☐ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(B) OR (G) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
American Depositary Shares (“ADS”), representing Class “B” Shares | TGS | New York Stock Exchange |
Class “B” Shares, par value Ps. 1.00 per share | n/a | New York Stock Exchange* |
Class “A” Shares, par value Ps. 1.00 each | 405,192,594 | |||
Class “B” Shares, par value Ps. 1.00 each | 389,302,689 | |||
Total(1) | 784,608,528 |
(1) Excludes 9,886,755 treasury shares, representing 1.24% of the total shares not deemed outstanding under Argentine law. |
Yes | ☒ | No | ☐ |
Yes | ☐ | No | ☒ |
Yes | ☒ | No | ☐ |
Yes | ☒ | No | ☐ |
Large accelerated filer | ☒ | Accelerated filer | ☐ |
Non-accelerated filer | ☐ | Emerging growth company | ☐ |
Yes | ☒ | No | ☐ |
☐ | U.S. GAAP | |
☒ | International Financial Reporting Standards as issued by the International Accounting Standards Board | |
☐ | Other |
Item 17 | ☐ | Item 18 | ☐ |
Yes | ☐ | No | ☒ |
Page | |||
i | |||
iv | |||
1 | |||
Item 1. | 1 | ||
Item 2. | 1 | ||
Item 3. | 1 | ||
Item 4. | 54 | ||
Item 4A. | 113 | ||
Item 5. | 113 | ||
Item 6. | 151 | ||
Item 7. | 166 | ||
Item 8. | 172 | ||
Item 9. | 176 | ||
Item 10. | 179 | ||
Item 11. | 197 | ||
Item 12. | 200 | ||
201 | |||
Item 13. | 201 | ||
Item 14. | 201 | ||
Item 15. | 202 | ||
Item 16. | 202 | ||
Item 16A. | 202 | ||
Item 16B. | 203 | ||
Item 16C. | 203 | ||
Item 16D. | 204 | ||
Item 16E. | 204 | ||
Item 16F. | 206 | ||
Item 16G. | 206 | ||
Item 16H. | 208 | ||
209 | |||
Item 17. | 209 | ||
Item 18. | 209 | ||
[Item 19. | 209 |
• | statements regarding changes in general economic, business, political or other conditions in Argentina and globally, including changes from actions taken by the Government and changes due to natural and human-induced disasters (including the current COVID-19 virus (“COVID”) outbreak), and the impact of the foregoing; |
• | estimates relating to future energy demand, tariffs and volumes for our natural gas transportation services and future prices and volumes for our natural gas liquid products such as propane and butane (also referred to as liquid petroleum gas or “LPG”), ethane and natural gasoline (collectively “Liquids”) and for products and services respectively produced and provided in our other nonregulated businesses; |
• | statements regarding future political developments in Argentina and future developments regarding the license granted to us by the Argentine government (the “Government”) to provide natural gas transportation services through the exclusive use of the southern natural gas transportation system in Argentina (“License”), the impact of the adoption of the new revised scheme of tariffs resulting from the renegotiation process of our License with the Government regulatory actions by Ente Nacional Regulador del Gas (“ENARGAS”) and other agencies of the Government, the legal framework established by the Federal Energy Bureau and any other applicable governmental authority that may affect us and our business; |
• | risks and uncertainties with respect to relations with our employees in Argentina; |
• | statements and estimates regarding future pipeline expansion and other projects and the cost of, or return to us from, any such expansion or projects; |
• | estimates of our future level of capital expenditures, including those required by ENARGAS or other governmental authorities for the expansion of our pipeline system or other purposes, and unscheduled and unexpected expenditures for the repair and maintenance of our fixed or capital assets; |
• | statements regarding the ability of companies engaged in the upstream business in the region where we operate to identify drilling locations and prospects for future drilling opportunities, and drill and develop such locations (such as the Vaca Muerta formation), as well as the Government’s regulations and policies affecting such companies and projects; and |
• | the risk factors discussed under “Item 3. Key Information—D. Risk Factors.” |
• | risks and uncertainties resulting from Government regulations that have affected or may affect our business, financial condition or results of operations, such as the prohibition on tariff increases (or tariff reductions) for our natural gas transportation segment and restrictions on payments abroad and exchange controls; |
• | risks and uncertainties resulting from disruptions to commercial activities due to natural and human-induced disasters, such as weather conditions, earthquakes, terrorist activities, social unrest and violence, armed conflicts and health epidemics, including the current COVID outbreak; |
• | risks and uncertainties related to changes in the peso / U.S. dollar exchange rate and the Argentine domestic inflation rate, which may materially adversely affect our revenues, expenses and the comparability of our historical financial information; |
• | risks and uncertainties associated with our nonregulated business, including those related to international and local prices of Liquids, taxes, cost and restrictions on the supply of natural gas and other restrictions imposed on Liquids exports, our ability to renegotiate our agreements with customers and possible adverse changes in the regulation of the Liquids industry; |
• | capital expenditures required by ENARGAS or other governmental authorities for the expansion of our pipeline system or other purposes, including the risk that we may be forced by ENARGAS or other governmental authorities to make investments that are not profitable or not as profitable as other investment opportunities identified by our management, or to take any other action not consistent with our business plan and strategy; |
• | risks and uncertainties associated with unscheduled and unexpected expenditures for the repair and maintenance of our fixed or capital assets; |
• | risks and uncertainties resulting from the prospect of additional regulation on our business or other Government involvement in our business; |
• | developments in legal and administrative proceedings involving us and our affiliates; |
• | changes to, or revocation of, our License and the tariffs we are allowed to charge; and |
• | risks and uncertainties impacting us as a whole, including changes in general economic, political and social conditions, changes in the Argentine laws and regulations to which we are subject, including tax, environmental and employment laws and regulations, and the cost and effects of legal and administrative claims and proceedings against us. |
Item 1. | Identity of Directors, Senior Management and Advisers |
Item 2. | Offer Statistics and Expected Timetable |
Item 3. | Key Information |
For the year ended December 31, | ||||||||||||||||
2019 | 2018(3) | 2017(3) | 2016(3) | |||||||||||||
(in thousands of pesos)(1) | ||||||||||||||||
Consolidated Statement of Comprehensive Income Data: | ||||||||||||||||
Revenues | 48,561,494 | 52,399,423 | 30,694,588 | 22,529,540 | ||||||||||||
Gas transportation net revenues | 22,620,423 | 23,785,660 | 11,469,824 | 6,402,843 | ||||||||||||
Liquids production and commercialization net revenues | 23,138,182 | 25,578,373 | 17,189,194 | 14,467,619 | ||||||||||||
Other services (midstream and telecommunications) net revenues | 2,802,889 | 3,035,390 | 2,035,570 | 1,659,078 | ||||||||||||
Operating profit | 19,758,608 | 21,931,976 | 9,545,020 | 4,480,856 | ||||||||||||
Net financial results | (2,897,421 | ) | (4,378,468 | ) | (812,762 | ) | (1,091,186 | ) | ||||||||
Net income before income tax | 16,829,329 | 17,581,516 | 8,765,549 | 3,397,499 | ||||||||||||
Net income and total comprehensive income for the year | 12,805,118 | 17,561,255 | 8,847,199 | 1,701,840 | ||||||||||||
Net income and total comprehensive for the year attributable to: | ||||||||||||||||
Owners of the Company | 12,805,105 | 17,561,249 | 8,847,196 | 1,701,837 | ||||||||||||
Non-controlling interest | 13 | 6 | 3 | 3 | ||||||||||||
Per Share Data:(2) | ||||||||||||||||
Net income per share | 16.50 | 22.27 | 11.14 | 2.00 | ||||||||||||
Net income per ADS | 82.49 | 111.37 | 55.70 | 11.00 |
(1) | Except per share and per ADS amounts or as otherwise indicated. |
(2) | Net income per share and ADS under IFRS has been calculated using the weighted average shares outstanding. Each ADS represents five shares. |
(3) | Comparatives figures as of December 31, 2018, 2017 and 2016, have been restated for hyperinflation accounting and are presented in terms of Current Currency. |
As of December 31, | ||||||||||||||||
2019 | 2018(3) | 2017(3) | 2016 | |||||||||||||
(in thousands of pesos)(1) | ||||||||||||||||
Consolidated Statement of Financial Position Data: | ||||||||||||||||
Total current assets | 20,939,930 | 35,632,685 | 16,288,999 | n/a | ||||||||||||
Property, plant and equipment, net | 74,552,728 | 59,510,863 | 52,550,238 | n/a | ||||||||||||
Total non-current assets | 74,661,395 | 59,655,761 | 52,710,105 | n/a | ||||||||||||
Total assets | 95,601,325 | 95,288,446 | 68,999,104 | n/a | ||||||||||||
Total current liabilities | 7,952,199 | 10,993,418 | 10,610,885 | n/a | ||||||||||||
Total non-current liabilities | 39,565,657 | 36,691,122 | 19,500,020 | n/a | ||||||||||||
Total liabilities | 47,517,856 | 47,684,540 | 30,110,905 | n/a | ||||||||||||
Non-controlling interest | 28 | 15 | 12 | n/a | ||||||||||||
Shareholders’ equity | 48,083,469 | 47,603,906 | 38,888,199 | n/a | ||||||||||||
Other Data: | ||||||||||||||||
Common stock (nominal value) | 784,608 | 780,894 | 794,495 | n/a | ||||||||||||
Additions to property, plant and equipment | 18,838,338 | 10,624,291 | 3,532,978 | n/a | ||||||||||||
Depreciation | 3,695,615 | 3,419,820 | 3,107,747 | n/a | ||||||||||||
Number of outstanding shares(2) | 784,608,528 | 780,894,503 | 794,495,283 | n/a |
(1) | Except number of outstanding shares or as otherwise indicated. |
(2) | Number of ordinary shares outstanding at year-end (excludes 9,886,755 and 13,600,780 treasury shares, representing 1.24% and 1.71% of the total share capital for the years ended on December 31, 2019 and 2018, respectively). |
(3) | Comparatives figures as of December 31, 2018 and 2017 have been restated for hyperinflation accounting and are presented in terms of Current Currency. |
Dividends declared and paid | ||||||||||||||||||||
Year ended December 31, | (in millions of Ps.)(1) | (in millions of U.S.$)(2) | (Ps. per share)(1) | (U.S.$ per share)(2) | (U.S.$ per ADS)(2) | |||||||||||||||
2015 | - | - | - | - | - | |||||||||||||||
2016(3) | 349.0 | 7.1 | 0.440 | 0.009 | 0.045 | |||||||||||||||
2017 | - | - | - | - | - | |||||||||||||||
2018(4) | 6,659.7 | 114.6 | 8.382 | 0.142 | 0.708 | |||||||||||||||
2019(5)(6) | 12,988.9 | 222.4 | 16.730 | 0.286 | 1.432 |
(1) | Stated in Ps. at Current Currency. |
(2) | Stated in U.S. dollars translated from pesos at the exchange rate in effect on the payment date. |
(3) | At a General Annual Shareholders’ Meeting held on April 23, 2015, our shareholders resolved to create a future dividends payment reserve in an amount equal to Ps. 380.4 million. At its meeting held on January 13, 2016, our Board of Directors approved to release such reserve in full to our shareholders in the form of cash dividend payments up to an amount equal to the aggregate amount of such reserve. |
(4) | At the General and Special Annual Shareholders’ Meeting held on April 10, 2018, our shareholders resolved to create a future dividends payment reserve in an amount equal to Ps. 5,789.6 million. At its meetings held on July 6, August 8 and September 6, 2018, our Board of Directors approved to release such reserve in full to our shareholders in the form of cash dividend payments up to an amount equal to the aggregate amount of such reserve. |
(5) | At the General Annual Shareholders’ Meeting held on April 11, 2019, our shareholders resolved to create a voluntary reserve for capital expenditures, stock buyback and/or dividends in an amount equal to Ps. 9,154.2 million and a cash dividend payment of Ps. 9,185.8 million. At its meetings held on April 11 and October 31, 2019, our Board of Directors approved the partial distribution of such reserve to our shareholders in an amount equal to Ps. 575.1 million the form of a cash dividend. |
(6) | Includes the dividend in kind approved by the General and Special Shareholders´ Meeting held on October 17, 2019 and our Board of Directors´ meeting held on October 31, 2019 consisting in 29,444,795 shares (0.0385 shares per share or 0.1925 per ADS) at a price of Ps. 102.25, calculated by reference to the closing price of our shares in BYMA as of November 12, 2019, the day immediately preceding the date of distribution of such shares to our shareholders. |
Pesos per U.S. dollar | ||||||||||||||||
High | Low | Average | Period end | |||||||||||||
Most recent six months: | ||||||||||||||||
November 2019 | 59.9500 | 59.5000 | 59.7453 | 59.9400 | ||||||||||||
December 2019 | 59.9900 | 59.8150 | 59.8748 | 59.8900 | ||||||||||||
January 2020 | 60.3500 | 59.8150 | 60.0326 | 60.3500 | ||||||||||||
February 2020 | 62.2100 | 60.4700 | 61.3561 | 62.2100 | ||||||||||||
March 2020 | 64.4690 | 62.2590 | 63.1241 | 64.4690 | ||||||||||||
April 2020 (through April 28, 2020) | 66.6300 | 64.5290 | 65.6493 | 66.6300 | ||||||||||||
Year ended December 31, | ||||||||||||||||
2015 | 13.4000 | 8.5550 | 9.2485 | 13.0400 | ||||||||||||
2016 | 16.0300 | 13.2000 | 14.7807 | 15.8900 | ||||||||||||
2017 | 19.2000 | 15.1900 | 16.5717 | 18.6490 | ||||||||||||
2018 | 41.2500 | 18.4100 | 28.1313 | 37.7000 | ||||||||||||
2019 | 60.4000 | 36.9000 | 48.234 | 59.8900 |
For your convenience and except as we specify otherwise, this Annual Report contains translations of certain peso-denominated amounts to U.S. dollars at the exchange rate reported by Banco Nación on December 31, 2019. These translations should not be construed as representations that the amounts actually represent such U.S. dollar amounts or could be or have been converted into U.S. dollars at the rates indicated, or at any other rates. On April 28, 2020, the reported selling exchange rate per U.S.$ 1.00 was Ps. 66.6300.
• | inflation, which remains high, and may continue to be high in the future; |
• | volatility in real GDP, which according to the restated information released by INDEC decreased by 2.5% in 2014, grew by 2.7% in 2015, decreased by 2.1% in 2016, grew by 2.7% in 2017, decreased by 2.5% in 2018 and decreased by 2.2% in 2019; |
• | Argentina’s public debt as a percentage of GDP, which remains high, and as of September 30, 2019, represented approximately 90% of the GDP; |
• | the discretionary increase in public expenditures that has resulted (and continues to result) in a fiscal deficit; |
• | high unemployment and informal employment rates; |
• | high exchange rate volatility; |
• | high fiscal and trade deficits; |
• | an inability to pay public debt and the reperfilation of debt maturities; |
• | limited access to funding in the local and international capital markets; |
• | agricultural exports, which fueled the economic recovery, have been affected by drought and lower prices than in prior years; |
• | fluctuations in international oil prices; |
• | unavailability of long-term credit to the private sector; |
• | the effects of a restrictive U.S. monetary policy, which could generate an increase in financial costs for Argentina; |
• | fluctuations in the BCRA’s foreign currency reserves; |
• | uncertainty with respect to the imposition of exchange and capital controls; |
• | the abrupt fall in the value of sovereign bonds and a decline in consumer confidence or foreign direct investment; |
• | the public health concerns derived from COVID and its scale and duration discussed below, which remain uncertain, but could impact our earnings, cash flow, liquidity, and financial condition; and |
• | other political, social and economic events abroad that adversely affect the current growth of the Argentine economy. |
• | Alleviation measures. On August 14, 2019, in order to reduce the effects of the worsening economic situation, the Government took the following measures: (i) a minimum wage increase of 20% and a special deduction for retirees and formal employees, together with an increase in the minimum income amount for federal income taxes, now at Ps. 55,376 for single filing status and Ps. 70,274 for “married with children”; (ii) a deduction of 50% in taxable fees for self-employed workers; (iii) an exemption from employee contributions for salaried employees with a net salary below Ps. 60,000 (personal contributions 11% of net salary) during September and October with a maximum of Ps. 2,000 monthly; (iv) an exemption from tax contributions for simplified filers (Monotributistas) during September; (v) an increase of Ps. 1,000 per child during September and October, for beneficiaries of the universal child allowance (asignación universal por hijo); (vi) the establishment by the Administración Federal de Ingresos Públicos, of a 10-year moratorium for small- and medium-sized companies (as well as for self-employed workers and simplified filers); and (vii) a 90-day freeze on gas prices. The fiscal cost of these measures reaches Ps. 40,000 million. |
• | Rate of 0% on the value-added tax of “basic food basket. ” By Decree No. 567/2019 published in the Official Gazette on August 16, 2019, the Government enacted that the sale of items in the “basic food basket” (canasta básica de alimentos) would be exempt from value added tax to final consumers. The products that are part of this basic food basket are: sunflower oil, corn and mix, rice, sugar, preserved fruits, vegetables and beans, corn flour, wheat flour, eggs, whole milk, skim milk, bread, bread-crumbs, dry pasta, yerba mate, mate cocido, tea, whole yoghurt and non-fat yoghurt. The exemption was in place until December 31, 2019. |
• | Public Debt Reprofiling. On August 29, 2019, the Executive Branch published Decree No. 598/2019, pursuant to which certain exceptional measures were adopted to relieve tension in the financial and foreign exchange markets. The measures consist of (i) an extension on the payment term for short-term local bonds, only for institutional investors that will receive the full payments in terms of three and six months (15% on original maturity date, 25% and 60% at 3rd and 6th month of the original maturity date, respectively) and not for natural persons who acquired the bonds before July 31, 2019, who will receive full payment on the maturity date; (ii) a proposal to the Argentine Congress of a bill to extend the maturity dates of other local bonds, without reduction on the capital or interest; (iii) proposal to extend of the maturity dates of foreign bonds; and (iv) after achieving fiscal goals, the start of talks with the IMF in order to reprofile the deadlines to reduce the default risk in 2020 and 2023. |
• | Exchange control restrictions. The Executive Branch reinstated restrictions on the foreign exchange market through the Emergency Decree No. 609/2019 (“Decree 609”), published in the Official Gazette on September 1, 2019, stating that until December 31, 2019, foreign currency proceeds from the export of goods and services must be transferred and sold in the Argentine foreign exchange market and the purchase of foreign currency in the Argentine foreign exchange market and its transfer abroad will require prior approval, distinguishing between individuals and legal entities and empowering the BCRA to enact the relevant regulations in connection thereto. These exchange control restrictions remain in place, because of Emergency Decree No. 91/2019. For additional information see “Item 10.C. Additional Information. Exchange Controls.” |
• | Occupational Emergency. Through Executive Order No. 34/2019, on December 13, 2019, the Government of Alberto Fernández declared a public emergency in occupational matters for a term of 180 days. In case of dismissal without cause during said period, the affected worker will have the right to receive double compensation in accordance with current legislation. |
• | Solidarity Law. On December 23, 2019, the National Congress enacted the Solidarity Law. This law declared a public emergency in economic, financial, fiscal, administrative, pension, tariff, energy health and social matters, and pursuant to the Argentine Constitution, the Solidarity Law delegates legislative powers to the Executive Branch. For additional information see “Item 5. Operating and Financial Review and Prospects. A. Operating Results. Factors affecting our consolidated results and operations.” |
• | limitations on our ability to increase prices or to reflect the effects of higher domestic taxes, increases in operating costs or increases in international prices of natural gas and other hydrocarbon fuels and exchange rate fluctuations on our domestic prices; |
• | risks in connection with the former and current incentive programs established by the Government for the oil and gas industry, such as the natural gas additional injection stimulus program and cash collection of balances with the Government; |
• | legislation and regulatory initiatives relating to hydraulic stimulation and other drilling activities for non-conventional oil and gas hydrocarbons, which could increase our cost of doing business or cause delays and adversely affect our operations; and |
• | the implementation or imposition of stricter quality requirements for hydrocarbon products in Argentina. |
• | repeated failure to comply with the obligations of our License and failure to remedy a significant breach of an obligation in accordance with specified procedures; |
• | total or partial interruption of service for reasons attributable to us that affects transportation capacity during the periods stipulated in our License; |
• | sale, assignment or transfer of our essential assets or the placing of encumbrances thereon without ENARGAS’ prior authorization, unless such encumbrances serve to finance extensions and improvements to the gas pipeline system; |
• | our bankruptcy, dissolution or liquidation; |
• | cessation and abandonment of the provision of the licensed service, an attempt to assign or unilaterally transfer our License in full or in part without the prior authorization of ENARGAS, or relinquishing our License, other than in the cases permitted therein; and |
• | delegation of the functions granted in such contract without the prior authorization of ENARGAS, or the termination of such agreement without regulatory approval of a new contract. |
• | Argentine natural gas transportation regulations; |
• | international oil and gas prices; |
• | timing, volume and location of new market demand; |
• | competition from alternative energy sources; |
• | supply and price of natural gas in Argentina; |
• | demand for natural gas in the markets we serve; and |
• | availability and competitiveness of alternative gas transportation infrastructure in the markets we serve. |
• | incur or permit to exist certain liens; |
• | incur additional indebtedness; |
• | pay dividends or make other restricted payments; |
• | make capital investments and other investments; |
• | enter into sale and lease-back transactions; |
• | enter into transactions with affiliates; |
• | sell, transfer or otherwise dispose of assets; and |
• | consolidate, amalgamate, merge or sell all or substantially all of our assets. |
• | fluctuations in our periodic operating results; |
• | changes in financial estimates, recommendations or projections by securities analysts; |
• | changes in conditions or trends in our industry; |
• | events affecting equities markets in Argentina; |
• | legal or regulatory measures affecting our financial conditions; |
• | departures of management and key personnel; or |
• | potential litigation or the adverse resolution of pending litigation against us or our subsidiaries. |
Company | Annual deliveries (Bcf) | Volume of market served (in %) | No. of end- users (in millions) | Deliveries received from us (in %) | ||||||||||||
Metrogas (1) | 245.4 | 22.6 | % | 2.4 | 87 | % | ||||||||||
Camuzzi Pampeana (1) | 208.0 | 19.1 | % | 1.4 | 96 | % | ||||||||||
Camuzzi Sur | 165.8 | 15.2 | % | 0.7 | 100 | % | ||||||||||
Naturgy Argentina (1) | 120.4 | 11.1 | % | 1.7 | 62 | % | ||||||||||
68.0 | % | 6.2 |
(1) | Also connected to the TGN system. |
For the years ended December 31, | ||||||||||||||||||||||||
2019 | 2018 | 2017 | ||||||||||||||||||||||
Average firm contracted capacity (MMcf/d) | Net revenues (millions of pesos) | Average firm contracted capacity (MMcf/d) | Net revenues (millions of pesos) | Average firm contracted capacity (MMcf/d) | Net revenues (millions of pesos) | |||||||||||||||||||
Firm: | ||||||||||||||||||||||||
Metrogas | 590 | 5,847.3 | 590 | 5,991.0 | 590 | 2,942.4 | ||||||||||||||||||
Camuzzi Pampeana | 558 | 4,277.3 | 558 | 4,365.8 | 558 | 2,129.7 | ||||||||||||||||||
Naturgy Argentina… | 417 | 3,484.0 | 417 | 3,574.9 | 364 | 1,553.6 | ||||||||||||||||||
Camuzzi Sur | 388 | 878.0 | 388 | 895.6 | 388 | 443.3 | ||||||||||||||||||
Pampa Energía | 162 | 792.9 | 92 | 652.6 | 49 | 51.4 | ||||||||||||||||||
Others | 802 | 3,241.7 | 840 | 3,354.9 | 844 | 1,851.0 | ||||||||||||||||||
Total firm | 2,917 | 18,521.2 | 2,885.0 | 18,834.8 | 2,793 | 8,971.4 | ||||||||||||||||||
Interruptible and others: | - | 4,099.2 | - | 4,950.9 | - | 2,498.4 | ||||||||||||||||||
Total | 2,917 | 22,620.4 | 2,885.0 | 23,785.7 | 2,793 | 11,469.8 |
For the year ended December 31, | ||||||||||||
2019 | 2018 | 2017 | ||||||||||
Firm: | Average daily deliveries (MMcf/d) | Average daily deliveries (MMcf/d) | Average daily deliveries (MMcf/d) | |||||||||
Metrogas | 494 | 487 | 533 | |||||||||
Camuzzi Pampeana | 350 | 371 | 378 | |||||||||
Camuzzi Sur | 233 | 244 | 247 | |||||||||
Naturgy Argentina | 240 | 223 | 208 | |||||||||
Others | 547 | 569 | 512 | |||||||||
Subtotal firm | 1,864 | 1,893 | 1,879 | |||||||||
Subtotal interruptible | 498 | 569 | 448 | |||||||||
Total | 2,362 | 2,462 | 2,327 | |||||||||
Average annual load factor (1) | 81 | % | 85 | % | 83 | % | ||||||
Average winter heating season load factor (1) | 90 | % | 98 | % | 90 | % |
(1) | Average daily deliveries for the period divided by average daily firm contracted capacity for the period, expressed as a percentage. |
• | From 12/28/2019 to 12/27/2020: 6.5% |
• | From 12/28/2020 to 12/27/2021: 6% |
• | From 12/28/2021 to 12/27/2022: 5.5% |
• | From 12/28/2022 to 12/27/2023: 5% |
• | From 12/28/2023 to 12/27/2024 and onwards: 4.5%. |
• | creation of Integración Energética Argentina S.A. (“IEASA,” formerly ENARSA) in 2004 for the purposes of restoring levels of reserves, production and supply of natural gas and meeting the infrastructure needs of the natural gas transportation and electricity industries; |
• | creation of the Gas Plus Program (the “Gas Plus Program”) in 2008, which aims to encourage producers to make further investments in natural gas infrastructure by allowing them to sell the resulting production of natural gas from new fields and fields that require more expensive extraction techniques at higher prices than the current authorized prices. In 2010, the Government increased the price paid to natural gas producers who invest in new fields, shale and tight natural gas under the Gas Plus Program; |
• | hiring of two re-gasifying LNG tankers through IEASA, in Bahía Blanca (2008) and Escobar (2011), to inject natural gas into the pipeline. The tanker located at Bahía Blanca, which was retired in November 2018, was connected to our pipeline, and the tanker at Escobar is connected to TGN’s pipeline; |
• | establishment of a framework for the constitution of Gas Trusts to finance natural gas pipeline expansions; |
• | the passage of Law No. 26,741, which declares that hydrocarbons self-sufficiency, as well as their production, industrialization, transport and marketing, are activities of public interest and primary goals of Argentina, empowering the Government to take the necessary measures to achieve such goals; |
• | creation of trust funds (Resolution No. 185/04 of the former MPFIPyS) in order to finance infrastructure works in transportation and distribution of natural gas; |
• | importation of natural gas from Bolivia and Chile, which has increased significantly over the past two years; |
• | creation of tariff charges to be paid by all consumers other than residential consumers in order to finance natural gas and electricity expansions and the import of natural gas; and |
• | under Law No. 26,741, a stimulus program was created to encourage new investments in exploration and exploitation. |
• | resolving appeals filed against ENARGAS resolutions; |
• | acting as the enforcement authority of Laws No. 17,319 and No. 26,020; |
• | managing the investment projects included in the framework of the programs created under Decree No. 1,277/2012, modified by Decree No. 272/2015; and |
• | acting as the enforcement authority regarding import and export of fuels. |
• | the completion of the RTI processes were prioritized to provide a framework of certainty to the operation of public utility companies; |
• | the Ministry of Energy and the Unidad de Renegociación y Análisis de Contratos de Servicios Públicos (“UNIREN”) were reorganized in order to streamline the aforementioned efforts; and |
• | the increase of the prices of natural gas at the supply point (“PIST”) and the tariffs of the public transport and distribution of natural gas service have been propitiated in order to correct the deterioration in the supply of this fluid and to reduce the burden that the public subsidies have on the national budget. |
• | fixes the natural gas prices in PIST; |
• | provides that the total amount of natural gas prices in PIST shall not exceed certain limits according to the type of customer; |
• | maintains the social tariff for the protection of the most vulnerable sectors; |
• | establishes the new propane prices for the distribution of undiluted Propane for Networks Agreement, settling at Ps. 800/Tn for residential users and general service P1 and P2, and Ps. 2,100/Tn for general service P3 users; and |
• | provides that adjustments will be implemented in the months of April and October of each year, until the total elimination of the subsidies, at which time PIST will be freely determined by the market. |
• | an agreement with unions to amend current existing collective bargaining agreements for the sector; |
• | the elimination of the obligation of repatriation of funds due to oil and gas exports currently regulated by Decree No. 1,722/11; and |
• | the creation of a program (regulated by Resolution No. 46-E/2017), the Investment in Natural Gas Production from Non-Conventional Reservoirs Stimulus Program, which establishes a support price for the volume of non-conventional natural gas production from concessions located in the Neuquina Basin included in the program. This program, originally scheduled to be effective until December 31, 2021, included a sliding-scale schedule for the minimum price to be paid per MMBtu: U.S.$7.50 for 2018, U.S.$7.00 for 2019, U.S.$6.50 for 2020 and U.S.$6.00 for 2021. In 2019, such program was modified by the Energy Secretary, and such decision of the Government resulted in conflicts between the Government and natural gas producers which led to a sharp decline in the number of investments made by natural gas producers since the second half of 2019. |
2003 | 2015 | 2016 | 2017 | 2018 | 2019 | |||||||||||||||||||
Residential (1) | 704.3 | 1,091.0 | 1,153.8 | 1,030.4 | 1,026.8 | 987.9 | ||||||||||||||||||
Commercial | 98.8 | 129.1 | 132.4 | 123.0 | 121.6 | 140.9 | ||||||||||||||||||
Industries (2) | 1,033.6 | 1,222.2 | 1,169.2 | 1,210.9 | 1,276.5 | 1,330.6 | ||||||||||||||||||
Power plants | 846.7 | 1,443.2 | 1,548.3 | 1,671.7 | 1,663.1 | 1,461.5 | ||||||||||||||||||
CNG | 255.4 | 288.4 | 273.5 | 246.9 | 232.3 | 238.2 | ||||||||||||||||||
Others (3) | 37.7 | 41.7 | 46.3 | 43.1 | 41.8 | 41.5 | ||||||||||||||||||
Total | 2,976.5 | 4,215.5 | 4,323.4 | 4,326.0 | 4,362.0 | 4,200.5 |
(1) | Includes subdistributors. |
(2) | Includes shrinkage natural gas from the Cerri Complex, which is included in Others. |
(3) | Includes governmental bodies. |
Basin | Location by province | Proved Gas Reserves(Bcf)(1)(2) | Production (Bcf) | Reserve Life (years)(3) | ||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||
Neuquina | Neuquén, Río Negro, La Pampa, Mendoza (south) | 7,001.2 | 5,826.7 | 1,002.7 | 924.4 | 7 | 6 | |||||||||||||||||||
Austral | Tierra del Fuego, Santa Cruz (south), and offshore | 3,545.9 | 3,871.8 | 406.9 | 377.2 | 9 | 11 | |||||||||||||||||||
San Jorge Gulf | Chubut, Santa Cruz (north) | 1,496.6 | 1,501.9 | 174.7 | 188.9 | 9 | 8 | |||||||||||||||||||
Cuyo | Mendoza (north) | 10.6 | 8.2 | 1.7 | 1.7 | 6 | 5 | |||||||||||||||||||
Northwest | Salta, Jujuy, Formosa | 452.6 | 539.6 | 74.5 | 84.8 | 6 | 6 | |||||||||||||||||||
Total | 12,506.9 | 11,748.2 | 1,660.5 | 1,577.0 | 8 | 7 |
(1) | Estimated as of December 31, 2018 and 2017, respectively. There are numerous uncertainties inherent in estimating quantities of proved natural gas reserves. The accuracy of any reserve estimate is a function of the quality of available data, and engineering and geological interpretation and judgment. Results of drilling, testing and production after the date of the estimate may require substantial upward or downward revisions. Accordingly, the reserve estimates could be materially different from the quantity of natural gas that ultimately will be recovered. |
(2) | Reserve figures do not include significant reserves located in certain Bolivian basins to which TGN is connected. |
(3) | Weighted average reserve life for all basins, at the 2018 or 2017 production levels, respectively. |
• | operating and safety standards; |
• | terms of service, including general service conditions, such as specifications regarding the quality of gas transported, major equipment requirements, invoicing and payment procedures, imbalances and penalties, and guidelines for dispatch management; |
• | contract requirements, including the basis for the provision of service, e.g., “firm” or “interruptible”; |
• | mandatory capital investments to be made over the first five years of the license term; and |
• | applicable rates based on the type of transportation service and the area serviced. |
• | repeated failure to comply with the obligations of our License and failure to remedy a significant breach of an obligation in accordance with specified procedures; |
• | total or partial interruption of the service for reasons attributable to us, affecting completely or partially transportation capacity during the periods stipulated in our License; |
• | sale, assignment or transfer of our essential assets or otherwise encumbering such assets without ENARGAS’s prior authorization, unless such encumbrances serve to finance expansions and improvements to the gas pipeline system; |
• | bankruptcy, dissolution or liquidation; and |
• | ceasing and abandoning the provision of the licensed service, attempting to assign or unilaterally transfer our License in full or in part without the prior authorization of ENARGAS, or giving up our License, other than in the cases permitted therein. |
Between April 1, 2016 and March 31,2017 | ||||||||||||||
Firm | Interruptible | |||||||||||||
Rate Zones | Reservation Charge(1) (Ps. m3/d) | Minimum Charge(2) (Ps. 1,000 m3) | Compression Fuel and Losses(3) (%) | |||||||||||
Receipt | Delivery | |||||||||||||
From Tierra del Fuego to: | Tierra del Fuego | 0.396058 | 13.201800 | 0.49 | ||||||||||
Santa Cruz Sur | 0.798666 | 26.622484 | 0.98 | |||||||||||
Chubut Sur | 2.037282 | 67.909449 | 3.38 | |||||||||||
Buenos Aires Sur | 2.400200 | 80.006630 | 5.60 | |||||||||||
Bahía Blanca | 3.676537 | 122.551231 | 8.40 | |||||||||||
La Pampa Norte | 3.663501 | 122.116622 | 8.60 | |||||||||||
Buenos Aires | 4.301588 | 143.386234 | 10.35 | |||||||||||
Greater Buenos Aires | 4.826380 | 160.879368 | 11.27 | |||||||||||
From Santa Cruz Sur to: | Santa Cruz Sur | 0.401399 | 13.379866 | 0.49 | ||||||||||
Chubut Sur | 1.638228 | 54.607597 | 2.89 | |||||||||||
Buenos Aires Sur | 2.001922 | 66.730682 | 5.11 | |||||||||||
Bahía Blanca | 3.284880 | 109.495948 | 7.91 | |||||||||||
La Pampa Norte | 3.284290 | 109.476235 | 8.11 | |||||||||||
Buenos Aires | 3.911976 | 130.399113 | 9.86 | |||||||||||
Greater Buenos Aires | 4.438382 | 147.946205 | 10.78 | |||||||||||
From Chubut to: | Chubut Sur | 0.398098 | 13.269851 | 0.49 | ||||||||||
Buenos Aires Sur | 0.746441 | 24.880963 | 2.71 | |||||||||||
Bahía Blanca | 1.990488 | 66.349237 | 5.51 | |||||||||||
La Pampa Norte | 2.090013 | 69.666693 | 5.71 | |||||||||||
Buenos Aires | 2.587629 | 86.254000 | 7.46 | |||||||||||
Greater Buenos Aires | 3.085246 | 102.841307 | 8.38 | |||||||||||
From Neuquén to: | Neuquén | 0.353737 | 12.128076 | 0.49 | ||||||||||
Bahía Blanca | 1.718143 | 57.254592 | 2.80 | |||||||||||
La Pampa Norte | 1.850629 | 61.671103 | 3.15 | |||||||||||
Buenos Aires | 2.326864 | 77.545340 | 3.91 | |||||||||||
Greater Buenos Aires | 2.850076 | 95.172312 | 4.86 | |||||||||||
From Bahía Blanca to: | Bahía Blanca | 0.398096 | 13.269853 | 0.49 | ||||||||||
La Pampa Norte | 0.099524 | 3.317455 | 0.20 | |||||||||||
Buenos Aires | 0.597139 | 19.904763 | 1.95 | |||||||||||
Greater Buenos Aires | 1.094759 | 36.492072 | 2.87 |
(1) | Monthly charge for every cubic meter per day of reserved transportation capacity. |
(2) | Minimum charge equal to the unit rate of the firm reservation charge at a 100% load factor. |
(3) | Maximum percentage of total transported gas that customers are required to replace in-kind to make up for gas used by us for compressor fuel or losses in rendering transportation services. |
Between April 1, 2017 and November 30, 2017 | ||||||||||||||
Firm | Interruptible | |||||||||||||
Rate Zones | Reservation Charge(1) (Ps. m3/d) | Minimum Charge(2) (Ps. 1,000 m3) | Compression Fuel and Losses(3) (%) | |||||||||||
Receipt | Delivery | |||||||||||||
From Tierra del Fuego to: | Tierra del Fuego | 0.650525 | 21.683927 | 0.49 | ||||||||||
Santa Cruz Sur | 1.311808 | 43.727372 | 0.98 | |||||||||||
Chubut Sur | 3.346231 | 111.541121 | 3.38 | |||||||||||
Buenos Aires Sur | 3.942323 | 131.410716 | 5.60 | |||||||||||
Bahía Blanca | 6.038705 | 201.290128 | 8.40 | |||||||||||
La Pampa Norte | 6.017293 | 200.576284 | 8.60 | |||||||||||
Buenos Aires | 7.065348 | 235.511576 | 10.35 | |||||||||||
Greater Buenos Aires | 7.927318 | 264.244011 | 11.27 | |||||||||||
From Santa Cruz Sur to: | Santa Cruz Sur | 0.659297 | 21.976401 | 0.49 | ||||||||||
Chubut Sur | 2.690787 | 89.692859 | 2.89 | |||||||||||
Buenos Aires Sur | 3.288153 | 109.605000 | 5.11 | |||||||||||
Bahía Blanca | 5.395408 | 179,846855 | 7.91 | |||||||||||
La Pampa Norte | 5.394439 | 179.814476 | 8.11 | |||||||||||
Buenos Aires | 6.425412 | 214.180259 | 9.86 | |||||||||||
Greater Buenos Aires | 7.290033 | 243.001319 | 10.78 | |||||||||||
From Chubut to: | Chubut Sur | 0.653875 | 21.795701 | 0.49 | ||||||||||
Buenos Aires Sur | 1.226027 | 40.866927 | 2.71 | |||||||||||
Bahía Blanca | 3.269373 | 108.978477 | 5.51 | |||||||||||
La Pampa Norte | 3.432841 | 114.427392 | 5.71 | |||||||||||
Buenos Aires | 4.250176 | 141.672007 | 7.46 | |||||||||||
Greater Buenos Aires | 5.067510 | 168.916622 | 8.38 | |||||||||||
From Neuquén to: | Neuquén | 0.581012 | 19.920338 | 0.49 | ||||||||||
Bahía Blanca | 2.822047 | 94.040542 | 2.80 | |||||||||||
La Pampa Norte | 3.039654 | 101.294653 | 3.15 | |||||||||||
Buenos Aires | 3.821870 | 127.368051 | 3.91 | |||||||||||
Greater Buenos Aires | 4.681244 | 156.320314 | 4.86 | |||||||||||
From Bahía Blanca to: | Bahía Blanca | 0.653875 | 21.795701 | 0.49 | ||||||||||
La Pampa Norte | 0.163469 | 5.448915 | 0.20 | |||||||||||
Buenos Aires | 0.980803 | 32.693530 | 1.95 | |||||||||||
Greater Buenos Aires | 1.798138 | 59.938145 | 2.87 |
(1) | Monthly charge for every cubic meter per day of reserved transportation capacity. |
(2) | Minimum charge equal to the unit rate of the firm reservation charge at a 100% load factor. |
(3) | Maximum percentage of total transported gas that customers are required to replace in-kind to make up for gas used by us for compressor fuel or losses in rendering transportation services. |
Between December 1, 2017 and March 31, 2018 | ||||||||||||||
Firm | Interruptible | |||||||||||||
Rate Zones | Reservation Charge(1) (Ps. m3/d) | Minimum Charge(2) (Ps. 1,000 m3) | Compression Fuel and Losses(3) (%) | |||||||||||
Receipt | Delivery | |||||||||||||
From Tierra del Fuego to: | Tierra del Fuego | 1.178272 | 39.275298 | 0.49 | ||||||||||
Santa Cruz Sur | 2.376029 | 79.201776 | 0.98 | |||||||||||
Chubut Sur | 6.060905 | 202.030320 | 3.38 | |||||||||||
Buenos Aires Sur | 7.140583 | 238.019383 | 5.60 | |||||||||||
Bahía Blanca | 10.937683 | 364.589386 | 8.40 | |||||||||||
La Pampa Norte | 10.898901 | 363.296426 | 8.60 | |||||||||||
Buenos Aires | 12.797205 | 426.573433 | 10.35 | |||||||||||
Greater Buenos Aires | 14.358459 | 478.615432 | 11.27 | |||||||||||
From Santa Cruz Sur to: | Santa Cruz Sur | 1.194161 | 39.805045 | 0.49 | ||||||||||
Chubut Sur | 4.873723 | 162.457367 | 2.89 | |||||||||||
Buenos Aires Sur | 5.955710 | 198.523493 | 5.11 | |||||||||||
Bahía Blanca | 9.772503 | 325.749975 | 7.91 | |||||||||||
La Pampa Norte | 9.770749 | 325.691329 | 8.11 | |||||||||||
Buenos Aires | 11.638111 | 387.936804 | 9.86 | |||||||||||
Greater Buenos Aires | 13.204167 | 440.139326 | 10.78 | |||||||||||
From Chubut to: | Chubut Sur | 1.184339 | 39.477749 | 0.49 | ||||||||||
Buenos Aires Sur | 2.220658 | 74.020757 | 2.71 | |||||||||||
Bahía Blanca | 5.921694 | 197.388697 | 5.51 | |||||||||||
La Pampa Norte | 6.217779 | 207.258114 | 5.71 | |||||||||||
Buenos Aires | 7.698187 | 256.605281 | 7.46 | |||||||||||
Greater Buenos Aires | 9.178595 | 305.952447 | 8.38 | |||||||||||
From Neuquén to: | Neuquén | 1.052366 | 36.080973 | 0.49 | ||||||||||
Bahía Blanca | 5.111469 | 170.332165 | 2.80 | |||||||||||
La Pampa Norte | 5.505614 | 183.471269 | 3.15 | |||||||||||
Buenos Aires | 6.922412 | 230.697053 | 3.91 | |||||||||||
Greater Buenos Aires | 8.478965 | 283.137219 | 4.86 | |||||||||||
From Bahía Blanca to: | Bahía Blanca | 1.184334 | 39.477755 | 0.49 | ||||||||||
La Pampa Norte | 0.296083 | 9.869416 | 0.20 | |||||||||||
Buenos Aires | 1.776485 | 59.216586 | 1.95 | |||||||||||
Greater Buenos Aires | 3.256902 | 108.563756 | 2.87 |
(1) | Monthly charge for every cubic meter per day of reserved transportation capacity. |
(2) | Minimum charge equal to the unit rate of the firm reservation charge at a 100% load factor. |
(3) | Maximum percentage of total transported gas that customers are required to replace in-kind to make up for gas used by us for compressor fuel or losses in rendering transportation services. |
Between April 1, 2018 and September 30, 2018 | ||||||||||||||
Firm | Interruptible | |||||||||||||
Rate Zones | Reservation Charge(1) (Ps. m3/d) | Minimum Charge(2) (Ps. 1,000 m3) | Compression Fuel and Losses(3) (%) | |||||||||||
Receipt | Delivery | |||||||||||||
From Tierra del Fuego to: | Tierra del Fuego | 1.767514 | 58.916471 | 0.49 | ||||||||||
Santa Cruz Sur | 3.564256 | 118.809770 | 0.98 | |||||||||||
Chubut Sur | 9.091901 | 303.063605 | 3.38 | |||||||||||
Buenos Aires Sur | 10.711516 | 357.050429 | 5.60 | |||||||||||
Bahía Blanca | 16.407506 | 546.916789 | 8.40 | |||||||||||
La Pampa Norte | 16.349329 | 544.977233 | 8.60 | |||||||||||
Buenos Aires | 19.196955 | 639.898420 | 10.35 | |||||||||||
Greater Buenos Aires | 21.538977 | 717.966088 | 11.27 | |||||||||||
From Santa Cruz Sur to: | Santa Cruz Sur | 1.791349 | 59.711139 | 0.49 | ||||||||||
Chubut Sur | 7.311021 | 243.700626 | 2.89 | |||||||||||
Buenos Aires Sur | 8.934100 | 297.803051 | 5.11 | |||||||||||
Bahía Blanca | 14.659632 | 488.654189 | 7.91 | |||||||||||
La Pampa Norte | 14.657000 | 488.566215 | 8.11 | |||||||||||
Buenos Aires | 17.458211 | 581.940011 | 9.86 | |||||||||||
Greater Buenos Aires | 19.807436 | 660.248478 | 10.78 | |||||||||||
From Chubut to: | Chubut Sur | 1.776614 | 59.220165 | 0.49 | ||||||||||
Buenos Aires Sur | 3.331187 | 111.037777 | 2.71 | |||||||||||
Bahía Blanca | 8.883072 | 296.100754 | 5.51 | |||||||||||
La Pampa Norte | 9.327226 | 310.905767 | 5.71 | |||||||||||
Buenos Aires | 11.547971 | 384.930944 | 7.46 | |||||||||||
Greater Buenos Aires | 13.768715 | 458.956121 | 8.38 | |||||||||||
From Neuquén to: | Neuquén | 1.578643 | 54.124697 | 0.49 | ||||||||||
Bahía Blanca | 7.667662 | 255.513529 | 2.80 | |||||||||||
La Pampa Norte | 8.258915 | 275.223364 | 3.15 | |||||||||||
Buenos Aires | 10.384239 | 346.066277 | 3.91 | |||||||||||
Greater Buenos Aires | 12.719209 | 424.731232 | 4.86 | |||||||||||
From Bahía Blanca to: | Bahía Blanca | 1.776607 | 59.220174 | 0.49 | ||||||||||
La Pampa Norte | 0.444152 | 14.805009 | 0.20 | |||||||||||
Buenos Aires | 2.664887 | 88.830192 | 1.95 | |||||||||||
Greater Buenos Aires | 4.885645 | 162.855375 | 2.87 |
(1) | Monthly charge for every cubic meter per day of reserved transportation capacity. |
(2) | Minimum charge equal to the unit rate of the firm reservation charge at a 100% load factor. |
(3) | Maximum percentage of total transported gas which customers are required to replace in-kind to make up for gas used by us for compressor fuel or losses in rendering transportation services. |
Between October 1, 2018 and March 31, 2019 |
| |||||||||||||
|
| Firm |
|
| Interruptible |
|
|
|
| |||||
Rate Zones | Reservation Charge(1) (Ps. m3/d) | Minimum Charge(2) (Ps. 1,000 m3) | Compression Fuel and Losses(3) (%) | |||||||||||
Receipt |
| Delivery |
|
|
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
| |||
From Tierra del Fuego to: |
| Tierra del Fuego |
|
| 2.115187 |
|
|
| 70.505443 |
|
|
| 0.49 |
|
| Santa Cruz Sur |
|
| 4.265351 |
|
|
| 142.179858 |
|
|
| 0.98 |
| |
| Chubut Sur |
|
| 10.880293 |
|
|
| 362.676743 |
|
|
| 3.38 |
| |
| Buenos Aires Sur |
|
| 12.818489 |
|
|
| 427.282869 |
|
|
| 5.60 |
| |
| Bahía Blanca |
|
| 19.634891 |
|
|
| 654.496272 |
|
|
| 8.40 |
| |
| La Pampa Norte |
|
| 19.565270 |
|
|
| 652.175202 |
|
|
| 8.60 |
| |
| Buenos Aires |
|
| 22.973029 |
|
|
| 765.767552 |
|
|
| 10.35 |
| |
| Greater Buenos Aires |
|
| 25.775731 |
|
|
| 859.191266 |
|
|
| 11.27 |
| |
From Santa Cruz Sur to: |
| Santa Cruz Sur |
|
| 2.143710 |
|
|
| 71.456424 |
|
|
| 0.49 |
|
| Chubut Sur |
|
| 8.749112 |
|
|
| 291.636962 |
|
|
| 2.89 |
| |
| Buenos Aires Sur |
|
| 10.691453 |
|
|
| 356.381429 |
|
|
| 5.11 |
| |
| Bahía Blanca |
|
| 17.543207 |
|
|
| 584.773317 |
|
|
| 7.91 |
| |
| La Pampa Norte |
|
| 17.540057 |
|
|
| 584.668038 |
|
|
| 8.11 |
| |
| Buenos Aires |
|
| 20.892272 |
|
|
| 696.408622 |
|
|
| 9.86 |
| |
| Greater Buenos Aires |
|
| 23.703593 |
|
|
| 790.120501 |
|
|
| 10.78 |
| |
From Chubut to: |
| Chubut Sur |
|
| 2.126078 |
|
|
| 70.868874 |
|
|
| 0.49 |
|
| Buenos Aires Sur |
|
| 3.986437 |
|
|
| 132.879101 |
|
|
| 2.71 |
| |
| Bahía Blanca |
|
| 10.630388 |
|
|
| 354.344287 |
|
|
| 5.51 |
| |
| La Pampa Norte |
|
| 11.161907 |
|
|
| 372.061471 |
|
|
| 5.71 |
| |
| Buenos Aires |
|
| 13.819476 |
|
|
| 460.647529 |
|
|
| 7.46 |
| |
| Greater Buenos Aires |
|
| 16.477046 |
|
|
| 549.233587 |
|
|
| 8.38 |
| |
From Neuquén to: |
| Neuquén |
|
| 1.889165 |
|
|
| 64.771119 |
|
|
| 0.49 |
|
| Bahía Blanca |
|
| 9.175905 |
|
|
| 305.773484 |
|
|
| 2.80 |
| |
| La Pampa Norte |
|
| 9.883458 |
|
|
| 329.360278 |
|
|
| 3.15 |
| |
| Buenos Aires |
|
| 12.426836 |
|
|
| 414.138116 |
|
|
| 3.91 |
| |
| Greater Buenos Aires |
|
| 15.221099 |
|
|
| 508.276603 |
|
|
| 4.86 |
| |
From Bahía Blanca to: |
| Bahía Blanca |
|
| 2.126068 |
|
|
| 70.868885 |
|
|
| 0.49 |
|
| La Pampa Norte |
|
| 0.531517 |
|
|
| 17.717180 |
|
|
| 0.20 |
| |
| Buenos Aires |
|
| 3.189075 |
|
|
| 106.303245 |
|
|
| 1.95 |
| |
| Greater Buenos Aires |
|
| 5.846660 |
|
|
| 194.889310 |
|
|
| 2.87 |
|
(1) | Monthly charge for every cubic meter per day of reserved transportation capacity. |
(2) | Minimum charge equal to the unit rate of the firm reservation charge at a 100% load factor. |
(3) | Maximum percentage of total transported gas that customers are required to replace in-kind to make up for gas used by us for compressor fuel or losses in rendering transportation services. |
Between April 1, 2019 and March 31, 2020 | ||||||||||||||
Firm | Interruptible | |||||||||||||
Rate Zones | Reservation Charge(1) (Ps. m3/d) | Minimum Charge(2) (Ps. 1,000 m3) | Compression Fuel and Losses(3) (%) | |||||||||||
Receipt | Delivery | |||||||||||||
From Tierra del Fuego to: | Tierra del Fuego | 2.665144 | 88.837143 | 0.49 | ||||||||||
Santa Cruz Sur | 5.374436 | 179.147196 | 0.98 | |||||||||||
Chubut Sur | 13.709213 | 456.974163 | 3.38 | |||||||||||
Buenos Aires Sur | 16.151349 | 538.378143 | 5.60 | |||||||||||
Bahía Blanca | 24.740042 | 824.667950 | 8.40 | |||||||||||
La Pampa Norte | 24.652320 | 821.743392 | 8.60 | |||||||||||
Buenos Aires | 28.946110 | 964.870213 | 10.35 | |||||||||||
Greater Buenos Aires | 32.477525 | 1,082.584470 | 11.27 | |||||||||||
From Santa Cruz Sur to: | Santa Cruz Sur | 2.701084 | 90.035383 | 0.49 | ||||||||||
Chubut Sur | 11.023917 | 367.463752 | 2.89 | |||||||||||
Buenos Aires Sur | 13.471273 | 449.042042 | 5.11 | |||||||||||
Bahía Blanca | 22.104511 | 736.816745 | 7.91 | |||||||||||
La Pampa Norte | 22.100543 | 736.684093 | 8.11 | |||||||||||
Buenos Aires | 26.324347 | 877.477681 | 9.86 | |||||||||||
Greater Buenos Aires | 29.866623 | 995.555027 | 10.78 | |||||||||||
From Chubut to: | Chubut Sur | 2.678866 | 89.295068 | 0.49 | ||||||||||
Buenos Aires Sur | 5.022927 | 167.428204 | 2.71 | |||||||||||
Bahía Blanca | 13.394433 | 446.475235 | 5.51 | |||||||||||
La Pampa Norte | 14.064048 | 468.798959 | 5.71 | |||||||||||
Buenos Aires | 17.412596 | 580.417750 | 7.46 | |||||||||||
Greater Buenos Aires | 20.761144 | 692.036541 | 8.38 | |||||||||||
From Neuquén to: | Neuquén | 2.380356 | 81.611872 | 0.49 | ||||||||||
Bahía Blanca | 11.561677 | 385.275827 | 2.80 | |||||||||||
La Pampa Norte | 12.453197 | 414.995282 | 3.15 | |||||||||||
Buenos Aires | 15.657864 | 521.815701 | 3.91 | |||||||||||
Greater Buenos Aires | 19.178646 | 640.430576 | 4.86 | |||||||||||
From Bahía Blanca to: | Bahía Blanca | 2.678855 | 89.295082 | 0.49 | ||||||||||
La Pampa Norte | 0.669714 | 22.323718 | 0.20 | |||||||||||
Buenos Aires | 4.018247 | 133.942519 | 1.95 | |||||||||||
Greater Buenos Aires | 7.366815 | 245.561319 | 2.87 |
(1) | Monthly charge for every cubic meter per day of reserved transportation capacity. |
(2) | Minimum charge equal to the unit rate of the firm reservation charge at a 100% load factor. |
(3) | Maximum percentage of total transported gas that customers are required to replace in-kind to make up for gas used by us for compressor fuel or losses in rendering transportation services. |
• | the net book value of the essential assets determined on the basis of the price paid by CIESA for shares of our common stock plus the original cost of subsequent investments carried in U.S. dollars in each case adjusted by the PPI, net of accumulated depreciation in accordance with the calculation rules to be determined by ENARGAS (since the enactment of the Public Emergency Law, this provision may no longer be valid); or |
• | the net proceeds of a new competitive bidding (the “New Bidding”). |
• | submit a bid computed at an equal and not lower price than the appraisal value determined by an investment bank selected by ENARGAS, which represents the value of the business providing the licensed service at the valuation date, as a going concern and without regard to the debts; |
• | match the best bid submitted by third parties in the New Bidding, if it would be higher than our bid mentioned above, paying the difference between both values to obtain a new license; and |
• | if we have participated in the New Bidding but are unwilling to match the best bid made by a third party, receive the appraisal value as compensation for the transfer of the essential assets to the new licensee, with any excess paid by the third-party remaining for the grantor. |
2019 | 2018 | 2017 | ||||||||||
Ethane | 312,651 | 437,362 | 311,786 | |||||||||
Propane | 416,519 | 334,852 | 353,561 | |||||||||
Butane | 287,083 | 260,761 | 260,171 | |||||||||
Natural Gasoline | 130,572 | 132,311 | 133,802 | |||||||||
Total | 1,146,825 | 1,165,286 | 1,059,319 |
(1) | Incorporated in Argentina. |
(2) | Incorporated in Uruguay. |
Major Pipeline | Length (miles) | Diameter (inches) | Maximum Pressure (pound/inch) | Compressor Units | Operative Compressor Plants | HP Output | ||||||||||||||||||
General San Martín | 2,939 | 24/30 | 853/995 | 59 | 17 | 512,800 | ||||||||||||||||||
Neuba I/Loop Sur | 1,217 | 24/30 | 853 | 18 | 6 | 65,800 | ||||||||||||||||||
Neuba II | 1,307 | 30/36 | 975/995 | 21 | 7 | 194,000 | ||||||||||||||||||
Other (1) | 273 | Various | Various | 6 | 3 | 7,500 | ||||||||||||||||||
Total | 5,736 | 104 | 33 | 780,100 |
(1) | Includes 247 miles of transfer pipelines throughout the pipeline system, as well as the Cordillerano pipeline, with a length of 239 miles, and the Chelforó-Conesa pipeline and other minor pipelines. |
• | inventory of gaseous emissions; |
• | monitoring of gaseous emissions from the Cerri Complex; |
• | zero effluent in the Cerri Complex; |
• | diagnosis of energy efficiency in the Cerri Complex, Puerto Galván and our headquarters; |
• | measurement of the vents generated by the use of seals; and |
• | sewage effluent treatment plant in Plaza Huincul. |
Item 4A. | Unresolved Staff Comments |
Item 5. | Operating and Financial Review and Prospects |
• | impairment of property, plant and equipment (“PPE”); |
• | provisions for legal claims and others; and |
• | income tax – deferred tax assets and tax credits. |
• | whether significant decreases in the market values of PPE elements took place; |
• | whether prices of the main products and services that are marketed decreased; |
• | whether significant changes in the regulatory framework were introduced; |
• | whether operating costs suffered a material increase; |
• | whether evidence of obsolescence or physical damage has occurred; and |
• | whether the macroeconomic situation in which we carry out our activities, including significant variations in the sale prices of products, raw materials, interest rates, etc., has worsened. |
• | it requires our management to make estimates and assumptions that are highly susceptible to change from period to period; and |
• | the impact that recognizing or reversing provisions for legal claims and others would have on our consolidated balance sheet as well as on the results of our operations could be material. |
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||
WPI (in %) (1) | 58.5 | 73.5 | 18.8 | 34.6 | 10.6 | |||||||||||||||
CPI (in %)(2) | 53.8 | 47.6 | 24.8 | 36.1 | 23.6 | |||||||||||||||
Devaluation of pesos vs. dollar (in %) | 58.9 | 102.2 | 17.4 | 9.3 | 52.5 | |||||||||||||||
Real GDP (pesos of 2004) (% change) | (2.2 | ) | (2.5 | ) | 2.7 | (2.1 | ) | 2.7 | ||||||||||||
Industrial production (% change) | 1.3 | (14.8 | ) | 1.8 | (4.6 | ) | 0.1 | |||||||||||||
Transportation services tariffs increase | 26.0 | 79.5 | 182.0 | 200.1 | 44.3 |
(1) | For the year 2015, the latest information published by the INDEC refers to October 2015. This rate (which contains ten months accumulated), was complemented with CPI average rates as of November and December 2015 published by the Province of San Luis and the City of Buenos Aires (7.8%). |
(2) | Since June 2016, the INDEC began to gradually publish CPI information for the period commencing in May 2016 and concluding in December 2016. As of the date of issuance of this Annual Report the CPI for the first four months of 2016 has not been published. As a consequence of the lack of information, we completed the missing information with CPI average rates for these four months published by the Province of San Luis and the City of Buenos Aires (16.6%). |
• | the volume of Liquids; |
• | changes in international prices of LPG and natural gasoline (in 2020 their outlook remains precarious principally as a consequence of the uncertainty regarding the effect of the COVID outbreak); |
• | regulation affecting our liquids business, including Law No. 26,020 (which requires us to meet domestic demand before exporting LPG); |
• | changes in the input costs related to the liquids production and commercialization segment, including the Gas Charge Resolutions; |
• | the availability of natural gas and its richness; |
• | fluctuation in the peso / U.S. dollar exchange rate; |
• | the tariffs we are permitted to charge in our Natural Gas Transportation business segment; |
• | local inflation and its impact on costs expressed in pesos; and |
• | other changes in laws or regulations affecting our operations, including tax matters. |
• | The components of the capital stock were restated from the dates they were contributed; |
• | Reserved earnings were maintained at the date of transition at their nominal value (legal amount without restatement); |
• | The restated unallocated results were determined by the difference between the net assets restated at the transition date and the rest of the initial equity components expressed as indicated in the preceding paragraphs; and |
• | After the restatement at the transition date, all the components of the equity were restated by applying the general price index from the beginning of the period, and each variation of those components was restated from the date of contribution or from the moment in which the variation is added by any other means. |
Year ended December 31, | ||||||||||||||||
2019 | 2018 | Variation | Percentage of change | |||||||||||||
(in millions of pesos) | ||||||||||||||||
Revenues | 48,561.5 | 52,399.4 | (3,837.9 | ) | (7.3 | ) | ||||||||||
Operating costs | (20,835.4 | ) | (21,894.5 | ) | 1,149.1 | (5.2 | ) | |||||||||
Depreciation | (3,540.1 | ) | (3,008.3 | ) | (531.8 | ) | 17.7 | |||||||||
Costs of sales | (24,375.5 | ) | (24,902.9 | ) | 527.4 | (2.1 | ) | |||||||||
Gross profit | 24,186.0 | 27,496.5 | (3,310.6 | ) | (12.0 | ) | ||||||||||
Administrative and selling expenses | (4,299.9 | ) | (4,194.3 | ) | (105.6 | ) | 2.5 | |||||||||
Other operating loss | (127.5 | ) | (1,370.3 | ) | 1,242.8 | (90.7 | ) | |||||||||
Operating profit | 19,758.6 | 21,932.0 | (2,173.4 | ) | (9.9 | ) | ||||||||||
Net financial results | (2,897.4 | ) | (4,378.5 | ) | 1,481.0 | (33.8 | ) | |||||||||
Share of (loss) / profit from associates | (31.9 | ) | 28.0 | (59.9 | ) | n/a | ||||||||||
Income tax (expense) | (4,024.2 | ) | (20.3 | ) | (4,003.9 | ) | n/a | |||||||||
Total net income and total comprehensive income | 12,805.1 | 17,561.2 | (4,756.1 | ) | (27.1 | ) |
• | Net revenues to third parties reached Ps. 48,561.5 million, a decrease of Ps. 3,837.9 million compared to the 2018 fiscal year. This decrease was mainly due to lower net revenues from the Natural Gas Transportation and Liquids Production and Commercialization segments, which suffer a reduction 4.9% or Ps. 1,165.3 million and 9.5% or Ps. 2,440.2 million, respectively. |
• | Cost of sales, including depreciation of fixed assets, decreased by Ps. 527.4 million, or 2.1% over 2018 fiscal year, primarily as a result of the decrease in the price and volumes of natural gas used as RTP totaling Ps. 1,059.5 million and lower technical assistance fee accrued of Ps. 881.5 million. These effects were partially offset by higher charges for the preservation of fixed assets, including depreciation of Ps. 1,140.8 million and labor costs of Ps. 260.7 million. |
• | Administrative and selling expenses rose by Ps. 105.6 million, or 2.5% over 2018 fiscal year, as a result of the increase in the turnover tax and tax on exports of Ps. 392.2 million and labor costs of Ps. 92.2 million. These effects were partially offset by lower doubtful accounts charges by Ps. 201.5 million and lower depreciations of Ps. 255.9 million. |
Year ended December 31, | ||||||||
2019 | 2018 | |||||||
(in millions of pesos) | ||||||||
Financial income | ||||||||
Interest income | 719.6 | 2,069.5 | ||||||
Foreign exchange gain | 7,815.6 | 12,559.2 | ||||||
Subtotal | 8,535.1 | 14,628.7 | ||||||
Financial expenses | ||||||||
Interest expense | (2,509.8 | ) | (2,577.4 | ) | ||||
Foreign exchange loss | (15,636.5 | ) | (20,185.9 | ) | ||||
Capitalized financial expenses | 446.2 | - | ||||||
Subtotal | (17,700.1 | ) | (22,763.3 | ) | ||||
Other financial results | ||||||||
Fair value gains on financial instruments through profit and loss | 542.2 | 2,112.0 | ||||||
Derivative financial instruments results | (19.2 | ) | 163.2 | |||||
Other financial charges | (409.7 | ) | (374.6 | ) | ||||
Subtotal | 113.4 | 1,900.6 | ||||||
Gain on monetary position | 6,154.2 | 1,855.5 | ||||||
Total | (2,897.4 | ) | (4,378.5 | ) |
Year ended December 31, | Year ended December 31, 2019, compared to year ended December 31, 2018 | |||||||||||||||
2019 | 2018 | Variation | Percentage Change | |||||||||||||
Natural Gas Transportation | ||||||||||||||||
Revenues from sales (1) | 23,236.4 | 24,706.2 | (1,469.8 | ) | (6.0 | %) | ||||||||||
Cost of sales | (8,667.6 | ) | (7,944.3 | ) | (723.3 | ) | 9.1 | % | ||||||||
Gross profit | 14,568.8 | 16,761.9 | (2,193.1 | ) | (13.1 | %) | ||||||||||
Administrative and selling expenses | (2,387.1 | ) | (2,751.9 | ) | 364.8 | (13.3 | %) | |||||||||
Other operating expense | (136.9 | ) | (240.4 | ) | 103.5 | (43.1 | %) | |||||||||
Operating profit | 12,044.8 | 13,769.6 | (1,724.8 | ) | (12.5 | %) | ||||||||||
Liquids Production and Commercialization | ||||||||||||||||
Revenues from sales | 23,138.2 | 25,578.4 | (2,440.2 | ) | (9,5 | %) | ||||||||||
Cost of sales | (14,661.5 | ) | (16,130.9 | ) | 1,469.3 | (9.1 | %) | |||||||||
Gross profit | 8,476.6 | 9,447.5 | (970.9 | ) | (10.3 | %) | ||||||||||
Administrative and selling expenses | (1,534.5 | ) | (1,114.1 | ) | (420.4 | ) | 37.7 | % | ||||||||
Other operating expense | 3.2 | (1,117.9 | ) | 1,121.1 | n/a | |||||||||||
Operating profit | 6,945.3 | 7,215.5 | (270.1 | ) | (3.7 | %) | ||||||||||
Other services | ||||||||||||||||
Revenues from sales | 2,526.6 | 2,784.5 | (257.9 | ) | (9,3 | %) | ||||||||||
Cost of sales | (1,524.4 | ) | (1,621.8 | ) | 97.3 | (6.0 | %) | |||||||||
Gross profit | 1,002.2 | 1,162.8 | (160.6 | ) | (13.8 | %) | ||||||||||
Administrative and selling expenses | (325.4 | ) | (276.0 | ) | (49.4 | ) | 17.9 | % | ||||||||
Other operating (expense) / income | 3.6 | (8.4 | ) | 12.0 | n/a | |||||||||||
Operating profit | 680.4 | 878.4 | (198.0 | ) | (22.5 | %) | ||||||||||
Telecommunications | ||||||||||||||||
Revenues from sales | 276.2 | 250.9 | 25.4 | 10.1 | % | |||||||||||
Cost of sales | (137.9 | ) | (126.5 | ) | (11.4 | ) | 9.0 | % | ||||||||
Gross profit | 138.4 | 124.4 | 14.0 | 11.3 | % | |||||||||||
Administrative and selling expenses | (52.8 | ) | (52.3 | ) | (0.6 | ) | 1.2 | % | ||||||||
Other operating expense | 2.6 | (3.6 | ) | 6.2 | n/a | |||||||||||
Operating profit | 88.2 | 68.5 | 19.6 | 28.6 | % |
(1) | Includes of intersegment revenues of Ps. 616.0 million and 920.6 million for the fiscal years 2019 and 2018, respectively. |
• | Revenues from the Natural Gas Transportation business segment decreased by Ps. 1,469.8 million for the year 2019 compared to 2018; |
• | During 2019, we received nominal tariff increases totaling 26.0% while annual inflation was 53.8%; |
• | Revenues related to natural gas firm transportation contracts for the years ended December 31, 2019, decreased by Ps. 313.6 million. The decrease is mainly due to a single rate increase granted by ENARGAS since April 2019 (26%, although according to the RTI process, a second increase as of October 2019 should have been granted), which was lower than the 2019 annual inflation rate (53.8%). See “Item 4. Our Information—B. Business Overview—Natural Gas Transportation—Regulatory Framework—Regulation of Transportation Rates-Actual Rates” for additional information; |
• | Revenues related to interruptible natural gas transportation service decreased by Ps. 885.5 million. The decrease mainly resulted from the tariff decrease in Current Currency discussed above and lower volumes dispatched; |
• | Revenues relating to the CAU decreased by Ps. 34.7 million by the same tariff effect. The value of the CAU is much lower than the transportation tariff we are permitted to charge for our natural gas transportation services, because we were not required to make any investment in the construction and expansion of the assets to which the CAU relates. See “Item 4. Our Information—B. Business Overview—Natural Gas Transportation—Pipeline Operations—Pipeline Expansions” for additional information regarding the CAU; |
• | Intersegment sales decreased by Ps. 304.6 million given the lower volumes of natural gas transported to Cerri Complex and the tariff decreases in Current Currency discussed above; |
• | Costs of sales and administrative and selling expenses for the year ended December 31, 2019 increased by Ps. 358.5 million, from Ps. 10,696.2 million to Ps. 11,054.7 million, as compared to the year ended December 31, 2018. This increase was mainly attributable to higher: (i) ordinary maintenance expenses for the pipelines and other fixed assets by Ps. 532.9 million, (ii) labor costs by Ps. 213.2 million and (iii) depreciations amounting to Ps. 105.7 million. These effects were partially offset by a lower technical assistance fee accrued of Ps. 513.0 million and charges in doubtful accounts by Ps. 203.9 million; and |
• | The positive variation in other operating expenses of Ps. 103.5 million derives mainly from the US$ 21.3 million one-time payment made in June 2018, as part of the resolution of the arbitration initiated by Pan American Energy LLC Argentine Branch and Pan American Sur S.A. before the International Court of Arbitration on May 8, 2015, against the Company for US$ 306.3 million. |
Years ended December 31, | Year ended December 31, 2019 compared to year ended December 31, 2018 | |||||||||||||||
(volumes in short tons) | (volumes in short tons) | |||||||||||||||
2019 | 2018 | Increase/ (Decrease) | Percentage Change | |||||||||||||
Local Market | ||||||||||||||||
Ethane | 312,651 | 437,362 | (124,711 | ) | (28.5 | ) | ||||||||||
Propane | 234,125 | 172,834 | 61,291 | 35.5 | ||||||||||||
Butane | 160,399 | 171,889 | (11,490 | ) | (6.7 | ) | ||||||||||
Subtotal | 707,175 | 782,085 | (74,910 | ) | (9.6 | ) | ||||||||||
Exports | ||||||||||||||||
Propane | 182,394 | 162,018 | 20,376 | 12.6 | ||||||||||||
Butane | 126,684 | 88,872 | 37,812 | 42.5 | ||||||||||||
Natural Gasoline | 130,572 | 132,311 | (1,738 | ) | (1.3 | ) | ||||||||||
Subtotal | 439,650 | 383,201 | 56,450 | 14.7 | ||||||||||||
Total Liquids | 1,146,825 | 1,165,286 | (18,460 | ) | (1.6 | ) |
• | Segment revenue decreased by Ps. 2,440.2 million in 2019, compared with the previous year. This decrease is mainly due to lower international reference prices by Ps. 4,154.2 million and ethane volumes and price by Ps. 4,225.9 million. These effects were partially offset by the depreciation of the peso against the U.S. dollar by Ps. 3,335.7 million, higher propane and butane volumes sold by Ps. 1,967.2 million and the increase in the price of the propane and butane sold under the supply programs sponsored by the Government; |
• | In 2019 propane, butane and natural gasoline average export prices recorded decreases of 28.5%, 23.3% and 17.0%, respectively. The fall in international reference prices occurred mainly during the first half of the year showing signs of recovery as from August 2019; |
• | During 2019, the production of Liquids reached 1,127,558 short tons (44,248 tons or 3.8% less than in 2018). This was mainly due to the lower ethane sold during 2019 as a result of the operational problems that occurred at the PBB facilities, an effect that was partially offset by the higher volumes of propane and butane obtained. It should be noted that there were no production restrictions during the winter period, as a result of a greater supply of local gas due to non-conventional gas developments; |
• | Notwithstanding the changes made to the Households with Bottles Program to supply butane to the domestic market described above, our obligations under this program continues to have an adverse impact on this segment, resulting in a negative operating margin on domestic sales of LPG; |
• | Costs of sales, administrative and selling expenses for the year ended December 31, 2019, decreased by Ps. 1,048.9 million, from Ps. 17,245.0 million to Ps. 16,196.0 million, as compared to the year ended December 31, 2018. This decrease was mainly due to the reduction in the price and volumes of natural gas that we are required to purchase as RTP as part of the Liquids processing business of Ps. 1,059.5 million and the lower technical assistance fee of Ps. 333.4 million. These effects were partially offset by higher taxes, mainly due to tax on exports, of Ps. 401.0 million, and labor costs of Ps. 92.6 million; |
• | Other operating expenses decreased by Ps. 1,121.1 million mainly resulting from the Ps. 1,054.4 million (US$ 21.3 million) payment made, on June 14, 2018, as part of the resolution of the arbitration initiated by Pan American Energy LLC Argentine Branch and Pan American Sur S.A. before the International Court of Arbitration on May 8, 2015, against the Company for US$ 306.3 million. |
• | Net revenues decreased by Ps. 257.9 million primarily due to the lower sales associated with lower construction of Ps. 499.6 million and operation and maintenance services of Ps. 172.5 million rendered in fiscal year 2019. These effects were partially offset by the impact of the exchange rate increase on the revenues denominated in United States dollars of Ps. 270.9 million and revenues related to natural gas transportation and conditioning in Vaca Muerta of Ps. 165.8 million. |
• | Costs of sales, administrative and selling expenses decreased by Ps. 47.9 million, mainly due to decreases in costs of services rendered to third parties (Ps. 236.5 million). These effects were partially offset by higher (i) depreciations (Ps. 98.4 million), (ii) professional fees (Ps. 51.5 million) and (iii) labor costs (Ps. 39.4 million). |
• | Net revenues increased by Ps. 25.4 million in the year ended December 31, 2019, when compared to 2018. The positive variation was mainly due to the increase in the foreign exchange rate of the peso compared to the U.S. dollar. |
• | Costs of sales, administrative and selling expenses increased by Ps. 12.0 million. |
Year ended December 31, | ||||||||||||||||
2018 | 2017 | Variation | Percentage of change | |||||||||||||
(in millions of pesos) | ||||||||||||||||
Revenues | 52,399.4 | 30,694.6 | 21,704.8 | 70.7 | % | |||||||||||
Operating costs | (21,894.5 | ) | (15,445.8 | ) | (6,448.7 | ) | 41.8 | % | ||||||||
Depreciation | (3,008.3 | ) | (2,915.0 | ) | (93.3 | ) | 3.2 | % | ||||||||
Costs of sales | (24,902.9 | ) | (18,361.0 | ) | (6,542.0 | ) | 35.6 | % | ||||||||
Gross profit | 27,496.5 | 12,333.6 | 15,162.8 | 122.9 | % | |||||||||||
Administrative and selling expenses | (4,194.3 | ) | (2,370.8 | ) | (1,823.5 | ) | 76.9 | % | ||||||||
Other operating loss | (1,370.3 | ) | (417.7 | ) | (952.6 | ) | 228.1 | % | ||||||||
Operating profit | 21,932.0 | 9,545.1 | 12,386.7 | 129.8 | % | |||||||||||
Net financial results | (4,378.5 | ) | (812.7 | ) | (3,565.8 | ) | 438.8 | % | ||||||||
Share of profit from associates | 28.0 | 33.2 | (5.2 | ) | (15.7 | %) | ||||||||||
Income tax (expense) | (20.3 | ) | 81.7 | (102.0 | ) | n/a | ||||||||||
Total net income and total comprehensive income | 17,561.2 | 8,847.3 | 8,713.7 | 98.5 |
• | Net revenues reached Ps. 52,399.4 million, an increase of Ps. 21,704.8 million compared to the 2017 fiscal year. This increase was mainly due to higher net revenues from the Natural Gas Transportation and Liquids Production and Commercialization segments, which grew by 108.6% or Ps. 12,859.3 million and 48.8% or Ps. 8,389.2 million, respectively. |
• | Operating costs, including depreciation of fixed assets, increased by Ps. 6,541.9 million, or 35.6% over 2017 fiscal year, primarily as a result of: (i) the increase in the price and volumes of natural gas used as RTP totaling Ps. 4,018.9 million, (ii) more third parties’ services and higher fees at Ps. 1,412.9 million, (iii) higher charges for the preservation of fixed assets, including depreciation of Ps. 484.7 million and (iv) labor costs of Ps. 213.8 million. |
• | Administrative and selling expenses rose by Ps. 1,823.4 million, or 76.9% over 2017 fiscal year, as a result of: (i) the increase in the turnover tax and tax on exports of Ps 1,150.4 million, (ii) higher doubtful accounts charges by Ps. 186.0 million and (iii) higher depreciations of Ps. 218.4 million. |
Year ended December 31, | ||||||||
2018 | 2017 | |||||||
(in millions of pesos) | ||||||||
Financial income | ||||||||
Interest income | 2,069.5 | 204.8 | ||||||
Foreign exchange gain | 12,559.2 | 863.9 | ||||||
Subtotal | 14,628.7 | 1,068.7 | ||||||
Financial expenses | ||||||||
Interest expense | (2,577.4 | ) | (1,302.0 | ) | ||||
Foreign exchange loss | (20,185.9 | ) | (1,718.6 | ) | ||||
Capitalized financial expenses | - | - | ||||||
Subtotal | (22,763.3 | ) | (3,020.6 | ) | ||||
Other financial results | ||||||||
Fair value gains on financial instruments through profit and loss | 2,112.0 | 680.7 | ||||||
Derivative financial instruments results | 163.2 | - | ||||||
Other financial charges | (374.6 | ) | (258.4 | ) | ||||
Subtotal | 1,900.6 | 422.4 | ||||||
Gain on monetary position | 1,855.5 | 716.8 | ||||||
Total | (4,378.5 | ) | (812.7 | ) |
Year ended December 31, | Year ended December 31, 2018 compared to year ended December 31, 2017 | |||||||||||||||
2018 | 2017 | Variation | Percentage Change | |||||||||||||
Natural Gas Transportation | ||||||||||||||||
Revenues (1) | 24,706.2 | 11,846.9 | 12,859.3 | 108.6 | % | |||||||||||
Cost of sales | (7,944.3 | ) | (6,428.5 | ) | (1,515.8 | ) | 23.6 | % | ||||||||
Gross profit | 16,761.9 | 418.4 | 11,343.5 | 209.4 | % | |||||||||||
Administrative and selling expenses | (2,751.9 | ) | (1,564.0 | ) | (1,187.9 | ) | 76.0 | % | ||||||||
Other operating expense | (240.4 | ) | (503.3 | ) | 262.9 | (52.3 | %) | |||||||||
Operating profit | 13,769.6 | 3,351.1 | 10,418.5 | 310.9 | % | |||||||||||
Liquids Production and Commercialization | ||||||||||||||||
Revenues | 25,578.4 | 17,189.2 | 8,389.2 | 48.8 | % | |||||||||||
Cost of sales | (16,130.9 | ) | (11,186.1 | ) | (4,944.8 | ) | 44.2 | % | ||||||||
Gross profit | 9,447.5 | 6,003.1 | 3,444.4 | 57.4 | % | |||||||||||
Administrative and selling expenses | (1,114.1 | ) | (552.4 | ) | (561.7 | ) | 101.7 | % | ||||||||
Other operating (expense) / income | (1,117.9 | ) | 99.5 | (1,217.4 | ) | n/a | ||||||||||
Operating profit | 7,215.5 | 5,550.2 | 1,665.3 | 30.0 | % | |||||||||||
Other services | ||||||||||||||||
Revenues | 2,784.5 | 1,844.8 | 1,844.8 | 50.9 | % | |||||||||||
Cost of sales | (1,621.8 | ) | (1,008.8 | ) | (1,008.8 | ) | 60.8 | % | ||||||||
Gross profit | 1,162.8 | 836.0 | 836.0 | 39.1 | % | |||||||||||
Administrative and selling expenses | (276.0 | ) | (220.6 | ) | (220.6 | ) | 25.1 | % | ||||||||
Other operating expense | (8,4 | ) | (14.2 | ) | (14.2 | ) | (41.3 | %) | ||||||||
Operating profit | 878.4 | 601.2 | 601.2 | 46.1 | % | |||||||||||
Telecommunications | ||||||||||||||||
Revenues | 250,9 | 190.9 | 60.0 | 31.4 | % | |||||||||||
Cost of sales | (126,5 | ) | (114.8 | ) | (11.7 | ) | 10.5 | % | ||||||||
Gross profit | 124.4 | 76.1 | 48.3 | 62.9 | % | |||||||||||
Administrative and selling expenses | (52.3 | ) | (33.8 | ) | (18.5 | ) | 54.6 | % | ||||||||
Other operating (expense) / income | (3.6 | ) | 0.3 | (3.9 | ) | -n/ | a | |||||||||
Operating profit | 68.5 | 42.6 | 25.9 | 60.4 | % |
(1) | Includes of intersegment revenues of Ps. 920.6 million and 377.2 million for the fiscal years 2018 and 2017, respectively. |
• | Revenues from the Natural Gas Transportation business segment increased by Ps. 12,859.3 million for the year 2018 compared to 2017; |
• | Revenues related to natural gas firm transportation contracts for the years ended December 31, 2018, increased by Ps. 9,863.4 million. The increase is mainly due to the combined effect of: (i) the full application during fiscal year 2018 of the tariff increases granted by Resolutions 4362 and 120 of 58% and 78%, respectively, (ii) the application starting April 1, 2018 of Resolution 310 including a tariff increase equivalent to 50%; and, (iii) the application starting October 1, 2018 of Resolution 265 including a tariff increase equivalent to 19.7%. See “Item 4. Our Information—B. Business Overview—Natural Gas Transportation—Regulatory Framework—Regulation of Transportation Rates-Actual Rates” for additional information; |
• | Revenues related to interruptible natural gas transportation service increased by Ps. 2,249.0 million. The increase mainly resulted from the tariff increase discussed above, |
• | Revenues relating to the CAU increased by Ps. 203.4 million. The value of the CAU is much less than the transportation tariff we are permitted to charge for our natural gas transportation services, because we were not required to make any investment in the construction and expansion of the assets to which the CAU relates. See “Item 4. Our Information—B. Business Overview—Natural Gas Transportation—Pipeline Operations—Pipeline Expansions” for additional information regarding the CAU, |
• | Intersegment sales increased by Ps. 543.3 million given larger volumes of natural gas transported to Cerri Complex and tariff increases, |
• | During 2018, we received nominal tariff increases totaling 79.5%; |
• | Costs of sales and administrative and selling expenses for the year ended December 31, 2018 increased by Ps. 2,703.7 million, from Ps. 7,992.5 million to Ps. 10,696.2 million, as compared to the year ended December 31, 2017. This increase was mainly attributable to: (i) a higher technical assistance fee accrued of Ps. 889.1 million, (ii) an increase of Ps. 380.9 million in ordinary maintenance expenses for the pipelines and other fixed assets and (iii) higher tax on sale of Ps. 626.4 million, (iv) higher depreciations amounting to Ps. 285.0 million and (v) a higher charge in doubtful accounts by Ps. 239.8 million; and |
• | The positive variation in other operating expenses mainly resulted from a Ps. 167.7 million decrease in certain non-financial assets. |
Years ended December 31, | Year ended December 31, 2018 compared to year ended December 31, 2017 | |||||||||||||||
(volumes in short tons) | (volumes in short tons) | |||||||||||||||
2018 | 2017 | Increase/ (Decrease) | Percentage Change | |||||||||||||
Local Market | ||||||||||||||||
Ethane | 437,362 | 311,786 | 125,576.0 | 40.3 | % | |||||||||||
Propane | 172,834 | 194,665 | (21,830.9 | ) | (11.2 | %) | ||||||||||
Butane | 171,889 | 156,912 | 14,976.9 | 9.5 | % | |||||||||||
Subtotal | 782,085 | 663,363 | 118,722.1 | 17.9 | % | |||||||||||
Exports | ||||||||||||||||
Propane | 162,018 | 158,895 | 3,122.8 | 2.0 | % | |||||||||||
Butane | 88,872 | 103,259 | (14,386.7 | ) | (13.9 | %) | ||||||||||
Natural Gasoline | 132,311 | 133,802 | (1,490.0 | ) | (1.1 | %) | ||||||||||
Subtotal | 383,201 | 395,956 | (12,753.9 | ) | (3.2 | %) | ||||||||||
Total Liquids | 1,165,286 | 1,059,319 | 105,968.2 | 14.7 | % |
• | Segment revenue increased by Ps. 8,389.2 million in 2018, compared with the previous year. This increase is mainly due to increases of: (i) Ps. 4,036.7 million as a result of depreciation of the Argentine peso against the U.S. dollar, (ii) Ps. 2,208.1 million resulting from higher international reference prices and the increase in the price of the butane received under the Households with Bottles Program and (iii) Ps. 2,124.4 million resulting from higher volumes sold; |
• | In 2018 propane, butane and natural gasoline export prices recorded increases of 8.1%, 1.0% and 26.3%, respectively, although with some volatility. In spite of that, in line with the developments in the oil prices, significant drops were recorded as from October and therefore prices as of December 2018 were 30% lower than in October; |
• | Notwithstanding the changes made to the Households with Bottles Program to supply butane to the domestic market described above, our obligations under this program continues to have an adverse impact on this segment, resulting in a negative operating margin on domestic sales of LPG; |
• | Costs of sales, administrative and selling expenses for the year ended December 31, 2018 increased by Ps. 5,506.5 million, from Ps. 11,738.5 million to Ps. 17,245.0 million, as compared to the year ended December 31, 2018. This increase was mainly due to: (i) the rise in the price of natural gas that we are required to purchase in as RTP as part of the Liquids processing business of Ps. 4,018.9 million, (ii) higher taxes, mainly due to tax on exports, of Ps. 380.9 million and (iii) higher technical assistance fee of Ps. 229.7 million; and |
• | Other operating expenses increased by Ps. 1,217.4 million mainly resulting from the Ps. 1,054.4 million (US$ 21.3 million) payment made, on June 14, 2018, as part of the resolution of the arbitration initiated by Pan American Energy LLC Argentine Branch and Pan American Sur S.A. before the International Court of Arbitration on May 8, 2015, against the Company for US$ 306.3 million. |
• | Net revenues increased by Ps. 939.7 million primarily due to the higher sales associated with: (i) the effect of the depreciation of the Argentine peso against the US dollar of Ps. 334.3 million, (ii) higher construction works performed by the UT of Ps. 483.8 million, (iii) higher natural gas compression and treatment services of Ps. 111.1 million. |
• | Costs of sales, administrative and selling expenses increased by Ps. 668.4 million, mainly due to increases in: (i) professional services fees (Ps. 192.3 million), (ii) property, plant and equipment maintenance (Ps. 32.9 million), (iii) labor costs (Ps. 152.9 million), (iv) costs of services rendered to third parties (Ps. 78.7 million) and (v) turnover tax (Ps. 62.6 million). |
• | Net revenues increased by Ps. 60.0 million in the year ended December 31, 2018 when compared to 2017. The positive variation was mainly due to the increase in the foreign exchange rate of the Argentine peso compared to the U.S. dollar; and |
• | Costs of sales, administrative and selling expenses increased by Ps. 30.2 million. |
Years ended December 31, | ||||||||||||
2019 | 2018 | 2017 | ||||||||||
(in millions of pesos) | ||||||||||||
Cash and cash equivalents at the beginning of the year | 25,605.1 | 6,025.2 | 4,415.6 | |||||||||
Cash flows provided by operating activities | 13,499.0 | 19,685.3 | 8,548.1 | |||||||||
Cash flows used in investing activities | (16,643.9 | ) | (7,278.2 | ) | (5,965.1 | ) | ||||||
Cash flows (used in ) / provided by financing activities | (11,318.5 | ) | 3,152.2 | (92.1 | ) | |||||||
Net (decrease) / increase in cash and cash equivalents | (14,463.5 | ) | 15,559.3 | 2,490.8 | ||||||||
Foreign exchange gains on cash and cash equivalents | 3,721.0 | 10,287.8 | 346.1 | |||||||||
Monetary results effect on Cash and cash equivalents | (5,097.5 | ) | (6,267.2 | ) | (1,227.3 | ) | ||||||
Cash and cash equivalents at the end of the year | 9,765.2 | 25,605.1 | 6,025.2 |
2019 | 2019 | 2018 | ||||||||||
(in millions of U.S. dollars) (2) | (in millions of pesos) | |||||||||||
Current loans: | ||||||||||||
2018 Notes Interest | 5.6 | 336.9 | 349.4 | |||||||||
Pre-export finance | 17.1 | 1,021.3 | - | |||||||||
Leasing | 6.1 | 363.9 | 331.8 | |||||||||
Total current loans | 28.8 | 1,722.1 | 681.2 | |||||||||
Non-current loans: | ||||||||||||
2018 Notes | 498.4 | 29,847.2 | 28,789.0 | |||||||||
Leasing | 33.6 | 2,013.5 | 2,214.7 | |||||||||
Total non-current loans | 532.0 | 31,860.7 | 31,003.7 | |||||||||
Total loans (1) | 560.7 | 33,582.8 | 31,684.9 |
(1) | Issuance expenses net. |
(2) | Converted at the exchange rate of Ps. 59.89 per U.S.$1.00, which was the selling exchange rate as of December 31, 2019. |
Amount in U.S.$ | 500.000.000 | |||
Interest Rate | 6,75% annual | |||
Pricing | 99,725 | % |
Date of Payment | Percentage on the Principal Amount to be Paid | |||||
Amortization. | May 2, 2025 | 100 | % | |||
Frequency of Interest Payment | Biannual, payable on May 2 and November 2 of each year. | |||||
Guarantor | None. |
2020 | 2021 | 2022 | Total | |||||||||||||
Natural Gas transportation | ||||||||||||||||
Reliability and others | 30.6 | 48.0 | 50.0 | 128.6 | ||||||||||||
Total | 30.6 | 48.0 | 50.0 | 128.6 | ||||||||||||
Liquids production and commercialization | ||||||||||||||||
Reliability and others | 3.3 | 13.9 | 10.9 | 28.1 | ||||||||||||
Operational efficiencies | 1.4 | - | - | 1.4 | ||||||||||||
Expansions | - | - | - | - | ||||||||||||
Total | 4.7 | 13.9 | 10.9 | 29.5 | ||||||||||||
Vaca Muerta Project | 29.4 | 4.8 | - | 34.2 | ||||||||||||
Other services | 2.5 | 4.1 | 4.0 | 10.6 | ||||||||||||
Total Capital Expenditures | 67.2 | 70.8 | 64.9 | 202.9 |
• | Participation in the tender called within the framework of Resolution 82 that will allow obtaining a new transport license, prior to the construction of a gas pipeline of approximately 621 miles in length. |
• | We conducted a pre-feasibility study for the development of a liquefaction plant in the Bahía Blanca Province of Buenos Aires, with the purpose of generating a larger natural gas demand that accelerates the development of non-conventional gas, increasing export opportunities and reducing the need to import. This year we have moved forward with the project and have reached the final investment decision stage. |
• | We have made progress in the pre-feasibility study for the building of a new liquids processing plant in Tratayén, which will enhance the value and contribute to the liquids business growth. |
Period | Propane | Butane | Natural gasoline | |||||||||
October 2018 – April 2019 | 6,663 | 4,967 | 2,976 | |||||||||
May 2019 – September 2019 | - | - | 4,519 | |||||||||
October 2019 | 9,996 | 7,727 | 4,630 | |||||||||
November 2019 – April 2020 | 14,438 | 11,038 | 6,614 |
Payment due by period (in millions of pesos) | ||||||||||||||||||||||||
Total | Due less than 1 year | Less than 1 year | 1-3 years | 3-5 years | More than 5 years | |||||||||||||||||||
Long-Term Debt Obligations(1)(2) | 42,089.6 | - | 3,048.8 | 6,063.9 | 32,976.9 | - | ||||||||||||||||||
Purchase Obligations(3) | 7,359.0 | - | 842.3 | 6,516.7 | - | - | ||||||||||||||||||
Leasing(4) | 3,046.2 | 90.4 | 448.0 | 896.1 | 896.1 | 715.7 | ||||||||||||||||||
Total | 52,494.7 | 90.4 | 4,339.0 | 13,476.7 | 33,873.0 | 715.7 |
(1) | Refers to amortization and interest payments on the 2018 Notes as described in “Item 5. Operating and Financial Review of Prospects B. Liquidity and Capital Resources——Description of indebtedness” and “Item 10. Additional Information——C. Material Contracts,” respectively. |
(2) | The total amount of interest payments includes Ps. 10,780.2 million of estimated interest payments not accrued according to the 2018 Notes. |
(3) | Refers to agreements for the purchase of natural gas used in our liquids production and commercialization activities. |
(4) | Corresponds to the lease liability arrangement entered with Pampa Energía. The total amount includes estimated interest payment not accrued as of December 31, 2019 for Ps. 668.7 million. For additional information see “Item 5. Operating and Financial Review of Prospects B. Liquidity and Capital Resources——Description of indebtedness” and “Item 10. Additional Information - C. Material Contracts-Financial lease with Pampa Energía.” |
a) | Is also a member of the management body of the controlling entity or another company belonging to the same economic group by a relationship existing at the time of its election or that ceased during the three years immediately preceding. |
b) | Is linked to the issuer or its shareholders that hold directly or indirectly “significant shareholding” or with companies in which these also have direct or indirectly “significant shareholding,” or was linked to them by a contract of employment during the last three years. |
c) | Provides, or belongs to a professional corporation or association, which renders professional services to or receives any form of remuneration or fees (other than the corresponding remuneration for its position in the administration body) from the issuer, or those shareholders that have any direct or indirect “significant shareholding” in us or from corporations in which shareholders also have any direct or indirect “significant shareholding.” |
d) | Directly or indirectly, holds five percent or more of shares entitled to vote of our capital or in a company which holds “significant shareholding” in the latter. |
e) | Directly or indirectly, sells or provides goods or services to the company or its shareholders, who hold direct or indirect “significant shareholding” for an amount substantially higher than the compensation received from the position as members of the administration body. This prohibition covers commercial relations that took place during the last three years prior to the appointment as director. |
f) | Has been a director, manager, administrator or principal executive of non-govermental organizations that have received funds, for amounts exceeding Ps. 800,000 from the company, its controlling entity and other companies of the group of which TGS is a part. |
g) | Receives some payment, including participation in stock option plans, from the company or the companies in its same group, other than the fees to be received under his position as director. |
h) | Has served as director at the company, its controlling entity or another company belonging to the same economic group for more than ten years. The condition of independent director will be recovered after at least three years have elapsed since the cessation of his position as director. |
i) | Is a husband or wife, legal partner, close relative up to third degree of consanguinity or second degree of relationship that, in the case of being a member of the administrative body, would not be independent as set forth in the CNV regulations. |
Name | Date of Appointment | Term Expires | Position | Position in Other Company | ||||
Gustavo Mariani | 4/21/2020 | 2021 | Chairman | Executive Vicepresident and Chief Executive Officer at Pampa Energía | ||||
Luis Alberto Fallo | 4/21/2020 | 2021 | Vice Chairman | Director of Sagua Argentina S.A. | ||||
Mariano Batistella | 4/21/2020 | 2021 | Director | Executive director of planning, strategy, downstream and affiliates at Pampa Energía | ||||
Pablo Viñals Blake | 4/21/2020 | 2021 | Director | Partner at Marval O’Farrell Mairal Law Firm | ||||
Luis Rodolfo Secco | 4/21/2020 | 2021 | Independent Director | Economist | ||||
Carlos Alberto Olivieri | 4/21/2020 | 2021 | Independent Director | Independent Consultant | ||||
Carlos Alberto Di Brico | 4/21/2020 | 2021 | Independent Director | Public Accountant | ||||
Gustavo Graziano | 4/21/2020 | 2021 | Independent Director | Business consultant | ||||
Federico Basualdo Richards | 4/21/2020 | 2021 | Independent Director | Comptroller at Ente Nacional Regulador de la Electricidad (“ENRE”) | ||||
Jorge Romualdo Sampietro | 4/21/2020 | 2021 | Alternate Director | Senior Director at Petroquímica Cuyo | ||||
Nicolás Mindlin | 4/21/2020 | 2021 | Alternate Director | Executive vice president, procurement, assets security and marketing director at Pampa Energia | ||||
Horacio Jorge Tomás Turri | 4/21/2020 | 2021 | Alternate Director | Executive director oil and gas at Pampa Energía | ||||
Francisco Macías | 4/21/2020 | 2021 | Alternate Director | Partner at Marval O’Farrell Mairal Law Firm | ||||
Enrique Llerena | 4/21/2020 | 2021 | Independent Alternate Director | Partner at Llerena – Amadeo law firm | ||||
Santiago Alberto Fumo | 4/21/2020 | 2021 | Independent Alternate Director | Independent consultant | ||||
Pablo Fabiam Waisberg | 4/21/2020 | 2021 | Independent Alternate Director | Accounting and tax advisor | ||||
Ignacio Gustavo Álvarez Pizzo | 4/21/2020 | 2021 | Independent Alternate Director | Lawyer at the Directors and Corporate Affairs department in the FGS | ||||
Andrea del Valle Polizoto | 4/21/2020 | 2021 | Independent Alternate Director | National Directorate for hydroelectric generation and renewable energy |
Name | Year of Appointment | Position | ||
Oscar Jose Sardi | 2019 | CEO | ||
Claudia Trichilo | 2019 | Operations Vice President | ||
Carlos Hector Sidero | 2013 | Human Resources Director | ||
Alejandro Mario Basso | 2016 | CFO and Services Director | ||
Hernan Diego Flores Gomez | 2017 | Legal Affairs Director | ||
Néstor Hugo Martín | 2013 | Business Director | ||
Rubén De Muria | 2018 | Institutional and Regulatory Affairs Director |
• | supervise the internal control and accounting systems as well as the reliability of the latter and all the financial information and other significant issues that are to be submitted to the SEC, CNV and BYMA in compliance with the applicable disclosure policies; |
• | supervise the application of information policies regarding our risk management; |
• | ensure that the market is informed about those operations where there may be a conflict of interest with one or more members of the Board of Directors, controlling shareholders or other parties as defined by the applicable regulations; |
• | express its view on the reasonableness of fees and stock option plans for directors submitted by the Board of Directors; |
• | express its view as to compliance with laws and regulations and the reasonableness of the conditions of an issuance of shares (or convertible securities), in the case of a capital increase excluding or limiting preferential rights; |
• | oversee compliance with the Code of Ethics (see “Item 16.B. Code of Ethics”); and other relevant rules; |
• | issue a well-founded opinion on whether the terms and conditions of relevant transactions with related parties are according to market practice, within five business days from the receipt of a petition issued by the Board of Directors, and at any other time at which a conflict of interest exists or might exist; |
• | prepare an annual working plan for the fiscal year and notify the Board of Directors and the Statutory Committee within 60 days from the beginning of the period; |
• | fulfill all the obligations stated in our By-laws and applicable laws and regulations; |
• | express its view on the Board of Directors’ proposals on whether to appoint the external auditors to be hired and monitor the auditors’ independence; and |
• | establish procedures for: (i) the receipt, treatment, investigation and administration of the complaints received by us regarding accounting, internal accounting controls or auditing matters; and (ii) the confidential, anonymous submission by our employees of concerns regarding questionable accounting or auditing matters. |
• | review their plans; and |
• | evaluate their performance, and give an opinion on their performance when issuing the annual Financial Statements. |
• | analyze the different services rendered by the external auditors as well as their independence, according to Technical Resolution (“TR”) No. 34 of the FACPCE, any other related regulations issued by professional councils; |
• | report separately the fees billed as follows: (i) fees for external audit and other related services meant to provide reliability to third parties (e.g., special reports about internal controls, shareholding prospectuses, certifications and special reports requested by regulators, etc.); and (ii) fees related to other special services different from those mentioned above; and |
• | review independence policies of the external auditors in order to verify their fulfillment. |
• | Give a prior assessment, that shall be used by the CNV to require us to designate an external auditor as requested by minority shareholders, as long as such shareholders represent at least 5% of our common stock and provide a justified request (in those cases in which the minority shareholders’ rights might be affected) and if CNV understands the credibility of the damage invoked by said shareholders in order to carry out one or more specific reviews. The charges of such reviews shall be borne by the petitioning shareholders (Act No. 26,381, article 108.f); |
• | provide a well-founded assessment about an acquiring tender offer if by withdrawing the public offering we would cease to be a public company or our stock cease to be traded (Act No. 26,381, article 98); and |
• | issue a report supporting a Board of Directors’ resolution to buy back our shares (Act No. 26,381, article 64). |
Name | Member since | Term Expires | Position | |
José Daniel Abelovich | 4/21/2020 | 2021 | Syndic | |
Valeria Fortti | 4/21/2020 | 2021 | Syndic | |
Gustavo Herman Isaack | 4/21/2020 | 2021 | Syndic | |
Marcelo Héctor Fuxman | 4/21/2020 | 2021 | Alternate Syndic | |
Francisco José Carrega | 4/21/2020 | 2021 | Alternate Syndic | |
Sandra Auditore | 4/21/2020 | 2021 | Alternate Syndic |
Number of Employees as of December 31, | ||||||||||||
Department | 2019 | 2018 | 2017 | |||||||||
General | 3 | 2 | 2 | |||||||||
Administration, Finance and Services | 106 | 103 | 98 | |||||||||
Human Resources | 23 | 23 | 22 | |||||||||
Legal Affairs | 10 | 10 | 9 | |||||||||
Public and Regulatory Affairs | 10 | 8 | 7 | |||||||||
Safety and Environmental | 29 | 28 | 27 | |||||||||
Business | 76 | 72 | 69 | |||||||||
Internal Audit | 4 | 4 | 3 | |||||||||
Operations | 786 | 747 | 688 | |||||||||
Trainees program | 13 | 7 | 7 | |||||||||
Total | 1,060 | 1,004 | 932 |
Number of Employees as of December 31, | ||||||||||||
Location | 2019 | 2018 | 2017 | |||||||||
City of Buenos Aires | 245 | 239 | 237 | |||||||||
Province of Buenos Aires | 448 | 427 | 406 | |||||||||
Province of Chubut | 64 | 61 | 53 | |||||||||
Province of La Pampa | 14 | 14 | 12 | |||||||||
Province of Neuquén | 133 | 114 | 91 | |||||||||
Province of Río Negro | 60 | 58 | 49 | |||||||||
Province of Santa Cruz | 94 | 88 | 82 | |||||||||
Province of Tierra del Fuego | 2 | 3 | 2 | |||||||||
Total | 1,060 | 1,004 | 932 |
Name of Beneficial Owner | Number of Shares(1) | Percent of Total Common Shares | Class | |||||||||
CIESA | 405,192,594 | 51.00 | % | A | ||||||||
FGS | 190,685,633 | 24.00 | % | B | ||||||||
Holders through BYMA | 64,640,514 | 8.14 | % | B | ||||||||
Treasury shares | 28,775,540 | 3.62 | % | B | ||||||||
ADRs through Citi | 105,201,002 | (1) | 13.24 | % | B | |||||||
Total | 794,495,283 | 100.00 | % | -- |
(1) | Equivalent to 21,040,200 ADRs. |
• | On July 27, 2016, Pampa Energía acquired from Petrobras Internacional Braspetro B.V. all the stock and voting rights of Petrobras Participaciones S.L., the holder of the 67.1933% of the capital stock and voting rights of Petrobras Argentina and, consequently, the indirect control of Petrobras Hispano Argentina. |
• | On the same day, (i) Pampa Energía and its subsidiary Pampa Participaciones S.A. sold all of the capital stock and voting rights of PEPCA to GIP by 51%, WST by 45.8% and PCT L.L.C. by 3.2% and (ii) Pampa Inversiones S.A. transferred its status as beneficiary of the Trust to GIP and PCT, in a proportion of 55% and 45%, respectively. This transaction was authorized by ENARGAS on August 9, 2016, through Resolution No. I / 3939. |
• | On January 17, 2017, CIESA was informed of the exercise of the swap option agreed among Pampa Energía, GIP, WST and PCT. Pursuant to such option, (i) GIP and PCT transferred to PHA (formerly Petrobras Hispano Argentina) their position as beneficiary of the CIESA Trust owning of 40% of the stock and voting rights of CIESA; and (ii) Pampa Energía and PHA (formerly Petrobras Hispano Argentina) transferred to GIP and PCT shares representative of 40% of the capital and voting rights of CIESA, while Pampa Energía kept a direct participation in CIESA of 10% of its capital and voting rights. |
• | On March 24, 2020, CIESA was informed of the transfer of the 40% capital stock owned by the CIESA Trust to PHA. |
• | Public takeover bids addressed to all holders of such shares at a fair price authorized by the CNV, under the terms of Chapters II, III and IV of Title III of the Capital Markets Law. |
• | Exchange of shares for other shares of the same or another company in the context of a merger, split or corporate reorganization processes. |
Shareholder | Number of shares | Class of shares | Ownership (%) | Group | |||
Pampa Energía | 63,881,869 | B1 | 10% | Pampa Group | |||
0.5 | A1 | ||||||
0.5 | A2 | ||||||
PHA | 0.5 | A1 | 40% | ||||
0.5 | A2 | ||||||
162,898,766 | A2 | ||||||
92,628,711 | B2 | ||||||
PEPCA S.A. (WST, GIP y PCT) | 63,881,870 | B3 | 10% | GIP/PCT/WST Group | |||
GIP | 89,594,322 | A1 | 22% | ||||
50,945,792 | B1 | ||||||
PCT | 73,304,444 | A1 | 18% | ||||
41,682,920 | B1 | ||||||
Total | 638,818,696 | 100% |
• | agreements for the purchase of natural gas used as RTP; |
• | natural gas transportation services; |
• | liquids sales; and |
• | compression and treatment of natural gas services. On November 1, 2016, Pampa Energía assigned the operation of the Río Neuquén area and its related contracts to YPF. Until that date, our transactions under those contracts were reported as transactions with related parties of our other services business segment. |
Revenues | Financial results | |||||||||||||||||||||||||||
Company | Natural Gas Transportation | Production and commercialization of Liquids | Other services | Gas purchase and others | Compensation for technical assistance | Revenues for administrative services | Interests expenses | |||||||||||||||||||||
(in thousands of pesos) | ||||||||||||||||||||||||||||
Controlling shareholder: | ||||||||||||||||||||||||||||
CIESA | - | - | - | - | - | 146 | - | |||||||||||||||||||||
Associate which exercises joint control on the controlling shareholder: | 803,610 | 269,511 | 268,991 | 575,857 | 1,144,777 | - | 194,944 | |||||||||||||||||||||
Pampa Energía | ||||||||||||||||||||||||||||
Associate with significant influence: | ||||||||||||||||||||||||||||
Link | - | - | 14,073 | - | - | - | - | |||||||||||||||||||||
Other related companies: | ||||||||||||||||||||||||||||
Oleoductos del Valle S.A. | 5,469 | - | - | - | - | - | - | |||||||||||||||||||||
Pampa Comercializadora S.A. | 52,051 | - | - | - | - | - | - | |||||||||||||||||||||
Central Piedra Buena S.A. | 121,367 | - | - | - | - | - | - | |||||||||||||||||||||
Experta ART | - | - | - | 20,080 | - | - | - | |||||||||||||||||||||
Total | 982,497 | 269,511 | 283,064 | 595,937 | 1,144,777 | 146 | 194,944 |
a) | Turnover tax calculated on the natural gas price consumed by us as fuel |
b) | Action for annulment of ENARGAS Resolutions |
c) | Recovery action of VAT and income tax |
d) | Turnover tax withholding in the Province of Buenos Aires |
a) | Environmental matters |
b) | Others |
• | Per the Tax Reform, for fiscal periods beginning on January 1, 2018, distribution of dividends made to human persons and foreign beneficiaries are subject to a tax withholding which we must withhold and enter to the tax authority as a single and definitive payment when the dividends are paid. This additional tax will be 7% or 13%, depending on whether the dividends distributed correspond to earnings of a fiscal period at the enacted income tax rate of 30% or 25%, respectively. For these purposes it is considered, without admitting proof to the contrary, that the dividends that are made available correspond, firstly, to the oldest accumulated earnings. |
• | The acquisition of treasury shares and the additional paid-up capital for the distribution of treasury shares in accordance with CNV Rules, restricts the amount of the retained earnings that the Company may distribute. See “Item 7. Major Shareholders and Related Party Transactions—A. Major Shareholders—Repurchase of Shares.” |
• | Furthermore, we are subject to certain restrictions for the payment of dividends, which were contemplated in the outstanding debt agreements (“Item 10. Additional Information—C. Material Contracts”). |
• | According to the BCRA regulations, under certain conditions, we have to obtain its previous authorization before transferring dividend payments abroad. For additional information see “Item 10. Additional Information – D. Exchange Controls.” |
• | Promoting the participation of small investors, union associations, industry groups and trade associations, professional associations and all public savings entities in the capital market, particularly encouraging mechanisms designed to promote domestic savings and channel such funds towards the development of production; |
• | Strengthening mechanisms for the protection of and prevention of abuses against small investors and for the protection of consumers’ rights; |
• | Promoting access of small and medium-sized companies to the capital market; |
• | Fostering the creation of a federally integrated capital market through mechanisms designed to achieve an interconnection of computer systems from different trading markets, with the use of state-of-the-art technology; and |
• | Encouraging simpler trading procedures available to users to attain greater liquidity and competitiveness in order to provide the most favorable conditions for the implementation of transactions. |
a) | issue regulations that allow stock brokers and brokerage firms authorized by the CNV to perform their duties; |
b) | authorize, suspend and cancel the listing and/or trading of negotiable securities pursuant to the provisions set forth in its by-laws; |
c) | issue regulations that ensure veracity in the record of prices and trades; |
d) | issue the regulations and policies deemed necessary to ensure transparency in the trades conducted by member stock brokers; |
e) | fix the margins that member brokers are to comply with for each type of trade BYMA guarantees; and |
f) | set up arbitration tribunals. |
2015 | 2016 | 2017 | 2018 | 2019 | ||||||||||||||||
Market capitalization (U.S.$ in billions) | 336.8 | 282.9 | 356.9 | 279.2 | 179.3 | |||||||||||||||
Number of listed companies | 99 | 99 | 97 | 95 | 90 |
• | Subject to the approval of the annual shareholders meeting, the number of members of the Board of Directors may vary between nine and eleven directors and an equal number of alternate directors. |
• | The Board of Directors meetings may be held not only with the members present, but also with the members communicating remotely. Under our By-laws, all members will have the same power to vote on a proposal and will be considered to constitute a quorum. |
• | The Audit Committee duties, which are in line with those requirements stipulated in the Capital Markets Law, were incorporated to our By-laws. For additional information regarding Audit Committee duties, see “Item 6. Directors, Senior Management and Employees—C. Board Practices—Audit Committee.” |
• | limitations on our ability to terminate our License or take any action that, in our reasonable opinion, would result in the termination of the License. We may not agree to amend or waive any terms of the License unless such amendment or waiver would not, in our reasonable opinion, adversely affect (i) our ability to meet our obligations under the 2018 Notes on a timely basis or (ii) any material rights or interest of the trustee or the holders under the indenture or the 2018 Notes; |
• | a requirement that we not enter into or consent to any amendment, restatement or modification of the SATFO or any successor agreement thereto, other than an amendment, restatement or modification that is not materially adverse to us and our subsidiaries, taken as a whole; |
• | a limitation on our and our subsidiaries’ ability to create liens on our property, assets or revenues, other than certain permitted liens; |
• | a limitation on our and our subsidiaries’ ability to incur additional indebtedness unless we meet certain financial ratios and no event of default exists, other than certain permitted indebtedness; |
• | a limitation on our and our subsidiaries’ ability to pay dividends and make certain other restricted payments and investments with respect to any fiscal year or fiscal semester unless: (i) no event of default or potential event of default shall have occurred and be continuing and (ii) immediately after giving effect to such restricted payment, we would be able to incur at least U.S.$1.00 of additional indebtedness pursuant to the limitation on indebtedness covenant; |
• | limitations on our and our subsidiaries’ ability to enter into sale-leaseback transactions; |
• | limitations on our and our subsidiaries’ ability to enter into a transaction with an affiliate, unless such transaction is on terms that are not materially less favorable to us or our subsidiary than we or such subsidiary would obtain in a comparable arm’s-length transaction with a non-affiliate; |
• | a limitation on our and our subsidiaries’ ability to sell our assets; and |
• | a limitation on our and our subsidiaries’ ability to enter into a merger, consolidation or similar transaction. |
• | default in the payment of principal, interest or any other amount due under the terms of the 2018 Notes after a specified grace period with respect to payments other than principal; |
• | breach of obligations contained in the 2018 Notes after a specified cure period; |
• | cross-default and cross-acceleration with respect to other debt obligations with an aggregate principal amount equal to or exceeding U.S.$50 million; |
• | the occurrence of certain bankruptcy events or enforcement proceedings; |
• | enforcement of monetary judgments exceeding U.S.$50 million; and |
• | the occurrence of certain material adverse events with respect to our License, such as the revocation, suspension for a period of greater than 180 days or termination of the License. |
a) | The prior authorization of the BCRA is required to access to the foreign exchange market for the purchase of foreign currency: |
• | For portfolio investment purposes for more than $200 per calendar month by individuals; |
• | For portfolio investment purposes by legal entities, local governments, funds and trusts; |
• | By non-Argentine residents, except for certain exemptions; |
• | For the payment of dividends and transfer of earnings out of Argentina, except that no such prior authorization is required for the payment of profits and dividends as from January 17, 2020 in an amount that (including the amount of the payment being made at the time of the access) does not exceed 30% of the value of new capital contributions of foreign direct investments made to the Argentine company duly capitalized and registered before the Registry of Commerce (or pending such registration) and the proceeds of which have been transferred to Argentina and sold for pesos through the foreign exchange market; |
• | For the pre-payment of principal and interest on foreign financial indebtedness with an anticipation of more than three business days in advance to the scheduled maturity dates, unless certain conditions are met; |
• | For the pre-payment of indebtedness for the import of goods and services, except for certain exemptions; |
• | For the payment of indebtedness for the import of goods past due before August 31, 2019 or at sight with related foreign parties in excess of $2,000,000 per calendar month; and |
• | For the payment of services with related foreign parties, except for certain exemptions. |
b) | Any proceeds from exports of goods and services, and from the sale of non-produced non-financial assets shall be transferred to Argentina’s financial system and exchanged in the market within the required periods. |
c) | The transfer and exchange of foreign currency obtained from financial borrowings is a prerequisite for the subsequent access to the foreign exchange market for the repayment of principal and interest. |
d) | As a general rule, Argentine residents may access the foreign exchange market for the payment of imports of goods. Different requirements apply for goods with customs entry registration and goods with pending customs entry registration. The Argentine importer may access the foreign exchange market to pay imports of goods with customs entry registration registered in the import payment tracking system (“SEPAIMPO”, after its Spanish acronym), provided that certain requirements are met, including, among others, the payment is not made before the scheduled maturity date. Payments must be made to the foreign supplier. Goods with pending customs entry registration are subject to a special follow-up regime. |
e) | It is prohibited to access the foreign exchange market for the purchase of foreign currency for the payment of local debts and other obligations incurred in foreign currency between Argentine residents originated as from September 1, 2019, except, among others, in the case of obligations contained in public registries or deeds as of August 30, 2019. |
• | Crimes related to illegal trafficking and commercialization of narcotics; |
• | Crimes related to arms trafficking; |
• | Crimes related to the activities of an illegal association as defined in Article 210 bis of the Penal Code; |
• | Illegal acts committed by illegal associations organized to commit crimes with political or racial objectives; |
• | Crimes of fraud against the Public Administration; |
• | Crimes against the Public Administration; |
• | Crimes of underage prostitution and child pornography; and |
• | Crimes related to terrorism financing. |
• | Dividends originated from profits obtained during fiscal years 2018, 2019 and 2020: dividends on Argentine shares paid to Argentine individuals and/or non-residents (“Foreign Beneficiaries”) are subject to a 7% income tax withholding on the amount of such dividends (“Dividend Tax”). |
• | Dividends originated from profits obtained during fiscal year 2021 onward: the tax rate is raised to 13%. |
• | Income tax would be assessed on 110% of the amount of funds transferred; |
• | VAT would be assessed on 110% of the amount of funds transferred. Even though the concept “income arising from” is not clear, it could be construed as any fund transfer; |
• | from an account in a non-cooperative jurisdiction, or from a bank account opened outside of a non-cooperative jurisdiction but owned by an entity located in a non-cooperative jurisdiction; or |
• | to a bank account located in Argentina or to a bank account opened outside of Argentina but owned by an Argentina tax resident. |
Financial assets (1) | Financial liabilities (2) | |||||||
(in thousands of pesos) | ||||||||
Fixed interest rate | 8,650,353 | 30,184,039 | ||||||
Variable interest rate | 1,038,402 | 1,021,325 | ||||||
Total | 9,688,755 | 31,205,364 |
(1) | Includes short-term investments, fixed-term investments and bank accounts. Most of our trade receivables do not accrue interest. |
(2) | Includes loans, excluding issuance expenses and lease liabilities. |
Expected maturity date | Fair value(2) | |||||||||||||||||||||||||||
Overdue | 2020 | 2021 | 2022 | Thereafter | Total(6) | |||||||||||||||||||||||
(in millions of pesos) (1) | ||||||||||||||||||||||||||||
Debt denominated in U.S. dollars(1) (4) (5) | ||||||||||||||||||||||||||||
Fixed rate | - | 2,021.3 | 2,021.3 | 2,021.3 | 34,998.2 | 41,062.1 | 26,266.9 | |||||||||||||||||||||
Interest rate (3) | 6.875 | % | 6.875 | % | 6.875 | % | ||||||||||||||||||||||
Variable rate | - | 1,027.5 | - | - | - | 1,027.5 | 1,021.3 | |||||||||||||||||||||
Interest rate (6) | LIBOR + 1.95 | |||||||||||||||||||||||||||
Financial lease in U.S. dollars(1) (4)(5) | ||||||||||||||||||||||||||||
Fixed rate | 90.4 | 447.9 | 448.0 | 448.0 | 1,611.8 | 3,046.1 | 2,377.4 |
(1) | Converted at the exchange rate as of December 31, 2019: Ps. 59.89 per U.S.$1.00. |
(2) | For a detailed description of 2018 Notes, see “Item 10. Additional Information—C. Material contracts—Debt Obligations.” |
(3) | For further information about limitations on our ability to make payments on our debt denominated in U.S. dollars see “Item 3. Key Information. - D. Risk Factors. – Risk Related to Argentina - The Argentine economy may be adversely affected by economic developments in other markets and by more general effects, which could have a material adverse effect on Argentina’s economic growth.” |
(4) | Includes future interest payments not accrued as of December 31, 2019. |
(5) | Contracted undiscounted cash flows. Thus, they do not reconcile to the amount disclosed on the statement of financial position. |
(6) | Corresponds to the pre-export finance totally paid as of the issuance of this Annual Report. |
Service | Rate | By Whom Paid | |||
Issuance of ADSs (e.g., an issuance upon a deposit of Shares, upon a change in the ADS(s)-to-Share(s) ratio, or for any other reason), excluding issuances as a result of distributions described in the Deposit Agreement. | Up to U.S. $5.00 per 100 ADSs (or fraction thereof) issued. | Person receiving ADSs. | |||
Cancellation of ADSs (e.g., a cancellation of ADSs for delivery of deposited Shares, upon a change in the ADS(s)-to-Share(s) ratio, or for any other reason). | Up to U.S. $5.00 per 100 ADSs (or fraction thereof) canceled. | Person whose ADSs are being canceled. | |||
Distribution of cash dividends or other cash distributions (e.g., upon a sale of rights and other entitlements). | Up to U.S. $5.00 per 100 ADSs (or fraction thereof) held. | Person to whom the distribution is made. | |||
Distribution of ADSs pursuant to (i) stock dividends or other free stock distributions, or (ii) an exercise of rights to purchase additional ADSs. | Up to U.S. $5.00 per 100 ADSs (or fraction thereof) held. | Person to whom the distribution is made. | |||
Distribution of securities other than ADSs or rights to purchase additional ADSs (e.g., spin-off shares). | Up to U.S. $5.00 per 100 ADSs (or fraction thereof) held. | Person to whom the distribution is made. | |||
ADS Services. | Up to U.S. $5.00 per 100 ADSs (or fraction thereof) held on the applicable record date(s) established by the Depositary. | Person holding ADSs on the applicable record date(s) established by the Depositary. |
PwC | EY | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
(in thousands of pesos) | ||||||||||||||||
Audit fees | 12,078.7 | 13,362.0 | 12,842.0 | 14,306.7 | ||||||||||||
Audit-related fees | 385.9 | 5,700.6 | 403.2 | 3,342.9 | ||||||||||||
Tax fees | 1,315.8 | 644.1 | - | - | ||||||||||||
All other fees | 863.3 | 2,222.0 | 4,538.9 | 6,888.5 | ||||||||||||
Total fees | 14,643.7 | 21,928.7 | 17,784.1 | 24,538.1 |
Item 16E. | Purchases of Registered Equity Securities of the Issuer by the Issuer and Affiliated Purchasers |
Period | Total number of ADRs purchased | Average price paid per ADRs (U.S.$) | Total Number of Shares Purchased as Part of the Publicly Announced Plan(1) | Maximum Number of Shares that may yet be purchased under the plan | ||||||||||||
5/11/2018 – 5/31/2018 | 811,624 | 17.19 | 4,058,120 | 6,043,022 | ||||||||||||
6/1/2018 – 6/30/2018 | 550,175 | 15.45 | 2,750,875 | 8,441,031 | ||||||||||||
7/1/2018 – 7/31/2018 | 359,536 | 13.69 | 1,797,680 | 5,726,035 | ||||||||||||
8/1/2018 – 8/31/2018 | 316,347 | 13.18 | 1,581,735 | 4,926,463 | ||||||||||||
9/1/2018 – 9/10/2018 | 65,400 | 12.07 | 327,000 | 8,708,255 | ||||||||||||
2,103,082 | 10,515,140 |
(1) | Correspond to the sum of common shares and ADRs purchased. Each ADR represents 5 common shares. |
Period | Total number of ADRs purchased | Average price paid per ADRs (U.S.$) | Total Number of Shares Purchased as Part of the Publicly Announced Plan(1) | Maximum Number of Shares that may yet be purchased under the plan | ||||||||||||
10/1/2018 – 10/31/2018 | 610,974 | 13.64 | 3,054,870 | 8,095,486 | ||||||||||||
12/1/2018 – 12/31/2018 | 6,100 | 13.43 | 30,500 | 4,123,872 | ||||||||||||
617,074 | 3,085,370 |
(1) | Correspond to the sum of common shares and ADRs purchased. Each ADR represents 5 common shares. |
Period | Total number of ADRs purchased | Average price paid per ADRs (U.S.$) | Total Number of Shares Purchased as Part of the Publicly Announced Plan(1) | Maximum Number of Shares that may yet be purchased under the plan | ||||||||||||
04/1/2019 – 04/30/2019 | 724,275 | 10.73 | 3,621,375 | 7,244,077 | ||||||||||||
05/1/2019 – 05/31/2019 | 636,037 | 11.08 | 3,180,185 | 16,803,442 | ||||||||||||
08/1/2019 – 08/26/2019 | 1,063,706 | 9.06 | 5,318,530 | 14,857,953 | ||||||||||||
2,424,018 | 12,120,090 |
(1) | Correspond to the sum of common shares and ADRs purchased. Each ADR represents 5 common shares. |
Period | Total number of ADRs purchased | Average price paid per ADRs (U.S.$) | Total Number of Shares Purchased as Part of the Publicly Announced Plan(1) | Maximum Number of Shares that may yet be purchased under the plan | ||||||||||||
08/28/2019 – 08/31/2019 | 460,000 | 7.81 | 2,300,000 | 4,266,259 | ||||||||||||
09/01/2019 – 09/30/2019 | 284,785 | 7.94 | 1,423,925 | 22,954,729 | ||||||||||||
11/01/2019 – 11/20/2019 | 644,120 | 6.27 | 3,220,600 | 10,800,521 | ||||||||||||
1,388,905 | 6,944,525 |
(1) | Correspond to the sum of common shares and ADRs purchased. Each ADR represents 5 common shares. |
Period | Total number of ADRs purchased | Average price paid per ADRs (U.S.$) | Total Number of Shares Purchased as Part of the Publicly Announced Plan(1) | Maximum Number of Shares that may yet be purchased under the plan | ||||||||||||
11/21/2019 – 11/30/2019 | 401,000 | 6.04 | 2,005,000 | 18,105,419 | ||||||||||||
12/01/2019 – 12/31/2019 | 932,231 | 5.97 | 4,661,155 | 34,274,490 | ||||||||||||
01/01/2020 – 01/31/2020 | 1,455,121 | 6.56 | 7,275,605 | 14,310,693 | ||||||||||||
02/01/2020 – 02/28/2020 | 555,098 | 6.21 | 2,775,490 | 9,913,620 | ||||||||||||
3,343,450 | 16,717,250 |
(1) | Correspond to the sum of common shares and ADRs purchased. Each ADR represents 5 common shares. |
Period | Total number of ADRs purchased | Average price paid per ADRs (U.S.$) | Total Number of Shares Purchased as Part of the Publicly Announced Plan(1) | Maximum Number of Shares that may yet be purchased under the plan | ||||||||||||
03/09/2020 – 03/31/2020 | 1,087,375 | 4.53 | 5,436,875 | 11,967,981 | ||||||||||||
04/01/2020 – 04/22/2020 | 391,918 | 4.43 | 1,959,590 | 11,838,846 | ||||||||||||
1,479,293 | 7,396,465 |
(1) | Correspond to the sum of common shares and ADRs purchased. Each ADR represents 5 common shares. |
• | applicable Argentine law (particularly, the General Companies Act), |
• | the standards of BYMA, |
• | Capital Markets Law and Decree No. 1,023/2013, |
• | the standards of the CNV, |
• | our By-laws, |
• | our integrity program and other internal control policies and procedures, and |
• | certain rules of the NYSE applicable to listed foreign private issuers. |
Page | |
Reports of independent registered public accounting firms | F-1 |
Consolidated Statements of Comprehensive Income for the years ended December 31, 2019, 2018 and 2017 | F-5 |
Consolidated Statements of Financial Position as of December 31, 2019, 2018 and 2017 | F-6 |
Consolidated Statements of Changes in Equity for the years ended December 31, 2019, 2018 and 2017 | F-7 |
Consolidated Statements of Cash Flows for the years ended December 31, 2019, 2018 and 2017 | F-8 |
Notes to Consolidated Financial Statements for the year ended December 31, 2019 and comparative information | F-9 |
Exhibit No. | |
Corporate Charter and By-laws. | |
By-laws Amendments.(1) | |
Indenture dated May 2, 2018, entered into among TGS, Delaware Trust Company as trustee, co-registrar, paying agent and transfer agent, and Banco Santander Rio S.A., as registrar, Argentine paying agent, Argentine transfer agent and representative of the trustee in Argentina, relating to the issuance of TGS’s Class 2, 6.750% senior notes due 2025.(2) | |
Officers’ Certificate establishing the terms of TGS’ 6.750% Notes Due 2025.(2) | |
Description of Securities Registered under Section 12 of the Exchange Act. | |
CIESA Shareholders’ Agreement.(3) | |
CIESA’s Fourth Amendment to the Restructuring Agreement.(5) | |
CIESA’s Settlement Agreement.(4) | |
Technical Assistance Service Agreement between TGS and Pampa Energía, dated December 26, 2017.(2) | |
Financial lease agreement between Petrobras Argentina and TGS, dated July 25, 2016.(9) | |
List of TGS’s Subsidiaries. | |
Code of Ethics.(3) | |
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
Audit Committee Charter.(7) |
(1) | Amendment incorporated by reference to our Annual Report on Form 20-F filed with the Securities and Exchange Commission for the year ended December 31, 2014 (Commission File No. 1-13396), and (ii) amendment previously filed with the Securities and Exchange Commission pursuant to current report on Form 6-K, dated April 12, 2017 (Commission File No. 1-13.396). |
(2) | Incorporated by reference to our Annual Report on Form 20-F filed with the Securities and Exchange Commission for the year ended December 31, 2018 (Commission File No. 1-13396). |
(3) | Incorporated by reference to our Annual Report on Form 20-F filed with the Securities and Exchange Commission for the year ended December 31, 2005 (Commission File No. 1-13396). |
(4) | Incorporated by reference to our Annual Report on Form 20-F filed with the Securities and Exchange Commission for the year ended December 31, 2012 (Commission File No. 1-13396). |
(5) | Incorporated by reference to our Annual Report on Form 20-F filed with the Securities and Exchange Commission for the year ended December 31, 2010 (Commission File No. 1-13396). |
(6) | Incorporated by reference to our Annual Report on Form 20-F filed with the Securities and Exchange Commission for the year ended December 31, 2017 (Commission File No. 1-13396). |
(7) | Incorporated by reference to our Annual Report on Form 20-F filed with the Securities and Exchange Commission for the year ended December 31, 2003 (Commission File No. 1-13396). |
TRANSPORTADORA DE GAS DEL SUR S.A. | |||
(Registrant) | |||
By: | |||
/s/ Oscar José Sardi | |||
Name: | Oscar José Sardi | ||
Title: | Chief Executive Officer | ||
/s/ Alejandro M. Basso | |||
Name: | Alejandro M. Basso | ||
Title: | Chief Financial Officer and Services Vice President |
/s/ Price Waterhouse & Co. S.R.L. | /s/ Pistrelli, Henry Martin y Asociados S.R.L | |
PISTRELLI, HENRY MARTIN Y ASOCIADOS S.R.L | ||
/s/Fernando Alberto Rodriguez | Member of Ernst & Young Global |
/s/ Price Waterhouse & Co. S.R.L. | /s/ Pistrelli, Henry Martin y Asociados S.R.L | |
PISTRELLI, HENRY MARTIN Y ASOCIADOS S.R.L | ||
/s/Fernando Alberto Rodriguez | Member of Ernst & Young Global |
TRANSPORTADORA DE GAS DEL SUR S.A. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2019, 2018 AND 2017 (Stated in thousands of pesos as described in Note 3 and 4.d. except for share and per share information) |
Notes | 2019 | 2018 | 2017 | |||||||||||||
Revenues | 8.h. | 48,561,494 | 52,399,423 | 30,694,588 | ||||||||||||
Cost of sales | 8.i. | (24,375,503 | ) | (24,902,866 | ) | (18,360,946 | ) | |||||||||
Gross profit | 24,185,991 | 27,496,557 | 12,333,642 | |||||||||||||
Administrative expenses | 8.j. | (1,260,300 | ) | (1,479,580 | ) | (1,128,936 | ) | |||||||||
Selling expenses | 8.j. | (3,039,557 | ) | (2,714,682 | ) | (1,241,883 | ) | |||||||||
Other operating expenses | 8.l. | (127,526 | ) | (1,370,319 | ) | (417,803 | ) | |||||||||
Operating profit | 19,758,608 | 21,931,976 | 9,545,020 | |||||||||||||
Net financial results | ||||||||||||||||
Financial income | 8.k. | 8,535,154 | 14,628,724 | 1,068,656 | ||||||||||||
Financial expenses | 8.k. | (17,700,134 | ) | (22,763,300 | ) | (3,020,602 | ) | |||||||||
Other financial results | 8.k. | 113,387 | 1,900,589 | 422,363 | ||||||||||||
Gain on net monetary position | 8.k. | 6,154,172 | 1,855,519 | 716,821 | ||||||||||||
Total | (2,897,421 | ) | (4,378,468 | ) | (812,762 | ) | ||||||||||
Share of (loss) / profit from associates | 11 | (31,858 | ) | 28,008 | 33,291 | |||||||||||
Net income before income tax | 16,829,329 | 17,581,516 | 8,765,549 | |||||||||||||
Income tax (expense) / benefit | 14 | (4,024,211 | ) | (20,261 | ) | 81,650 | ||||||||||
Total comprehensive income for the year | 12,805,118 | 17,561,255 | 8,847,199 | |||||||||||||
Total comprehensive income attributable to: | ||||||||||||||||
Owners of the Company | 12,805,105 | 17,561,249 | 8,847,196 | |||||||||||||
Non-controlling interests | 13 | 6 | 3 | |||||||||||||
12,805,118 | 17,561,255 | 8,847,199 | ||||||||||||||
Weighted average of outstanding ordinary shares * | 776,121,341 | 788,405,563 | 794,495,283 | |||||||||||||
Basic and diluted earnings per share | 16.50 | 22.27 | 11.14 |
TRANSPORTADORA DE GAS DEL SUR S.A. CONSOLIDATED STATEMENTS OF FINANCIAL POSITION AS OF DECEMBER 31, 2019 AND 2018 (Stated in thousands of pesos as described in Note 3 and 4.d.) |
Notes | 2019 | 2018 | ||||||||||
ASSETS | ||||||||||||
Non-current assets | ||||||||||||
Property, plant and equipment | 12 | 74,552,728 | 59,510,863 | |||||||||
Investments in associates | 9 | 78,660 | 111,790 | |||||||||
Other financial assets at amortised cost | 8.m. | 5,403 | 13,476 | |||||||||
Deferred income tax asset | 14 | 15,600 | 6,967 | |||||||||
Other receivables | 8.a. | 9,004 | 12,665 | |||||||||
Total non-current assets | 74,661,395 | 59,655,761 | ||||||||||
Current assets | ||||||||||||
Other receivables | 8.a. | 2,898,077 | 4,096,646 | |||||||||
Inventories | 307,640 | 554,218 | ||||||||||
Trade receivables | 8.b. | 6,473,759 | 4,791,109 | |||||||||
Contract assets | 177,269 | 241,012 | ||||||||||
Derivative financial instruments | 274,024 | 335,773 | ||||||||||
Other financial assets at amortised cost | 8.m. | 1,043,960 | 8,790 | |||||||||
Cash and cash equivalents | 8.c. | 9,765,201 | 25,605,137 | |||||||||
Total current assets | 20,939,930 | 35,632,685 | ||||||||||
Total Assets | 95,601,325 | 95,288,446 | ||||||||||
EQUITY | ||||||||||||
Common stock | 28,349,861 | 28,224,365 | ||||||||||
Treasury shares | 366,086 | 491,582 | ||||||||||
Cost of adquisition of treasury shares | (730,764 | ) | (2,185,845 | ) | ||||||||
Additional paid-up capital | (791,712 | ) | - | |||||||||
Legal reserve | 1,922,444 | 1,000,251 | ||||||||||
Future capital expenditures reserve | - | 107,453 | ||||||||||
Future dividends reserve | - | 1,525,444 | ||||||||||
Reserve for capital expenditures, acquisition of treasury shares and/or dividends | 5,351,123 | - | ||||||||||
Accumulated retained earnings | 13,616,403 | 18,440,641 | ||||||||||
Non-controlling interests | 28 | 15 | ||||||||||
Total equity | 48,083,469 | 47,603,906 | ||||||||||
LIABILITES | ||||||||||||
Non-current liabilities | ||||||||||||
Deferred tax liabilities | 14 | 4,778,114 | 3,427,531 | |||||||||
Contract liabilities | 8.d. | 2,926,826 | 2,259,876 | |||||||||
Loans | 13 | 31,860,717 | 31,003,715 | |||||||||
Total non-current liabilities | 39,565,657 | 36,691,122 | ||||||||||
Current liabilities | ||||||||||||
Provisions | 15 | 589,118 | 570,977 | |||||||||
Contract liabilities | 8.d. | 219,801 | 199,333 | |||||||||
Other payables | 8.e. | 287,659 | 124,103 | |||||||||
Taxes payables | 8.f. | 353,183 | 311,083 | |||||||||
Income tax payable | 18,329 | 3,759,987 | ||||||||||
Payroll and social security taxes payable | 8.n. | 648,451 | 590,156 | |||||||||
Loans | 13 | 1,722,087 | 681,225 | |||||||||
Trade payables | 8.g. | 4,113,571 | 4,756,554 | |||||||||
Total current liabilities | 7,952,199 | 10,993,418 | ||||||||||
Total liabilities | 47,517,856 | 47,684,540 | ||||||||||
Total equity and liabilities | 95,601,325 | 95,288,446 |
TRANSPORTADORA DE GAS DEL SUR S.A. CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2019, 2018 AND 2017 (Stated in thousands of pesos as described in Note 3 and 4.d.) |
Shareholders Contributions | Retained Earnings | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outstanding shares | Treasury shares | Reserve for | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common stock | Inflation adjustment to common stock | Common stock (1) | Inflation adjustment to common stock (1) | Acquisition cost of treasury shares (1) | Additional paid-up capital (1) | Total common stock | Legal reserve | Future dividends Reserve | Future capital expenditures reserve | capital expenditures, acquisition of treasury shares and/or dividends | Accumulated retained earnings | Subtotal | Total | Non-Controlling interests | Total | |||||||||||||||||||||||||||||||||||||||||||||||||
Balances at December 31, 2016* | 794,495 | 27,921,452 | - | - | - | - | 28,715,947 | 944,177 | 31,414 | 115,648 | - | 233,799 | 1,325,038 | 30,040,985 | 26 | 30,041,011 | ||||||||||||||||||||||||||||||||||||||||||||||||
Resolutions of the Ordinary and Extraordinay Shareholders´ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Meeting held on April 26, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
- Legal reserve | - | - | - | - | - | - | - | 56,074 | - | - | - | (56,074 | ) | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||
- Future dividends reserve | - | - | - | - | - | - | - | - | 2,364,126 | - | - | (2,364,126 | ) | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||
- Derecognition of reserves | - | - | - | - | - | - | - | - | - | (8,195 | ) | - | 8,195 | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||
- | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Dividends payment to non-controlling interest | - | - | - | - | - | - | - | - | - | - | - | - | - | - | (11 | ) | (11 | ) | ||||||||||||||||||||||||||||||||||||||||||||||
Comprehensive income for the year | - | - | - | - | - | - | - | - | - | - | - | 8,847,196 | 8,847,196 | 8,847,196 | 3 | 8,847,199 | ||||||||||||||||||||||||||||||||||||||||||||||||
Balances at December 31, 2017 * | 794,495 | 27,921,452 | - | - | - | - | 28,715,947 | 1,000,251 | 2,395,540 | 107,453 | - | 6,668,990 | 10,172,234 | 38,888,181 | 18 | 38,888,199 | ||||||||||||||||||||||||||||||||||||||||||||||||
Resolutions of the Ordinary and Extraordinay Shareholders´ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Meeting held on April 10, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
- Future Dividends reserve | - | - | - | - | - | - | - | - | 5,789,598 | - | - | (5,789,598 | ) | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||
Cash dividends distribution | - | - | - | - | - | - | - | - | (6,659,694 | ) | - | - | - | (6,659,694 | ) | (6,659,694 | ) | - | (6,659,694 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Treasury shares purchase | (13,601 | ) | (477,981 | ) | 13,601 | 477,981 | (2,185,845 | ) | - | (2,185,845 | ) | - | - | - | - | - | - | (2,185,845 | ) | - | (2,185,845 | ) | ||||||||||||||||||||||||||||||||||||||||||
Cash dividends distribution to non-controlling interest | - | - | - | - | - | - | - | - | - | - | - | - | - | - | (9 | ) | (9 | ) | ||||||||||||||||||||||||||||||||||||||||||||||
Comprehensive income for the year | - | - | - | - | - | - | - | - | - | - | 17,561,249 | 17,561,249 | 17,561,249 | 6 | 17,561,255 | |||||||||||||||||||||||||||||||||||||||||||||||||
Balances at December 31, 2018 | 780,894 | 27,443,471 | 13,601 | 477,981 | (2,185,845 | ) | - | 26,530,102 | 1,000,251 | 1,525,444 | 107,453 | - | 18,440,641 | 21,073,789 | 47,603,891 | 15 | 47,603,906 | |||||||||||||||||||||||||||||||||||||||||||||||
Resolutions of the Ordinary Shareholders | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Meeting held on April 11, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Reserve | - | - | - | - | - | - | - | 922,193 | - | - | - | (922,193 | ) | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||
Dividends payment (2) | - | - | - | - | - | - | - | - | - | - | - | (9,185,852 | ) | (9,185,852 | ) | (9,185,852 | ) | - | (9,185,852 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Reserve for capital expenditures, acquisition of treasury shares and/or dividends | - | - | - | - | - | - | - | - | - | - | 9,154,195 | (9,154,195 | ) | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||
Derecognition of reserves | - | - | - | - | - | - | - | - | (1,525,444 | ) | (107,453 | ) | - | 1,632,897 | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||||
Treasury shares distribution (2) | 29,445 | 860,761 | (29,445 | ) | (860,761 | ) | 4,045,739 | (791,712 | ) | 3,254,027 | - | - | - | (3,228,002 | ) | - | (3,228,002 | ) | 26,025 | - | 26,025 | |||||||||||||||||||||||||||||||||||||||||||
Dividends payment (2) | - | - | - | - | - | - | - | - | - | - | (575,070 | ) | - | (575,070 | ) | (575,070 | ) | - | (575,070 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Treasury shares purchase | (25,731 | ) | (738,979 | ) | 25,731 | 738,979 | (2,590,658 | ) | - | (2,590,658 | ) | - | - | - | - | - | - | (2,590,658 | ) | - | (2,590,658 | ) | ||||||||||||||||||||||||||||||||||||||||||
Comprehensive income for the year | - | - | - | - | - | - | - | - | - | - | - | 12,805,105 | 12,805,105 | 12,805,105 | 13 | 12,805,118 | ||||||||||||||||||||||||||||||||||||||||||||||||
Balances at December 31, 2019 | 784,608 | 27,565,253 | 9,887 | 356,199 | (730,764 | ) | (791,712 | ) | 27,193,471 | 1,922,444 | - | - | 5,351,123 | 13,616,403 | 20,889,970 | 48,083,441 | 28 | 48,083,469 |
TRANSPORTADORA DE GAS DEL SUR S.A. CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019, 2018 AND 2017 (Stated in thousands of pesos as described in Note 3 and 4.d.) |
2019 | 2018 | 2017 | ||||||||||
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES | ||||||||||||
Total comprehensive income for the year | 12,805,118 | 17,561,255 | 8,847,199 | |||||||||
Reconciliation of total comprehensive income to cash flows provided by operating activities: | ||||||||||||
Depreciation of property, plant and equipment | 3,695,615 | 3,419,820 | 3,107,746 | |||||||||
Derivative financial instrument results | 19,172 | (163,192 | ) | - | ||||||||
Disposal of property, plant and equipment | 100,858 | 243,851 | 202,165 | |||||||||
Share of profit / (loss) from associates | 31,858 | (28,008 | ) | (33,291 | ) | |||||||
Increase in provisions | 266,775 | 299,656 | 333,693 | |||||||||
Interest expense accrual, net | 1,908,169 | 2,444,361 | 1,120,891 | |||||||||
Interest income on other financial assets other than cash and cash equivalents | (100,489 | ) | (694,566 | ) | (147,228 | ) | ||||||
Income tax | 4,024,211 | 20,261 | (81,650 | ) | ||||||||
Doubtful accounts | 2,435 | 203,860 | (35,989 | ) | ||||||||
Foreign exchange loss, net | 8,887,732 | 8,734,823 | 730,004 | |||||||||
Gain on net monetary position | (6,606,675 | ) | (5,926,962 | ) | (1,332,478 | ) | ||||||
Changes in assets and liabilities: | ||||||||||||
Trade receivables | (3,733,961 | ) | (2,286,449 | ) | (2,158,024 | ) | ||||||
Other receivables | (1,838,443 | ) | (1,205,780 | ) | (576,187 | ) | ||||||
Inventories | 52,634 | (362,774 | ) | 14,996 | ||||||||
Trade payables | 140,873 | 2,479,008 | 554,773 | |||||||||
Contract assets | (20,597 | ) | (241,012 | ) | - | |||||||
Payroll and social security taxes | 264,815 | 228,332 | 150,694 | |||||||||
Taxes payables | (132,169 | ) | 76,873 | 16,798 | ||||||||
Other payables | 206,985 | 72,497 | 67,528 | |||||||||
Provisions | (7,590 | ) | 1,211 | (392,054 | ) | |||||||
Interest paid | (2,039,877 | ) | (1,393,331 | ) | (464,817 | ) | ||||||
Derivative financial instruments | 21,929 | (159,661 | ) | - | ||||||||
Income tax paid | (4,881,195 | ) | (4,273,266 | ) | (1,282,282 | ) | ||||||
Contract liabilities | 430,781 | 634,525 | - | |||||||||
Advances from customers | - | - | (94,376 | ) | ||||||||
Cash flows provided by operating activities | 13,498,964 | 19,685,332 | 8,548,111 | |||||||||
CASH FLOWS USED IN INVESTING ACTIVITIES | ||||||||||||
Additions to property, plant and equipment | (15,932,000 | ) | (12,496,827 | ) | (2,986,295 | ) | ||||||
Financial assets not considered cash equivalents | (711,899 | ) | 5,218,620 | (2,978,848 | ) | |||||||
Cash flows used in investing activities | (16,643,899 | ) | (7,278,207 | ) | (5,965,143 | ) | ||||||
CASH FLOWS (USED IN) / PROVIDED BY FINANCING ACTIVITIES | ||||||||||||
Payment of loans | - | (1,886,079 | ) | (92,109 | ) | |||||||
Precancellation of loans | - | (7,378,176 | ) | - | ||||||||
Payment of leases | (18,751 | ) | - | - | ||||||||
Loans receive | 1,051,809 | 21,261,978 | - | |||||||||
Payment of acquisition of treasury shares | (2,590,658 | ) | (2,185,845 | ) | - | |||||||
Dividends paid | (9,760,922 | ) | (6,659,694 | ) | (9 | ) | ||||||
Cash flows (used in) / provided by financing activities | (11,318,522 | ) | 3,152,184 | (92,118 | ) | |||||||
NET (DECREASE) / INCREASE IN CASH AND CASH EQUIVALENTS | (14,463,457 | ) | 15,559,309 | 2,490,850 | ||||||||
Cash and cash equivalents at the beginning of the year | 25,605,137 | 6,025,226 | 4,415,596 | |||||||||
Foreign exchange gain on Cash and cash equivalents | 3,721,043 | 10,287,800 | 346,132 | |||||||||
Monetary results effect on Cash and cash equivalents | (5,097,522 | ) | (6,267,198 | ) | (1,227,352 | ) | ||||||
Cash and cash equivalents at the end of the year | 9,765,201 | 25,605,137 | 6,025,226 |
1. | BUSINESS DESCRIPTION |
1. | Provisions regarding sovereign debt through which the Executive Branch is empowered to carry out the negotiations and make the necessary decisions to achieve the renegotiation of the Argentine public debt. |
2. | Freezing and tariff review of transportation and distribution services of natural gas and electric power (for more information, see Note 17.a). |
3. | Establishment of a cap on the export rights of hydrocarbons (for more information see Note 17.b). |
4. | Establishment of a regime of regularization of tax, social security and customs obligations. |
5. | Tax modifications concerning taxes on: personal property, financial income, income (for more information, see Note 14 and 19.c), on bank and internal credits and debits. |
6. | Creation of the Tax for an Inclusive and Solidarity Argentina that taxes foreign currency acquisition operations for treasury, acquisition of goods and services and tourism. |
7. | Modifications to customs taxes. |
2. | CONSOLIDATED FINANCIAL STATEMENTS |
3. | BASIS OF PRESENTATION |
4. | SIGNIFICANT ACCOUNTING POLICIES |
a) | New accounting standards |
• | Accounting for operating leases with a remaining lease term of less than 12 months as at January 1, 2019 as short-term leases. |
• | The Company has elected not to reassess whether a contract is, or contains a lease at the date of initial application. Instead, for contracts entered into before the transition date (January 1, 2019), the Company relied on its assessment made applying IAS 17 – Leases and IFRIC 4 – Determining whether an arrangement contains a lease. |
• | This standard does not apply for those leases classified as low value contracts. |
a) | Fixed payments less any lease incentive receivable; |
b) | Variable lease payments that depend on an index; |
c) | Amounts expected to be payable by the Company under residual value guarantees; |
d) | The exercise price of a purchase option; and |
e) | Payments of penalties for terminating the lease. |
a) | The amount of the initial measurement of lease liability. |
b) | Any lease payment made at or before the commencement date less any lease incentives received. |
c) | Any initial direct cost, and |
d) | Restoration costs. |
• | IFRIC Interpretation 23 “Uncertainty over income tax treatments.” |
• | Annual improvements to IFRS Standards 2015 – 2017 Cycle. |
• | Amendments to IFRS 9 – Financial instruments. |
b) | Consolidation |
Company | % of shareholding and votes | Country | Closing date | Main activity | |||
Telcosur | 99.98 | Argentina | December 31 | Telecommunication Services | |||
CTG (1) | 100.00 | Argentina | December 31 | Electricity related services | |||
Company | % of shareholding and voting | Country | Main activity | Closing date | |||
TGU | 49.00 | Uruguay | Pipeline maintenance | December 31 | |||
EGS (“in liquidation”) | 49.00 | Argentina | Pipeline exploitation and construction | December 31 | |||
Link | 49.00 | Argentina | Pipeline exploitation and construction | December 31 |
c) | Foreign currency translation |
d) | Restatement to constant currency - Comparative Information |
e) | Financial instruments |
ii. | Financial assets subsequently measured at amortized cost, and |
iii. | Financial assets subsequently measured at fair value (either with changes in other comprehensive income or with changes in results). |
• | The financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows; and |
• | The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. |
• | Expected credit losses within of 12 months: these are expected credit losses that result from possible default events within 12 months after the filing date; and |
• | Expected credit losses during the life of the asset: these are expected credit losses that result from possible events of default during the expected life of a financial instrument. |
f) | Derivative financial instruments |
g) | Inventories |
h) | Trade receivables and other receivables |
i) | Cash and cash equivalents |
j) | Property, plant and equipment (“PPE”) |
- | Assets transferred from the privatization of GdE: The value of these assets was determined based on the price paid for the acquisition of 70% of the Company’s common stock, which amounted to U.S.$ 561.2 million. This price was the basis to determine a total value of common stock of U.S.$ 801.7 million, which, when added to the debt assumed under the Company’s privatization agreement (the “Transfer Agreement”) of U.S.$ 395.0 million, resulted in a total value for PPE of U.S.$ 1,196.7 million. Such value, converted at the exchange rate in effect as of the date of the Transfer Agreement, has been restated for the effects of inflation as mentioned in Note 4.d, and less accumulated depreciation. |
- | Line pack: It represents the natural gas in the transportation system that is necessary to keep the system at operating capacity, valued at acquisition cost and restated for the effects of inflation as mentioned in Note 4.d. |
- | Other items of PPE: have been valued at acquisition cost restated for the effects of inflation as mentioned in Note 4.d, and net of accumulated depreciation. They include, mainly, all the investments made to achieve system integrity and public safety equal to those required by international standards. Such investments included, among others, the costs of survey programs related to internal and external pipeline inspection, cathodic protection, pipeline replacement and recoating, and the facilities affected to the Production and Commercialization of Liquids and Other Services segment. |
- | Impairment of non-financial assets: The Company assesses at each reporting period whether there is an indication that an individual component or a group of PPE may be impaired. |
k) | Leases |
l) | Loans |
m) | Trade payables |
n) | Income tax and deferred income tax |
o) | Provisions |
p) | Revenue recognition from contract with customers |
q) | Contract liabilities |
r) | Equity accounts |
s) | Basic and diluted earnings per share |
2019 | 2018 | 2017 | ||||||||||
Net income attributable to owners of the Company | 12,805,105 | 17,561,249 | 8,847,196 | |||||||||
Average number of outstanding shares (1) | 776,121,341 | 788,405,563 | 794,495,283 | |||||||||
Basic and diluited earnings per share | 16.50 | 22.27 | 11.14 |
5. | CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS |
• | Whether significant decreases in the market values of PPE elements took place. |
• | Whether prices of the main products and services that are marketed decreased. |
• | Whether significant changes in the regulatory framework were introduced. |
• | Whether operating costs suffered a materially increase. |
• | Whether evidence of obsolescence or physical damage has occurred. |
• | Whether the macroeconomic situation in which TGS carries out its activities, including significant variations in the sale prices of products, raw materials, interest rates, etc, has worsen. |
6. | SUPPLEMENTAL CASH FLOW INFORMATION |
2019 | 2018 | 2017 | ||||||||||
Unpaid acquisition of PPE | 1,331,105 | 473,413 | 460,879 | |||||||||
Principal payment of financial lease (1) | 149,238 | 156,861 | 101,645 | |||||||||
Capitalization of finance costs | 446,195 | - | - |
7. | CONSOLIDATED BUSINESS SEGMENT INFORMATION |
Year ended December 31, 2019 | ||||||||||||||||||||||||
Natural Gas Transportation | Production and Commercialization of Liquids | Other Services | Telecommunications | Eliminations | Total | |||||||||||||||||||
Revenues from sales | 22,620,423 | 23,138,182 | 2,526,643 | 276,246 | - | 48,561,494 | ||||||||||||||||||
Intersegment revenues | 615,993 | - | - | - | (615,993 | ) | - | |||||||||||||||||
Cost of sales | (8,667,640 | ) | (14,661,541 | ) | (1,524,445 | ) | (137,870 | ) | 615,993 | (24,375,503 | ) | |||||||||||||
Administrative expenses | (1,043,519 | ) | (144,313 | ) | (61,021 | ) | (11,447 | ) | - | (1,260,300 | ) | |||||||||||||
Selling expenses | (1,343,560 | ) | (1,390,215 | ) | (264,396 | ) | (41,386 | ) | - | (3,039,557 | ) | |||||||||||||
Other operating (expenses) / income | (136,926 | ) | 3,200 | 3,576 | 2,624 | - | (127,526 | ) | ||||||||||||||||
Operating profit | 12,044,771 | 6,945,313 | 680,357 | 88,167 | - | 19,758,608 | ||||||||||||||||||
Depreciation of property, plant and equipment | (2,998,224 | ) | (246,720 | ) | (450,671 | ) | - | - | (3,695,615 | ) |
Natural Gas Transportation | Commercialization of Liquids | Other Services | Telecommunications | Total | ||||||||||||||||
Identifiable assets | 64,431,193 | 10,865,257 | 20,090,627 | 214,248 | 95,601,325 | |||||||||||||||
Identifiable liabilities | 29,338,859 | 3,093,226 | 15,020,159 | 65,612 | 47,517,856 |
Year ended December 31, 2018 | ||||||||||||||||||||||||
Natural Gas Transportation | Production and Commercialization of Liquids | Other Services | Telecommunications | Eliminations | Total | |||||||||||||||||||
Revenue from sales | 23,785,660 | 25,578,373 | 2,784,534 | 250,856 | - | 52,399,423 | ||||||||||||||||||
Intersegment revenues | 920,555 | - | - | - | (920,555 | ) | - | |||||||||||||||||
Cost of sales | (7,944,333 | ) | (16,130,863 | ) | (1,621,770 | ) | (126,455 | ) | 920,555 | (24,902,866 | ) | |||||||||||||
Administrative expenses | (1,284,707 | ) | (129,315 | ) | (55,348 | ) | (10,210 | ) | - | (1,479,580 | ) | |||||||||||||
Selling expenses | (1,467,144 | ) | (984,794 | ) | (220,674 | ) | (42,070 | ) | - | (2,714,682 | ) | |||||||||||||
Other operating (expenses) / income | (240,414 | ) | (1,117,949 | ) | (8,375 | ) | (3,581 | ) | - | (1,370,319 | ) | |||||||||||||
Operating profit | 13,769,617 | 7,215,452 | 878,367 | 68,540 | - | 21,931,976 | ||||||||||||||||||
Depreciation of property, plant and equipment | (2,892,621 | ) | (174,964 | ) | (352,235 | ) | - | - | (3,419,820 | ) |
Natural Gas Transportation | Production and Commercialization of Liquids | Other Services | Telecommunications | Total | ||||||||||||||||
Identifiable assets | 69,603,664 | 13,907,967 | 11,621,495 | 155,320 | 95,288,446 | |||||||||||||||
Identifiable liabilities | 25,748,537 | 2,301,679 | 19,563,528 | 70,796 | 47,684,540 |
Year ended December 31, 2017 | ||||||||||||||||||||||||
Natural Gas Transportation | Production and Commercialization of Liquids | Other Services | Telecommunications | Eliminations | Total | |||||||||||||||||||
Revenue from sales | 11,469,824 | 17,189,194 | 1,844,712 | 190,858 | - | 30,694,588 | ||||||||||||||||||
Intersegment revenues | 377,137 | - | - | - | (377,137 | ) | - | |||||||||||||||||
Cost of sales | (6,428,448 | ) | (11,186,009 | ) | (1,008,879 | ) | (114,747 | ) | 377,137 | (18,360,946 | ) | |||||||||||||
Administrative expenses | (918,567 | ) | (144,172 | ) | (56,110 | ) | (10,087 | ) | - | (1,128,936 | ) | |||||||||||||
Selling expenses | (645,435 | ) | (408,173 | ) | (164,471 | ) | (23,804 | ) | - | (1,241,883 | ) | |||||||||||||
Other operating (expenses) / income | (503,409 | ) | 99,520 | (14,150 | ) | 236 | - | (417,803 | ) | |||||||||||||||
Operating profit | 3,351,102 | 5,550,360 | 601,102 | 42,456 | - | 9,545,020 | ||||||||||||||||||
Depreciation of property, plant and equipment | (2,607,632 | ) | (146,630 | ) | (353,484 | ) | - | - | (3,107,746 | ) |
8. | DETAIL OF SIGNIFICANT STATEMENT OF FINANCIAL POSITION AND STATEMENT OF COMPREHENSIVE INCOME CAPTIONS |
a) | Other receivables |
2019 | 2018 | |||||||||||||||
Current | Non Current | Current | Non Current | |||||||||||||
Turnover tax balance | 50,711 | - | - | - | ||||||||||||
Income tax credit balance (1) | 42,607 | - | - | - | ||||||||||||
VAT credit balance | 1,018,621 | - | 461,916 | - | ||||||||||||
Other tax receivables | 1,227 | 1,401 | 15,365 | 3,144 | ||||||||||||
Prepaid expenses | 90,714 | - | 73,464 | - | ||||||||||||
Advances to suppliers | 1,181,972 | - | 2,847,433 | - | ||||||||||||
Subsidies receivables | 143,829 | - | 450,523 | - | ||||||||||||
Other Receivables UT | 39,009 | - | 45,697 | - | ||||||||||||
Others | 329,387 | 7,603 | 202,248 | 9,521 | ||||||||||||
Total | 2,898,077 | 9,004 | 4,096,646 | 12,665 |
b) | Trade receivables |
2019 | 2018 | |||||||||||||||
Current | Non Current | Current | Non Current | |||||||||||||
Commons | 6,329,258 | - | 4,788,890 | - | ||||||||||||
UT | 13,813 | - | 31,446 | - | ||||||||||||
Natural Gas Transportation | 3,774,497 | - | 2,549,704 | - | ||||||||||||
Production and Commercialization of Liquids | 1,903,005 | - | 1,680,674 | - | ||||||||||||
Other services | 637,943 | - | 527,066 | - | ||||||||||||
Related parties (Note 21) | 279,457 | - | 206,079 | |||||||||||||
Natural Gas Transportation | 154,009 | - | 112,671 | - | ||||||||||||
Production and Commercialization of Liquids | 53,744 | - | 12,497 | - | ||||||||||||
Other services | 71,704 | - | 80,911 | - | ||||||||||||
Allowance for doubtful accounts | (134,956 | ) | - | (203,860 | ) | - | ||||||||||
Total | 6,473,759 | - | 4,791,109 | - |
Balances as of December 31, 2017 | - | |||
Additions (1) | 203,860 | |||
Applications | - | |||
Reversals | - | |||
Balances as of December 31, 2018 | 203,860 | |||
Inflation adjustment restatement | (71,339 | ) | ||
Additions (1) | 2,435 | |||
Applications | - | |||
Reversals | - | |||
Balances as of December 31, 2019 | 134,956 |
c) | Cash and cash equivalents |
2019 | 2018 | |||||||
Cash and banks | 1,123,051 | 9,174,577 | ||||||
UT Cash and banks | 2,758 | 235 | ||||||
Time deposits | - | 938,544 | ||||||
Mutual funds in Argentine Pesos | 1,029,644 | 3,302,476 | ||||||
Interest-bearing accounts | 7,609,748 | 12,167,206 | ||||||
UT Mutual funds | - | 22,099 | ||||||
Total | 9,765,201 | 25,605,137 |
d) | Contract liabilities |
2019 | 2018 | |||||||||||||||
Current | Non Current | Current | Non Current | |||||||||||||
Natural Gas Transportation | 98,460 | 1,744,944 | 104,572 | 1,844,227 | ||||||||||||
Production and Commercialization of Liquids | 38,387 | 341,698 | 39,249 | 392,388 | ||||||||||||
Other services | 62,386 | 840,184 | 3,104 | 23,261 | ||||||||||||
UT | 20,568 | - | 52,408 | - | ||||||||||||
Total | 219,801 | 2,926,826 | 199,333 | 2,259,876 |
e) | Other payables |
2019 | 2018 | |||||||||||||||
Current | Non Current | Current | Non Current | |||||||||||||
Payable for compensation for the Board of Directors and Supervisory Committee | 8,498 | - | 8,321 | - | ||||||||||||
Others | 1,744 | - | 2,529 | - | ||||||||||||
UT Other liabilities | 277,417 | - | 113,253 | - | ||||||||||||
Total | 287,659 | - | 124,103 | - |
f) | Taxes payables |
2019 | 2018 | |||||||||||||||
Current | Non Current | Current | Non Current | |||||||||||||
Health and safety tax | 12,989 | - | 13,522 | - | ||||||||||||
Withholdings and perceptions made to third parties | 148,052 | - | 170,174 | - | ||||||||||||
Turnover Tax | 85,283 | - | 96,474 | - | ||||||||||||
Withholding Tax | 71,998 | - | - | - | ||||||||||||
UT Others | 341 | - | 4,233 | - | ||||||||||||
Others | 34,520 | - | 26,680 | - | ||||||||||||
Total | 353,183 | - | 311,083 | - |
g) | Trade payables |
2019 | 2018 | |||||||||||||||
Current | Non Current | Current | Non Current | |||||||||||||
Suppliers | 3,875,928 | - | 4,304,927 | - | ||||||||||||
UT Suppliers | 109,876 | - | 138,837 | - | ||||||||||||
Customers (credit balances) | 6,164 | - | 3,438 | - | ||||||||||||
Related companies | 121,603 | - | 309,352 | - | ||||||||||||
Total | 4,113,571 | - | 4,756,554 | - |
h) | Revenues |
2019 | 2018 | 2017 | ||||||||||
Sales of goods and services | 48,359,045 | 51,773,746 | 30,159,782 | |||||||||
Subsidies | 202,449 | 625,677 | 534,806 | |||||||||
Total | 48,561,494 | 52,399,423 | 30,694,588 |
Year ended December 31, 2019 | ||||||||||||||||||||
Natural Gas Transportation | Production and Commercialization of Liquids | Other Services | Telecommunications | Total | ||||||||||||||||
Primary geographical market: | ||||||||||||||||||||
External market | - | 9,144,860 | - | - | 9,144,860 | |||||||||||||||
Local market | 22,620,423 | 13,993,322 | 2,526,643 | 276,246 | 39,416,634 | |||||||||||||||
Total | 22,620,423 | 23,138,182 | 2,526,643 | 276,246 | 48,561,494 | |||||||||||||||
Timing of revenue recognition: | ||||||||||||||||||||
Over the time | 22,620,423 | 1,226,814 | 2,526,643 | 276,246 | 26,650,126 | |||||||||||||||
At a point in time | - | 21,911,368 | - | - | 21,911,368 | |||||||||||||||
Total | 22,620,423 | 23,138,182 | 2,526,643 | 276,246 | 48,561,494 |
Year ended December 31, 2018 | ||||||||||||||||||||
Natural Gas Transportation | Production and Commercialization of Liquids | Other Services | Telecommunications | Total | ||||||||||||||||
Primary geographical market: | ||||||||||||||||||||
External market | - | 9,269,086 | - | - | 9,269,086 | |||||||||||||||
Local market | 23,785,660 | 16,309,287 | 2,784,534 | 250,856 | 43,130,337 | |||||||||||||||
Total | 23,785,660 | 25,578,373 | 2,784,534 | 250,856 | 52,399,423 | |||||||||||||||
Timing of revenue recognition: | ||||||||||||||||||||
Over the time | 23,785,660 | 1,084,994 | 2,784,534 | 250,856 | 27,906,044 | |||||||||||||||
At a point in time | - | 24,493,379 | - | - | 24,493,379 | |||||||||||||||
Total | 23,785,660 | 25,578,373 | 2,784,534 | 250,856 | 52,399,423 |
Year ended December 31, 2017 | ||||||||||||||||||||
Natural Gas Transportation | Production and Commercialization of Liquids | Other Services | Telecommunications | Total | ||||||||||||||||
Primary geographical market: | ||||||||||||||||||||
External market | - | 6,664,863 | - | - | 6,664,863 | |||||||||||||||
Local market | 11,469,824 | 10,524,331 | 1,844,712 | 190,858 | 24,029,725 | |||||||||||||||
Total | 11,469,824 | 17,189,194 | 1,844,712 | 190,858 | 30,694,588 | |||||||||||||||
Timing of revenue recognition: | ||||||||||||||||||||
Over the time | 11,469,824 | 822,760 | 1,844,712 | 190,858 | 14,328,154 | |||||||||||||||
At a point in time | - | 16,366,434 | - | - | 16,366,434 | |||||||||||||||
Total | 11,469,824 | 17,189,194 | 1,844,712 | 190,858 | 30,694,588 |
i. | Natural Gas Transportation: |
2019 | 2018 | 2017 | ||||||||||
Firm | 18,521,215 | 18,834,776 | 8,971,393 | |||||||||
Access and Charge | 835,721 | 870,398 | 666,979 | |||||||||
Interruptible and Others | 3,263,487 | 4,080,486 | 1,831,452 | |||||||||
Total | 22,620,423 | 23,785,660 | 11,469,824 |
ii. | Production and Commercialization of Liquids: |
2019 | 2018 | 2017 | ||||||||||
Product | 21,708,919 | 23,867,702 | 15,776,153 | |||||||||
Services | 1,226,814 | 1,084,994 | 878,235 | |||||||||
Government grants | 202,449 | 625,677 | 534,806 | |||||||||
Total | 23,138,182 | 25,578,373 | 17,189,194 |
iv. | Other services: |
2019 | 2018 | 2017 | ||||||||||
Conditioning and treatment | 1,273,070 | 1,130,820 | 841,091 | |||||||||
Operation and maintenance | 651,665 | 738,568 | 637,752 | |||||||||
Steam sales | 231,565 | 210,387 | 148,582 | |||||||||
Construction | 11,899 | 32,799 | 213,270 | |||||||||
UT Construction | 187,686 | 666,402 | - | |||||||||
Transportation and conditioning of Naural Gas in Vaca Muerta | 165,725 | - | - | |||||||||
Others | 5,033 | 5,558 | 4,017 | |||||||||
Total | 2,526,643 | 2,784,534 | 1,844,712 |
i) | Cost of sales |
2019 | 2018 | 2017 | ||||||||||
Inventories at the beginning of the year | 554,218 | 282,659 | 371,470 | |||||||||
Purchases | 12,052,590 | 13,630,238 | 9,250,971 | |||||||||
Operating costs (Note 8.i.) | 12,076,335 | 11,544,187 | 9,021,164 | |||||||||
Inventories at the end of the year | (307,640 | ) | (554,218 | ) | (282,659 | ) | ||||||
Total | 24,375,503 | 24,902,866 | 18,360,946 |
j) | Expenses by nature – Information required under art. 64 paragraph I, clause B) Commercial Companies Law |
2019 | ||||||||||||||||||||||||
Operating expenses | ||||||||||||||||||||||||
Accounts | Total | Regulated Activities | Non Regulated Activities | Administrative expenses | Selling expenses | Financial expenses | ||||||||||||||||||
Salaries, wages and other compensations | 3,193,390 | 1,463,206 | 953,222 | 604,578 | 172,384 | - | ||||||||||||||||||
Social security taxes | 595,112 | 271,610 | 170,506 | 117,055 | 35,941 | - | ||||||||||||||||||
Compensation to Directors and Supervisory Committee | 32,528 | - | - | 32,528 | - | - | ||||||||||||||||||
Professional services fees | 483,128 | 15,383 | 248,648 | 186,970 | 32,127 | - | ||||||||||||||||||
Technical operator assistance fees | 1,144,777 | 776,200 | 368,577 | - | - | - | ||||||||||||||||||
Materials | 387,772 | 169,415 | 218,357 | - | - | - | ||||||||||||||||||
Third parties services | 435,870 | 180,037 | 222,864 | 24,485 | 8,484 | - | ||||||||||||||||||
Telecommunications and post expenses | 44,810 | 12,956 | 6,097 | 23,952 | 1,805 | - | ||||||||||||||||||
Rents | 43,758 | 12,717 | 21,141 | 8,888 | 1,012 | - | ||||||||||||||||||
Transports and freight | 115,986 | 73,000 | 40,551 | 2,435 | - | - | ||||||||||||||||||
Easements | 91,941 | 87,367 | 4,574 | - | - | - | ||||||||||||||||||
Offices supplies | 13,332 | 4,019 | 2,310 | 5,183 | 1,820 | - | ||||||||||||||||||
Travels expenses | 132,485 | 65,497 | 35,936 | 27,340 | 3,712 | - | ||||||||||||||||||
Insurance | 96,399 | 47,111 | 38,101 | 6,391 | 4,796 | - | ||||||||||||||||||
Property, plant and equipment maintenance | 2,566,969 | 2,233,041 | 298,406 | 35,522 | - | - | ||||||||||||||||||
Depreciation of property, plant and equipment | 3,695,615 | 2,842,666 | 697,391 | 155,558 | - | - | ||||||||||||||||||
Taxes and contributions | 3,044,070 | 334,176 | 24,473 | 3,903 | 2,681,518 | (1) | - | |||||||||||||||||
Advertising | 90,137 | - | - | - | 90,137 | - | ||||||||||||||||||
Doubtful accounts | 2,435 | - | - | - | 2,435 | - | ||||||||||||||||||
Banks expenses | 19,308 | - | - | 19,308 | - | - | ||||||||||||||||||
Interests expense | 2,509,815 | - | - | - | - | 2,509,815 | ||||||||||||||||||
Foreign exchange loss | 15,636,514 | - | - | - | - | 15,636,514 | ||||||||||||||||||
Capitalized financial costs | (446,195 | ) | - | - | - | - | (446,195 | ) | ||||||||||||||||
Costs of services rendered to third parties | 13,664 | - | 13,664 | - | - | - | ||||||||||||||||||
Other expenses | 132,706 | 79,239 | 43,877 | 6,204 | 3,386 | - | ||||||||||||||||||
Total 2019 | 34,076,326 | 8,667,640 | 3,408,695 | 1,260,300 | 3,039,557 | 17,700,134 |
2018 | ||||||||||||||||||||||||
Operating expenses | ||||||||||||||||||||||||
Accounts | Total | Regulated Activities | Non Regulated Activities | Administrative expenses | Selling expenses | Financial expenses | ||||||||||||||||||
Salaries, wages and other contributions | 2,942,737 | 1,370,862 | 873,457 | 549,048 | 149,370 | - | ||||||||||||||||||
Social security taxes | 492,620 | 222,669 | 130,665 | 107,092 | 32,194 | - | ||||||||||||||||||
Compensation to Directors and Supervisory Committee | 39,718 | - | - | 39,718 | - | - | ||||||||||||||||||
Professional services fees | 422,573 | 10,841 | 208,637 | 192,647 | 10,448 | - | ||||||||||||||||||
Technical operator assistance fees | 2,026,244 | 1,289,165 | 737,079 | - | - | - | ||||||||||||||||||
Materials | 344,492 | 105,664 | 238,828 | - | - | - | ||||||||||||||||||
Third parties services | 402,701 | 157,394 | 200,379 | 30,443 | 14,485 | - | ||||||||||||||||||
Telecommunications and post expenses | 33,498 | 6,455 | 4,395 | 21,933 | 715 | - | ||||||||||||||||||
Rents | 38,129 | 11,779 | 15,846 | 9,147 | 1,357 | - | ||||||||||||||||||
Transports and freight | 104,751 | 64,965 | 35,357 | 4,429 | - | - | ||||||||||||||||||
Easements | 83,186 | 83,186 | - | - | - | - | ||||||||||||||||||
Offices supplies | 10,763 | 3,647 | 1,324 | 4,815 | 977 | - | ||||||||||||||||||
Travels expenses | 131,177 | 58,722 | 41,135 | 25,222 | 6,098 | - | ||||||||||||||||||
Insurance | 101,944 | 58,713 | 36,451 | 6,775 | 5 | - | ||||||||||||||||||
Property, plant and equipment maintenance | 1,946,371 | 1,700,665 | 221,697 | 24,009 | - | - | ||||||||||||||||||
Depreciation of property, plant and equipment | 3,419,820 | 2,481,136 | 527,193 | 411,491 | - | - | ||||||||||||||||||
Taxes and contributions | 2,578,080 | 262,317 | 30,893 | 3,274 | 2,281,596 | (1) | - | |||||||||||||||||
Advertising | 7,470 | - | - | - | 7,470 | - | ||||||||||||||||||
Doubtful accounts | 203,860 | - | - | - | 203,860 | - | ||||||||||||||||||
Banks expenses | 18,691 | - | - | 18,691 | - | - | ||||||||||||||||||
Interests expense | 2,577,365 | - | - | - | - | 2,577,365 | ||||||||||||||||||
Foreign exchange loss | 20,185,935 | - | - | - | - | 20,185,935 | ||||||||||||||||||
Costs of services rendered to third parties | 254,250 | - | 254,250 | - | - | - | ||||||||||||||||||
Other expenses | 135,374 | 56,152 | 42,269 | 30,846 | 6,107 | - | ||||||||||||||||||
Year ended Deccember 31, 2018 | 38,501,749 | 7,944,332 | 3,599,855 | 1,479,580 | 2,714,682 | 22,763,300 |
2017 | ||||||||||||||||||||||||
Operating expenses | ||||||||||||||||||||||||
Accounts | Total | Regulated Activities | Non Regulated Activities | Administrative expenses | Selling expenses | Financial expenses | ||||||||||||||||||
Salaries, wages and other compensations | 2,755,821 | 1,329,370 | 721,780 | 550,569 | 154,102 | - | ||||||||||||||||||
Social security taxes | 474,525 | 208,944 | 123,835 | 108,080 | 33,666 | - | ||||||||||||||||||
Compensation to Directors and Supervisory Committee | 21,253 | - | - | 21,253 | - | - | ||||||||||||||||||
Professional services fees | 153,215 | 3,706 | 7,585 | 129,187 | 12,737 | - | ||||||||||||||||||
Technical operator assistance fees | 887,901 | 400,020 | 487,881 | - | - | - | ||||||||||||||||||
Materials | 149,305 | 46,117 | 103,188 | - | - | - | ||||||||||||||||||
Third parties services | 317,596 | 132,233 | 159,075 | 26,288 | - | - | ||||||||||||||||||
Telecommunications and post expenses | 24,756 | 3,307 | 3,034 | 17,223 | 1,192 | - | ||||||||||||||||||
Rents | 16,828 | 4,863 | 2,432 | 8,372 | 1,161 | - | ||||||||||||||||||
Transports and freight | 89,022 | 52,995 | 30,416 | 5,560 | 51 | - | ||||||||||||||||||
Easements | 54,249 | 54,249 | - | - | - | - | ||||||||||||||||||
Offices supplies | 8,633 | 2,561 | 900 | 4,027 | 1,145 | - | ||||||||||||||||||
Travels expenses | 47,741 | 21,350 | 7,865 | 13,831 | 4,695 | - | ||||||||||||||||||
Insurance | 81,007 | 47,294 | 26,962 | 6,013 | 738 | - | ||||||||||||||||||
Property, plant and equipment maintenance | 1,546,413 | 1,331,530 | 198,875 | 13,290 | 2,718 | - | ||||||||||||||||||
Depreciation of property, plant and equipment | 3,107,746 | 2,414,921 | 500,115 | 192,710 | - | - | ||||||||||||||||||
Taxes and contributions | 1,413,444 | 327,852 | 20,606 | 1,824 | 1,063,162 | (1) | - | |||||||||||||||||
Advertising | 1,180 | - | 5 | - | 1,175 | - | ||||||||||||||||||
Doubtful accounts | (35,989 | ) | - | - | - | (35,989 | ) | - | ||||||||||||||||
Banks expenses | 11,102 | - | - | 11,102 | - | - | ||||||||||||||||||
Interests expense | 1,301,985 | - | - | - | - | 1,301,985 | ||||||||||||||||||
Foreign exchange loss | 1,718,617 | - | - | - | - | 1,718,617 | ||||||||||||||||||
Other financial charges | 258,315 | - | - | - | - | 258,315 | ||||||||||||||||||
Costs of services rendered to third parties | 177,326 | - | 177,326 | - | - | - | ||||||||||||||||||
Other expenses | 88,909 | 47,134 | 20,838 | 19,607 | 1,330 | - | ||||||||||||||||||
Total 2017 | 14,670,900 | 6,428,446 | 2,592,718 | 1,128,936 | 1,241,883 | 3,278,917 |
k) | Net financial results |
2019 | 2018 | 2017 | ||||||||||
Financial income | ||||||||||||
Interest income | 719,559 | 2,069,473 | 204,776 | |||||||||
Foreign exchange gain | 7,815,595 | 12,559,251 | 863,880 | |||||||||
Subtotal | 8,535,154 | 14,628,724 | 1,068,656 | |||||||||
Financial expenses | ||||||||||||
Interest expense | (2,509,815 | ) | (2,577,365 | ) | (1,301,985 | ) | ||||||
Foreign exchange loss | (15,636,514 | ) | (20,185,935 | ) | (1,718,617 | ) | ||||||
less: Capitalized finance costs | 446,195 | - | - | |||||||||
Subtotal | (17,700,134 | ) | (22,763,300 | ) | (3,020,602 | ) | ||||||
Other financial results | ||||||||||||
Derivative financial instruments results | (19,172 | ) | 163,192 | - | ||||||||
Fair value gains on financial instruments through profit or loss | 542,218 | 2,112,016 | 680,678 | |||||||||
Others | (409,659 | ) | (374,619 | ) | (258,315 | ) | ||||||
Subtotal | 113,387 | 1,900,589 | 422,363 | |||||||||
Gain on net monetary position | 6,154,172 | 1,855,519 | 716,821 | |||||||||
Total | (2,897,421 | ) | (4,378,468 | ) | (812,762 | ) |
l) | Other operating expenses |
2019 | 2018 | 2017 | ||||||||||
Net increase in provisions (1) | (156,124 | ) | (1,185,743 | ) | (351,039 | ) | ||||||
Recovery of insurance | - | 36,726 | 299,495 | |||||||||
Write off of other receivables | - | - | (161,596 | ) | ||||||||
Others | 28,598 | (221,302 | ) | (204,663 | ) | |||||||
Total | (127,526 | ) | (1,370,319 | ) | (417,803 | ) |
m) | Other financial assets at amortized cost |
2019 | 2018 | |||||||||||||||
Current | Non Current | Current | Non Current | |||||||||||||
VRD bonds | 3,355 | 5,403 | 8,790 | 13,476 | ||||||||||||
US Treasury Bills | 1,040,605 | - | - | - | ||||||||||||
Total | 1,043,960 | 5,403 | 8,790 | 13,476 |
n) | Payroll and social security taxes payable |
2019 | 2018 | |||||||||||||||
Current | Non Current | Current | Non Current | |||||||||||||
Vacation benefit payable | 305,847 | - | 262,577 | - | ||||||||||||
Annual bonus payable | 205,541 | - | 205,159 | - | ||||||||||||
Social security taxes payable | 130,942 | - | 103,654 | - | ||||||||||||
UT | 6,121 | 18,766 | ||||||||||||||
Total | 648,451 | - | 590,156 | - |
9. | INVESTMENTS IN ASSOCIATES |
2019 | 2018 | ||||||||||||||||||||||||||||||||||||||
Issuer Information | |||||||||||||||||||||||||||||||||||||||
Description of securities | Last financial statemets issued | ||||||||||||||||||||||||||||||||||||||
Name and issuer | Face value | Amount | Cost | Book value | Main business | Date | Common stock | Net (loss) / income for the year / period | Shareholders equity | % of Common Stock | Book value | ||||||||||||||||||||||||||||
Transporte y Servicios de Gas en Uruguay S.A. | Ps. Uru. 1 | 196,000 | 182 | 6,627 | Pipeline maintenance | 09/30/2019 | 28 | (783 | ) | 14,308 | 49.00 | 8,919 | |||||||||||||||||||||||||||
Emprendimientos de Gas del Sur S.A. (in liquidation) | $ | 1 | 116,130 | 2,025 | 418 | Pipeline constructionand operation services | 09/30/2019 | 237 | (186 | ) | 854 | 49.00 | 498 | ||||||||||||||||||||||||||
Gas Link S.A. | $ | 1 | 502,962 | 8,595 | 71,615 | Pipeline construction and operation services | 09/30/2019 | 1,026 | 6,990 | 396,461 | �� | 49.00 | 102,373 | ||||||||||||||||||||||||||
Total | 78,660 | 111,790 |
10. | JOINT ARRANGEMENTS |
2019 | 2018 | |||||||
Consolidated Statements of financial position | ||||||||
Non Current assets | - | - | ||||||
Current Assets | 232,849 | 300,649 | ||||||
Total | 232,849 | 300,649 | ||||||
Non Current Liabilities | - | - | ||||||
Current Liabilities | 414,323 | 261,274 | ||||||
Total | 414,323 | 261,274 |
2019 | 2018 | 2017 | ||||||||||
Consolidated Statements of comprehensive income | ||||||||||||
Gross (loss) / profit | (154,303 | ) | 52,112 | 1,226 | ||||||||
Operating (loss) / profit | (172,298 | ) | 37,517 | (38 | ) | |||||||
Net Financial results | (21,069 | ) | 1,611 | 348 | ||||||||
Comprehensive (loss) / income | (193,367 | ) | 39,128 | 310 |
11. | PROFIT FROM ASSOCIATES |
2019 | 2018 | 2017 | ||||||||||
EGS (in liquidation) | (80 | ) | 4,770 | 32 | ||||||||
TGU | (664 | ) | (68 | ) | 438 | |||||||
Link | (31,114 | ) | 23,306 | 32,821 | ||||||||
Total | (31,858 | ) | 28,008 | 33,291 |
12. | PROPERTY, PLANT AND EQUIPMENT |
2019 | ||||||||||||||||||||||||||||||||||||||||||||
Cost | Depreciation | |||||||||||||||||||||||||||||||||||||||||||
Account | Beginning of the year | Additions | Retirements | Transfers | End of the year | Accumulated at the beginning of the year | Retirements | For the year | rate % | Accumulated at the end of the year | Net book value | |||||||||||||||||||||||||||||||||
Pipelines | 61,419,814 | - | 13,330 | 1,933,215 | 63,339,699 | 29,732,526 | 7,747 | 1,518,032 | 2.2 | 31,242,811 | 32,096,888 | |||||||||||||||||||||||||||||||||
Compressor plants | 23,468,780 | 399,897 | 179,885 | 2,033,984 | 25,722,776 | 16,260,945 | 108,445 | 1,067,625 | 3.3 to 25 | 17,220,125 | 8,502,651 | |||||||||||||||||||||||||||||||||
Other plants | 26,488 | - | - | - | 26,488 | 8,039 | - | 899 | 3.3 | 8,938 | 17,550 | |||||||||||||||||||||||||||||||||
Stations of regulation and/or measurement of pressure | 2,091,798 | - | - | 76,900 | 2,168,698 | 1,668,370 | - | 57,681 | 4.0 | 1,726,051 | 442,647 | |||||||||||||||||||||||||||||||||
Other technical installations | 413,717 | - | - | 7,440 | 421,157 | 353,051 | - | 9,250 | 6.7 | 362,301 | 58,856 | |||||||||||||||||||||||||||||||||
Subtotal assets related to natural gas transportation service | 87,420,597 | 399,897 | 193,215 | 4,051,539 | 91,678,818 | 48,022,931 | 116,192 | 2,653,487 | 50,560,226 | 41,118,592 | ||||||||||||||||||||||||||||||||||
Non-regulated segment Pipelines | 124,829 | - | - | 10,109,995 | 10,234,824 | 63,362 | - | 62,977 | 2.2 | 126,339 | 10,108,485 | |||||||||||||||||||||||||||||||||
Non-regulated segment Compressor plants | 1,910,728 | - | - | 145,605 | 2,056,333 | 582,695 | - | 217,431 | 3.3 to 25 | 800,126 | 1,256,207 | |||||||||||||||||||||||||||||||||
Non-regulated segment Other plants | 13,326,401 | - | - | 4,726,393 | 18,052,794 | 9,976,456 | - | 312,521 | 3.3 | 10,288,977 | 7,763,817 | |||||||||||||||||||||||||||||||||
Non-regulated segment Stations of regulation and/or measurement of pressure | 160,534 | 11,284 | - | 457,977 | 629,795 | 32,186 | - | 11,582 | 4.0 | 43,768 | 586,027 | |||||||||||||||||||||||||||||||||
Non-regulated segment Other technical installations | 254,016 | - | - | - | 254,016 | 75,525 | - | 22,868 | 6.7 | 98,393 | 155,623 | |||||||||||||||||||||||||||||||||
Subtotal assets related to Other Services and | ||||||||||||||||||||||||||||||||||||||||||||
Production and Commercialization of Liquids | 15,776,508 | 11,284 | - | 15,439,970 | 31,227,762 | 10,730,224 | - | 627,379 | 11,357,603 | 19,870,159 | ||||||||||||||||||||||||||||||||||
Lands | 165,136 | 189,003 | - | - | 354,139 | - | - | - | - | - | 354,139 | |||||||||||||||||||||||||||||||||
Buildings and constructions | 3,119,619 | - | 948 | 428,387 | 3,547,058 | 1,761,692 | 11 | 58,976 | 2.0 | 1,820,657 | 1,726,401 | |||||||||||||||||||||||||||||||||
Facilities and features in building | 263,700 | - | - | 97 | 263,797 | 105,381 | - | 10,927 | 4.0 | 116,308 | 147,489 | |||||||||||||||||||||||||||||||||
Machinery, equipment and tools | 933,683 | 172,586 | 7,758 | 6,207 | 1,104,718 | 578,196 | 7,758 | 80,007 | 6.7 to 10 | 650,445 | 454,273 | |||||||||||||||||||||||||||||||||
UT Machinery, equipment and tools | 909 | - | - | - | 909 | 686 | - | 223 | 6.7 to 10 | 909 | - | |||||||||||||||||||||||||||||||||
Computers and Telecommunication systems | 4,177,609 | 3,440 | - | 662,582 | 4,843,631 | 3,420,768 | - | 221,927 | 6.7 to 20 | 3,642,695 | 1,200,936 | |||||||||||||||||||||||||||||||||
Vehicles | 455,370 | 80,860 | 24,497 | - | 511,733 | 320,725 | 23,144 | 41,452 | 20 | 339,033 | 172,700 | |||||||||||||||||||||||||||||||||
Furniture | 228,540 | - | - | - | 228,540 | 221,308 | - | 1,237 | 10 | 222,545 | 5,995 | |||||||||||||||||||||||||||||||||
Materials | 2,363,440 | 2,259,125 | 21,545 | (1,458,699 | ) | 3,142,321 | - | - | - | - | - | 3,142,321 | ||||||||||||||||||||||||||||||||
Line pack | 578,707 | - | - | (84,156 | ) | 494,551 | 27,646 | - | - | - | 27,646 | 466,905 | ||||||||||||||||||||||||||||||||
Works in progress | 9,216,602 | 15,722,143 | - | (19,045,927 | ) | 5,892,818 | - | - | - | - | - | 5,892,818 | ||||||||||||||||||||||||||||||||
Total | 124,700,420 | 18,838,338 | 247,963 | - | 143,290,795 | 65,189,557 | 147,105 | 3,695,615 | 68,738,067 | 74,552,728 |
2018 | ||||||||||||||||||||||||||||||||||||||||||||
Cost | Depreciation | |||||||||||||||||||||||||||||||||||||||||||
Account | Beginning of the year | Additions | Retirements | Transfers | End of the year | Accumulated at the beginning of the year | Retirements | For the year | rate % | Accumulated at the end of the year | Net book value | |||||||||||||||||||||||||||||||||
Pipelines | 60,167,955 | - | 27,845 | 1,279,704 | 61,419,814 | 28,257,137 | 461 | 1,475,850 | 2.2 | 29,732,526 | 31,687,288 | |||||||||||||||||||||||||||||||||
Compressor plants | 22,369,570 | - | 474,819 | 1,574,029 | 23,468,780 | 15,721,120 | 429,105 | 968,930 | 3.3 to 25 | 16,260,945 | 7,207,835 | |||||||||||||||||||||||||||||||||
Other plants | 26,488 | - | - | - | 26,488 | 7,141 | - | 898 | 3.3 | 8,039 | 18,449 | |||||||||||||||||||||||||||||||||
Stations of regulation and/or measurement of pressure | 2,093,130 | 1,663 | 9,150 | 6,155 | 2,091,798 | 1,620,632 | 7,942 | 55,680 | 4.0 | 1,668,370 | 423,428 | |||||||||||||||||||||||||||||||||
Other technical installations | 407,598 | - | 2,046 | 8,165 | 413,717 | 346,264 | 2,046 | 8,833 | 6.7 | 353,051 | 60,666 | |||||||||||||||||||||||||||||||||
Subtotal assets related to | ||||||||||||||||||||||||||||||||||||||||||||
natural gas transportation service | 85,064,741 | 1,663 | 513,860 | 2,868,053 | 87,420,597 | 45,952,294 | 439,554 | 2,510,191 | 48,022,931 | 39,397,666 | ||||||||||||||||||||||||||||||||||
Non-regulated segment Pipelines | 124,829 | - | - | - | 124,829 | 61,868 | - | 1,494 | 2.2 | 63,362 | 61,467 | |||||||||||||||||||||||||||||||||
Non-regulated segment Compressor plants | 1,898,166 | - | 4,330 | 16,892 | 1,910,728 | 395,448 | 808 | 188,055 | 3.3 to 25 | 582,695 | 1,328,033 | |||||||||||||||||||||||||||||||||
Non-regulated segment Other plants | 13,744,847 | 9,207 | 1,029,228 | 601,575 | 13,326,401 | 10,676,085 | 950,340 | 250,711 | 3.3 | 9,976,456 | 3,349,945 | |||||||||||||||||||||||||||||||||
Non-regulated segment Stations of regulation and/or | ||||||||||||||||||||||||||||||||||||||||||||
measurement of pressure | 160,534 | - | - | - | 160,534 | 25,765 | - | 6,421 | 4.0 | 32,186 | 128,348 | |||||||||||||||||||||||||||||||||
Non-regulated segment Other technical installations | 254,016 | - | - | - | 254,016 | 52,658 | - | 22,867 | 6.7 | 75,525 | 178,491 | |||||||||||||||||||||||||||||||||
Subtotal assets related to Other Services and Production and Commercialization of Liquids | 16,182,392 | 9,207 | 1,033,558 | 618,467 | 15,776,508 | 11,211,824 | 951,148 | 469,548 | 10,730,224 | 5,046,284 | ||||||||||||||||||||||||||||||||||
Lands | 110,509 | 54,627 | - | - | 165,136 | - | - | - | - | - | 165,136 | |||||||||||||||||||||||||||||||||
Buildings and constructions | 3,053,615 | - | 73,980 | 139,984 | 3,119,619 | 1,765,318 | 58,701 | 55,075 | 2.0 | 1,761,692 | 1,357,927 | |||||||||||||||||||||||||||||||||
Facilities and features in building | 255,239 | - | 18,078 | 26,539 | 263,700 | 103,710 | 9,419 | 11,090 | 4.0 | 105,381 | 158,319 | |||||||||||||||||||||||||||||||||
Machinery, equipment and tools | 790,333 | 199,925 | 73,467 | 16,892 | 933,683 | 609,507 | 73,206 | 41,895 | 6.7 to 10 | 578,196 | 355,487 | |||||||||||||||||||||||||||||||||
UT Machinery, equipment and tools | - | 909 | - | - | 909 | - | - | 686 | 6.7 to 10 | 686 | 223 | |||||||||||||||||||||||||||||||||
Computers and Telecommunication systems | 5,762,314 | 258 | 2,085,323 | 500,360 | 4,177,609 | 5,203,218 | 2,078,177 | 295,727 | 6.7 to 20 | 3,420,768 | 756,841 | |||||||||||||||||||||||||||||||||
Vehicles | 405,725 | 58,593 | 8,948 | - | 455,370 | 294,870 | 8,465 | 34,320 | 20 | 320,725 | 134,645 | |||||||||||||||||||||||||||||||||
Furniture | 228,380 | - | - | 160 | 228,540 | 220,020 | - | 1,288 | 10 | 221,308 | 7,232 | |||||||||||||||||||||||||||||||||
Materials | 2,419,633 | 880,423 | 55,307 | (881,309 | ) | 2,363,440 | - | - | - | - | - | 2,363,440 | ||||||||||||||||||||||||||||||||
Line pack | 236,471 | - | - | 342,236 | 578,707 | 27,646 | - | - | - | 27,646 | 551,061 | |||||||||||||||||||||||||||||||||
Works in progress | 3,429,298 | 9,418,686 | - | (3,631,382 | ) | 9,216,602 | - | - | - | - | - | 9,216,602 | ||||||||||||||||||||||||||||||||
Total | 117,938,650 | 10,624,291 | 3,862,521 | - | 124,700,420 | 65,388,407 | 3,618,670 | 3,419,820 | 65,189,557 | 59,510,863 |
2018 | ||||
Capitalized financial lease | 2,501,165 | |||
Accumulated depreciaton | (560,091 | ) | ||
Total | 1,941,074 |
12/31/2019 | 1/1/2019 | |||||||
Other plants | 448,306 | 515,552 | ||||||
Compressor plants | 1,113,024 | 1,279,978 | ||||||
Other technical installations | 126,560 | 145,544 | ||||||
Total | 1,687,890 | 1,941,074 |
12/31/2019 | ||||
Other plants | (67,246 | ) | ||
Compressor plants | (166,954 | ) | ||
Other technical installations | (18,984 | ) | ||
Total | (253,184 | ) |
13. | LOANS |
2019 | 2018 | |||||||
Current Loans | ||||||||
2018 Notes Interest | 336,881 | 349,375 | ||||||
Pre-export finance | 1,021,325 | - | ||||||
Leasing (Note 22) | 363,881 | 331,850 | ||||||
Total Current loans | 1,722,087 | 681,225 | ||||||
Non Current Loans | ||||||||
2018 Notes | 29,847,160 | 28,789,009 | ||||||
Leasing (Note 22) | 2,013,557 | 2,214,706 | ||||||
Total non current loans | 31,860,717 | 31,003,715 | ||||||
Total (1) | 33,582,804 | 31,684,940 |
2019 | ||||||||||||
Leases liabilities | Other payables | 2018 | ||||||||||
Beggining balance | 2,546,556 | 29,138,384 | 10,218,503 | |||||||||
Inflation adjustment restatement | (891,146 | ) | (13,298,217 | ) | (10,931,986 | ) | ||||||
Accrued interest | 194,944 | 2,061,631 | 2,305,265 | |||||||||
Effect of foreign exchange rate change | 1,178,710 | 13,935,368 | 19,765,612 | |||||||||
VAT unpaid installments | 15,988 | - | 29,388 | |||||||||
Procceds from loans | - | 1,051,809 | 21,261,978 | |||||||||
Payment of loans (1) | (167,989 | ) | - | (2,042,940 | ) | |||||||
Payment of redemption of loans | - | - | (7,378,176 | ) | ||||||||
Interest paid (2) | (159,164 | ) | (2,024,070 | ) | (1,542,704 | ) | ||||||
Ending balance | 2,717,899 | 30,864,905 | 31,684,940 |
To due | ||||||||||||||||||||||||||||
Due at 12/31/2019 | From 1/01/2020 to 12/31/2020 | From 1/01/2021 to 12/31/2021 | From 1/01/2022 to 12/31/2022 | From 1/01/2023 to 12/31/2023 | From 1/01/2024 onwards | Total | ||||||||||||||||||||||
2018 Notes | - | 336,881 | - | - | - | 29,847,160 | 30,184,041 | |||||||||||||||||||||
Financial Leasing | 90,363 | 273,518 | 296,515 | 321,370 | 348,380 | 1,047,292 | 2,377,438 | |||||||||||||||||||||
Pre-export finance | - | 1,021,325 | - | - | - | - | 1,021,325 | |||||||||||||||||||||
Total | 90,363 | 1,631,724 | 296,515 | 321,370 | 348,380 | 30,894,452 | 33,582,804 |
12/31/2019 | ||||
As of 12/31/2020 | 538,339 | |||
From 1/01/2021 to 12/31/2021 | 448,037 | |||
From 1/01/2022 to 12/31/2022 | 448,037 | |||
From 1/01/2023 to 12/31/2023 | 448,037 | |||
From 1/01/2024 onwards | 1,163,723 | |||
Total minimum future payments | 3,046,173 | |||
Future financial charges on financial leases | (668,735 | ) | ||
Book Value financial leases | 2,377,438 |
2018 Notes | |
Amount in U.S.$ | 500,000,000 |
Interest Rate | 6.75% annual |
Issuance price | 99.725% |
Scheduled payment date | Percentage of the principal to be paid | |
Amortization | May 2, 2025 | 100% |
Frequency of interest payment | Semiannual, payable on May 2 and November 2 of each year. | |
Guarantor | None |
Amount in US$ | 17,000,000 |
Interest Rate | LIBOR + 1.95% |
Scheduled payment date | Percentage of the principal to be paid | |
Amortization | March 4, 2020 | 100% |
Frecuency of interest payment | Monthly, payable on December 4,2019, January 6, 2020, February 4, 2020 and March 4, 2020 | |
Guarantor | US Treasury bills * | |
* Included in “Other financial assets at amortized cost.” |
14. | INCOME TAX AND DEFERRED TAX |
2019 | 2018 | 2017 | ||||||||||
Current income tax | (2,682,261 | ) | (4,920,109 | ) | (3,757,523 | ) | ||||||
Special revaluation tax | - | (1,612,164 | ) | - | ||||||||
Deferred income tax | (1,341,950 | ) | 6,512,012 | 3,839,173 | ||||||||
Total income tax | (4,024,211 | ) | (20,261 | ) | 81,650 |
2019 | 2018 | |||||||
Deferred tax assets: | ||||||||
Deferred tax assets to be recovered after more than 12 months | 996,567 | 1,044,262 | ||||||
Deferred tax assets to be recovered after less than 12 months | 273,287 | 231,200 | ||||||
Deferred tax liabilities: | ||||||||
Deferred tax liabilities to be recovered after more than 12 months | (6,002,822 | ) | (4,527,584 | ) | ||||
Deferred tax liabilities to be recovered after less than 12 months | (29,546 | ) | (168,442 | ) | ||||
Deferred tax liabilities, net | (4,762,514 | ) | (3,420,564 | ) |
Deferred tax assets | Allowance for doubtful accounts | Tax credits discounted value loss | Account receivables discounted value | Provisions for legal claims and other provisions | Financial lease | Contract liabilities | Tax inflation adjustment | Total | ||||||||||||||||||||||||
As of December 31, 2017 | - | - | - | 173,575 | 516,052 | 436,324 | - | 1,125,951 | ||||||||||||||||||||||||
Charge in results | - | 596 | 3,497 | (18,349 | ) | 110,929 | 52,838 | - | 149,511 | |||||||||||||||||||||||
As of December 31, 2018 | - | 596 | 3,497 | 155,226 | 626,981 | 489,162 | - | 1,275,462 | ||||||||||||||||||||||||
Charge in results | 731 | (240 | ) | (2,766 | ) | (375 | ) | (26,711 | ) | 14,925 | 8,828 | (5,608 | ) | |||||||||||||||||||
As of December 31, 2019 | 731 | 356 | 731 | 154,851 | 600,270 | 504,087 | 8,828 | 1,269,854 |
Deferred tax liabilities | Deferred sales | Loans | Property, Plant and Equipment | Cash and cash equivalents | Inventaries | Other financial assets at amortized cost | Tax inflation adjustment | Total | ||||||||||||||||||||||||
As of December 31, 2017 | - | (5,633 | ) | (11,016,028 | ) | (25,325 | ) | (11,541 | ) | - | - | (11,058,527 | ) | |||||||||||||||||||
Charge in results | 4,367 | (42,180 | ) | 6,527,245 | (120,683 | ) | (6,248 | ) | - | - | 6,362,501 | |||||||||||||||||||||
As of December 31, 2018 | 4,367 | (47,813 | ) | (4,488,783 | ) | (146,008 | ) | (17,789 | ) | - | - | (4,696,026 | ) | |||||||||||||||||||
Charge in results | (4,367 | ) | 21,547 | 139,697 | 143,880 | (2,346 | ) | (1,864 | ) | (1,632,889 | ) | (1,336,342 | ) | |||||||||||||||||||
As of December 31, 2019 | - | (26,266 | ) | (4,349,086 | ) | (2,128 | ) | (20,135 | ) | (1,864 | ) | (1,632,889 | ) | (6,032,368 | ) |
2019 | 2018 | 2017 | ||||||||||
Pre tax income | 16,829,329 | 17,581,516 | 8,765,549 | |||||||||
Statutory income tax rate | 30 | % | 30 | % | 35 | % | ||||||
Pre tax income at statutory income tax rate | ||||||||||||
(5,048,799 | ) | (5,274,455 | ) | (3,067,942 | ) | |||||||
Tax effects due to: | ||||||||||||
- Restatement by inflation | 2,039,603 | 371,340 | (287,676 | ) | ||||||||
- Tax revalution benefit | - | 6,447,872 | - | |||||||||
- Special revalution tax | - | (1,612,164 | ) | - | ||||||||
- Adjustment affidavit previous year | 136,641 | (464 | ) | - | ||||||||
- Change in the taxe rate | - | - | 3,437,625 | |||||||||
- Tax inflation adjustment | (1,998,487 | ) | - | - | ||||||||
- Others | 846,831 | 47,610 | (357 | ) | ||||||||
Total income tax | (4,024,211 | ) | (20,261 | ) | 81,650 |
15. | PROVISIONS |
For legal claims and others | |||||
Balances as of 12/31/2017 | 445,962 | ||||
Inflation adjustment restatement | (173,430 | ) | |||
Additions | 300,213 | (1) | |||
Uses | (1,211 | ) | |||
Decreases | (557 | ) | (2) | ||
Balances as of 12/31/2018 | 570,977 | ||||
Inflation adjustment restatement | (241,044 | ) | |||
Additions | 272,477 | (3) | |||
Uses | (7,590 | ) | |||
Decreases | (5,702 | ) | (2) | ||
Balances as of 12/31/2019 | 589,118 |
16. | FINANCIAL RISK MANAGEMENT |
1. | Financial risk factors |
2. | Foreign exchange risk |
Financial assets (1) | Financial liabilities (2) | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Fix interest rate | 8,650,353 | 13,114,538 | 30,184,039 | 29,138,384 | ||||||||||||
Variable interest rate | 1,038,402 | 22,264 | 1,021,325 | - | ||||||||||||
Total | 9,688,755 | 13,136,802 | 31,205,364 | 29,138,384 |
Period | Propane | Butane | Natural gasoline | |||||||||
October 2018 – April 2019 | 6,663 | 4,967 | 2,976 | |||||||||
May 2019 – September 2019 | - | - | 4,519 | |||||||||
October 2019 | 9,996 | 7,727 | 4,630 | |||||||||
November 2019 – April 2020 | 14,438 | 11,038 | 6,614 |
2019 | 2018 | |||||||
Current trade receivables | 6,608,715 | 4,994,969 | ||||||
Allowances for doubful accounts | (134,956 | ) | (203,860 | ) | ||||
Total | 6,473,759 | 4,791,109 |
2019 | 2018 | 2017 | ||||||||||||||||||
Revenues | Trade receivables | Revenues | Trade receivables | Revenues | ||||||||||||||||
MetroGas | 5,849,138 | 1,459,410 | 4,957,415 | 577,764 | 2,948,056 | |||||||||||||||
Camuzzi Gas Pampeana S.A. | 4,353,024 | 729,137 | 3,682,320 | 430,212 | 2,167,208 | |||||||||||||||
Naturgy Argentina | 3,496,055 | 567,429 | 2,971,396 | 368,782 | 1,556,829 | |||||||||||||||
CAMMESA | 1,337,997 | 206,403 | 2,057,838 | 281,896 | 1,368,671 | |||||||||||||||
Pampa Energía | 803,610 | 258,007 | 676,180 | 141,040 | 68,737 | |||||||||||||||
Camuzzi Gas del Sur S.A. | 1,075,744 | 150,838 | 822,176 | 87,574 | 477,222 |
2019 | 2018 | 2017 | ||||||||||||||||||
Revenues | Trade receivables | Revenues | Trade receivables | Revenues | ||||||||||||||||
PBB Polisur | 6,338,222 | 841,338 | 8,102,817 | 1,090,359 | 5,667,118 | |||||||||||||||
Petredec | 1,003,264 | - | 1,321,183 | - | 2,119,267 | |||||||||||||||
Geogas Trading S.A. | 1,691,910 | 375,723 | 1,695,707 | - | 878,783 | |||||||||||||||
Shell Trading (US) Company | - | - | 138,246 | - | 2,192,301 | |||||||||||||||
YPF | 1,239,102 | 26,501 | 729,113 | 30,968 | - | |||||||||||||||
Petrobras Global Trading BV | 4,446,241 | 397,172 | 2,682,539 | 211,387 | - |
December 31, 2019 | ||||||||||||
Cash and cash equivalents | Other financial assets | Credits (1) (2) | ||||||||||
Without specified maturity | 9,650,787 | - | 21,607 | |||||||||
With specified maturity | ||||||||||||
Overdue | ||||||||||||
Until 12-31-2018 | - | - | 144,596 | |||||||||
From 01-01-19 to 03-31-19 | - | - | 1,538 | |||||||||
From 04-01-19 to 06-30-19 | - | - | 4,245 | |||||||||
From 07-01-19 to 09-30-19 | - | - | 343,827 | |||||||||
From 10-01-19 to 12-31-19 | - | - | 791,533 | |||||||||
Total overdue | - | - | 1,285,739 | |||||||||
Non-due | ||||||||||||
From 01-01-20 to 03-31-20 | 114,414 | 1,315,640 | 5,271,983 | |||||||||
From 04-01-20 to 06-30-20 | - | 796 | 482,630 | |||||||||
From 07-01-20 to 09-30-20 | - | 775 | 8,105 | |||||||||
From 10-01-20 to 12-31-20 | - | 773 | 10,092 | |||||||||
During 2021 | - | 3,043 | 6,943 | |||||||||
During 2022 | - | 1,911 | - | |||||||||
During 2023 | - | 449 | - | |||||||||
During 2024 | - | - | - | |||||||||
From 2025 onwards | - | - | - | |||||||||
Total non-due | 114,414 | 1,323,387 | 5,779,753 | |||||||||
Total with specified maturity | 114,414 | 1,323,387 | 7,065,492 | |||||||||
Total | 9,765,201 | 1,323,387 | 7,087,099 |
December 31, 2018 | ||||||||||||
Cash and cash equivalents | Other financial assets | Credits (1) (2) | ||||||||||
Without specified maturity | 22,283,431 | - | 718 | |||||||||
With specified maturity | ||||||||||||
Overdue | ||||||||||||
Until 12-31-2017 | - | - | 205,783 | |||||||||
From 01-01-18 to 03-31-18 | - | - | 477 | |||||||||
From 04-01-18 to 06-30-18 | - | - | 6,184 | |||||||||
From 07-01-18 to 09-30-18 | - | - | 17,537 | |||||||||
From 10-01-18 to 12-31-18 | - | - | 823,940 | |||||||||
Total overdue | - | - | 1,053,921 | |||||||||
Non-due | ||||||||||||
From 01-01-19 to 03-31-19 | 3,321,706 | 338,073 | 4,530,803 | |||||||||
From 04-01-19 to 06-30-19 | - | 2,300 | 63,313 | |||||||||
From 07-01-19 to 09-30-19 | - | 2,300 | - | |||||||||
From 10-01-19 to 12-31-19 | - | 1,894 | - | |||||||||
During 2020 | - | 5,161 | 8,505 | |||||||||
During 2021 | - | 4,683 | - | |||||||||
During 2022 | - | 2,940 | - | |||||||||
During 2023 | - | 688 | - | |||||||||
From 2024 onwards | - | - | - | |||||||||
Total non-due | 3,321,706 | 358,039 | 4,602,621 | |||||||||
Total with specified maturity | 3,321,706 | 358,039 | 5,656,542 | |||||||||
Total | 25,605,137 | 358,039 | 5,657,260 |
December 31, 2019 | ||||||||||||
Loans | Other financial liabilities | Leases liabilities | ||||||||||
Without specified maturity | - | - | - | |||||||||
With specified maturity | ||||||||||||
Overdue | ||||||||||||
Until 12-31-2018 | - | 130,829 | - | |||||||||
From 01-01-19 to 03-31-19 | - | 311 | - | |||||||||
From 04-01-19 to 06-30-19 | - | 311 | - | |||||||||
From 07-01-19 to 09-30-19 | - | 311 | - | |||||||||
From 10-01-19 to 12-31-19 | - | 311 | 90,363 | |||||||||
Total overdue | - | 132,073 | 90,363 | |||||||||
Non-due | ||||||||||||
From 01-01-20 to 03-31-20 | 1,027,502 | 3,745,057 | 111,994 | |||||||||
From 04-01-20 to 06-30-20 | 1,010,644 | 32,769 | 111,994 | |||||||||
From 07-01-20 to 09-30-20 | - | - | 111,994 | |||||||||
From 10-01-20 to 12-31-20 | 1,010,644 | - | 111,994 | |||||||||
During 2021 | 2,021,288 | - | 448,037 | |||||||||
During 2022 | 2,021,288 | - | 448,037 | |||||||||
During 2023 | 2,021,288 | - | 448,037 | |||||||||
During 2024 | 2,021,288 | - | 448,037 | |||||||||
From 2025 onwards | 30,955,641 | - | 715,686 | |||||||||
Total non-due | 42,089,583 | 3,777,826 | 2,955,810 | |||||||||
Total with specified maturity | 42,089,583 | 3,909,899 | 3,046,173 | |||||||||
Total | 42,089,583 | 3,909,899 | 3,046,173 |
December 31, 2018 | ||||||||||||
Loans | Other financial liabilities | Financial leases | ||||||||||
Without specified maturity | - | - | - | |||||||||
With specified maturity | ||||||||||||
Overdue | ||||||||||||
Until 12-31-2017 | - | 159,366 | - | |||||||||
From 01-01-18 to 03-31-18 | - | 478 | - | |||||||||
From 04-01-18 to 06-30-18 | - | 478 | - | |||||||||
From 07-01-18 to 09-30-18 | - | 478 | - | |||||||||
From 10-01-18 to 12-31-18 | - | 478 | 87,517 | |||||||||
Total overdue | - | 161,278 | 87,517 | |||||||||
Non-due | ||||||||||||
From 01-01-19 to 03-31-19 | - | 5,157,610 | 108,450 | |||||||||
From 04-01-19 to 06-30-19 | 978,663 | 33,442 | 108,450 | |||||||||
From 07-01-19 to 09-30-19 | - | - | 108,450 | |||||||||
From 10-01-19 to 12-31-19 | 978,663 | - | 108,450 | |||||||||
During 2020 | 1,957,325 | - | 433,860 | |||||||||
During 2021 | 1,957,325 | - | 433,860 | |||||||||
During 2022 | 1,957,325 | - | 433,860 | |||||||||
During 2023 | 1,957,325 | - | 433,860 | |||||||||
From 2024 onwards | 31,933,396 | - | 1,126,898 | |||||||||
Total non-due | 41,720,022 | 5,191,052 | 3,296,138 | |||||||||
Total with specified maturity | 41,720,022 | 5,352,330 | 3,383,655 | |||||||||
Total | 41,720,022 | 5,352,330 | 3,383,655 |
2019 | 2018 | |||||||
Total debt (Note 13) | 33,582,804 | 31,684,940 | ||||||
Total Equity | 48,083,469 | 47,603,906 | ||||||
Total Capital | 81,666,273 | 79,288,846 | ||||||
Gearing Ratio | 0.41 | 0.4 |
2. | FINANCIAL INSTRUMENTS BY CATEGORY AND HIERARCHY |
December 31, 2019 | ||||||||||||
Financial assets at fair value | Financial assets at amortizef cost | Total | ||||||||||
CURRENT ASSETS | ||||||||||||
Trade receivables | - | 6,473,759 | 6,473,759 | |||||||||
Other receivables | - | 473,216 | 473,216 | |||||||||
Derivative financial instruments | 274,024 | - | 274,024 | |||||||||
Other financial assets at amortized cost | - | 1,043,960 | 1,043,960 | |||||||||
Cash and cash equivalents | 1,029,644 | 8,735,557 | 9,765,201 | |||||||||
Total current assets | 1,303,668 | 16,726,492 | 18,030,160 | |||||||||
NON-CURRENT ASSETS | ||||||||||||
Other receivables | - | 7,603 | 7,603 | |||||||||
Other financial assets at amortized cost | - | 5,403 | 5,403 | |||||||||
Total non-current assets | - | 13,006 | 13,006 | |||||||||
Total assets | 1,303,668 | 16,739,498 | 18,043,166 |
Financial liabilities at fair value | Other financial liabilities | Total | ||||||||||
CURRENT LIABILITIES | ||||||||||||
Trade payables | - | 4,113,571 | 4,113,571 | |||||||||
Loans | - | 1,722,087 | 1,722,087 | |||||||||
Payroll and social security taxes payables | - | 533,497 | 533,497 | |||||||||
Other payables | - | 287,659 | 287,659 | |||||||||
NON-CURRENT LIABILITIES | ||||||||||||
Loans | - | 31,860,717 | 31,860,717 | |||||||||
Total non-current liabilities | - | 31,860,717 | 31,860,717 | |||||||||
Total liabilities | - | 38,517,531 | 38,517,531 |
2018 | ||||||||||||
Financial assets at fair value | Financial assets at amortirzed cost | Total | ||||||||||
CURRENT ASSETS | ||||||||||||
Trade receivables | - | 4,791,109 | 4,791,109 | |||||||||
Other receivables | - | 652,771 | 652,771 | |||||||||
Derivative financial instruments | 335,773 | - | 335,773 | |||||||||
Other financial assets at amortized cost | - | 8,790 | 8,790 | |||||||||
Cash and cash equivalents | 3,324,575 | 22,280,562 | 25,605,137 | |||||||||
Total current assets | 3,660,348 | 27,733,232 | 31,393,580 | |||||||||
NON-CURRENT ASSETS | ||||||||||||
Other receivables | - | 9,521 | 9,521 | |||||||||
Other financial assets at amortized cost | - | 13,476 | 13,476 | |||||||||
Total non-current assets | - | 22,997 | 22,997 | |||||||||
Total assets | 3,660,348 | 27,756,229 | 31,416,577 |
Financial liabilities at fair value | Other financial liabilities | Total | ||||||||||
CURRENT LIABILITIES | ||||||||||||
Trade payables | - | 4,756,554 | 4,756,554 | |||||||||
Loans | - | 681,225 | 681,225 | |||||||||
Payroll and social security taxes payables | - | 475,882 | 475,882 | |||||||||
Other payables | - | 124,103 | 124,103 | |||||||||
Total current liabilities | - | 6,037,764 | 6,037,764 | |||||||||
NON-CURRENT LIABILITIES | ||||||||||||
Loans | - | 31,003,715 | 31,003,715 | |||||||||
Total non-current liabilities | - | 31,003,715 | 31,003,715 | |||||||||
Total liabilities | - | 37,041,479 | 37,041,479 |
• | Level 1: includes financial assets and liabilities whose fair values are estimated using quoted prices (unadjusted) in active markets for identical assets and liabilities. The instruments included in this level primarily include balances in mutual funds and public or private bonds listed on the BYMA. The mutual funds mainly carry out their placements in bonds issued by the Central Bank of the Argentine Republic (“BCRA”). |
• | Level 2: includes financial assets and liabilities whose fair value is estimated using different assumptions quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (for example, derived from prices). Within this level, the Company includes those derivate financial instruments for which it was not able to find an active market. |
• | Level 3: includes financial instruments for which the assumptions used in estimating fair value are not based on observable market information. |
As of December 31, 2019 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Financial assets at fair value | ||||||||||||||||
Cash and cash equivalents | 1,029,644 | - | - | 1,029,644 | ||||||||||||
Derivative financial instruments | - | 274,024 | - | 274,024 | ||||||||||||
Total | 1,029,644 | 274,024 | - | 1,303,668 |
As of December 31, 2018 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Financial assets at fair value | ||||||||||||||||
Cash and cash equivalents | 3,324,575 | - | - | 3,324,575 | ||||||||||||
Derivative financial instruments | - | 335,773 | - | 335,773 | ||||||||||||
Total | 3,324,575 | 335,773 | - | 3,660,348 |
As of December 31, 2019 | ||||||||
Carrying amount | Fair value | |||||||
2018 Notes | 30,184,039 | 26,266,856 |
17. | REGULATORY FRAMEWORK |
a) | General framework of the natural gas transportation segment: |
• | The RTI Process, which will culminate in the signing of the integral agreement, was approved. As a result of this RTI, a new tariff schedule was also approved. This new tariff schedule applicable to the Company determined a total tariff increase of 214.2% and 37%, in the event that it had been granted in a single installment as of April 1, 2017, on the tariff of the natural gas transportation service and the CAU, respectively. |
• | The Five-Year Investment Plan was approved. Resolution 4362 obliged TGS for the execution of the Five-Year Plan, which requires a high level of essential investments for the operation and maintenance of the pipeline system, to provide quality, safe and reliable service. The Five-Year Plan shall be for the period from April 1, 2017 to March 31, 2022 and will amount to Ps. 6,786,543, expressed in December 31, 2016 currency terms. |
• | A non-automatic six-month adjustment mechanism for the natural gas transportation tariff and the investment commitments were approved. This adjustment must be approved by ENARGAS and for its calculation, the evolution of the WPI published by INDEC will be considered. |
• | TGS and its shareholders must withdraw any claim against the Government related to the natural gas transportation business, including the arbitration proceedings before the ICSID. The Company desisted from it on June 26, 2018. |
• | Effective as of April 1, 2017, 64.2% of the tariff for the natural gas transport service, the CAU not being adjusted, in accordance with the provisions of Resolution No. 4362/2017 (“Resolution 4362”). |
• | Effective as of December 1, 2017, after the issuance of Resolution 120, 81.1% on the tariff for the natural gas transport service and 29.7% on the CAU, which includes the first adjustment by WPI. |
• | Effective as of April 1, 2018, an increase of 50% over the tariff for the natural gas transport service and the CAU within the framework of the provisions of Resolution No. 310/2018 issued by ENARGAS. |
i) | the net book value of the essential assets determined on the basis of the price paid by the acquiring joint arrangements, and the original cost of subsequent investments carried in US dollars and adjusted by the PPI, net of accumulated depreciation according to the calculation rules to be determined by ENARGAS; or |
ii) | the net proceeds of a new competitive bidding (the “New Bidding”). |
(i) | that its bid in the New Bidding be computed at an equal to the appraisal value to be determined by an investment bank selected by ENARGAS, which represents the value of the business of providing the licensed service as it is driven by the Licensee at the valuation date, as a going concern and without regard to the debts; |
(ii) | to obtain the new License, without payment, in the event that any bid submitted in the New Bidding exceeds the appraised value; |
(iii) | to match the best bid submitted by third parties in the New Bidding, if it would be higher than its bid mentioned in (i) paying the difference between both values to obtain the new License; |
(iv) | if the Company is unwilling to match the best bid made by a third party, to receive the appraisal value mentioned in (i) as compensation for the transfer of the Essential Assets to the new licensee. |
18. | ASSETS AND LIABILITIES IN FORREIGN CURRENCY |
2019 | 2018 | ||||||||||||||||||||||
Foreign currency and amount (in thousands) | Exchange rate | Amount in local currency | Foreign currency and amount (in thousands) | Amount in local currency | |||||||||||||||||||
CURRENT ASSETS | |||||||||||||||||||||||
Cash and cash equivalents | US$ | 143,920 | 59.690 | (1) | 8,590,585 | US$ | 361,017 | 20,826,043 | |||||||||||||||
Derivative financial instruments | US$ | 4,591 | 59.690 | (1) | 274,024 | US$ | 5,821 | 335,773 | |||||||||||||||
Other financial assets at amortized cost | US$ | 17,433 | 59.690 | (1) | 1,040,605 | - | - | ||||||||||||||||
Trade receivables | US$ | 43,091 | 59.690 | (1) | 2,572,102 | US$ | 30,380 | 1,752,536 | |||||||||||||||
Other receivables | US$ | 325 | 59.690 | (1) | 19,399 | US$ | 1,693 | 97,665 | |||||||||||||||
Total current assets | US$ | 209,360 | 12,496,715 | US$ | 398,911 | 23,012,017 | |||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||||||||
Trade payables | US$ | 59,595 | 59.890 | (2) | 3,569,145 | US$ | 42,184 | 2,446,454 | |||||||||||||||
Loans | US$ | 28,754 | 59.890 | (2) | 1,722,087 | US$ | 11,746 | 681,225 | |||||||||||||||
Contract liabilities | US$ | 990 | 59.890 | (2) | 59,283 | - | - | ||||||||||||||||
Total current liabilities | US$ | 89,339 | 5,350,515 | US$ | 53,930 | 3,127,679 | |||||||||||||||||
NON CURRENT LIABILITIES | |||||||||||||||||||||||
Loans | US$ | 531,987 | 59.890 | (2) | 31,860,717 | US$ | 534,595 | 31,003,715 | |||||||||||||||
Contract liabilities | US$ | 13,692 | 59.890 | (2) | 820,025 | - | - | ||||||||||||||||
Total non current liabilities | US$ | 545,679 | 32,680,742 | US$ | 534,595 | 31,003,715 | |||||||||||||||||
TOTAL LIABILITIES | US$ | 635,018 | 38,031,257 | US$ | 588,525 | 34,131,394 |
19. | COMMON STOCK AND DIVIDENDS |
a) | Common stock structure and shares’ public offer |
Common Stock structure as of December 31, 2018 | ||||||||||||
Shares Class | Amount of common stock, subscribed, issued, paid in, and authorized for | |||||||||||
public offer | ||||||||||||
Common Shares Class | ||||||||||||
(Face value $ 1, 1 vote) | Outstandings shares | Treasury Shares | Common Stock | |||||||||
Class “A” | 405,192,594 | - | 405,192,594 | |||||||||
Class “B” | 375,701,909 | 13,600,780 | 389,302,689 | |||||||||
Total | 780,894,503 | 13,600,780 | 794,495,283 |
Common Stock structure as of December 31, 2019 | ||||||||||||
Shares Class | Amount of common stock, subscribed, issued, paid in, and authorized for | |||||||||||
public offer | ||||||||||||
Common Shares Class | �� | |||||||||||
(Face value $ 1, 1 vote) | Outstandings shares | Treasury Shares | Common Stock | |||||||||
Class “A” | 405,192,594 | - | 405,192,594 | |||||||||
Class “B” | 379,415,934 | 9,886,755 | 389,302,689 | |||||||||
Total | 784,608,528 | 9,886,755 | 794,495,283 |
b) | Acquisition of treasury shares |
c) | Dividends distribution |
• | The Ordinary General Shareholders´ Meeting of the Company at its meeting held on April 11, 2019 approved the payment of Ps. 9,185,584 (Ps. 11,7671 per share). |
• | The Board of Directors of the Company at its meeting held on April 11, 2019 approved the payment of Ps. 318,732 (Ps. 0,4083 per share). |
• | On October 31, 2019, the Board of Directors of the Company approved, together with the distribution mentioned below, to make available to the shareholders as of November 13, 2019 a cash dividend amounting to Ps. 256,338 (Ps. 0,3351 per share). This dividend was compensated -in the corresponding cases- with the withholding of income tax by virtue of the distribution of treasury shares (article 46 of the Income Tax Law and article 66.2 of the Regulatory Decree), in the case that it should be done. |
d) | Restrictions on distribution of retained earnings |
20. | LEGAL CLAIMS AND OTHER MATTERS |
a) | Turnover tax calculated on the natural gas price consumed by TGS |
b) | Action for annulment of ENARGAS Resolutions No. I-1,982/11 and No. I-1,991/11 (the “Resolutions”) |
c) | Recovery action of VAT and income tax |
d) | Turnover tax withholding in the Province of Buenos Aires |
e) | Environmental matters |
f) | Others |
21. | BALANCES AND TRANSACTIONS WITH RELATED COMPANIES |
2019 | 2018 | |||||||||||||||
Company | Accounts receivable | Accounts payable | Accounts receivable | Accounts payable | ||||||||||||
Controlling shareholder: | ||||||||||||||||
CIESA | 37 | - | - | - | ||||||||||||
Associate which exercises joint control on the controlling shareholder: | ||||||||||||||||
Pampa Energía (1) | 210,126 | 2,489,507 | 141,040 | 2,846,676 | ||||||||||||
Associate which exercises significant influence on the controlling shareholder: | ||||||||||||||||
Link | 668 | - | 9,971 | - | ||||||||||||
EGS | - | - | - | - | ||||||||||||
TGU | - | 9,534 | - | 9,232 | ||||||||||||
Other related companies: | ||||||||||||||||
SACDE Sociedad Argentina de Construcción (2) | 23,344 | - | 329,429 | - | ||||||||||||
Pampa Comercializadora S.A. | 43,843 | - | 10,942 | - | ||||||||||||
CT Barragán S.A. | 8,131 | - | - | - | ||||||||||||
Oleoductos del Valle S.A. | 3,348 | - | 4,816 | - | ||||||||||||
Central Piedra Buena S.A. | 13,304 | - | 39,170 | - | ||||||||||||
Transener S.A. | - | - | 140 | - | ||||||||||||
Total | 302,801 | 2,499,041 | 535,508 | 2,855,908 |
Revenues | Costs | Financial results | ||||||||||||||||||||||||||
Company | Natural Gas Transportation | Production and commercialization of liquids | Other services | Gas purchase and others | Compensation for technical assistance | Revenues for administrative services | Interest expense | |||||||||||||||||||||
Controlling shareholder: | ||||||||||||||||||||||||||||
CIESA | - | - | - | - | - | 146 | - | |||||||||||||||||||||
Associate which exercises joint control on the controlling shareholder: | ||||||||||||||||||||||||||||
Pampa Energía | 803,610 | 269,511 | 268,991 | 575,857 | 1,144,777 | - | 194,944 | |||||||||||||||||||||
Associates with significant influence: | ||||||||||||||||||||||||||||
Link | - | - | 14,073 | - | - | - | - | |||||||||||||||||||||
Other related companies: | ||||||||||||||||||||||||||||
Oleoductos del Valle S.A. | 5,469 | - | - | - | - | - | - | |||||||||||||||||||||
Pampa Comercializadora S.A. | 52,051 | - | - | - | - | - | - | |||||||||||||||||||||
Central Piedra Buena S.A. | 121,367 | - | - | - | - | - | - | |||||||||||||||||||||
Experta ART | - | - | - | 20,080 | - | - | - | |||||||||||||||||||||
Total | 982,497 | 269,511 | 283,064 | 595,937 | 1,144,777 | 146 | 194,944 |
Revenues | Costs | Financial results | ||||||||||||||||||||||||||
Company | Natural Gas Transportation | Production and commercialization of liquids | Other services | Gas purchase and others | Compensation for technical assistance | Revenues for administrative services | Interest expense | |||||||||||||||||||||
Controlling shareholder: | ||||||||||||||||||||||||||||
CIESA | - | - | - | - | - | 225 | - | |||||||||||||||||||||
Associate which exercises joint control on the controlling shareholder: | ||||||||||||||||||||||||||||
Pampa Energía | 676,180 | 2,035 | 355,245 | 949,283 | 2,026,244 | - | 193,009 | |||||||||||||||||||||
Associates with significant influence: | ||||||||||||||||||||||||||||
Link | - | - | 13,213 | - | - | - | - | |||||||||||||||||||||
Other related companies: | ||||||||||||||||||||||||||||
Oleoductos del Valle S.A. | 9,459 | - | 12,733 | - | - | - | - | |||||||||||||||||||||
Transener S.A. | - | - | 18,481 | - | - | - | - | |||||||||||||||||||||
Petrolera Entre Lomas S.A. | - | - | - | 3,103 | - | - | - | |||||||||||||||||||||
Pampa Comercializadora S.A. | 41,333 | - | - | - | - | - | - | |||||||||||||||||||||
Central Térmica Piedrabuena S.A. | 103,337 | - | - | - | - | - | - | |||||||||||||||||||||
Experta ART | - | - | - | 18,321 | - | - | - | |||||||||||||||||||||
Total | 830,309 | 2,035 | 399,672 | 970,707 | 2,026,244 | 225 | 193,009 |
Revenues | Costs | Financial results | ||||||||||||||||||||||||||
Company | Natural Gas Transportation | Production and commercialization of liquids | Other services | Gas purchase and others | Compensation for technical assistance | Revenues for administrative services | Interest expense | |||||||||||||||||||||
Controlling shareholder: | ||||||||||||||||||||||||||||
CIESA | - | - | - | - | - | 238 | - | |||||||||||||||||||||
Associate which exercises joint control on the controlling shareholder: | ||||||||||||||||||||||||||||
Pampa Energía | 68,736 | 143,945 | 178,731 | 349,268 | 887,901 | - | 165,726 | |||||||||||||||||||||
Jointly control entity: | ||||||||||||||||||||||||||||
UT | - | - | - | - | - | 3,253 | - | |||||||||||||||||||||
Associates with significant influence: | ||||||||||||||||||||||||||||
Link | - | - | 11,516 | - | - | - | - | |||||||||||||||||||||
Other related companies: | ||||||||||||||||||||||||||||
Oleoductos del Valle S.A. | 11,476 | - | 2,616 | - | - | - | - | |||||||||||||||||||||
Refinor S.A. | - | - | - | 8,230 | - | - | - | |||||||||||||||||||||
Petrolera Pampa S.A. | - | - | - | 62,062 | - | - | - | |||||||||||||||||||||
Petrolera Entre Lomas S.A. | - | - | - | 27,384 | - | - | - | |||||||||||||||||||||
Pampa Comercializadora S.A. | 16,575 | - | - | - | - | - | - | |||||||||||||||||||||
Central Piedra Buena S.A. | 20,245 | - | - | - | - | - | - | |||||||||||||||||||||
Central Térmica Loma La Lata S.A. | - | - | 598 | - | - | - | - | |||||||||||||||||||||
Experta ART | - | - | - | 18,381 | - | - | - | |||||||||||||||||||||
Total | 117,032 | 143,945 | 193,462 | 465,325 | 887,901 | 3,491 | 165,726 |
22. | CONTRACTUAL OBLIGATIONS |
Estimated maturity date | ||||||||||||||||||||||||
Total | Due less than one year | Less than one year | 1-2 years | 3-5 years | More than 5 years | |||||||||||||||||||
Financial indebtedness (1) | 42,089,583 | - | 3,048,790 | 6,063,863 | 32,976,930 | - | ||||||||||||||||||
Purchase obligations (2) | 7,358,968 | - | 842,255 | 6,516,713 | - | - | ||||||||||||||||||
Financial Leases | 3,046,173 | 90,363 | 447,976 | 896,074 | 896,074 | 715,686 | ||||||||||||||||||
Total | 52,494,724 | 90,363 | 4,339,021 | 13,476,650 | 33,873,004 | 715,686 |
23. | ASSOCIATES AND JOINT ARRANGEMENTS |
24. | SUBSEQUENT EVENTS |