Empresas Copec SA
SGO:COPEC
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Good morning and good afternoon, everyone. Welcome to Empresas Copec's Second Quarter 2021 Results Conference Call. Today's presentation and the second quarter 2021 earnings release are available on the company's website at www.empresascopec.cl, and also on our Investor Relations website, investor.empresascopec.cl.
Before we begin, I would like to remind you that this presentation may include market outlooks and forward-looking statements, which are based on the beliefs and assumptions of Empresas Copec's management and on information currently available to the company. They involve risks, uncertainties and assumptions because they relate to future events and therefore, depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions, industry conditions and other operating factors could also affect the future results of Empresas Copec and could cause results to differ materially from those expressed in such forward-looking statements. This presentation contains certain performance measures that have been adjusted with respect to IFRS definitions, such as EBITDA.
I will now turn the call over to Mr. Rodrigo Huidobro, Chief Financial Officer of Empresas Copec. Please go ahead, sir.
Okay. Thank you very much. Good morning and good afternoon, everyone, and thank you for joining us today in this conference call, where we'll be taking a look at the results of the second quarter for Empresas Copec. I will be joined today here by people from our Investor Relations department, led by Mr. Cristián Palacios; and also people from Arauco, led by Mr. Gianfranco Truffello. We will be taking questions through the webcast. So as I give out my presentation, you, please, feel free to send your questions through the webcast platform.
Let us now please move to Page 4, where we are presenting a brief summary of the main highlights of the quarter. It was a good quarter. We presented a very strong recovery in EBITDA, both respect to the last year and also to the last quarter, and that was explained by a very good performance of forestry and fuels. In forestry, we saw a scenario of very good pulp prices, basically, and also we saw a continuing scenario of good conditions for wood products. So we saw higher margins in panels and sawn timber, and pulp prices increasing with respect to the last quarter and also with respect to last quarter last year.
In the case of fuels, the quarter was basically marked by a recovery, a very strong recovery of volumes with respect to the second quarter last year where we were suffering probably the most important effect of the pandemic. So volumes were posted quite significantly during this quarter with respect to the second quarter of 2020. Together with that, we showed some effects of a very favorable inventory revaluation, both at the Copec Chile level and at Terpel. LPG continues to perform very well. This has been a resilient business all along the pandemic, and it has shown actually good rates of growth along all business lines and our local geographies.
In terms of projects and other milestones of the quarter, we would like to highlight the MAPA progress, which is reaching 86% as of July, and we are expecting the start-up for the last quarter this year. Mina Justa already started operations by the end of the first quarter, and we had the first shipments for sales in July. We had previously announced 2 operations of asset sales. In both cases, we were able to close these 2 operations during the quarter. So we had the closing of Abastible sale of Gasmar, and also the closing of the forest lands sold by Arauco in an agreement that was signed in May.
We would also like to highlight the leverage reduction. We continue to reduce our leverage, and we have moved from 3.6x last quarter to 2.8 at the end of the second quarter.
Moving on to Page 5, just to give some historical context to the figures that we are presenting. We came up to $883 million of EBITDA, a very good level in a historical context, way above what we presented in the second quarter of 2020, of course, when we were hit by the pandemic and also by very low pulp prices and wood prices as well. And also, it's above the figure that we presented in the first quarter this year, which was $693. So all in all, a very interesting figure for the quarterly EBITDA.
In terms of net income, also an interesting figure. We came up to $340 million, which compares with a loss of $32 million in the second quarter of 2020, in the midst of the pandemic and compares very well also with the $229 million that we recorded in the first quarter this year.
On Page 6, we can see this graph where we can -- to the left-hand side, we can see where the explanation lies for the increase in EBITDA with respect to the second quarter of 2020. And you can see that the main contributions come from Arauco, which at that time was facing a very weak market for pulp and for wood products. And the second largest contribution comes from Copec, which at that point in time were suffering the effect in volumes of the pandemic.
To the right-hand side, you can see the composition of EBITDA with Arauco, Copec and Abastible, as usual, accounting for more than 90% of the total figure. Total increase in what for EBITDA is 181% with respect to the second quarter 2020.
In terms of net income, which is shown on Page 7, you can see that improvements come basically from Arauco and Copec as well following the same explanations as for the EBITDA. And to the right-hand side, you can see that it is composed basically of the forestry and also the fuel sector subsidiaries. We had a net income that goes up basically because of operational factors, nonoperational factors as well, we will detail them further on. All of this offset to some extent by increased taxes.
So going deeper into the figures for the net income we are presenting on Page 8, the consolidated income statement. You can see that the net income, once again, goes up from a loss of minus $32 million to a net income of $340 million. And that has to do -- in operating terms, it has to do with higher results at Arauco, explained by the rises in the price of pulp and also by higher margins in wood products. In the case of Copec, it has to do with higher volumes related to the recovery, the post-pandemic recovery and also better margins explained, basically because of inventory revaluation. And this is related to the prices -- the oil prices going up. In the case of Abastible, we also have improved results due to, a large extent, to stronger physical sales in the 4 countries in which it operates.
In the case of nonoperating income, you can see that it went -- it was a loss of $59 million, but it compares favorably with the loss of $90 million that we recorded in the second quarter last year. We had a decrease in other expenses because, basically, because we had some one-off impairments taking place last year at Arauco. We also had increased profit in joint ventures and associated companies, which is explained basically by our associate, Sonae, which operates in the panel business. And together with that, we had lower exchange rate differences and also lower financial expenses.
All of that is offset to some extent by taxes, which increased quite significantly, coming up to $176 million for this quarter on account, of course, of a higher tax base and also a onetime effect in deferred liabilities that we will explain further on.
In terms of financial ratios that we are showing on Page 9, you can see that our margins and returns have gone up quite interestingly, with respect to both comparable quarters, we are now standing at 10.1% operating margin, 15.1% EBITDA margin and a return on capital employed of 9.4%. In relation to coverage, EBITDA/interest expense coverage, we are up to 7.3%. And in terms of net debt to EBITDA, we are down to 2.8x.
So as you can see in the chart to the bottom right-hand corner, we saw this metric going up significantly, basically because we saw EBITDA being hurt by the pandemic and by the low pulp price scenario in the second and third quarter last year. And at the same time, we were going through very strong capital investment CapEx requirements related to Mina Justa and to MAPA.
So at that point in time, we reached 4.6%, which is one of our -- probably our historical maximum in terms of net debt to EBITDA. But that has evolved quite well and quite quickly. Now we can see that EBITDA has gradually been going up in line with the recovery in pulp prices and in line with the recovery in fuels volumes as well. And as we come to an end in terms of large projects, we are also being able to pay down some debt and reduce our debt. And so the 2.8x is much closer to the ranges in which we feel more comfortable in terms of net debt to EBITDA.
In terms of debt maturities, the schedule is quite well balanced for the next few years, and we have quite an interesting cash position as well to be able to meet those requirements.
Moving on to the business divisions. Let us go, please, to Page 12, where we are going deeper into the figures for Arauco. Arauco presented a net income of $201 million for the quarter, which compares very well with the minus $56 million, the loss of $56 million that we recorded in the second quarter last year.
EBITDA is up to $558 million compared with $197 million for last year. The reasons are pretty much the same. We've already gone through some more detail here. We have increased sales in pulp because of better prices. We have improved margins in wood products because of both higher volumes and higher prices in the 2 relevant business lines here, which are sawn timber and panels.
In terms of nonoperating income, we have a drop in other expenses. That is because we had some one-off effect last year related to impairments and closure of some panel mills. In particular, last year, we reported impairments related to panel mills in the U.S., which were closed following the optimization that took place after the starting up of the Grayling mill.
In terms of profit in associates and JVs, very good performance of Sonae, basically. It's the joint venture, the 50% stake that we have in this joint venture in the panel business in Europe and South Africa. Together with that, we have a less financial expenses and also lower exchange rate differences.
Offsetting all of the above, we have increased taxes, which stem from a higher tax base, of course, but also to a onetime effect related to tax rates going up in Argentina. And so we are recording a deferred tax liability in relation to this increase in tax rates in Argentina. That is a onetime effect.
Moving on to Page 13, some more detail regarding pulp. In terms of the comparison with the second quarter last year, we had an EBITDA that goes significantly up. EBITDA goes up to $330 million for pulp compared with $168 million in the second quarter of 2020. And that is explained by higher prices, offset to some extent by lower volumes. So prices go up by 68%, offset by volumes going down by 12% approximately. And then we have some increases in costs particularly bleached softwood, which went up by 11%, but also some decreases in other fibers, 2.4% and 0.2% in bleached hardwood and unbleached softwood, respectively.
In the case of the quarter-on-quarter analysis, we have EBITDA going up again from $210 million to $330 million. And this is due to once again, higher prices, which go up by 40% approx, offset by volumes that go down by 4% approximately. In terms of the costs, we had an increase of 6.7% in bleached softwood, 2.5% in unbleached and hardwood costs going down by 2%.
Moving on to Page 14. Some brief comments about the performance of pulp markets during the quarter. We saw logistic challenges, challenges related to logistical operations going on. We saw pulp prices continuing to increase, especially at the beginning of the quarter and reaching peak levels for all types of fibers. Paper demand and therefore, pulp demand was also very strong. And especially in Europe, we saw customers asking for more volumes.
In China, we saw stability, in general. Pulp demand was quite stable. We saw short fiber reaching their highest point at the beginning of the quarter and then stabilized in the following months in the last few months going a little down. In terms of long fiber prices, they also reached their peak at some point at the beginning of the quarter and then decreased slightly towards the end.
In what relates to Dissolving Pulp, also a very good performance. They reached very high levels during the quarter. And after that, they had some downward pressure in line with this cost.
You can see some statistics about the variation of global demand and also inventories down -- on the same page. Inventories are quite in line with their historical average as of May, which are the figures that we're presenting there.
In terms of the outlook, which is presented on Page 15, you can see pulp prices in China, net in China, as of August this year. So we have hardwood reaching 670 after having reached a peak of 800 a couple of months ago. And we can see that softwood also goes down from 980 to 860, currently. Dissolving Pulp also standing at very good levels, but also facing some downward pressure and having gone down from 1,100 to a little bit above $1,000 per ton.
So we are seeing the effects of seasonality as usual in this part of the year. This is basically lower demand due to seasonality, together with some oversupply in paper in China. We are seeing that possibly towards the end of the third quarter, we will be able to see stability in prices staying at a fairly good level.
And in the case of dissolving pulp, we see that the months to come, might continue to have some adjustments, though less important than in the case of paper-grade pulp. The gap, you can see the gap in China between softwood and hardwood is, of course, above the historic levels, amounting to approximately $200 or $210 per ton. You can see the graph in Europe as well, where prices have remained stable and markets continue to show quite an interesting strength.
On Page 16, we can see -- the situation for wood products and panels. EBITDA has been increasing and reaching very interesting levels of $254 million for this last quarter, which compares, of course, very well with -- both with the second quarter of 2020 and the first quarter of 2021, where we recorded $67 million and $187 million, respectively. All of this stems from better prices, a very good price situation with prices going up in the case of panels by 16%, and 10% with respect to the last year and the last quarter, respectively. And sales volume is also going up in panels.
In the case of wood, also prices increasing significantly with respect to last year and sales volumes as well. So both volumes and prices going up and this division going through very interesting times.
Brief comments on the outlook for this division on Page 17. North America has become our most important market with 54% of our sales. We see particleboard to continue stable for the rest of the year. However, we could see some higher supply and also lower demand than in the second quarter, which was very, very good. The MDF market, we see with stability at very good levels as well. It has been very active.
In the case of remanufactured products, a strong demand, strong market and prices going up related to the housing market, which has also been very strong.
In the case of plywood, we have seen some increases in supply, and also some slight decreases in demand. And so possibly some adjustments there in plywood.
Moving on to Page 18, some comments about South and Central America, which is our second most important market. Brazil has continued to show a lot of activity. So we see stability at these very good levels for the rest of the year.
In the case of Chile, we see a very -- a market, which is very active as well with demand pushing up prices, which are reaching record levels in some products. Some supply shortages as well. Same thing for sawn wood and plywood.
In the case of Argentina, it continues to show increased demand and prices. And these prices have been able all the way to compensate inflation and devaluation. So we are also seeing stability in our margins and prices in dollar terms. It's a good thing in Argentina.
In the case of our last market, which is Asia and Oceania, which is 10% of our total sales. Basically, markets are stable, but with some slowdown, basically, in China and also some logistical problems for getting there.
Let's move please to the fuels division. Let's move to Page 20, where we're showing the figures for Copec. Copec had a net income of CLP 74.9 billion, which is, of course, a very strong increase on the loss that we recorded last year. In terms of EBITDA, the same thing, CLP 172 billion, which compares very well. It's basically 4x what we recorded in the second quarter last year. All of this has to do with higher volumes, basically. Volumes have been growing very significantly and also higher margins related to the inventory revaluation accounting effects that we record when international oil prices go up.
In terms of volumes, you can see, as we are showing there, they went up significantly, 69% in Terpel, 25% in Chile and 20% in Mapco. And this all has to do with a better mobility situation following the progressive lifting of restrictions related to the pandemic.
In the case of nonoperating results, just one thing to comment, which is a better result in associates and joint ventures, which was basically related to provisions that we went ahead with last year because of accounts receivables related to Air BP, so to the aviation industry. So that was written down basically in the second quarter last year. And therefore, there is an improvement in the result related to associates and joint ventures.
All of this is compensated by tax, of course, which is significantly higher because of higher taxable income.
On Page 21, we are showing some operational figures for Copec Chile. We are at 58.9% market share as of May and reaching 58.6% for the month of May. This is the latest figure that we have available. This is pretty much in line with where we have stood in terms of market shares over the last few years.
In terms of fuels volumes, we have seen a strong increase, although there was a slight decrease with respect to the first quarter, this has to do basically with some additionally -- additional mobility restrictions that we saw in the first part of the quarter related to a second wave of the pandemic in Chile, basically. We had very tough restrictions in the first part of the second quarter, which were then progressively lifted as the sanitary situation began to improve.
So we saw a drop with respect to the first quarter, but a significant increase with respect to the second quarter this year. And this is both in gas stations and in industrial channel and especially in gas stations, and this is, of course, related to mobility, improved mobility.
We continue to see volumes normalizing and at this point in time, very close or even above pre-pandemic levels in some channels. So as we have seen the situation improve in Chile and restrictions progressively lifted, volumes have moved in line. And now we're seeing pretty normalized volumes. And as I said, even above pre-pandemic level in some particular channels.
Margins, as always, this is a business with a very stable commercial margin with some volatility components having to do with some industrial variations that take place every now and then, and also with the FIFO inventory effect that we have mentioned already. In terms of positioning, we continue to hold quite an interesting leadership position in the local market.
On Page 22, the situation for Terpel is also very interesting and very positive. Terpel recorded EBITDA for the second quarter COP 20 billion, which compares very well with a negative EBITDA that was recorded in the second quarter of last year. And this has to do pretty much like we saw in Chile with better volumes, having to do with the normalization of the activity, in general, and also with revaluation of inventories, which also took place significantly in Colombia.
The figures for the increase of fuels volumes are very surprising and very positive. You can see down there where we had a split country by country that the total volumes increased 69%, and the increases in different countries are very relevant. Colombia, of course, being the largest market, representing the largest portion of the volume with a 66% increase.
Aviation has been gradually normalized, but they continue -- volumes in aviation continue to be affected, of course. It is important to highlight the performance of the lubricants segment. This has been also very depressed during a couple of quarters last year. But we are seeing very interesting signs of normalization there. And in terms of our assets that were lately acquired from ExxonMobil, they also performed very well right now, following this recovery in relation in line with normalization. Together with that, some nonoperational factors such as a lower financial cost and a favorable exchange rate.
So EBITDA was quite interesting, as you can see the historical graph there. We had probably the largest EBITDA -- quarterly EBITDA ever last quarter, which was driven by a very strong component of inventory revaluation. This quarter, we went down with respect to the last quarter, but still it is a very interesting figure.
We're showing Mapco on Page 23. Mapco is showing EBITDA numbers, which are pretty much in line with the normal -- more in line with the normal scenario, I would say. Last year, even though we saw a drop in volumes as everywhere in -- across all of our geographies. In the case of Mapco, we saw margins that were way above what we had historically recorded. That very positive scenario of margins has already ceased to exist. And now, we're seeing margins that are very much in line with our historical averages. And therefore, the EBITDA that we reported, which was a $19 million is much more in line with what we should expect for a normal quarter.
We are seeing volumes also gradually normalizing and with a very strong increase of almost 20% with respect to the second quarter last year. Challenges for Mapco are basically trying to stabilize margins in fuels. They tend to be quite volatile in this particular market, still working in improving operational efficiency. We've gone a long way there and achieved quite significant milestones, but still some work to do there. We have been working also in improving the product mix at convenient stores. And also, at some point in time, we should go back to going ahead with renewing and expanding the network with some new points of sales. All in all, a very good performance for Mapco as well.
Now moving to Abastible, which is shown on Page 24. Net income is CLP 15 billion and a little bit below what we recorded in the second quarter last year, basically because of the tax situation. EBITDA, however, operational figures are above last year. EBITDA is up to CLP 39 million, almost CLP 40 billion when compared with CLP 35 million last year. This is a market that has been quite resilient. We are -- we did not see a significant decrease of volumes during the pandemic. We did see in certain particular channels, but when it was offset by a very good performance of other tax. So all in all, the Abastible business has been quite stable all along the pandemic. Still, we are seeing interesting signs of recovery across all geographies. We are seeing volumes increasing double digits into 4 countries, as you can see there.
There's also a one-off effect related to the sale of Gasmar, which brought about some adjustments in accounts payable and accounts receivable, which also helped to boost EBITDA. That's a one-off effect that we are showing in this particular quarter. The tax is higher than last year. So there's a higher tax payment this year. This is linked to the effect of the increase in the value of the dollar on the accounting of international subsidiaries. So this is a foreign exchange effect that we saw in the accounting of international subsidiaries, which brings about an increase in tax as well.
On Page 25, we are seeing some a brief discussion related to each particular market. As I said, volumes have been growing. This is in part related to stimulus plans, which are -- have been brought about by the government in Chile. Volumes in the bulk segment as well, which is basically commercial and industrial, continue to recover. And this has to do with normalization of the economy on one hand, but also with very interesting commercial initiatives that Abastible has coming forward in Chile and in the other countries as well.
In the case of Colombia, we saw some decrease in volumes during May, basically, which was the hardest month for the social unrest process that took place in Colombia. However, during the quarter as a whole, we saw volumes increasing with respect to last year. Margins, however, were affected by the high prices of the raw material, which is propane. Internationally, propane has been going through a period of very high prices.
In Peru, the pandemic has exacerbated the competition with the informal sector. So it was -- it has been tough to compete in that environment. However, we're seeing volumes gradually recovering, which we have been seeing since the end of 2020. There has been some opportunities to supply the country with LPG as well through the terminals because of some situations of LPG shortages in the country. In the case of bulk segments, we have seen in growth, related once again to some successful commercial strategies. And in the case of the bottled segments, margins, like in Colombia, were pretty much affected by the situation of high prices of propane.
In Ecuador, everything was pretty stable actually. However, we had a strong quarter for both segments with margins which are here very stable because it's a regulated market. Once again, this is explained to a great extent with the recovery related to the lifting of restrictions.
On Page 26, just a brief comment on Sonacol. We had an EBITDA which is, of course, significantly higher than the second quarter last year, and this has to do with an increase in the total volumes pipeline. This is an increase of 45%, as you can see there. And that once again has to do with the progressive normalization of the economy.
On Page 28, some very brief comments on our other investments. In the case of Igemar, which is our fishing division, we are seeing a net income of $8.8 million, which is slightly below what we reported in the second quarter of last year, basically, has to do with nonoperational factors.
In the case of Alxar Internacional, which is the parent company of our Mina Justa project, in the second quarter, we continue to record losses because of the financial costs and the sales and administrative costs related to the development of the project. Just to remind you, we started operating by the end of the last quarter, and we started selling in July. So the effects of those sales are not still recorded in the second quarter.
In the case of Metrogas and AGESA, a better situation, which is, of course, explained to a large extent by an improved operational performance, related once again to the recovery in volumes.
That's what I had to comment on results basically. We are now moving to the highlights of the quarter. Just to remind you, if you want to submit any questions, please do it through the webcast platform.
On Page 30, the first milestone that we would like to highlight is the fact that Mina Justa makes the first shipments during July. Just to remind you, we started operations at the end of March. And the first sales of both cathodes and concentrates where made in July, of course, is in a very good pricing context.
We are still going through a ramp-up process here. We, in general, have seen production and costs pretty much in line with the budget and what we expected. But of course, ramping up processes are very complex, and we're working on internalizing all of the variables and the different outcomes and evolution of the different factors in order to update the production plan and come up with a more precise figure that we can make public.
This is an investment that reached $1.6 billion, which was pretty much in line with what we initially announced. So we successfully, I would say, ended the project with a CapEx that was in line with the initial estimations.
Moving on to Page 31. A brief update on the MAPA project. we reached 86% approx by the end of July. We continue to go ahead with the construction work. We're also going ahead with commissioning and start-up of some facilities and equipment. There are some highlights related to bridge cranes of the washing and machine buildings and the hydraulic test of the digester, also some milestones related to the production of demineralized water.
All this has been done in a context of maximum precaution and total focus and the sanitation situation, which has resulted into permanent realization of PCR tests. So close to 400,000 PCR tests having done to date among our workers and contractors.
We continue to estimate that the project will be starting up during the fourth quarter 2021. And at that time, we are also closing down the Line 1 mill, which is the original mill at the Arauco site.
On Page 32, this is the closing of the operations that we announced back in May when it was signed. Arauco signed a contract whereby it was committed to sell 465 forest lands for a total of approximately 80,000 hectares. The total price was $385 million plus the value-added tax. That was at that point in time, subject to closing to meeting some conditions, including some authorizations by the local economic authorities. That was all in place by August, and therefore, we were able to close the operation on August 17, 430 out of the 461 properties. The total price paid so far is $343 million plus VAT.
In parallel to this, the parties have entered into a supply contract with an option to purchase pulp volume of pine and some services related to forest management and firefighting and others of the kind. The remaining properties, which are 31 are going to be closed as certain particular conditions are met, and we expect to achieve that within the next few months.
Moving on to Page 33. Similar situation for the sale that we had announced back in May, Abastible had signed an agreement to sell Gasmar. The agreement was also subject to some suspensive conditions, which included the approval by the local economic authorities. This also took place, and therefore, we were able to close the deal.
As we announced before, this was an enterprise value of a little bit above 400 -- 440 -- $422 million, and that resulted after all adjustments. And in relation to the proportion of the stake held by Abastible, that all resulted into a payment of $117.6 million for Abastible. This will translate into a onetime net income, a onetime positive result of about $103 million before tax for Abastible and -- a figure which is very close to that for Empresas Copec.
On Page 34, just a brief mention of our new sustainability report, which relates to year 2020 is already published in our website, so we invite you to read it. It contains a lot of information. Once again, it was done using the GRI methodology, but it now includes some other standards, such as the TCFD or the SASB, which both contribute to improve transparency standards and to improve quality of information. And so we strongly invite you to take a look at that report.
Finally, on Page 35. Just a brief thank you note here for your vote in the institutional investor ranking. We came up very well as a company, as an Investor Relations team, in different categories. So once again, thank you very much for recognizing our work. And also a very good news in terms of Empresas Copec being confirmed in the FTSE4Good Index, which is one of the most important ESG indexes worldwide.
With that, I am finishing what I had prepared for you. And I now invite you to place your questions through the platform and Cristián will consolidate them, and we will go ahead and answer them for you. Thank you very much.
[Operator Instructions]
Okay. Thank you for attending our webcast results for the second quarter. We have a first question from [ Matthias Wozniak ] at [ Inversiones Santillana ]. He's asking for some color about the effect of revaluation of inventories in Copec's EBITDA, and how that compares with the first quarter?
Yes, we have been showing both the first and second quarter. We've seen some strong FIFO effects. The valuation with respect to the second quarter last year is approximately $40 million. So it's a very important valuation. I'm going to look for the valuation of -- with respect to the first quarter. While we do that, let us go to the next question, please. I'm going to look for the...
Okay. Okay. The second question comes from Juan Pablo Berríos at Sagil. He wants to get an update on timing for the asset sales of Metrogas and Sonacol.
Yes. Well, we've been going ahead with these asset sales. We've been going ahead with 4 processes at the same time, which was really quite a challenge, especially throughout the pandemic and under the conditions set by the pandemic. These asset sales make a lot of sense in several regards, and one of them is to make our balance sheet more efficient and also to create value.
We believe that these are assets which are long term, cash flow is very stable, and that it may be worth more in the hands of specialized investors. So we decided to go ahead with this sales. At the same time, given the situation that we went through last year with our trading metrics, which were deteriorated at that point in time, these asset sales came up as a very good alternative to bring some good news in terms of those credit metrics and improvement, at least a little bit.
As we communicated here, we have been very much committed to two of the processes, which are Gasmar and the forestry asset sales, and we have been able -- we have managed to sign and close those 2 deals. And the other two, therefore, are -- have made progress, but there's not a lot of information of additional information that I can tell you at that point -- at this point in time.
They are complex processes. They require signing some contracts before the asset sales. They require also some agreements with other shareholders. So they are making progress. They are making very good progress, actually. But at this point in time, we're still not allowed to communicate regarding the 2 processes that are left, which are Sonacol and Metrogas.
Let me go back to the FIFO question. We basically had an effect of -- it was a negative effect in the second quarter of 2020, close to $20 million, negative. And the effect this year was positive by more than $20 million. And that's why I talked about a difference of almost $40 million in that effect. And the effect in the first quarter 2021 was a little less than what we recorded this quarter, just probably around $5 million less than what we recorded in this particular quarter. That's a bulk figure for the effects related to inventory revaluations.
Let's move on, Cristián, if you wish to the next question.
Okay. Sure. Next question, Cesar Perez at BTG Pactual, he congratulates on the strong performance and has 2 questions. First, given the fact that projects approaching completion, what we can expect on future areas of investment and growth and on what sectors? That is the first one.
Yes. Well, that's a good question. In effect, we're coming to the end. We already completed Mina Justa, and we're coming to the end in MAPA. I would say that the general answer is that we should continue to invest according to our traditional philosophy, which are basically long-term investments in areas where we have competitive advantages. And this means, basically, to focus in energy and natural resources.
By definition and because of the definition of long term, this also implies a strong focus in sustainability. But basically, traditional philosophy of investment in forestry, this basically means looking for geographies that have good conditions for growing forests, as we have done in the past around Latin America. And starting there, we have been building facilities for producing pulp and wood products, basically. That's our growth philosophy, and we should continue along those same lines.
In the case of energy, it means trying to add as much value as possible to our existing networks, but also looking for complementary assets that they first help us to add more value, but also help us to transition to a low-carbon economy. We are very conscious of the fact that we are going through a process where the energy segment will show probably a very different shape in the future.
We have made the first steps to make this transition to the low-carbon economy by doing what Copec is doing today, which is basically leading electromobility in the countries where we operate and also looking for complementary technologies and other developments that may add value to its existing networks and allow it to have a very good competitive position in the new energy scenario. So growth will be probably along those lines. No particular project yet, but that's the general philosophy for growth going forward.
Thank you, Rodrigo. The second question is on Mina Justa. What are the expectations on sales volumes for 2022 when the mine is fully ramped up?
Yes. We are working on updating the mining plan, which is one of the very, very interesting challenges that we have at this point when we're doing the ramp-up. The ramping up is a complex process, and it brings about a lot of news regarding the evolution of the different variables that will impact production. But long term, we should be able to produce what we have previously announced, which is 100,000 tons on average for the whole life of the mine, reaching approximately 150,000 tons for the first few years when the best grades are mined.
But we are precisely looking at revisiting our mining plan at Mina Justa at this point in time as we get information from the ramping up, and we will be issuing some more definite figures very soon.
Thank you, Rodrigo. We have another question from José Manuel Echeverria at Cuprum. Could you please give some guidance about CapEx range for 2022 and '23?
Yes. Well, that will depend a lot on the projects that we decide to execute, so we do not have a lot of visibility at this point in time. What I can tell you is that the CapEx figure is basically built from a base figure, which is a maintenance figure, which at the consolidated level is around $800 million to $900 million. So starting from that, and depending on the projects that we decide to execute, we will build a figure for 2022 and going forward.
In terms of the CapEx for 2021, we had previously announced a figure between $1.8 billion and $1.9 billion, which was basically composed of this base CapEx of around $800 million to $900 million plus investments related to MAPA and Mina Justa for another $700 million to $800 million, and plus a bunch of other smaller efficiency projects, basically, that we have been going ahead with.
And we are pretty much in line with that. So by the end of June, we came up to $940 million approx. And therefore, we -- for this year, we are pretty much in line with what we have particularly previously announced.
Thank you, Rodrigo. We have a couple of questions on forestry, so I hand it over to Gianfranco. The first one comes from Camila Raddatz at Moneda Asset Management. Is there an effect on results due to the sale of forest assets?
Okay. Well, yes, it's going to be an effect. It's not recorded as the second quarter because the closing of the agreement was done on August, but we estimate that we're going to have a positive impact in net income of around $190 million. That should be recorded mostly on the third quarter as the properties are registered under the new owners.
Okay. Thank you, Gianfranco. The second one comes from Leopoldo Silva at LarrainVial. What portion of your land is on the Araucanía region or specifically, was being claimed by the Mapuche people? And if you can comment on the flexibility that has or might have to reallocate those plantations and the possibility of reaching commercial agreements with possible new owners of that land.
Well, that number is -- it's very difficult to calculate, really. But I mean, it's a big number. We are more concentrated on the Bio Bio region and the Los Rios and Los Lagos and Maule regions. So we don't have a lot of land in the Araucanía region. And specifically claimed by the Mapuche people, this number has been changing. Historically, we had a very, very low number of hectares that were in the red zone that we call it at the moment. It was about 2%, 3%, but that thing has been changing this year.
But anyway, we have a lot of flexibility on how we can supply our mills. So we don't see any problem in supplying our mills. And of course, we are open to get an agreement with new owners of land if portion of the land is given to some communities by the government, and we, of course, we want to buy any forest. So we don't see any problem supplying our mills or adjusting or harvesting in order to have the supply for our mills.
Thank you, Gianfranco. And we don't have more questions at this time. Operator?
This will conclude the question-and-answer section. At this time, I would like to turn the floor back to Mr. Rodrigo Huidobro for any closing remarks.
Okay. Thank you very much, everyone, for joining us today, and we expect to get back to you by mid-November in order to take a look at the results for the third quarter. Thank you very much. Bye-bye.
Thank you. This concludes today's presentation. You may disconnect now, and have a nice day.