixed rate 2027 750 636 7.5%
CB Series III at discount & fixed rate 2029 300 293 9.125%
           
In US$-link          
CTEB1 CB Series I 2023 43 43 4%
CB Series IV 2024 96 96 0%
           
In AR$          
Pampa CB Series VIII (Green Bond) 2023 3,107 3,107 Badlar Privada +2%
           
In UVA          
CTEB1 CB Series II 2024 65 65 4%

Note: 1 According to IFRS, affiliates are not consolidated in Pampa’s FS.

Credit rating

The following table shows the Group’s ratings:

Company Agency Rating
Global Local
Pampa S&P B-1 na
Moody's Caa3 na
FitchRatings2 B- AA (long-term)
A1+ (short-term)
TGS S&P CCC+ na
Moody's Caa3 na
Transener FitchRatings2 na A+ (long-term)
CTEB FitchRatings2 na A+

Note: 1 Stand-alone rating. 2 Local ratings issued by FIX SCR.

 

Pampa Energía ● Q4 21 Earning release ● 9

 

2.4Buyback of own financial securities5

Pampa

On December 1, 2021, Pampa’s Board of Directors approved the XI share buyback program under the following terms and conditions. However, on March 10, 2022, Pampa’s Board of Directors resolved to suspend this program as the Company’s share and ADR’s quote reached values exceeding the repurchase cap. If the conditions previously approved in the share repurchase program is reestablished, the program will be automatically restored the next business day after this event.

  XI repurchase program
Maximum amount to buyback US$30 million
Maximum price AR$167/common share or US$19/ADR
Period in force 120 days as from December 3, 2021
Status Suspended

In Q4 21, the Company indirectly acquired 15 thousand ADR at an average price of US$18.0/ADR. After the closing of the quarter, the Company indirectly acquired 95 thousand ADR at an average price of US$18.4/ADR.

On the other hand, on March 3, 2022, the cancellation of 12.5 million shares (equivalent to 0.5 million ADR) became effective, which was previously approved by the Shareholders’ Meeting held on September 30, 2021.

Therefore, as of March 9, 2022, Pampa’s outstanding capital stock amounts to 1,383.6 million common shares (equivalent to 55.3 million ADR)6.

TGS

As of March 9, 2022, TGS’s outstanding capital stock amounts to 752.8 million common shares (equivalent to 150.6 million ADR).

On the other hand, in Q4 21, Pampa indirectly acquired 1.9 million ADR of TGS at an average cost of US$4.9/ADR. After the closing of the quarter, Pampa acquired 0.1 million ADR of TGS at an average cost of US$4.3/ADR. As of March 9, 2022, the Company’s direct and indirect ownership of TGS amounts to 29.3% of its issued capital stock.

Regarding debt securities, in Q4 21 TGS repurchased US$1.3 million FV of its 2025 CB. As of March 9, 2022, the outstanding 2025 CB amounted to US$477.6 million FV.

5 Deemed to be effected transactions.

6 For further information, see Ownership Breakdown.

 

Pampa Energía ● Q4 21 Earning release ● 10

3.Analysis of the Q4 21 results
Breakdown by segment
Figures in US$ million		 Q4 21 Q4 20 Variation
Sales Adjusted EBITDA Net Income Sales Adjusted EBITDA Net Income Sales Adjusted EBITDA Net Income
                   
Power generation 155 105 31 150 121 20 +3% -13% +55%
Oil and Gas 119 46 (5) 68 19 2 +75% +146% NA
Petrochemicals 144 9 4 87 10 5 +66% -11% -20%
Holding and Others 7 39 9 3 34 (3) +133% +13% NA
Eliminations (19) - - (22) - - -14% NA NA
                   
Subtotal continuing operations 406 199 39 286 184 24 +42% +8% +63%
                   
Electricity distribution (discont.) - - - - (16) (487) NA -100% -100%
                   
Total 406 199 39 286 168 (463) +42% +18% NA

Note: Net income attributable to the Company’s shareholders.

3.1Reconciliation of consolidated adjusted EBITDA
Reconciliation of consolidated adjusted EBITDA,
in US$ million		   Fiscal year   Fourth quarter
  2021 2020   2021 2020
Consolidated operating income   579 243   106 32
Consolidated depreciations and amortizations   205 205   58 52
EBITDA   784 448   164 84
             
Adjustments from generation segment   29 126   8 60
Deletion of equity income   (47) (67)   (15) (30)
Deletion of PPE & intangible assets' impairment   2 128   - 72
Deletion of provision recovery of PEPE IV surety bond   (13) (7)   - -
Deletion of gain from commercial interests   (24) (23)   (4) (6)
Deletion of outage provision at GEBATG03   8 -   - -
Deletion of PPE's impairment   14 -   5 -
Greenwind's EBITDA adjusted by ownership   11 12   3 3
CTBSA's EBITDA adjusted by ownership   78 83   19 21
Adjustments from oil and gas segment   13 9   0 (1)
Deletion of gain from commercial interests   (3) (4)   (0) (2)
Deletion of provision for environmental remediation   14 -   - -
Deletion of impairment of receivables from distCos   - 13   - -
OldelVal's EBITDA adjusted by ownership   1 1   0 0
Adjustments from petrochemicals segment   2 11   2 (0)
Deletion of inventory impairment   2 11   2 -
Deletion of gain from commercial interests   (0) (0)   (0) (0)
Adjustments from holding and others segment   77 104   25 41
Deletion of equity income   (70) (18)   (17) 11
Deletion of gain from commercial interests   (0) (2)   (0) (0)
Deletion of contigencies provision    12 -   - -
Deletion of executive compensation liabilities' reversal   (7) -   - -
TGS's EBITDA adjusted by ownership   123 98   39 25
Transener's EBITDA adjusted by ownership   14 27   2 5
Refinor's EBITDA adjusted by ownership   5 (1)   1 (0)
             
Consolidated adjusted EBITDA, continuing op.   905 698   199 184
At our ownership   905 694   200 184
             
+ Discontinued op. EBITDA: Edenor   17 51   - (16)
             
Consolidated adjusted EBITDA, cont. and discont. op.   921 749   199 168
At our ownership   911 722   200 175

 

Pampa Energía ● Q4 21 Earning release ● 11

3.2Analysis of the power generation segment
Power generation segment, consolidated
Figures in US$ million		   Fiscal year   Fourth quarter
  2021 2020 ∆%   2021 2020 ∆%
Sales revenue   656 559 +17%   155 150 +3%
Cost of sales   (355) (254) +40%   (89) (73) +22%
                 
Gross profit   301 305 -1%   66 77 -14%
                 
Selling expenses   (2) (2) -   (1) (1) -
Administrative expenses   (31) (30) +3%   (10) (8) +25%
Other operating income   42 35 +20%   6 10 -40%
Other operating expenses   (5) (6) -17%   (1) (1) -
Impairment of PPE and intangible assets   (2) (128) -98%   - (72) -100%
Results for participation in joint businesses   47 67 -30%   15 30 -50%
                 
Operating income   350 241 +45%   75 35 +114%
                 
Finance income   4 3 +33%   1 - NA
Finance costs   (46) (73) -37%   (14) (31) -55%
Other financial results   (14) 1 NA   (27) 2 NA
Financial results, net   (56) (69) -19%   (40) (29) +38%
                 
Profit (loss) before tax   294 172 +71%   35 6 NA
                 
Income tax   (75) (33) +127%   (5) 8 NA
                 
Net income (loss) for the period   219 139 +58%   30 14 +114%
Attributable to owners of the Company   218 147 +48%   31 20 +55%
Attributable to non-controlling interests   1 (8) NA   (1) (6) -83%
                 
Adjusted EBITDA   467 462 +1%   105 121 -13%
Adjusted EBITDA at our share ownership   467 458 +2%   106 121 -12%
                 
Increases in PPE, intangible and right-of-use assets   39 61 -36%   32 9 +256%
Depreciation and amortization   88 95 -7%   22 26 -15%

In Q4 21, the US$5 million year-on-year increase in sales is mainly explained by the additional and transitionary income for legacy energy (SE Res. No. 1037/21), and the recovery of industrial demand and Energía Plus prices, partially offset by the maturity of PPA at the ST of CTLL and at CTP, billed under spot energy as from November 1 and July 15, 2021, respectively.

Even though spot energy comprises 63% of the 4,970 MW operated by Pampa7, it represented 30% of the segment’s sales in Q4 21. SE Res. No. 1037/21 established that CAMMESA should pay 100% of the power capacity remuneration, assuming a 70% load factor, plus an additional amount for the electricity exported by CAMMESA, retroactive to September 1, 2021 and until February 28, 2022. Thanks to this transitionary income, the power capacity remuneration was US$3.6 thousand/MW-month for our thermal legacy units and US$1.9 thousand/MW-month for hydros, being 23% and 5% higher than Q4 20, respectively. However, a higher increase of AR$-denominated costs was recorded in certain units as the inflation was higher than the AR$ devaluation.

Revenues from fuel were slightly higher than Q4 20 as the increase in prices due to Plan Gas.Ar was offset by lower volume as a consequence of the programmed maintenance at the second CCGT of CTGEBA. It is worth mentioning that this income, which also affects the cost of sales due to gas purchases to our E&P, only applies to PPA under SEE Res. No. 287/17 and Energía Plus contracts. CAMMESA provides directly the remaining gas and liquid fuel consumed to dispatch our thermal units, without representing any revenues or costs for the Company.

In operating terms, the power generation operated by Pampa increased by 6% vs. Q4 20, similar to the national demand growth (+6.5%), whereas the nationwide generation increased only 1%. From units

7 Under IFRS, CTEB (567 MW) and PEMC (100 MW) are affiliates; their results are not consolidated in the FS, but they are operated by Pampa and their EBITDA at our equity stake are included in Pampa’s adjusted EBITDA.

 

Pampa Energía ● Q4 21 Earning release ● 12

operated by Pampa, there was a higher dispatch at almost all our thermal units (+665 GWh), except for the CCGT at CTLL and the new CCGT at CGEBA, affected by programmed maintenance (-288 GWh), and the engines CTPP and CTIW due to lower exports from the SADI (-27 GWh). Moreover, there was lower hydroelectric generation (-65 GWh) and wind generation (-16 GWh) due to lower water inputs and wind resources, respectively.

In Q4 21, all power units operated by Pampa reached an average availability rate of 95.5%, slightly higher than the 94.2% recorded in Q4 20, mainly explained by the forced outage at CTG’s Plus unit and the programmed maintenance at CTEB in Q4 20, partially offset by the programmed maintenance at CTLL’s CCGT and the new CCGT at CTGEBA in Q4 21. Especially, thermal units recorded an availability of 98.2% (Q4 21) and 98.1% (Q4 20).

Power generation's key performance indicators    2021   2020   Variation
Hydro Wind Thermal Total Hydro Wind Thermal Total Hydro Wind Thermal Total
Installed capacity as of Dec (MW)   938 206 3,826 4,970   938 206 3,811 4,955   - - +0% +0%
New capacity (%)   - 100% 43% 37%   - 100% 48% 41%   - - -6% -4%
Market share (%)   2% 0% 9% 12%   2% 0% 9% 12%   -0% -0% -0% -0%
                               
Fiscal year                              
Net generation (GWh)   1,343 838 15,252 17,433   1,546 859 14,065 16,470   -13% -2% +8% +6%
Volume sold (GWh)   1,342 870 16,246 18,458   1,542 862 14,159 16,563   -13% +1% +15% +11%
                               
Average price (US$/MWh)   22 70 47 46   22 71 47 46   -1% -0% -1% -0%
Average gross margin (US$/MWh)   4 58 31 30   10 63 36 35   -64% -8% -15% -14%
                               
Fourth quarter                              
Net generation (GWh)   419 195 4,055 4,670   485 211 3,705 4,400   -13% -7% +9% +6%
Volume sold (GWh)   419 203 4,405 5,028   486 214 3,727 4,427   -14% -5% +18% +14%
                               
Average price (US$/MWh)   18 71 42 41   15 72 48 46   +21% -1% -12% -9%
Average gross margin (US$/MWh)   -3 57 27 26   3 64 35 33   -204% -11% -22% -21%

Note: Gross margin before amortization and depreciation. It includes CTEB and PEMC, operated by Pampa (50% of equity stake).

Q4 21 net operating costs, excluding depreciation and amortizations, increased by 55% vs. Q4 20, mainly explained by higher energy purchases to cover the rise in Plus demand, increase in material and wage expenses as the inflation and wage evolutions were higher than the AR$ devaluation, and lower commercial interests due to collection delays received from CAMMESA as it improved the days sales outstanding. Moreover, in Q4 21 PPE impairments were charged at certain legacy energy units (US$5 million).

The Q4 21 financial results amounted to a net loss of US$40 million, US$11 million higher than Q4 20, mainly explained by losses from the holding of financial securities in Q4 21, partially offset by lower financial interests due to lower stock of debt and allocation to the segment.

In Q4 21, our power generation’s adjusted EBITDA amounted to US$105 million, 13% lower vs. Q4 20, mainly due to the PPA maturity at the ST of CTLL, partially offset by the additional and transitionary income for legacy energy, and the Energía Plus’s increased margins. The adjusted EBITDA considers our proportional 50% stake of CTEB (CTBSA), contributing US$19 million in Q4 21 (vs. US$21 million in Q4 20), and a 50% stake of PEMC (Greenwind), contributing US$3 million in Q4 21 (the same as Q4 20). Moreover, the adjusted EBITDA excludes the recognition of commercial interests from delayed receivables, mostly from CAMMESA (US$4 million in Q4 21 and US$6 million in Q4 20), in addition to the PPE impairment charged as operating expenses in Q4 21 (US$ 5 million).

Finally, capital expenditures in Q4 21, excluding CTEB and PEMC, increased by US$23 million vs. Q4 20, mainly explained by PEPE III’s expansion project.

 

Pampa Energía ● Q4 21 Earning release ● 13

 

Regarding our expansion projects, the following summary shows the current status:

Project MW Marketing Currency Awarded price   Estimated capex in
US$ million1		 Date of
commissioning
Capacity per
MW-month		 Variable
per MWh		 Total
per MWh		   Budget % Executed
@12/31/21
Thermal                    
Loma de la Lata 15 SE Res. No. 440/21 AR$ 208,980 - 551,475(2) 418 939   22 90% August 3, 2021
Closing to CCGT Genelba Plus 400 PPA for 15 years US$ 20,500 6 34   350 90% OC: June 12, 2019(3)
CC: July 2, 2020
Closing to CCGT Ensenada 280 PPA for 10 years US$ 23,962 10.5 43   213 76% Q3 2022 (est.)
                     
Renewable                    
Pampa Energía III 81 MAT ER US$ na na 58(4)   128 0% Q2 2023 (est.)

Note: 1 Amount without value-added tax. 2 It considers the range of load factor coefficient and the HMRT additional remuneration.
3 201 MW were remunerated under spot energy until July 1, 2020. 4 Estimated average.

3.3Analysis of the oil and gas segment
Oil & gas segment, consolidated
Figures in US$ million		   Fiscal year   Fourth quarter
  2021 2020 ∆%   2021 2020 ∆%
Sales revenue   453 294 +54%   119 68 +75%
Cost of sales   (289) (243) +19%   (89) (58) +53%
                 
Gross profit   164 51 +222%   30 10 +200%
                 
Selling expenses   (18) (15) +20%   (10) (2) NA
Administrative expenses   (46) (42) +10%   (14) (10) +40%
Other operating income   58 9 NA   6 3 +100%
Other operating expenses   (28) (17) +65%   (2) (6) -67%
Impairment of financial assets   - (13) -100%   1 - NA
                 
Operating income (loss)   130 (27) NA   11 (5) NA
                 
Finance income   3 7 -57%   1 2 -50%
Finance costs   (103) (100) +3%   (17) (18) -6%
Other financial results   (16) 44 NA   (10) 23 NA
Financial results, net   (116) (49) +137%   (26) 7 NA
                 
Profit (loss) before tax   14 (76) NA   (15) 2 NA
                 
Income tax   8 23 -65%   10 - NA
                 
Net income (loss) for the period   22 (53) NA   (5) 2 NA
                 
Adjusted EBITDA   257 90 +184%   46 19 +146%
                 
Increases in PPE and intangible assets   213 41 NA   67 7 NA
Depreciation and amortization   114 108 +6%   35 25 +40%

In Q4 21, our oil and gas sales increased by US$51 million vs. Q4 20, mainly explained by the Plan Gas.Ar GSA (higher sale price and volume), the recovery of natural gas demand and prices on the industrial segment, and the substantial growth of gas exported to Chile at higher prices than local market, and to a lesser extent, the increase of oil price.

In operating terms, in Q4 21, our oil and gas segment total production registered 58.1 kboe/day (+33% vs. Q4 20 and +1% vs. Q3 21). Gas production reached 9.0 million m3/day (+34% vs. Q4 20 and +1% vs. Q3 21), mainly explained by the activity resumption as a result of Plan Gas.Ar. In particular, a significant growth was recorded at El Mangrullo, reaching a new record production of 6.3 million m3/day in Q4 21 (+39% vs. Q4 20 and +2% vs. Q3 21), comprising 70% of our total gas production. A significant production increase was also recorded at Río Neuquén, (1.5 million m3/day in Q4 21, +84% vs. Q4 20 and

 

Pampa Energía ● Q4 21 Earning release ● 14

+8% vs. Q3 21). These effects were partially offset by reduced output at Rincón del Mangrullo, due to lower activity and natural decline (0.4 million m3/day in Q4 21, -34% year-on-year and -19% vs. Q3 21).

Our accrued gas average sale price was US$3.1/MBTU in Q4 21 (+47% vs. Q4 20), mainly explained by the Plan Gas.Ar8, the gradual convergence of the industrial/spot prices to the Plan Gas.Ar and the high prices from exports to Chile. Moreover, 40% of our gas deliveries went to the industrial/spot market, 22% was consumed as raw material for our thermal power plants9 and our petrochemical plants, 21% was exported and 15% was destined to the residential segment. The marginal balance was sold directly to CAMMESA. On the other hand, in Q4 20, 52% of the deliveries were destined to CAMMESA’s spot tenders, 40% went to our thermal power plants and petrochemicals, and the balance to the industrial/spot segment.

Oil production reached 5.2 kbbl/day in Q4 21 (+20% vs. Q4 20 and +9% vs. Q3 21), mainly due to the domestic demand recovery, offset by lower exports. Production increased at El Tordillo, Río Neuquén and Gobernador Ayala (4.5 kbbl/day in Q4 21, +29% year-on-year). Moreover, 93% of the volume sold during Q4 21 was destined to the domestic market (vs. 86% in Q4 20). Our accrued oil average sale price in Q4 21 increased year-on-year by 42% to US$58.6/bbl, explained by the rise of Brent but moderated by local prices.

Oil and gas'
key performance indicators 		   2021   2020   Variation
Oil Gas Total Oil Gas Total Oil Gas Total
Fiscal year                        
Volume                        
Production                        
In thousand m3/day   0.7 8,004     0.7 6,902     +6% +16% +15%
In million cubic feet/day     283       244    
In thousand boe/day   4.7 47.1 51.8   4.4 40.6 45.1  
Sales                        
In thousand m3/day   0.7 8,122     0.7 7,190     +1% +13% +12%
In million cubic feet/day     287       254    
In thousand boe/day   4.6 47.8 52.4   4.6 42.3 46.9  
                         
Average Price                        
In US$/bbl   58.8       39.0       +51% +61%  
In US$/MBTU     3.6       2.2      
                         
Fourth quarter                        
Volume                        
Production                        
In thousand m3/day   0.8 8,987     0.7 6,683     +20% +34% +33%
In million cubic feet/day     317       236    
In thousand boe/day   5.2 52.9 58.1   4.3 39.3 43.7  
Sales                        
In thousand m3/day   0.7 8,962     0.7 6,772     +1% +32% +29%
In million cubic feet/day     316       239    
In thousand boe/day   4.7 52.7 57.4   4.7 39.9 44.5  
                         
Average Price                        
In US$/bbl   58.6       41.3       +42% +47%  
In US$/MBTU     3.1       2.1      

Note: Net production in Argentina. Gas volume standardized at 9,300 kilocalories (kCal).

As of December 31, 2021, we accounted for 884 productive wells, 26 more than December 31, 2020. Moreover, Pampa’s proven reserves by the end of 2021 amounted to 157 million boe, 11% higher than 2020’s end of year. Besides, we recorded shale reserves from the Vaca Muerta formation 40% higher than

8 A 4-year contract until December 2024 to supply gas to power plants and the retail segment, at price of US$4.5/MBTU during the winter period (May to September) and US$3.0/MBTU for the rest of the year.

9 Energía Plus and SEE Res. No. 287/17.

 

Pampa Energía ● Q4 21 Earning release ● 15

the volume certified in 2020. Considering the production levels and additional reserves achieved in 2021, the replacement ratio amounted to 1.8 and the average reserve life was 8.4 years approximately.

 

Net operating costs in Q4 21, excluding depreciation and amortizations as well as Plan Gas.Ar, increased by 63% vs. Q4 20, mainly due to higher gas activity (contractors and maintenance), the increase in gas transportation expenses due to higher exports, more royalties and levies from higher volume and prices sold, and higher wages expenses as the wage evolution was higher than the AR$ devaluation. Compared to Q3 21, net operating costs increased 9%, mainly due to higher gas activity and the increase in the transportation costs from gas exports, partially offset by lower royalties and levies due to price seasonality and increase of oil stock, exported in January 2022. In particular, the lifting cost10 reached US$7.8 per produced boe in Q4 21, 29% higher than the US$6.0/boe recorded in Q4 20 and Q3 21.

In Q4 21, financial results reached a net loss of US$26 million, whereas a US$7 million net gain was recorded in Q4 20, mainly because of profits from the holding of financial securities in Q4 20, and to a lesser extent, higher financial interests due to higher allocation to the segment (offset by lower stock of debt).

Our oil and gas’ adjusted EBITDA amounted to US$46 million in Q4 21 vs. US$19 million in Q4 20, mainly explained by the Plan Gas.Ar effect over natural gas volume and price sold, in addition to higher oil price, partially offset by the increase in expenses related to the resumption of gas activity and its exports. The adjusted EBITDA excludes the recognition of commercial interest due to collection delays, mostly charged to CAMMESA (US$0.3 million in Q4 21 and US$2 million in Q4 21).

Finally, the segment’s capital expenditures amounted to US$67 million in Q4 21, whereas US$7 million was recorded in Q4 20, mainly explained by the commitments under Plan Gas.Ar, which reactivated drilling and completion activities at gas-bearing blocks.

10 Metric equivalent to cost of sales excluding purchase and inventory, royalties, direct taxes and depreciations and amortizations.

 

Pampa Energía ● Q4 21 Earning release ● 16

3.4Analysis of the petrochemicals segment
Petrochemicals segment, consolidated
Figures in US$ million		   Fiscal year   Fourth quarter
  2021 2020 ∆%   2021 2020 ∆%
Sales revenue   490 267 +84%   144 87 +66%
Cost of sales   (424) (233) +82%   (130) (72) +81%
                 
Gross profit   66 34 +94%   14 15 -7%
                 
Selling expenses   (13) (9) +44%   (4) (3) +33%
Administrative expenses   (4) (3) +33%   (1) - NA
Other operating income   1 - NA   - (1) -100%
Other operating expenses   (3) (6) -50%   (1) (2) -50%
Recovery of financial assets impairment   - 1 -100%   - - NA
Impairment of inventories   (2) (11) -82%   (2) - NA
                 
Operating income (loss)   45 6 NA   6 9 -33%
                 
Finance costs   (3) (3) -   (1) (1) -
Other financial results   (2) 5 NA   - (1) -100%
Financial results, net   (5) 2 NA   (1) (2) -50%
                 
Profit (loss) before tax   40 8 NA   5 7 -29%
                 
Income tax   (12) (2) NA   (1) (2) -50%
                 
Net income (loss) for the period   28 6 NA   4 5 -20%
                 
Adjusted EBITDA   50 19 +164%   9 10 -11%
                 
Increases in PPE and intangible assets   6 3 +100%   1 2 -50%
Depreciation and amortization   3 2 +50%   1 1 -

The adjusted EBITDA of the petrochemicals segment amounted to US$9 million in Q4 21, slightly lower than Q4 20. The higher costs of virgin naphtha and other raw materials (driven by international reference prices) and the Plan Gas.Ar effect over the cost of gas were partially offset by the substantial price improvement, both domestic and international, and the recovery of demand, mainly in the local market. Quarter-on-quarter, adjusted EBITDA increased by US$2 million, explained by better international reference prices, lower costs of gas due to off-peak period, and higher volume sold of styrene and polystyrene in the domestic market.

Total volume sold increased by 6% vs. Q4 20, mainly explained by the increase of reforming products sales in the domestic market due to higher gasoline consumption (offset by lower exports), as well as higher domestic and foreign demand of styrene and polystyrene. It is worth mentioning that, in Q4 21, 6 thousand ton of bases and gasoline were dispatched as toll processing, which were not recorded as volume sold. The amounts corresponding to Pampa are shown below:

 

Pampa Energía ● Q4 21 Earning release ● 17

Petrochemicals'
key performance indicators 		   Products   Total
  Styrene & polystyrene1 SBR Reforming  
Fiscal year            
Volume sold 2021 (thousand ton)   114 49 254   417
Volume sold 2020 (thousand ton)   94 37 205   337
Variation 2021 vs. 2020   +21% +32% +24%   +24%
             
Average price 2021 (US$/ton)   1,778 2,003 741   1,175
Average price 2020 (US$/ton)   1,195 1,302 503   786
Variation 2021 vs. 2020   +49% +54% +47%   +50%
             
Fourth quarter            
Volume sold Q4 21 (thousand ton)   33 11 70   114
Volume sold Q4 20 (thousand ton)   29 11 68   107
Variation Q4 21 vs. Q4 20   +14% +3% +4%   +6%
             
Average price Q4 21 (US$/ton)   1,846 2,318 831   1,266
Average price Q4 20 (US$/ton)   1,252 1,401 506   795
Variation Q4 21 vs. Q4 20   +47% +65% +64%   +59%

Note: 1 It includes Propylene.

In Q4 21, financial results reached a net loss of US$1 million (US$1 million improvement vs. Q4 20), mainly explained by losses from the holding of financial securities and FX net difference in Q4 20.

The capital expenditures reached US$1 million in Q4 21 and US$2 million in Q4 20.

3.5Analysis of the holding and others segment
Holding and others segment, consolidated
Figures in US$ million		   Fiscal year   Fourth quarter
  2021 2020 ∆%   2021 2020 ∆%
Sales revenue   22 20 +10%   7 3 +133%
                 
Gross profit   22 20 +10%   7 3 +133%
                 
Administrative expenses   (18) (18) -   (7) (4) +75%
Other operating income   4 7 -43%   1 2 -50%
Other operating expenses   (22) (7) +214%   (4) (1) +300%
Impairment of financial assets   (2) 3 NA   - 4 -100%
Results for participation in joint businesses   70 18 +289%   17 (11) NA
                 
Operating income (loss)   54 23 +135%   14 (7) NA
                 
Finance income   4 1 +300%   2 - NA
Finance costs   (34) (3) NA   (3) (1) +200%
Other financial results   18 34 -47%   (6) 12 NA
Financial results, net   (12) 32 NA   (7) 11 NA
                 
Profit (loss) before tax   42 55 -24%   7 4 +75%
                 
Income tax   2 (23) NA   2 (7) NA
                 
Net income for the period   44 32 +38%   9 (3) NA
                 
Adjusted EBITDA   131 127 +3%   39 34 +13%
                 
Increases in PPE   2 2 +10%   1 1 -
Depreciation and amortization   - - NA   - - NA

In the holding and others segment, without considering the equity income from affiliates (Transener, TGS and Refinor), we recorded a US$3 million operating loss, whereas in Q4 20 a US$4 million profit was recorded, mainly explained by higher provision for contingencies, partially offset by higher accrued fees.

 

Pampa Energía ● Q4 21 Earning release ● 18

The Q4 21 financial results amounted to a net loss of US$7 million, whereas in Q4 20 was a net gain of US$11 million, mainly due to FX net difference losses in Q4 21 as a result of lower devaluation over the net passive monetary position in AR$, in addition to the interests related to contingencies from the tax of presumed minimum profit.

The adjusted EBITDA of our holding and others increased by 13%, recording US$39 million in Q4 21. The adjusted EBITDA excludes commercial interests (marginal) and the equity income from our participation in TGS, Transener and Refinor. In turn, it adds the EBITDA adjusted by equity ownership in these businesses.

The EBITDA from our direct and indirect ownership of 29.2% and 27.7% in TGS were US$39 million (US$133 million at 100%) in Q4 21 vs. US$25 million (US$91 million at 100%) in Q4 20. The increase of total adjusted EBITDA was mainly explained by higher international reference prices of natural gasoline and LPG, higher LPG export volume, the increase in ethane price and more midstream revenues from natural gas transportation and conditioning service in Vaca Muerta. These effects were partially offset by the higher US$ unit cost of natural gas, which is used to replace thermal reduction at Cerri Complex Plant, and lower regulated revenues due to the lack of tariff adjustment since April 2019 and the AR$ devaluation, in addition to a higher export duties charge.

In Transener, the EBITDA adjusted by our indirect stake ownership of 26.3% decreased to US$2 million (US$8 million at 100%) in Q4 21 vs. US$5 million (US$19 million at 100%) in Q4 20, mainly because of the lack of tariff adjustment, frozen as from August 2019, and devaluation effect.

In Refinor, the EBITDA adjusted by our stake ownership of 28.5% in Q4 21 recorded a gain of US$1 million (US$3 million at 100%), whereas in Q4 20 was marginal. The increase is mainly explained by the gradual recovery of demand and higher sales prices, partially offset by increased crude oil costs, which is the refinery’s main raw material.

 

Pampa Energía ● Q4 21 Earning release ● 19

3.6Analysis of the fiscal year, by subsidiary and segment
Subsidiary
In US$ million		 Fiscal year 2021   Fiscal year 2020
% Pampa Adjusted EBITDA Net debt2 Net income3   % Pampa Adjusted EBITDA Net debt2 Net income3
 
Power generation segment                  
Diamante 61.0% 4 (6) 4   61.0% 6 (2) (3)
Los Nihuiles 52.0% (3) (5) (1)   52.0% 4 (10) (13)
                   
Greenwind   22 72 (4)     24 90 5
Non-controlling stake adjustment   (11) (36) 2     (12) (45) (3)
Subtotal Greenwind adjusted by ownership 50.0% 11 36 (2)   50.0% 12 45 3
                   
CTBSA   156 220 98     165 202 129
Non-controlling stake adjustment   (78) (110) (49)     (83) (101) (65)
Subtotal CTBSA adjusted by ownership 50.0% 78 110 49   50.0% 83 101 65
                   
Pampa stand-alone, other companies, adjs. & deletions1 100.0% 378 167 168   100% 358 465 96
Subtotal power generation   467 302 218     462 598 147
                   
Oil & gas segment                  
OldelVal   61 (27) 25     55 (10) 24
Non-controlling stake adjustment   (60) 26 (24)     (54) 9 (24)
Subtotal OldelVal adjusted by ownership 2.1% 1 (1) 1   2.1% 1 (0) 1
                   
Pampa stand-alone, other companies, adjs. & deletions1   255 801 21     89 744 (54)
Subtotal oil & gas   257 801 22     90 744 (53)
                   
Petrochemicals segment                  
Pampa Energía 100.0% 50 - 28   100.0% 19 - 6
Subtotal petrochemicals   50 - 28     19 - 6
                   
Holding & others segment                  
Transener   54 (31) (13)     102 (9) 49
Non-controlling stake adjustment   (40) 22 9     (75) 6 (36)
Subtotal Transener adjusted by ownership 26.3% 14 (8) (3)   26.3% 27 (2) 13
                   
TGS   425 310 204     356 406 39
Non-controlling stake adjustment   (302) (220) (145)     (257) (294) (28)
Subtotal TGS adjusted by ownership 29.2% 123 90 59   27.7% 98 113 11
                   
Refinor   17 35 (4)     (4) 27 (8)
Non-controlling stake adjustment   (12) (25) 3     3 (19) 6
Subtotal Refinor adjusted by ownership 28.5% 5 10 (1)   28.5% (1) 8 (2)
                   
Pampa stand-alone, other companies, adjs. & deletions1 100% (11) (91) (11)   100% 3 (48) 11
Subtotal holding & others   131 1 44     127 70 32
                   
Deletions 100% - (238) -   100% - (263) -
Total consolidated, continuing operations   905 866 312     698 1,148 132
At our share ownership   905 1,109 312     694 1,416 132
                   
+ Discontinued operations: Edenor 4.2% 17 - (39)   55.1% 51 (0) (499)
                   
Total consolidated, continuing and discontinued operations   921 866 273     749 1,148 (367)
At our share ownership   911 1,109 273     722 1,416 (367)

Note: 1 The deletions correspond to other companies or inter-companies or debt repurchases. 2 Net debt includes holding companies.
3 Attributable to the Company’s shareholders.

 

 

Pampa Energía ● Q4 21 Earning release ● 20

3.7Analysis of the quarter, by subsidiary and segment
Subsidiary
In US$ million		 Fourth quarter 2021   Fourth quarter 2020
% Pampa Adjusted EBITDA Net debt2 Net income3   % Pampa Adjusted EBITDA Net debt2 Net income3
 
Power generation segment                  
Diamante 61.0% 1 (6) 1   61.0% 1 (2) (4)
Los Nihuiles 52.0% (2) (5) (3)   52.0% (0) (10) (9)
                   
Greenwind   5 72 0     6 90 1
Non-controlling stake adjustment   (3) (36) (0)     (3) (45) (1)
Subtotal Greenwind adjusted by ownership 50.0% 3 36 0   50.0% 3 45 1
                   
CTBSA   38 220 31     42 202 59
Non-controlling stake adjustment   (19) (110) (15)     (21) (101) (30)
Subtotal CTBSA adjusted by ownership 50.0% 19 110 15   50.0% 21 101 30
                   
Pampa stand-alone, other companies, adjs. & deletions1 100.0% 85 167 17   100% 97 465 3
Subtotal power generation   105 302 31     121 598 20
                   
Oil & gas segment                  
OldelVal   17 (27) 11     13 (10) (0)
Non-controlling stake adjustment   (17) 26 (11)     (13) 9 0
Subtotal OldelVal adjusted by ownership 2.1% 0 (1) 0   2.1% 0 (0) (0)
                   
Pampa stand-alone, other companies, adjs. & deletions1   46 801 (5)     18 744 2
Subtotal oil & gas   46 801 (5)     19 744 2
                   
Petrochemicals segment                  
Pampa Energía 100.0% 9 - 4   100.0% 10 - 5
Subtotal petrochemicals   9 - 4     10 - 5
                   
Holding & others segment                  
Transener   8 (31) (3)     19 (9) 6
Non-controlling stake adjustment   (6) 22 2     (14) 6 (4)
Subtotal Transener adjusted by ownership 26.3% 2 (8) (1)   26.3% 5 (2) 2
                   
TGS   133 310 73     91 406 (42)
Non-controlling stake adjustment   (94) (220) (52)     (66) (294) 30
Subtotal TGS adjusted by ownership 29.2% 39 90 21   27.7% 25 113 (12)
                   
Refinor   3 35 1     (0) 27 (1)
Non-controlling stake adjustment   (2) (25) (0)     0 (19) 1
Subtotal Refinor adjusted by ownership 28.5% 1 10 0   28.5% (0) 8 (0)
                   
Pampa stand-alone, other companies, adjs. & deletions1 100% (3) (91) (12)   100% 4 (48) 7
Subtotal holding & others   39 1 9     34 70 (3)
                   
Deletions 100% - (238) -   100% - (263) -
Total consolidated, continuing operations   199 866 39     184 1,148 24
At our share ownership   200 1,109 39     184 1,416 24
                   
+ Discontinued operations: Edenor 4.2% - - -   55.1% (16) (0) (487)
                   
Total consolidated, continuing and discontinued operations   199 866 39     168 1,148 (463)
At our share ownership   200 1,109 39     175 1,416 (463)

Note: 1 The deletions correspond to other companies or inter-companies or debt repurchases. 2 Net debt includes holding companies.
3 Attributable to the Company’s shareholders.

 

Pampa Energía ● Q4 21 Earning release ● 21

4.Appendix
4.1Power generation main operational KPIs
Power generation's
key performance indicators 		   Hydroelectric   Wind   Subtotal
hydro
+wind		 Thermal   Total
  HINISA HIDISA HPPL   PEMC1 PEPE2 PEPE3   CTLL CTG CTP CPB CTPP CTIW CTGEBA2 Eco-
Energía		 CTEB1 Subtotal  
Installed capacity (MW)   265 388 285   100 53 53   1,144 780 361 30 620 100 100 1,253 14 567 3,826   4,970
New capacity (MW)   - - -   100 53 53   206 184 100 - - 100 100 565 14 567 1,631   1,837
Market share   0.6% 0.9% 0.7%   0.2% 0.1% 0.1%   2.7% 1.8% 0.8% 0.1% 1.4% 0.2% 0.2% 2.9% 0.03% 1.3% 8.9%   11.6%
                                             
Fiscal year                                            
Net generation 2021 (GWh)   467 325 550   367 215 256   2,181 4,682 392 53 312 299 301 8,594 75 546 15,252   17,433
Market share   0.3% 0.2% 0.4%   0.3% 0.2% 0.2%   1.5% 3.3% 0.3% 0.0% 0.2% 0.2% 0.2% 6.1% 0.1% 0.4% 10.8%   12.3%
Sales 2021 (GWh)   467 325 550   367 247 256   2,212 4,692 624 53 313 299 300 9,266 153 546 16,246   18,458
                                             
Net generation 2020 (GWh)   481 323 742   409 207 243   2,404 4,406 368 55 576 193 229 7,912 72 255 14,065   16,470
Variation 2021 vs. 2020   -3% +1% -26%   -10% +4% +5%   -9% +6% +7% -4% -46% +55% +31% +9% +5% #### +8%   +6%
Sales 2020 (GWh)   482 323 737   409 207 246   2,404 4,399 418 55 575 193 229 7,946 89 255 14,159   16,563
                                             
Avg. price 2021 (US$/MWh)   18 34 18   71 73 67   41 31 45 84 75 126 100 34 33 na 47   46
Avg. price 2020 (US$/MWh)   21 37 16   70 76 68   39 36 42 123 43 na 125 27 58 na 47   46
Avg. gross margin 2021 (US$/MWh)   (6) 12 7   61 55 58   25 26 10 41 12 103 78 17 12 na 31   30
Avg. gross margin 2020 (US$/MWh)   8 20 7   62 65 65   29 33 13 90 12 na 100 17 19 na 36   35
                                             
Fourth quarter                                            
Net generation Q4 21 (GWh)   200 104 116   86 52 58   615 1,061 222 22 152 62 77 2,182 16 260 4,055   4,670
Market share   0.6% 0.3% 0.3%   0.2% 0.1% 0.2%   1.7% 3.0% 0.6% 0.1% 0.4% 0.2% 0.2% 6.2% 0.0% 0.7% 11.5%   13.2%
Sales Q4 21 (GWh)   200 104 116   86 59 58   623 1,071 290 22 152 62 77 2,440 30 261 4,405   5,028
                                             
Net generation Q4 20 (GWh)   195 129 160   97 50 64   696 1,115 21 15 88 78 87 2,211 15 74 3,705   4,400
Variation Q4 21 vs. Q4 20   +2% -20% -28%   -11% +4% -10%   -12% -5% na +45% +73% -21% -12% -1% +7% na +9%   +6%
Sales Q4 20 (GWh)   196 129 161   97 52 64   700 1,113 64 15 88 78 87 2,183 25 74 3,727   4,427
                                             
Avg. price Q4 21 (US$/MWh)   12 26 20   72 74 67   35 25 31 26 52 149 97 31 43 na 42   41
Avg. price Q4 20 (US$/MWh)   12 20 14   71 80 67   32 34 65 113 53 120 88 31 57 na 48   46
Avg. gross margin Q4 21 (US$/MWh)   (11) 2 6   61 54 56   17 17 10 (1) 18 120 75 18 18 na 27   26
Avg. gross margin Q4 20 (US$/MWh)   (1) 6 6   61 67 67   22 31 (4) 85 (5) 97 75 20 12 na 35   33

Note: Gross margin before amortization and depreciation. 1 Operated by Pampa (50% of equity stake). 2 Commissioning of ST02 as of July 2, 2020.

 

Pampa Energía ● Q4 21 Earning release ● 22

4.2Oil and gas production in the main areas
Main areas' production   Fiscal year   Fourth quarter
2021 2020 Variation 2021 2020 Variation
Gas (k boe/day)                
El Mangrullo   32.6 26.6 +23%   37.0 26.7 +39%
Río Neuquén   7.2 5.4 +34%   9.1 4.9 +84%
Sierra Chata   3.1 2.9 +10%   3.3 2.7 +20%
Rincón del Mangrullo1   3.1 4.5 -31%   2.4 3.7 -34%
Others   1.1 1.3 -16%   1.1 1.3 -15%
Total gas at O/S   47.1 40.6 +16%   52.9 39.3 +34%
                 
Oil (k boe/day)                
El Tordillo2   2.5 2.4 +4%   2.9 2.3 +26%
Gobernador Ayala   0.9 0.8 +20%   1.0 0.8 +21%
Associated oil3   0.9 0.9 +3%   1.0 0.9 +13%
Others   0.3 0.3 -4%   0.4 0.4 +1%
Total oil at O/S   4.7 4.4 +6%   5.2 4.3 +20%
Total at O/S (kboe/day)   51.8 45.1 +15%   58.1 43.7 +33%

Note: Production in Argentina. 1 It doesn’t include shale formation. 2 It includes La Tapera - Puesto Quiroga field. 3 From gas fields.

4.3Electricity distribution segment, discontinued11
Electricity distribution segment, consolidated
Figures in US$ million		   Fiscal year   Fourth quarter
  2021 2020 ∆%   2021 2020 ∆%
Sales revenue   493 1,085 -55%   - 220 -100%
Cost of sales   (398) (926) -57%   - (200) -100%
                 
Gross profit   95 159 -40%   - 20 -100%
                 
Selling expenses   (36) (79) -54%   - (22) -100%
Administrative expenses   (26) (64) -59%   - (23) -100%
Other operating income   21 29 -28%   - 9 -100%
Other operating expenses   (18) (25) -28%   - (9) -100%
Impairment of financial assets   (11) (50) -78%   - (10) -100%
Recovery of PPE impairment   16 (589) NA   - (589) -100%
                 
Operating income (loss)   41 (619) NA   - (624) -100%
                 
RECPAM   120 115 +4%   - 36 -100%
Finance income   - 1 -100%   - 1 -100%
Finance costs   (106) (110) -4%   - (39) -100%
Other financial results   8 (20) NA   - 1 -100%
                 
Profit (loss) before tax   63 (633) NA   - (625) -100%
                 
Income tax   (138) 41 NA   - 56 -100%
                 
Net income (loss) for the period   (75) (592) -87%   - (569) -100%
Attributable to owners of the Company   (39) (499) -92%   - (487) -100%
Attributable to non-controlling interests   (36) (93) -61%   - (82) -100%
                 
Adjusted EBITDA, discontinued   17 51 -68%   - (16) -100%
                 
Increases in PPE, intangible and right-of-use assets   64 135 -52%   - 40 -100%
Depreciation and amortization   - 81 -100%   - 19 -100%


11 On June 30, 2021, the sale closing of the controlling stake in Edenor was closed. Consequently, under IFRS, the electricity distribution segment is deconsolidated from Pampa’s FS and shown as discontinued operations for the current and comparative periods.

 

Pampa Energía ● Q4 21 Earning release ● 23

5.Glossary of terms
Term Definition
Q3 21/Q3 20 Third quarter of 2021/Third quarter of 2020
Q4 21/Q4 20 Fourth quarter of 2021/Fourth quarter of 2020
ADRs/ADSs American Depositary Receipts
AR$ Argentine Pesos
Bbl Barrel
BICE Banco de Inversión y Comercio Exterior S.A. (Investment and Foreign Trade Bank)
Boe Barrels of oil equivalent
CAMMESA Compañía Administradora del Mercado Mayorista Eléctrico S.A. (Argentine Wholesale Electricity Market Clearing Company)
CB Corporate Bonds
CCGT Combined cycle gas turbine
CEO Chief Executive Officer
CFO Chief Financial Officer
CPB Piedra Buena Thermal Power Plant
CTBSA CT Barragán S.A.
CTEB Ensenada Barragán Thermal Power Plant
CTG Güemes Thermal Power Plant
CTGEBA Genelba Thermal Power Plant
CTIW Ingeniero White Thermal Power Plant
CTLL Loma De La Lata Thermal Power Plant
CTP Piquirenda Thermal Power Plant
CTPP Parque Pilar Thermal Power Plant
DNU Decreto de Necesidad y Urgencia (Necessity and Urgency Executive Order)
E&P Exploration and Production
EBITDA Earnings before interest, tax, depreciation and amortization
EcoEnergía EcoEnergía Co-Generation Power Plant
Edenor Empresa Distribuidora y Comercializadora Norte S.A.
ENARGAS Ente Nacional Regulador del Gas (National Gas Regulatory Entity)
Energía Plus Energía Plus Program, SE Res. No. 1,281/06
ENRE Ente Nacional Regulador de la Electricidad (National Electricity Regulatory Entity)
FO Fuel oil
FS Financial Statements
FV Face Value
FX Nominal exchange rate
GO Gas oil (Diesel oil)
Greenwind Greenwind S.A.
GSA Gas Supply Agreement
GWh Gigawatt-hour
HIDISA Diamante Hydroelectric Power Plant
HINISA Los Nihuiles Hydroelectric Power Plant
HMRT Horas de Alto Requerimiento Térmico del Mes (Hours of the month with a high thermal demand)
HPPL Pichi Picún Leufú Hydroelectric Power Plant
ICMA International Capital Market Association
IDB Invest Inter-American Development Bank Invest (former Inter-American Investment Corporation)
 

Pampa Energía ● Q4 21 Earning release ● 24

 

IEASA/ENARSA Integración Energética Argentina S.A. (former Energía Argentina S.A.)
IFRS International Financial Reporting Standards
Kbbl/kboe Thousands of barrels/thousands of barrels of oil equivalent
LNG Liquified Natural Gas
LPG Liquified Petroleum Gas
M3 Cubic meter
MAT ER Term Market from Renewable Energy Sources
MBTU Million British Thermal Unit
MW/MWh Megawatt/Megawatt-hour
N.a. Not applicable
O/S At equity ownership
OldelVal Oleoductos del Valle S.A.
Pampa / the Company Pampa Energía S.A.
Pampa Group Pampa Energía S.A. and its subsidiaries
PEMC Ingeniero Mario Cebreiro Wind Farm
PEN Poder Ejecutivo Nacional (National Executive Branch)
PEPE Pampa Energía Wind Farm
Plan Gas.Ar Argentine Natural Gas Production Promotion Program – 2020 – 2024 Supply and Demand Scheme (DNU No. 892/20 and supplementary regulations)
PPA Power Purchase Agreement
PPE Property, Plant and Equipment
RECPAM Results from a net monetary position
Refinor Refinería del Norte S.A.
Res. Resolution/Resolutions
SADI Sistema Argentino de Interconexión (Argentine Electricity Grid)
SBR Styrene-Butadiene Rubber
SE Secretariat of Energy
SEE Under Secretariat of Electric Energy (former Secretariat of Electric Energy)
ST Steam turbine
TGS Transportadora de Gas del Sur S.A.
Ton Metric Ton
Transba

Empresa de Transporte de Energía Eléctrica por Distribución Troncal de la Provincia de Buenos Aires

Transba S.A.

Transener Compañía de Transporte de Energía Eléctrica en Alta Tensión Transener S.A.
US$ U.S. Dollars
UVA Unidad de Valor Adquisitivo (Acquisitive Value Units)
VRD Debt Securities

 

Pampa Energía ● Q4 21 Earning release ● 25