Grupo Mexico SAB de CV

BMV:GMEXICOB

Earnings Call Transcript 2021-Q4

[Operator]

Good afternoon. Thank you for holding, and welcome to Grupo Mexico's Fourth Quarter 2021 Earnings Conference Call. With us this afternoon are all of Grupo Mexico's top executives will discuss the fourth quarter and 2021 financial performance of the company, giving you a summary of the latest news and address any questions you might have at the end of the call.

Before we begin, I would like to remind you that information discussed on today's call may include forward-looking statements regarding the company's results and prospects, which are subject to risks and uncertainties. Actual results may differ materially, and the company cautions not to play undue reliance on these forward-looking statements. Grupo Mexico undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

All results are expressed in full U.S. GAAP. [Operator Instructions] A copy of the slides that the company will be reviewing today is available on the website at grupomexico.com. [Operator Instructions]

Now we will begin with Ms. Marlene Finny.

[Marlene de la Torre, executive]

Thank you so much, Carmen. Good evening, everybody, and thank you all for joining us today for Grupo Mexico's Fourth Quarter Earnings Conference Call. Joining us today are the top executives from our 3 divisions. During our call, as Carmen was mentioning before, we will be following a presentation that can be downloaded from our website or followed by accessing the webcast, whichever works better for you.

On today's call, we will be following the program found on Slide #3. And then I will start with the Grupo Mexico's main highlights, going through our ESG achievements and scorecard and our financial highlights for the quarter and the year. Then Mr. Xavier Garcia de Quevedo will provide detailed information regarding our Mining Division, commenting on the industry's economic environment and the division's financial highlights and project updates as well.

He will be -- then be followed by Mr. Fernando Lopez, who will go through the Transportation Division financial and operational highlights. Finally, Mr. Francisco Zinser will comment on the financial highlights and relevant events that occurred during the quarter and the year in our Infrastructure Division. At the end, the line will be open for questions and answers.

Before starting with our results, I will -- I want to highlight, we are excited and optimistic about our future. We are seeing a positive environment of copper prices, and we have softer growth projects in our Mining Division. Our Transportation Division continues to see volume growth, while our Infrastructure Division continues to expand.

So now let's start with our main ESG highlights on Slide #5. Okay. Southern Copper, our mining company listed in the New York Stock Exchange and Lima, in charge of our Mexican and Peruvian operations achieved a 22% decrease in the S&P's corporate sustainability assessment rating during 2021. This performance exceeds the metal and mining industries with an average by 79 percentage points above the average. Sorry, I was a little bit confused in there.

Also, I am very excited to announce Southern Copper Corporations committed to the Copper Mark, a voluntary assurance scheme assuring responsible production practices and contributing to the UN Sustainable Development Goals. As you all know, this constitutes a milestone in our ESG progress for our company, and we are very happy to have joined such an important initiative in the industry worldwide. This continues to be in line with our commitment to working towards best practices.

Our Mining Division has specific goals and objectives in several areas to make sure we have a responsible production and this is also an essential topic in our sustainable development strategy. Regarding our commitment to fight against a pandemic Southern Copper and the Peruvian Ministry of South reached agreement, which allows the application of over 1 million doses with COVID-19 vaccines throughout the 5 regions in which we operate. These achievements are just some examples of the efforts we are doing to continue improving ESG matters, but you will be able to find more detailed information in our annual ESG report.

Then in Slide #6, our scorecard show outstanding results for the quarter and the year. As you can see, we achieved record sales during 2021, netting almost $14.8 billion, an increase of more than 35% versus 2020 and 17% versus the same period of 2020 during the fourth quarter. This was mainly driven by favorable metal prices and our recovery in transported volumes, offsetting a reduction of roughly 4% in corporate products, which Mr. Xavier Garcia de Quevedo will comment on during our Mining Division highlights.

Our EBITDA totaled $8.9 billion, almost $9 billion, during 2021, an increase of 66% versus the previous year. And now setting our EBITDA margin at 60.4%, an increase of over 11 percentage points versus 2020. Our operating income netted $7.5 billion, an increase of 88.7% versus 2020 and 40% versus the same quarter of last year. Very important to mention that our Board approved to maintain a dividend of 1.75 pesos per share, reinforcing a strong dividend program, which translates into the approximate or a little bit above 8% dividend yield. This is a higher [indiscernible].

I would also like to highlight our net cash costs, which averaged $0.84 per pound of copper, an improvement of 1.9% versus 2020, reaffirming our spots as the industry leaders in this matter.

Finally, I would like to comment on our CapEx for the year that. Total $1.4 billion for 2021. Our investment program for 2022 has reached almost $2.3 billion at our consolidated level in different projects that will be sources of economic growth, job creation and well-being for the communities where we operate.

Okay. Moving forward to Slide #7. You can find a brief summary of our financial highlights for the quarter and the year 2020 and 2021 then you can see all the difference. In case you need to -- at any point of the presentation, you have the -- our main top line P&L. As you can see, expense growth of [indiscernible]. So I take here the pay dividend really -- during 2021 really stands out as it was more than doubled versus the previous year. I think important to note.

On Slide #8, Grupo Mexico continues to have a solid balance sheet with low leverage and a net debt-to-EBITDA ratio of 0.3x. Our debt is mainly issued in U.S. dollars that accounts for roughly 81% of the total debt, while the rest is denominated in Mexican pesos. On this slide, you can also see the dividends paid from 2019 to 2021 in respective annual and quarterly inflight dividend yields.

And then going back to the bit to the debt part. It is important to mention that we normally what we try to do, and I think we have mentioned this before, is in our Mining Division in which we have our income, our revenues in U.S. dollars, we have the debt in U.S. dollars. In our operations for transportation that has a part of the revenues in pesos, I would try to have like a natural hedge, a natural match between our revenues and the debt in the different divisions or the assets that we have just to highlight that.

As for debt maturity profile picture on Slide #9, we continue to have a comfortable maturity schedule with no payments of over 1 billion until 2035. Our cash flow showed a significant increase of 60% this year to $6.4 billion at the end of 2021. So this is significant.

Now I would let Mr. Xavier Garcia De Quevedo's comments on our Mining Division's performance.

[Xavier García de Quevedo Topete, executive]

Thank you, Marlene. Good afternoon, everyone, and thank you, again, for joining us. Today, I will start with a couple of quick remarks on the current copper market that you can follow on Slide 11. We saw an increase of over 35% in the LME copper price when comparing the fourth quarters of 2020 versus 2021 $3.25 per pound to $4.40. Currently, prices range between $4.4 and $4.5 per pound remaining higher than last year's average of $4.23.

For this year's outlook, more relevant markets in intelligence houses state a balanced market assuming a 3% demand growth with an uncertainty in the side of the offer. Some of the factors that we believe are influencing the markets are an and economic slowdown is expected in China due to real estate challenge and Omnicron's impact in the country. Remember that China consumed over 45% of the copper worldwide. And this slow damage and life mine because it's from 5.14% increase to 5.1%.

Peruvian and Chilean future production uncertainty, which [indiscernible] represent about 40% of the world supply, 12% is from Peru and 28% from Chile. Combined inventories of the LME, Comex, Shanghai and Bonded warehouses remain at a very low level. Falling from 569,000 tons in September to 369,000 tons in December 2021, a 35% reduction. These inventory represents a weak copper consumption in a more balanced market. We expect inventory to be around 3, 4 weeks of consumption. On the right-hand and you can see a line chart of the copper price performance during last year, which remained in [indiscernible] of around 4.8 an increase significantly.

Now let me move forward to the Mining Division operating and financial highlights on Slide 12. As Marlene mentioned, during 2021, we saw a decrease in production of 3.9% when compared to 2020 given the optimized mining plan for '20 and '21 that suggested mining to areas with lower ore grades that will increase in the following years. As a side note, copper sales were lower than production from 2001, due to the absence of third-party concentrate purchases as well as some delayed achievements as a conviction of the pandemic.

For 2022, we expect to produce 1,028,000 tons of copper out of which 972,000 will come from Southern Copper and around 125,000 tons from [indiscernible].

Production will continue to be affected by a temporary reduction in ore grade and recording of the Peruvian operations. We expect copper solutions to grow come back in 2023 and reach 1.11 million tons as we get the production track -- back on track and generate new production in our [indiscernible]. However, I mentioned on my product provision, we managed to keep the production of molybdenum, our main by growth, stable and slight increase our work. Despite the decrease in production in '21, we were able to achieve annual sales of over $12 billion, a story record for our division. This result is 41% higher than 2020's result due to higher copper and by-product prices.

On a quarterly basis, sales increased [indiscernible] year-over-year totaling more than $3 billion during the fourth quarter of 2021. Our EBITDA increased over 82% during 2021, netting $7.58 billion, which translates to 62.7% EBITDA margin. Along this increases our net income so fast, $3.5 billion during 2021 and $7.98 million for the last quarter of the year.

Our cash cost net of [indiscernible] for the year ended are $0.84 per ton, an improvement of roughly 2% versus 2020, supported by higher price [indiscernible], along with an effective cost control to reinforce our position as cost leaders in the industry worldwide, even an inflationary cost in mining. The Mining division CapEx totaled $935 million in 2021 and $214 million during the fourth quarter of the year.

As we move forward in Slide 13 and 14, I would like to share our projects update and highlights. Let's first talk about our [indiscernible]. In Pilares, which we expect to be operating by the second half of 2022. We have already deployed 48% of investment and the construction of the road for mining trucks within the Pilares pit and the primary crushers at La Caridad is complete.

In our Buenavista field project, engineering study has been completed and has all the necessary permits. The procurement has a 96% progress and deployed CapEx reached $270 million last year. As for the El Pilar, the results and the leaching [indiscernible] impact contained that the suitable copper recovery. The basic engineering is completed, and we'll continue developing projects on site environmental activities. It is important to mention that all the [indiscernible] for El Pilar has been [indiscernible].

Lastly, our new Lime Plant in Sonora, which is expected to reiterate in by the second quarter [indiscernible] of land becoming the largest manned cost and portion reduction of 50% or [indiscernible]. 68% of the total investment for the total Lime Plant has already been deployed up to date. So you have an additional question in this project, please feel free to ask during the Q&A session.

Coming to our long-term project, I would like to talk about the China in [indiscernible]. 2021 in great progress for changes, we engaged in social and environmental [indiscernible] the local communities and work in the environmental impact assessment of over 130,000 tons per earnings open pit mine.

Last year also marked a positive year for the [indiscernible] project as we were able to sign a social agreement with CPI and in [indiscernible] communities, providing an opportunity to improve the resins like quality to strong social programs, also posted by a solid team work at the [indiscernible]. All of this along with the peruvian Minister of Energy approval of the [indiscernible] environmental impact for the factories of 2021 are important steps that will allow us to initiate and exploration forward by the first quarter of this year.

As for [indiscernible], Mexico we have completed the baseline restoring and not reviewing the vacation analysis to request enviromental impact to them.

In Slide 15, you can see a graph of our robust pipeline of coming projects and their impact to production, and we continue our journey to reach 2 million tons of copper produced per year. And that would be all from our Mining Division highlights. If you're happy to have any follow-up questions, we will be pleased to address them during the Q&A session.

Now I will let Fernando comment on our Transportation Division. Thank you.

[Fernando Guerra, executive]

Thank you, Xavier, and good afternoon, everyone. Let me start with the Transportation Division's financial highlights for the quarter and the year shown on Slide 17.

First, I am pleased to announce that most of our segments showed positive variations in revenue, carloads and ton kilometers during 2021. And by most, I mean, all of our segments, except the automotive segment, which has been impacted by the microchip shortage that is -- that the world is going through. This is the only segment that is still below pre-COVID levels and -- but we're very encouraged that demand is there for new cars and from -- for our services as well.

Our sales continue to -- this positive trend and showed a 16.5% recovery during the fourth quarter of 2021 when compared to the same period of 2020. They totaled $2.5 billion for the year at 16.9% versus 2020. This was mainly driven by higher volumes that we moved during the year, gaining market share versus over the road and not only recuperating from COVID but gaining market share versus over the road and the other railroads.

Our EBITDA also saw a significant improvement of 18.9% versus 2020, ending the year in $1.1 billion with an EBITDA of 44.5% margin translating this into an 80% -- 80 basis point improvement. The division's net income totaled $369 million during 2021, of which $90 million were generated during the fourth quarter, an increase of 34.4% and 36.6%, respectively, versus 2020.

Following the trend -- our volume and carloads increased 10.2% and 9%, respectively, during 2021 versus the same period of the previous year with a total of 1.9 million carloads hold during 2021. These improvements were also seen during the fourth quarter of 2021 with the net ton kilometers improving 7.8% and carloads 5.1%.

As we move forward to Slide 18, you can see our main highlights. Volumes have returned stronger than pre-COVID levels in most of the business segments. Both the fourth quarter and the full year set a new financial record with revenues increasing 17.2% in Mexican pesos, driven by market share gains, as I commented before, and a 17.5% increase in EBITDA, which totaled MXN 5,668 million. It is also important to highlight that we have gotten an extension of our exclusivity rights in our Mexican subsidiary for building a bypass in the Bajio region for the government. So this -- I believe, this shows with facts that this government is happy with how its railroads are operating and that no changes will come as we move forward.

Continuing with the main variations of our revenue on Slide 19. As I previously mentioned, almost all of our segments saw revenue growth during the fourth quarter with the automotive segment being the only segment showing a decrease of 13% in revenue due to the global microchip shortage. In relative terms, this quarter's top performer was the energy segment, which saw an increase of 53% due to increase in refined -- in movements of refined products, coal and fuel oil.

Other segments, which saw revenue growth of 20% or above where to start with industrials, where we had a revenue increase with market share gain in consumption product. And chemicals were basic chemicals and Mexican imports of plastics saw also an increase in -- on volume and an over share. In agricultural products, we achieved an increase in market share of the imports in grain into Mexico.

In minerals, the iron ore industry has reactivated in most of the mines that we serve. In metals, we continue to gain share from the ports, moving raw materials and finished products into and out of Mexico. With medium growth and showing also double-digit growth, we had the cement segment increasing 14% due to increased Mexican import, exports to the U.S. and also a steady growth or substantial growth in U.S. domestic volumes.

As a result of the U.S. recovery of its construction industry. Intermodal, we saw an increase of 13%, propelled by market share gains from truck to rail conversions and an increase in demand in the U.S. Specifically in this segment, we ran out of capacity. Our Board has approved a substantial investment in new containers and also in intermodal terminals enhancement in equipment and in growth of them as well.

In Slide #20, we show our operating metrics for the year from 2019 to 2021, and we can see that most of our indicators show overall progress in STEM. Thanks to our efforts to optimize our service master plan and the continuous effort from our operating team down to the field. We're very, very happy since starting in February of this year, we are now live with our new operating system. This will enable us to become way more productive and to all of our decisions to become implemented faster and to be able to see everything live from all of the terminals. So this will -- this is a major change for us.

Average train speed dropped 5.2% during the year. This was mainly due to weather conditions and a very heavy track maintenance program that we have put in place. 12x increase from 22 hours to about 28. We held certain trains -- as we held certain trains to be able to run longer and heavier trains that you can see translated below in the improvement of gross tons per train. Car velocity dropped as a result of the combination of the average train speed and the 12x. The average train length improved 4.3% and gross tons per train improved 5.5% for the year. As a result of this, the average crew starts increased only 2.3%. Bear in mind that our traffics grew 10%. So this is where the productivity starts to show.

In 2022, we will focus on preserving the levels of the remaining indicators and maintaining the efficiency of all our processes. As for our CapEx in 2022, shown on Slide 21, we expect to invest around $450 million, where $294 million will be invested in maintenance projects, which is not only maintenance for us, it's the capacity of the truck itself, the better truck we have, the faster we move. The faster we move, the more trains we can get, the more competitive we become against trucks.

$119 million will be invested in growth projects, such as the intermodal terminals that I just spoke of. And increasing also the capabilities and the capacity that we have at the Mexican ports and the American ports to be able to increase volumes. You will also see our Celaya bypass that I mentioned before that where we got an extension and exclusivity rights from the Mexican government. And the Monterrey bypass, which the first stage will be ready for this year, giving us access to Pesqueria, which is Nuevo Leon. Nuevo Leon is newest and most up-and-coming industrial area.

We also have $36 million that will be invested in efficiency programs, including the LNG conversions, the LNG locomotive conversion plan. For this, we conclude the general overview of the Transportation Division.

I will now let the call to Francisco Zinser so that he can comment on the Infrastructure Division.

[Francisco Gonzalez, executive]

Thank you very much, Fernando, and good afternoon, everyone. I'll continue today's call by going through the financial highlights of the Infrastructure Division, which are depicted on Slide #23. Our annual revenues totaled $558 million, a 6% increase when compared to 2020, while our quarterly revenues totaled $148 million an increase of 8.7% when compared to the fourth quarter of 2020. Finally, our net income totaled $17.5 million.

Increase in sales was led by our energy business, followed by an excellent performance of both our toll roads and the engineering business units. Our EBITDA for the year totaled $228 million, 14.3% below the previous year's result with a yearly EBITDA margin ending in 41%. The EBITDA for the fourth quarter of 2021 netted $55 million, a decrease of 13.7% when compared to the same period of 2020. These results were mainly driven due to an adjustment in our [ pencil ] tariffs, the oil rigs, projects mismatch in our construction company and lower foreign exchange rates.

As we continue into Slide #24, I will go through the most relevant events of the division and the brief project update. Our engineering services business unit had a record year for third year straight in a row with increases in sales and EBITDA versus 2020 of 19% and 8%, respectively. This was achieved by expanding the total number of third-party contracted projects and the execution of our EPC projects, which totaled almost $10 million.

Through our main project updates, the construction of over 168-megawatt wind farm, Fenicias, which is located in the state of Nuevo Leon, is complete and has already concluded its testing phase. Up to date, 95% of the total cost has been invested and we expect its commercial operation to start in April 1, 2022.

Finally, the Maya Train construction is in progress. The Mexican government recently decided to change the outline or route of the location, moving it a few kilometers to the west. This will significantly reduce the impacts to the local community during the construction as the original route is going to be in the highway and will eliminate the need to build 2 over passes, which were initially planned to be located in Playa del Carmen, 7 kilometers; and in Puerto Aventuras, almost 2 kilometers, among other advantages. This concludes the Infrastructure Division highlights.

I will let Marlene to proceed with her closing remarks. Thank you.

[Marlene de la Torre, executive]

Thank you, Francisco, Fernando and Xavier. I just want to thank everybody again for their time and attention and for joining us today. Now we will open the line for the Q&A questions and wishing you all the best as well for this year.

[Operator]

[Operator Instructions] We have a question from the line of Carlos De Alba with Morgan Stanley.

[Carlos de Alba, analyst]

Yes. So first question, if I may, Marlene, maybe what do you -- you have a very strong balance sheet. Copper prices are doing quite well. And so what -- you already pay a very good dividend yield. But what are you planning on doing with the increasing or the very healthy cash flow generation that you are having every single quarter? Is it possible to maybe increase dividends even more? Or are you on a company planning on perhaps investing in other businesses outside where you already play?

And then my other question, if I may. Can you add any color -- any color on the outlook for Asarco in terms of production and cost in 2022? And perhaps Francisco, the same for the Infrastructure businesses. How do you see revenues and EBITDA this year?

[Marlene de la Torre, executive]

Thank you, Carlos. Sure. I will answer the first question, and I will let Fernando -- to answer the question and Francisco, the infrastructure. But regarding the cash generation, yes, we are generating a lot of cash. It was a record high year in terms of cash generation. As you have probably seen our dividends in the Transportation Division was $0.60 per share, it has increased a lot increased last quarter, and we have the same one which was up from 35 before that.

Our dividend for Southern Copper has also increased to $1 in line with last quarter, but during the first quarter or 2, 3 quarters ago, it was $0.70, and then managing something like 3 quarters ago.

So we have been increasing our dividends as well as Grupo Mexico now with $1.75. Going forward, we definitely -- so on a whole cash, as you know, we have a higher CapEx plan for this year than last year. But we are going to invest in our projects to continue with the expansion and to continue improving our operating efficiencies. So that's our priority. And then also analyzing on a quarterly basis, possible increase in our dividend, which could happen. We have seen this over the past 2 quarters, and this could continue to be a trend.

So as you know, I cannot assure you. This is something that we have to review on a quarterly basis with our Board, depending on our cash generation and CapEx needs and everything, but this could be a trend going forward. I don't know -- as for investing in other businesses in which we don't have presence, I don't think that is our like intention.

As you know, we have a very strong M&A team in all of the 3 divisions, the Mining, the Transportation in the Infrastructure Division and we analyze the opportunities that are out there. We're also doing our Mining Division. We invest in exploration. So we can have more projects in the pipeline, and we are -- that's an interesting part as well. But I don't think that going to a new business is something that we are looking forward. But we analyze everything that makes sense with renewable run rates that makes it with what we currently have.

As for Asarco...

[Leonardo Contreras Lerdo de Tejada, executive]

Marlene, this is Leonardo. Good afternoon, Carlos. With regards to Asarco production, we're expecting -- for 2022, we're expecting similar production last year, around 127,000 metric tons. And the cash cost after byproducts around 235 primarily driven by the increase in consumables and the price of acid. If there's any additional comment or not, I'll give the word to Francisco.

[Francisco Gonzalez, executive]

Yes, sure. Thank you, Leonardo. So regarding the outlook for the Infrastructure Division, for 2022, we are expecting our sales to increase roughly 10%. However, our EBITDA should be growing by roughly 20%. We see growth in all of our business lines, mostly -- the most important growth will come from the Energy Division because as we said before, Fenicias should come online on April 1. So we will have the impact of the new wind farm.

And we also expect the growth coming from the construction company because of different projects that were delayed last year and most significantly because of the Maya Train, as you know, so the construction will happen between this year and next and that we have a significant impact in our EBITDA. And we also see growth in the rest of our business lines in the early rigs because of a potential increase in tariffs with PEMEX now that the oil prices are again high in the highway division because at least inflation will be recognized in the tariff, and we expect also the number of cars to increase as the pandemic exist.

And finally, in the Engineering Division, as I said before, we have been growing into historical numbers for 3 years in a row. And the Maya Train, Engineering Division also has an important role to play there. And we have been able to increase our clients from outside third-party companies. So we expect 2022 to be a better year for the Infrastructure Division. Thank you, Carlos.

[Operator]

Our next question comes from Isabella Vasconcelos with Bradesco BBI.

[Isabella Vasconcelos, analyst]

I have 2 questions also here on my side. The first one on the Transportation Division, if you could share also some guidance in terms of expected volume growth and also the cost outlook for the Transportation Division.

And the second question on -- still on capital allocation. Marlene, you mentioned that you are conducting exploration studies in other countries in the Americas, economic stake in Argentina, Ecuador. So do you have any updates in terms of potential projects or is it still too early to say here?

[Fernando Guerra, executive]

Thank you. If you like, I'll start with the Transportation Division. We see our volume growth between 5% and 7%, price increases across the board should come in between 7% or 8%. So that gives you revenue on margin. We see an improvement between 100 and 200 basis points for the year, more between the next 12 to 18 months, this 200 basis.

[Marlene de la Torre, executive]

Thank you for ingest, Isabella. I will let Mr. Xavier give you further information on our exploration and give you a more detailed update. But yes, we do export in Argentina [indiscernible] in Ecuador, which I think is the most important one right now as well as Mexico, Peru and the U.S.A. I would let Mr. Xavier give you an update.

[Xavier García de Quevedo Topete, executive]

In Ecuador, we have covered it in [indiscernible]. We have an open pit copper project. We have finished all the drilling, and we are in the process to finish the capability studies to start the negotiations with the Ecuador government for this project for the participation. We're participating with our 70% revenue. We have other important projects in Chile. By example, we have project in [indiscernible], the region of Atacama, it's a couple of old projects.

We have an advanced conceptual story that with an 80% progress. And we are considering the process to have -- the process in the concentrate to 8,000 tons per day. An important project in Argentina is [indiscernible] is probably the most important one. These are -- and these are an underground gold and [indiscernible] projects with an -- these are 70.6 kilometer of land with a wider up to 7 meters. The resource and we have measured there is approximately 9.3 million tons [indiscernible] ounces of gold -- of silver, sorry, and 0.5 ounces of gold.

Another important project in Argentina is Esperanza is also on the [indiscernible] Argentina province. We have 100% this property of Southern Copper. Here, we have also the resource for gold and silver project with a good potential.

The values of [ 2.85 ] grams of gold and 100 grams of silver. We are expecting also to explore [indiscernible], this is a copper [indiscernible] deposit, copper and gold, and we are just starting. The potential of [indiscernible], probably 300 million tons with 0.5% of copper and 0.2 grams per tons of gold.

These are now our main projects that we have in South America. And as you know, we are continuing with our company, we are progressing, and we expect to have the final environmental license of [indiscernible] by the middle of this year.

[Operator]

[Operator Instructions] Miss Finny, I'm not showing any further questions. You may continue.

[Marlene de la Torre, executive]

Well, thank you, everybody. And then if further on, you have any questions, please reach out to us. We'll get the answer to any questions you might have. Thank you so much for your time and all the best for this year. Thank you, Carmen, as well for everything.

[Operator]

Thank you. My pleasure. And ladies and gentlemen, this concludes our program. You may now disconnect. Have a wonderful day.