Enel Chile SA

NYSE:ENIC

Earnings Call Transcript 2022-Q3

[Operator]

Good afternoon, ladies and gentlemen, and welcome to Enel Chile's Third Quarter and 9 Months 2022 Results Conference Call. My name is Victor, and I will be your operator for today. [Operator Instructions]

During this conference call, we may make statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect only our current expectations, are not guarantees of future performance and involve risks and uncertainties. Actual results may differ materially from those anticipated in the forward-looking statements as a result of various factors. These factors are described in Enel Chile's press release reporting its third quarter and 9 months 2022 results, the presentation accompanying this conference call at Enel Chile's annual report on Form 20-F, included under Risk Factors.

You may access our third quarter and 9 months 2020 results press release and presentation on our website, www.enel.cl and our 20-F on the SEC's website, www.sec.gov. Readers are cautioned not to place undue reliance on those forward-looking statements, which speak only as of their dates.

Enel Chile undertakes no obligation to update these forward-looking statements or to disclose any development as a result of which these forward-looking statements become inaccurate, except as required by law.

I would now like to turn the presentation over to Ms. Isabela Klemes, Head of Investor Relations of Enel Chile. Please proceed.

[Isabela Klemes, executive]

[Foreign Language] Good afternoon, and welcome to Enel Chile's Third Quarter and 9 Months 2022 Results Presentation. Thank you all for joining us today.

Joining me this afternoon is our CFO, Giuseppe Turchiarelli. Our presentation and related financial information are available on our website, www.enel.cl in the Investors section and in our app, investors. In addition, a replay of the call will be soon available. At the end of this presentation, there will be an opportunity to ask questions via phone or webcast chat through the link, Ask a Question. On this occasion, media participants are connected only in listen in mode.

In the following slides, Giuseppe will open the presentation with our key highlights, later present by markets and strategy outlook and finally to our business, economic and financial performance. Thank you all for joining us today.

Now let me hand over to Giuseppe.

[Giuseppe Turchiarelli, executive]

Thank you, Isabela. Good afternoon, and thanks for joining us.

Let me now start with the highlights of the period on Slide 3. As we mentioned during our last call, the rainfall and the snowing period in Chile was better than last year. As a result, we can see better hydro production during the third quarter. Therefore, we maintain our expectation of a good hydro contribution for the Q4. Argentine natural gas was confirmed for early October until the end of April 2023. This associated with better hydrology in supporting a slight decrease in spot prices, which are still pressured by commodities given the international scenario.

We have been taking several management actions to offset this pressure and take advantage of the natural resilience of our assets, proving that our strategy is reliable and resilient. The gas optimization is helping us to slightly mitigate the international headwind. We completed the process of the coal phaseout in our operation in Chile. During the third quarter, we added around 0.2 gigawatts of additional capacity, fully renewable, reaching plus 0.4 gigawatts in the year-to-date figures.

Regarding our economic performance, we faced temporary headwinds over our margin related to the commodity pressure in hydrology during the first half of this year. Thanks to the managerial action we have put in place and the positive hydro production in the third quarter, the scenario has changed translating into margin recovery. As a result, we keep our view for the year and confirming our guidance for this 2022.

And finally, last week, we had an important update on our asset allocation strategy. The antitrust body approved the sale of our transmission assets. So now we are passing through this stage at which the buyer will make a tender offer for the total shares. We expect to cash in the sales of the assets by the end of the year.

Now let's move to Slide 5 to briefly talk about the market situation and how we have developed our recovery plan. Our company this year has been facing a challenging scenario due to the sharp increase in the commodity prices, transmission constraints and critical hydrology conditions in the first half of the year. Nevertheless, we have been able to develop several managerial actions that have helped us to cope with headwinds contributing with around $240 million year-to-date, as better detailed in the slide.

The improvement of rainfall in the third quarter led to an important recovery in our hydro generation. Moreover, our new connected renewable project, including that has obtained the COD in this quarter are part of the improvement decision. Active natural gas purchases in the period by the increased availability of Argentinian gas and LNG cargo from different players have allowed us to optimize the operation of our combined cycle power plant and furthermore to carry out gas trading activities.

Now let's move to Slide 6 to talk about just transition -- energy transition strategy, given the coal fadeout that we have been carrying out. Decarbonization is one of Enel Group's strategic pillar. The decision to close the plant ahead of the time was taken in the context on the agreement to shut down coal-fired power plants signed with the Chilean government through the Ministry of Energy in June 2019. Therefore, we decided to anticipate that is out of both units of Bocamina and Tarapaca.

Enel Chile has taken a great step forward in its process of decarbonization by the increase in renewable energy and the disconnection of Bocamina plant. Bocamina shutdown is part of the implementation of business energy transition strategy, which means incorporating technological, social and environmental solutions and placing the workers of the plant is contracted and the community at the core of this decision. We are analyzing several alternatives for land use and 100% of the coal facility employees have the option to be relocated within the company or take retirement plan. This is the true meaning of all the inclusive and just energy transition, ensuring that no one is left behind.

Let's now look at how we are consolidating our renewable leadership on Slide 7. During the last year, we have focused most of our efforts on developing a diversified renewable market in line with our decarbonization strategy aiming for a clean energy market. As you can see, our renewable capacity continued to increase. This quarter, we have connected 225 megawatts of solar capacity. In this period, we received the authorization to start the commercial operation of the Azabache photovoltaic plant, the first hybrid renewable plant in Chile being associated with the Valle de los Vientos wind facility.

Additionally, we received authorization to start commercial operation of the Sol de Lila photovoltaic plant, which incorporates state-of-art vibration photovoltaic technology for greater efficiency in capturing solar radiation. The renewable potential of the country continues to represent an attractive opportunity, and we continue consolidating our leadership, contributing to the transition from the current energy market towards to one based on 100% renewable generation.

Now on Page 8, let us look at our electrification strategy. One of the key elements to face the climate change is the decarbonization of the [indiscernible] through electrification. Transforming today's power grid into a smart resilient grid are mandatory and combined with the renewable growth will be expansion to reach a net zero goal.

Furthermore, the quality and digitalization of our network are at the core of our grid structure, and we continue working to improve all the main indicators, as you can see in this slide. Additionally, we have carried out different projects in partnership aiming to decarbonize the energy consumption of our clients. Let me go through some example of the period.

Regarding e-buses, 2 e-buses projects are being developed for the metropolitan region in public transportation, Transantiago core and Santa Rosa. With these, we will reach 20 e-buses in total in 2022, with an estimated consumption of 77 gigawatt hours per year. Relative to the e-city segment, we signed partnership with the Chilean Football National Association to develop projects installing with a focus on less lightening, water heating, video surveillance and analytics as part of our secular city approach.

Finally, in e-industries, we are developing a project for 2 PV clients for the forestry and paper company, CMPC with a total of 1 megawatt. This project is part of our effort to provide solutions to our clients, supporting them to reaching their decarbonization strategy.

Let me now detail our economic and financial performance of the period on Slide 10 where I show the main adjustments for the period. In 9 months and in the third quarter of 2022, we applied an adjustment in EBITDA due to the impairment made to the cost of the period, which amounted to $60 million and $1 million, respectively. These adjustments had an effect on the bottom line of $41 million in the 9 months and $0.4 million in the quarter.

In the same period of last year, we applied an adjustment due to the coal stock and the voluntary retirement, which amounted $48 million in the 9 months and $10 million in the quarter. At the bottom line, these effects amounted to $33 million and $7 million in the 9 months and third quarter, respectively.

The Q3 2022 adjusted EBITDA increased 201%, reaching $242 million, mainly due to the better hydrology in the quarter, the gas optimization activity in support of the new renewable projects connected since last year. These effects have also impacted the 9-month 2022 adjusted EBITDA performance, which increased 18%, reaching $543 million.

In terms of adjusted net income during the 9 months 2022, this increased by 140% reflecting higher EBITDA of the period and the lower financial costs coming from the factoring of bank accounts made in the first half 2021 to improve the liquidity of the company. In this quarter, the net income reached to $117 million due to the same reason I mentioned before. 9 months 2022 CapEx reached $715 million, a 13% higher than 9 months 2021, mainly due to the construction of new renewable capacity.

In the third quarter, our CapEx reached $234 million, a 15% higher than the same period of the previous year. FFO accounts for a negative $343 million representing a significant reduction in the 9 months 2022 versus last year, driving by the stabilization mechanism effect in the 9 months 2022. This quarter, FFO reached $124 million reflecting the stabilization mechanism as well.

Now let's review more about CapEx on Slide 11. During the 9 months of 2022, commodities CapEx reached $715 million, of which 93% was linked to the SDG goals, mainly relative to our renewable growth. Customer CapEx totaled $52 million and was mainly focused on grid segment in order to improve quality and digitalization, improving the experience for our customers in these new [indiscernible].

Asset management CapEx reached $112 million and was mainly focused on maintenance and repair activity to ensure the continuity and resilience of our operations, thus reducing an availability risk. In terms of generation business, larger CapEx was deployed in the maintenance of hydro [indiscernible]. The last one as a consequence from the greater usage of this facility in the last year.

Development CapEx reached $552 million, representing an increase of 7%, mostly related to our renewable expansion plan reflected in our projects under construction as a clear signal of our commitment for the decarbonization goals.

Let's now move to Slide 12, where we have the summary of the third quarter adjusted EBITDA break down, accounting for $242 million. The variation was mainly related to an increase in our PPA sales of $120 million in the third Q 2022, primarily explained by the higher devaluation of the Chilean pesos against the dollar. Renewable growth, mainly due to the new capacity, adding $13 million in EBITDA of the [indiscernible], $94 million which was the best at hydrology in the period. Gas optimization activity that generated $104 million of margin. All the factors that I've just mentioned in the generational side were offset by a negative $76 million related to variable cost, mainly due to a higher thermal generation cost related to the commodity prices and higher regasification costs due to higher volume and by the hedging commodity coverage instrument in the period. And higher spot price in this season, in the third Q 2022 was mainly due to the higher commodity prices.

Following on next slide, let me talk about the other elements that explain our EBITDA. Grid accounted a negative impact of $5 million, mainly related to the provision of regulatory fines in network business due to the noncompliance on quality services indices from previous year, partially offset by starting the expansion in both distribution and transmission line.

Other effects in the period was the hedging instrument associated with the bond that -- which had negative impact around $13 million. OpEx and other factors accounted minus $28 million, mainly related to the higher inflation costs affecting structural and maintenance costs.

Let's move now to Slide 13 where we have the summary of 9-month adjusted EBITDA breakdown accounting for $543 million, 18% higher versus 2021 figures. This variation was mainly related to $310 million higher PPA sales in 9 months 2022, primarily explained by the higher foreign exchange of the Chilean pesos against dollar. Renewable growth contribution, mainly due to the new capacity added $33 million in EBITDA and better hydrology in the third quarter that had an impact of $68 million. Gas optimization activity that generated $128 million on margin.

All the factors that I just mentioned were offset by a negative $176 million in variable cost, mainly related to a higher thermal generation cost due to the commodity prices and higher regasification cost in the year due to the higher [indiscernible], partially offset by a more efficient thermal generation in the period and [ savings ] in commodity coverage instruments in this year, a negative $263 million due to the higher spot price in the system in the first 9 months 2022. The remaining variation of our EBITDA comes from $32 million due to the grid remuneration and demand, mainly explained by the $3 million mainly to the release of the final transmission tariffs taken in the report, issued by the regulator in the first quarter 2022.

This final tariff allow us to reduce the provision that have to be made since the beginning of the new regulatory cycle that started in January 2020, and $22 million [ relaxation ] in both network of business. And the recovery of the demand in the period of which increased 7% in 9-month 2022 compared to the 9-month 2021, reaching prepandemic level.

This effect was offset by the hedging instruments associated with the bond debt and the higher generation business OpEx in the period by [ $15 million], mainly reflecting the higher personnel costs and the operational maintenance activity. These factors were affected by higher capitalization of the period.

All the above, lets us confidence that we will reach our adjusted EBITDA goal for this period '22. In the last call, I have explained that our generation business is quite seasonal. That is mainly related to the fact that from June to August, we had the start of rainy period in Chile associated with the starting of snowing. And at the beginning of our Spring during October, we started to have higher hydro generation in the country associated with the melting season. All these aspects associated with the long position on natural gas supply resulted in the higher generation of hydro activity and the gas optimization activity allow us to compare PPA to adjusted EBITDA guidance.

Let me now give you more details on generation KPIs on Page 14. Net electricity generation increased by 20% to 16.5 terawatt hour in the 9-month period of 2022, mainly resulting from a higher dispatch of our CCGTs, a greater hydro production due to the improved rainfall, coupled with a higher generation from other renewable sources, especially solar production, mostly related to the additional capacity of new projects.

Similarly, net generation increased 36% to 6.3 terawatt hours during Q3 2022. Highlighting the improved hydro production and also a greater generation from other renewables sources. Our energy sales increased 14% as of this September 2022, mostly related to higher sales to free customers, primarily due to the new contract, coupled with greater sales to regulated customers during the third Q 2022, physical sales grew by 3% -- 7% sorry, mainly as a result of higher sales to regulated customers.

Now on Slide 15. Let's go through the main drivers of our group net income. Our 9 months adjusted net income amounted $215 million, representing an increase versus last year's figures of 140%. The main variances are coming from higher adjusted EBITDA, which increased $82 million or 18% already explained in the previous slide. Higher D&A impairment and bad debt by $32 million versus last year results, mainly related to higher depreciation and amortization in EGP assets, primarily explained by the exchange rate effect in the period and the initial commissioning of a new solar power plant, and the higher depreciation in the distribution and transmission segment related to the new projects and higher amortization of intangible assets related to the new commercial system recently upgraded at Enel distribution.

Also, we had a higher provision of bad debt in the distribution business, mainly due to the increase in overdue debt in the retail clients and municipality. Financial results and equity investments recorded an improvement of $64 million in the 9 months 2022 mainly due to the lower expenses related to the factoring executed last year in generation business on accounts receivable that arose from the tariff stabilization loan.

Income taxes decreased by $25 million, mainly related to higher tax credit to the monetary correction in the period, offset by higher [indiscernible] tax result of the company due to the better EBITDA and financial results. The adjusted net income of the third Q 2022 reached $117 million, which represents an increase of [ $128 million ] in the quarter, mainly explained by the same effect of the 9 months.

Moving to FFO of the 9 months 2022 on Slide 16. The 9 months 2022 FFO amounted a negative $343 million in the period, mainly explained by accumulated stabilization mechanism effect in our receivables accounted in 9 months 2022 for $338 million, reducing the cash conversion of the period.

Let me highlight that $67 million related to the stabilization mechanism approved in 2019 and $271 million related to the new mechanism approved this August. According to the mechanism of the law recently approved, the $271 million represents a temporary effect that we expect to recover within the first half of the next year through a financial instrument that should be guaranteed by the Chilean government. The working capital in the period accounts for a negative impact of $340 million, mainly due to $229 million related to the delta payable in September 2022 versus December '21, mainly coming from CapEx execution profile in the year. Most of this impact shall also be recovered within this year, $107 million due to higher VAT mainly due to the energy spot prices, most of it to be recovered by the end of the year.

Temporary effects of $40 million related to lower collection in energy distribution mainly associated with the fine-tuning of commercial system update. And these effects were partially offset by the factoring executed 9 months 2022 of $90 million. Income tax reached $54 million with regards to the variation versus 2021 figures, I would like to recall that last year's numbers were impacted by FX losses resulting in lower payment of tax.

And finally, the financial expense amounted to $155 million related to the debt cost payment in the period, but when comparing the last year's figures, these include expenses related to the debt factoring instrument that I just mentioned.

Moving to our debt on Page 17. Our gross debt increased by $1 billion, amounting to $6 billion as of September 2022, due to the company loan provided by Enel Finance International to Enel Chile for $700 million and third parties loan for $200 million in the Q3 2022. This was partially offset by a $21 million amortization of Enel Finance from Chile local bonds. Our debt maturity remains comfortable with an average of 4.7 years and the fixed rate at close to 70%. We are working to increase the fixed rate portion and the age, life of our debt as part of the debt optimization strategy using the sources of Enel International sales.

For the current year, we have around $400 million debt at Enel Chile level with EFI that has a maturity in December. We are currently evaluating whether to amortize or not debt as part of our debt optimization strategy. Despite the increase of our debt, its average cost decreased to 3.9% as of September 2022 from 4.4% as of December 2021, as a result of financial management carryouts in the 9 months. In the period, 17% of our total gross taxes currently SDG linked. We confirm our plan to continue to push this kind of debt in line with our sustainable business strategy.

In terms of liquidity, we maintain another good business position in order to cope with possible headwinds in the debt market related to the overall economic situation, including the international conflicts in Eastern Europe.

Now I will point out some closing remarks on Slide 18. As we mentioned during the call, we completed the coal phaseout process and completed the first coal-free conventional utility in Chile. As all known, this year, the international market has been particularly impacted by another current event or externalities, and we have taken several management actions to offset this impact. The asset rotation transaction is ongoing as expected, and this should be closed by the end of December. This decision will add the company to unleverage Enel's price with net debt-EBITDA ratio.

To conclude, we are confident that we will reach our 2022 main guidance.

Let me now hand over to Isabela.

[Isabela Klemes, executive]

Thank you, Giuseppe. Before starting the Q&A section, we want to invite you to participate in our Investor Day 2022, which will be held on November 28, in which we will update the strategic figures for the periods 2023 up to 2024, 2025.

As anticipated, we received questions via phone or chat in the webcast on this occasion. The Q&A session is open. Operator, please, you may start.

[Operator]

[Operator Instructions] Our first question will come from line of Javier Suarez from Mediobanca.

[Javier Suarez Hernandez, analyst]

So 3 questions. The first one is, again, on the FFO year-to-date, where there has been a decrease of something like $600 million versus previous year. You explained the effect is basically 50% coming from the stabilization mechanism and then 50% from working capital absorption. And you mentioned during the presentation that you are expecting to recover the impact from the stabilization mechanism during the first half 2023. Can you again help to understand how this recovery is going to be implemented?

And then on the working capital absorption, that should be at least partially recovered before the year-end, which are the managerial actions that are going to be taken for that reduction and a little bit of the thing that I'm trying to understand is where this $100 million should be by the year-end in terms of working cash absorption. That is the first question.

The second question is on the debt evolution. The debt -- the cost of debt has been reduced this year. But obviously, there is a scenario of higher interest rates -- a global scenario of higher interest rates. So how do you see that level of debt impacting your company for the next year, for example, any indication of how -- where do you see cost of debt in 2023, would be helpful.

And then the third question that is related to the second one is on the management of your capital structure. So in a scenario of more higher interest rate down the road, do you see a necessity to modulate CapEx or to be more selective on CapEx and to allocate in a different way CapEx and dividend as you see fit there? So any comment on capitalization -- capital allocation would be welcome as well.

[Giuseppe Turchiarelli, executive]

Okay. So what concern the, Isabela , the first question and the recovery that we see or at least we expect by the end of the year, we have basically 3 main items that we are taking into the consideration. And the first is the debt payable. As I said in September figures, we see an impact of $229 million because the CapEx profile has a certain level over the year. And so let me say that around 30% of our CapEx are concentrated in the last quarter. So once we're going to close the year, you shouldn't see such a big difference. This is the reason because I believe that we are able to recover it.

The second one is that VAT that as of today, we have an impact -- a significant impact that it will be recovered as soon as we're going to sell our energy. So we believe also that the higher VAT will be absorbed according to our projection. And the last one is the collection and distribution that we have put in place several actions in order to recover the tail that we had coming from the changing in our commercial team.

So we believe that this -- all these actions will allow us to reach around $300 million FFO positive really, positive factor in -- at the end of the year. This is for what concerned the first question.

For what concerned the second one. Let me say that, as soon as we are going to get the proceeds from the Enel transmission sales by the end of the year, we are able to rebalance our balance sheet in terms of debt. And we believe that we are able to have an interest rate -- an average interest rate around corporate sales, that will continue to meet our target this year and next year. But we're going to see in more detail the number as soon as we are going to have our Capital Markets Day in this year.

And for what concerned the CapEx modulation. The CapEx that we have this year are already committed and are basically related to the projects already in execution. Clearly, as I said before, in 1 month from now, we're going to have a new Capital Markets Day. So we're going to present the strategy for the next year and according to this study, you can see our projection for the following year.

[Operator]

Our next question will come from the line of Francisco Paz from Santander.

[Francisco Paz Díaz, analyst]

My question is the following and is a really open one. Given the end of the operation of the coal unit with the cease of Bocamina II, what will be the main focus of the Enel Chile investment plan? If you can give some further information about that.

[Giuseppe Turchiarelli, executive]

Okay, thank you, Francisco. Well, clearly, the close of Bocamina II is one of the pillars that we had in our strategic plan together with renewable expansion. And I mean, we are finalizing our industrial plan that is going to be presented in the Capital Market Day. So it's just a matter of 1 month before to show everybody our strategy. And in general, I mean, the decarbonization strategy is going to be still the pillar of our company. So we are going to present all the details in 1 month from now.

[Operator]

Our next question comes from the line of Ezequiel Fernández from Balanz.

[Ezequiel Fernández López, analyst]

Thank you very much for the materials, very complete, as always. I have 3 questions. I would like to go one by one, if you don't mind. The first one is related to gas provisioning during the next 2 quarters. What can we expect from Argentine gas? If you are confident on getting as much as you did this year, maybe a little bit more? And the second one is, how do you feel about the possibility of seeing any of the LNG vessels bound for Chile being redirected to Europe?

[Giuseppe Turchiarelli, executive]

Okay. Well, we are -- I mean, this year we were able to optimize our gas activity, thanks to the availability of our sources, and we believe that considering the good platform in terms of raining and melting season, we believe that in the last quarter, we are able to make some additional optimization that we are going to finalize during this week. The margin, I mean, it's something difficult to say right now, because we didn't close yet the sale, but we expect a very good results also in the last quarter.

And well, the optimization of the gas means all our sources. So we have different kind of sources. As you know, we have the LNG contract with Shell. We have the availability of other sources like third parties or Argentinian Gas. But anyway, we are trying to figure out which is the best way in order to exploit the maximum advantage for -- from this feasibility. So again, I believe that we are able to do some very good deal in the last quarter. As of today, cannot tell you margin or any other information.

[Ezequiel Fernández López, analyst]

Okay. My second question is related to the PEC 2 stabilization program. We understand that it has 2 parts. One is the surcharge that's going to be borne by all Chilean power demand, regulated and unregulated customers. And then there is this hike to the energy component of power bills, but it's going to be enacted just for the larger consumers connected to the distribution networks. I was wondering if that increase for the larger consumers has already been enacted or not, or it should be enacted next year?

[Giuseppe Turchiarelli, executive]

Okay. Well, consider that the law forcing a different kind of tariff for different kinds of clients. And for what concerned the large customers, they are going to be -- they are going to pay basically the full PPA starting from the next year. Basically, there is a different kind of cluster with different kind of increase per customer, but for those ones that customers that are higher than 700 megawatts hour, they're going to have the regular price or the price coming from the PPA since 2023.

And what I can tell you is that, in general, if you compare the 2 different kind of mechanisms, now the perimeter of the receivable is going to be reduced significant, around 40% of our customers. And this is the reason because we believe that the second -- this new mechanism is going to impact lower way, but always important because of the exchange rate scenario that we see this year. Anyway, as I said during the presentation, the good point for what concern this new mechanism is that there is a guarantee from the Chilean government. And the receivable that is going to be accumulated, because of the mechanism, is going to include also the interest associated to the late payments. So at the end of the day, what we are doing is to identify the proper financial instrument in order to factorize this amount without any kind of effect in terms of financial expense.

[Ezequiel Fernández López, analyst]

Great. My third question is related to the carbon taxes. And a lot of the presidential hopefuls last year were campaigning on hiking the carbon tax. So far, we haven't seen anything. I don't know if you have any updates on that side.

[Giuseppe Turchiarelli, executive]

Look, as of today, we don't have news about that. Clearly, we are monitoring the issues that could be potentially impact on our company, but so far, we don't have any specific update to communicate.

[Operator]

I'm not showing any further questions in the queue at this time. Now I'll turn it over to Isabela for any closing remarks.

[Isabela Klemes, executive]

We have actually 2 questions coming from the web chat here. So the first one, Giuseppe, is coming from Andrew McCarthy from CrediCorp. He's asking, why was the commercialization margin for gas so high in the third quarter of this year versus prior quarters? How sustainable is that going forward?

And actually also on the same route, there is also a question from Rodrigo Mora that is coming -- is from Moneda, that's coming high. Could you please give us the physical sales of LNG in TBTU during this in this year, during these 9 months of 2022? And that's it. These 2 questions, Giuseppe.

[Giuseppe Turchiarelli, executive]

Okay. Well, for what comes under first question, of course, the margin that we are able to reach every quarter is the kind of the market scenario intentional price. But let me say that this high margin that we got in the third quarter basically coming from the fact that we were able to use our regasification system. So basically, we were able to use our capability to deliver the sales in excess to different markets. So the price, of course, is depending on the client and the scenario that we find in the international level. For what concern the question related to Rodrigo.

[Isabela Klemes, executive]

Rodrigo. Cost relating how -- some of the...

[Giuseppe Turchiarelli, executive]

[indiscernible] the whole amount, we are talking about Tera BTU. These are the ones that we sold through to our network.

[Isabela Klemes, executive]

So as we do not have any more questions, operator coming from the system or for the webcast -- actually, we have one more question that just has arrived here. So the question, Giuseppe, that we have is from Pamela Salgado. And Pamela is asking us how has energy decoupling affected Enel Power's EBITDA, the curtailment. Energy decoupling understood that the difference between the sale price -- it's other thing, okay. Energy -- the company is understood that the difference between the sale price and the purchase price.

[Giuseppe Turchiarelli, executive]

Yes. Well, Enel CNF has an energy balance, where having some commitment PPA has to cover it with its own production or buying the energy on the market -- on the spot market, on the third parties. Now we, of course, buy the energy on the spot market and causing the variable cost that we have for our power plants and the economy scenario that the impact significant the spot price. So every month and every day, let me say, there is a different kind of situation.

As of today, we are in a position in which we are short if you look -- if you compare just the sales versus the renewable production, but of course, we have enough gas capacity to cover whatever it is the remaining amount of energy. But again, sometimes depending on the hour and depending on the season that we are -- it could be more convenient to buy on the market rather than to produce with our power plant. So basically, we have an impact, but the impact depends on different kind of factor, one of the most important cost is [ sales driven ].

[Isabela Klemes, executive]

Okay. Thank you, Pamela Salgado from [indiscernible] for your question. Just checking if we're receiving additional question, no for now.

So as there is no more questions, I conclude the results conference call. Let me remind you that the Investor Relations team is available for any doubts you may have.

Many thanks for your attention and see you soon on our event on November 28. Thank you.

[Operator]

This concludes today's conference call. Thank you for participating. You may now disconnect. Everyone, have a great day.