Grupo Energía Bogotá S.A. E.S.P. (GEB) Earnings Call Transcript & Summary

Good morning. My name is [ Valeria Marconi ]. Chief of Investor Relations of Energía Bogotá. We are here for the result conference for the Third (sic) [ Fourth ] Quarter. We welcome you. The instructions are in the chat, you can load the presentation. Additionally, this presentation is being made in Spanish with simultaneous translation in English. It's being recorded. We appreciate your questions. I will be moderating your questions and they will be answered by the leaders of the areas. We have the presenters, the speakers that will perform the conference on GEB, our President, Jorge Tabares, Juan Ricardo Ortega, the President. Also the leaders that will take your questions. Now we will move on with Jorge Tabares for him to begin the presentation.

Thank you, Valeria. Greetings, everyone. Any question after the presentation, the agenda that we are presenting. This is a summary of our annual results. This sector is with economic -- during 2020, it's a difficult year, complex year from a point of view of health, emotionally, from a point of view of unemployment, unfortunately. We can show good results for the contribution of all our business. The print business that we have developed through the years and it performed with success with our 300 employees of the group of providers. And all the communities we interact with allowed us to deliver favorable results for investment -- for investors. From the left, all these numbers are in millions -- thousands of millions of pesos. Our EBITDA was COP 3.66 billion with a growth of 17%. Our EBITDA is one of elements we outstand in our results. The percentages on the right represents each of the business. Big diversification, transport and gas distribution, with more and half of EBITDA, transmission of energy 17%, distribution of energy 13%, generation 12%. Basically, those percentages are kept compared to what we had last year with a small growing participation of the business of distribution of energy, thanks to the procurement in 2019 of [ Electrogas ]. We see the contribution of Colombia, 70%, International contribution, 30%. This is more and more important. The qualifiers of risk separates also the profile of risk in Colombia, something that we want to diversify. In front of each of the business lines, we see the combined infrastructure, the one that we surpassed with the help of our partners, 3.5 million gas connections. This will generate an important business when -- as long as our businesses evolve to offer more business lines and we move towards platforms. We have an important base customer. Speaking about profit. Since results are positive, we are offering the assembly of shareholders, 27%. And for a continuity signal, the ordinary with a growth of IPC of 5%, and the remaining will be stated as an extraordinary profit, this is COP 1.6 billion. The total return of 20% (sic) [ 27.4% ] of the value -- of the share plus the dividend, we have is 21.4%. This year, 2020, are presenting outstanding results. We have a dividend of 2.7% compared to December. It's one of the best in the market, the Colombian market. Our score is AAA international. I highlight we are BBB in Fitch, is one above [indiscernible] and something that is relevant. This topic discussion is that Republic will keep the degree of investment, we have space. That takes us apart from the nation, which is positive. There is a level above the investment level and we are above the nations. A good year on investment. We had a moderate leverage, which creates an investment potential -- I'm sorry, I lost the sound. I'm sorry -- I'm not receiving the sound. With asset number that is positive. Moving on with the numbers. The results of the year, the last line, the income grew 5%, the profit growth 13%. And again, this is how many of the businesses behave. EBITDA is 17% of growth, and net profit is COP 2.5 billion is a growth of 33% (sic) [ 13.8% ] and we normalize the net profit is 12 -- COP 2.1 billion, this year was atypical due to several events, mainly the exchange rate that was high during the year, COP 3,700, on the average rate of 2019. This that leverages the net profit. Seeing the forecast of all business, we reversed the deterioration with $20,000, updating the numbers of the business plan. This is compared with a deterioration of last year of [ COP 52 million ]. That are included in the 12.5 76% is 15%. It is a notable number. That shows the health of the businesses. When we combine organic investments of infrastructure, we executed COP 2 million, this number decreased. It is the decision, lack of opportunity of investment, is a period of 3, 4 months where activities was low. Simply, it couldn't be executed part of the business planning, transmission branch. So we executed 25% our budget of organic investments. This is a wide summary -- broadly summary of the results. We are pleased to inform that basically all our indicators, the group presented development that was positive through the year. Here, some of the relevant points through the quarter -- and after the quarter. After the tragedy Mocoa 2017, we can say that they are, again, with infrastructure that allow them to receive energy from the transformation sector for the distribution in operation. In February this year, we delivered to the community. Regarding all this potential of artificial intelligence and data analytics, we participated in the foundation of the data analytics with other entities with the district. We our shareholders 40%. We are developing the business plan that we are going to execute in this entity with a great potential, and we are going behind after other countries that have been able to do this to belong -- to form partnership with entities of the district, gives us access to data. As a business, we continue receiving recognition by the program, Energía Para La Paz that has existed for some years and has a social impact. Associated with the process of negotiations in Peru, 2 important awards. Finally -- in fine short terms, we -- in Peru, we had Electrodunas, solid support from the local market. It helps us diversify -- I'm sorry, I lost the sound of the speaker. I'm not receiving sound from the speaker, I'm sorry. In terms of operational profit, it is a growth of 30%, with more than $412 million (sic) [COP 415 million ] of increase of the operational, COP 1.8 billion in 2020. It belongs to a contribution of diverse factors, greater income, less costs compared to previous year of COP 148 million. I can say that between cost and expenditures, our reaction at the moment of COVID in March, April was cost control and austerity. But also, there was no activity, no trips, no displacement. So it is easier to control expenditures. This year is a critical year when we started having more activity, and the expenditure control is critical. If we see on the left -- at the bottom, the profit, we had 5%. Clearly, we can see second quarter with impact. And the fourth quarter, COP 1.8 billion of income in the quarter, greater compared to the first quarter. That was good. The Peruvian and Colombian economy had good behavior in the first quarter. So we started 2021 with a level of activity of income that was better than we had in the beginning of the year. This allows us to foresee a good 2021. Our sector compared to other sectors, the impact of COVID will be long term. Most of it was an isolated impact to what happened during 2020. Again, a positive aspect of the sector. With an increase of 4.9%, we showed a decrease of cost at the level of group of 5%, this is 2.7% below. Not only we absorbed the inflation, but we reduced the total costs. And we see the branches, many of them decreased with the decrease in Dunas basically because in 2019, we had only 5 months in the financial balances while we bought the company, and we had 12 months of operations. That is why we show the increase of 42. So there is a mild increase associated to the profit of the company through the -- some months of the year. Now the EBITDA consolidated, because all the business have the EBITDA growth, significant -- significantly in the energy distribution and gas distribution, we had a direct impact during the quarter. But at the end of the year, there is a growth of energy distribution and delivery with COP 312 million (sic) [ COP 318 million ] more and COP 54 million gas distribution. Also, these numbers are impacted due to diversification of currency. Remember that we have 75% of our income that is in dollars either because economies, the sector in Peru is a dollar and the transport gas sector in Colombia is dollar, and we see some elements of the other elements that are related to dollar. So we need to foster the results. We control 70% of our EBITDA. These are the companies we operate directly. And our partners operate [ 70% ]. It is not -- doesn't leave completely the growth of the companies because we only have the profit of the companies, but it is also a healthy result in the profit received from the companies we have participation during the year. If we see the participation by company here, we have controlled and noncontrolled. On top of the right [ 3.76 ] if we compare to the previous year. Basically, it is an increase of 2%. Last one was 5%. I highlight that because it is our inorganic growth. The strategy of the latest 2 years to strengthen the growth that we have had. And [ CGU ] lowers a little bit. Those are the main changes. But somehow, relatively, we compare both years. And that shows stability of our business, which is high and positive. If we saw quarter-after-quarter, the EBITDA of the controlled companies, we cannot see a second quarter so affected. This is more due to internal issues, nonrecurrent, especially in our investment in Brazil, COP 129 million, of the second quarter has an effect in [indiscernible] that makes it look bigger. The organic effect comparable is close to COP 104 million is stable. The transmission of energy, the same happens with COP 88 million in the fourth quarter. The business of energy transmission that has recurrent. COP 104 million, COP 103 million of the previous quarters shows stability. And we see the low we had a TGI of COP 357 million, COP 324 million, the gas transport due to the transitory commercial policy to -- added the complex situation of the country. I think with that, we have covered everything so far. When we see net profit, the growth of 36.4 when normalize it in COP 2.5 billion becomes COP 2.1 billion and we move to a growth of 24.4% normalized. There, we have a result of expenditures in line with previous year, despite the debt increase because we were able to lower the costs. We benefited of macroeconomical favorable environment and the inflation helped depreciate, and we issued bonds with a fixed rate. For the next years, we have a difference of exchange rate. It is not a recurrent issue, but it affected us [indiscernible] 1.6, the participation method. Here, we have the companies we cannot control. Look at how all of them have operational growth, so it's positive. And the health of our portfolio is a very good indication. We bought a company in March 2020, and it starts showing important numbers, Gebbras, the low of COP 52 million to COP 19 million it is not due to operation, but it is a difference in the exchange of the Colombian pesos and the Brazilian currency. And operationally, the only one that didn't have favorable results is the smallest one of the portfolio with almost 50%. But the big part of the portfolio with powerful results, including Codensa that generated the low demand, low economic activity during April and May were -- all of us were at home, taking care of ourselves, while we learned to live with COVID, 9.6% increasing the branches -- noncontrolled branches and the net profit that leverages the possibility of growth in profit that is irrelevant that we mentioned. In terms of debt, stable situation that we showed the first quarter's [ $3.8 million ] of total debt. There, we have [ 3.3 times ] of debt and financial expenditures, a healthy indicators of 6.3 times levels of [ 3 ] , we would be within the expectation for the scoring companies. Cost of debt that I highlighted a total of 4% in dollars, 4.2% in pesos, they were closed this year because the inflation in Colombia is 1.6% of inflation in the year, and we had 14% of the debt indexed with IPC. That helps us clearly and the potential of acquisition. We have [indiscernible] and of due date flexibility of our debt portfolio that allows us have an acquisition in case we find profitability to -- as a strategy. I highlight the opportunities we have of investment. In 2020, totally, we invested $571 million -- these are million dollars. Out of those $333 million where the Argo acquisition, along with the [ Espana ] Spain that used to have if we compared '19 with '21 or the [indiscernible] '20 that had an important drop, more than 25% of the budget was not investment during the year. And we have a profile of investment that is diversified that surpasses the $300 million. We included something in the part of TGI, the [ lighter greens ], an investment in equity of TGI should perform in gasificadora Pacific, in case we conclude that the study of profit, the risk is appropriate. And we are awarded the process -- national process. It is 3 months delayed from April to July, and they have additional flexibility in the risk balance of the project. We continue analyzing our partner in [ NAGAS ] for the investment. It has benefit for the shareholders. The 2 indicators of return on equity, you see that normalized, is the light blue. We are basically about at the same levels the previous year, keeping profitability, net profit of 2020. It had a nonrecurring impact. So instead using [ 21.4% ] we showed the normalized of [ 17.8%]. In cash flow, we generate solidly the operation with COP 3 billion totally. If you compare that with the investments of CapEx of COP [ 1.5 trillion ] generates an important [indiscernible]. Basically, the profit we received of our branches, [ 107 ] with a great part of the dividends -- profit we give our shareholders. And this year, [ 106 ] the year was active in the capital investment. We got a debt by COP 5 billion we paid COP 3.2 billion . As many companies, we took short-term credit that we paid in the end. And we ended the year with cash -- solid cash position of COP 1.4 billion at the level of group when we -- some add the cash, [ COP 1.4 million ] cash flow at the moment. With that, I give the floor to Ricardo, our President. We received recently a revision of the strategy of the group. And Ricardo has important news. Juan Ricardo, please go ahead.

Thank you, Jorge. Truly, too, it's a pleasure to be with you. We have notes where we have these details to have the opportunity to tell you how we are working, what we are doing, but it was making a theme. We have an excellent capability, enormous skills, the different priorities. The first one last year was to guarantee that our officials could be able to work, keep the capability of the execution as long as possible during the lockdown, protecting the lives. And I think the most important achievement is that this first year of crisis, it's full of risks or challenges and our officials, the ones who were sick had first level care. We didn't have a fatality, unfortunately, families. Some of the families has suffered. And from our heart, we tried to accompany them, it has been painful and traumatic. The fundamental value as -- the best result is that not only we protected communities and our officials, but also we continued with this culture of proper operations with good planning, and we moved on with a third consecutive year without fatality. And the main challenges for next year is to be 0 fatality. That is the search on our north, our path, our vision of Energía Bogotá, where we're going to, and we're working hard to see the horizon. So we need to change that is difficult to imagine the energy transition. We have excellent white papers and Juan Benavides with a portfolio in the republic they speak about what this means. This will be one of the deepest transformation humanity has seen and will accelerate things that happen normally in 300 years, 200 years. Colombia has challenges for 10 years and the sectors that should be the avant-garde of development of a country like Colombia is the transition. The electric transmission and gas transportation, unarguably, the renewables will have a role from electricity with production from clean energies like sun, wind. It will be important at some point that the transportation infrastructure are a mid, long term with opportunities. And looking around the transformation of the world, we could think, well, we have to do how we can guarantee values to our shareholders, to our collaborators, Bogotá Colombia, the region where we work. There is when we give the message that in reality what we are looking for, what makes us different is that we improve life to have access to energy is the essence to fight against poverty. It is the base of equality, equity in the society to improve lives is what we want to do. And we are working on that hard developing our area, our sustainability and social responsibility of the corporation. The work with the schools in La Guajira through solar to be one of the first companies in Peru. The engineers, they installed laboratory to use oxygen to avoid people to suffocate. And clearly, it marked the reality of society, Lima, Cálidda. The common dining kitchens or places or that they kept the structures, taking care of the population, those are examples of what we are capable of achieving additionally to our mission that is to offer sustainable energy with competitive prices. We are capable to reduce cost of transportation and transmission. And the changes that we have, the possibility of the country that is legal, safe in piece, unarguably allows us to change the engineering of the towers that for years had to be made with robust basis to support the [ bombs ]. We are conscious -- we are aware that the violence increases the cost of payers of services. So to advance and have a better environment in the country, [ arm ] harmony with our citizens is essential for us to transform the infrastructure, make it less costful, more efficient and provide reduction with [ 75 -- 3.5% ]. Next slide to tell you a little bit on the strategy. We are clear that gas is part of the future. Gas is essential to generate the first transformation to withdraw the trucks that contaminate or pollute that are not healthy, they issue the black smoke in the cities, that should not be tolerable. There should be drastic rules to foster, to change the fleet, to improve the environment it has shown in England, how children that have died by diseases. Many of them are consequences of that particles in the air that is polluted by diesel motors, engines all those small B10, B2 microparticles in the lungs, generate many of the severe diseases, the carbon. Many of the women who cook with coal, they suffer lung diseases. It's one of the silent death of the vulnerable people because of the lack of transition into renewable sources. Gas is a means to keep those industries and activities where heat is essential, not only energy. There is where gas can be essentially part of the transformation or the transport fleet that perfectly can have the incentives to move using gas and use the gas at home with a cheaper source energy. We want to continue the development of this sector and strengthen our company of transport and distribution companies. Either Peru region and Colombia, we believe that we contribute enormously to that transformation of the energy metrics to remove carbon that is highly pollutant. We are willing to make it greener. And one of the goals, we are going to be working this year. Likewise, generation -- sustainable generation is one of the contributions where we're going to build the first line of green transmission in Latin America with the challenge to show communities in the future, the Caribbean area in La Guajira, particularly to be able -- the climate change stop, it is life or death issue, the high temperature is 30%, 40% in the days of the year. In the case of La Guajira the temperatures of 60 degrees. These are regular temperatures, the life conditions can deteriorate to support this energy transition is our obligation. That is why Grupo has the challenge to explain communities more than 300 consultation and debate to build a line of energy transmission to have a new future of the Caribbean La Guajira like renewable nonconventional energy solar and wind power have a potential. So it is a way to transform the energy at a reasonable cost of competitiveness and guarantee the country the transition without losing, without overlooking that our energy sources have to be also part of this progressive change, particularly is a part of the carbon, coal that has to be exported since Colombia is a country that has minimum carbon print. We do not contaminate more than 100 million tons of carbon when the problem of the [ 512 million ] tons are particularly Chile and the United States. So we need to have a balance in this transformation, while we allow the economic just step-by-step, the change in generation of energy, the sector transforms radically these renewable nonconventional energies like wind and solar. It's routable. There could be a cloud or we could lack wind and we cannot have unstable energy stable. So gas is important there, but also digitalization. That is the idea of out Bogotá the capability to be able to work hand-in-hand with our Enel partner through Codensa to work in the city with ETB to mount the fiber optic to guarantee intelligent measures -- meters for conversions not only gas and electric energy, but also the consumer that will have distributed energy solar panels to make a decision to deactivate the oven or the refrigerator or load the electric car at 3 a.m. where energy is -- consumption is low. And if it is hydraulic can be generated any time of the day. So the capability will allow the people to make decisions to have cheap consumption to make the strategic decision on the hours. They will use the energy and develop new markets where the care of service of the customer will be important to make decisions. The transition for tomorrow is the vision of the company that more and more the corporate government will guarantee total transparency in the management, in the use of capital, documenting, decision of purchase and procurement and sales to make -- to take responsibility that we require in the company to guarantee the stability of the Boards and involving women, not only due to the value they contribute with in the company, but because there is a gap we need to close. And Energía Bogotá Group has that diversity work, and there is on equity and quality in Colombia, we need to get together. We offer Colombian women have 40% of participation more than double of women consider that are none for Colombian. This is to show -- this is problems that our society has to overcome. So that corporate model with a vision of the energy transition leads us to a portfolio that to make decisions of growth to focus our portfolio, invest in certain regions and sectors that do not have potential growth to focus on gas transportation. This is one of the gaps we need to close on digital transformation. The group will finish create transformation at the end of the year to deliver shared services to reduce costs in our branches and transparency in the control of the information and data handling. All this will generate a positive impact, not only in the company, not only you as shareholders about the society and the environment. Because having good processes, good accountability and staff that is committed, top to bottom, we are going to work carefully in our communities and the sectors. Next, so here is the challenges that I told you before. Of course, the environment and our challenge is a priority. Here, Grupo has goals to reduce carbon print we're going to issue reports and this will become more demanding for this year. We know investments for the transmission of these renewable energy nonconventionals will have an impact of 2.3 million of carbon dioxide reduction. Wind in the country to gigabytes of power in La Guajira up to 20, if we achieve the climate of investment of the awareness of the citizens, the employment capability and growth and development. As I told you, efficiency, that we are working part to reduce our cost is to continue offering lower cost in the transportation. It depends on the advance of the country. We trust the country will progress, and we will make decisions for less heavy infrastructure that will improve life of the citizens that is part of our responsibility. In the end, a social impact that this generates not only because we're going to deliver energy and telecommunications in the case of the infrastructure of transmission but also because we are willing to invest on security, and we are continuing -- we're going to continue working in improving the life of all of those that surround our structure so that they see us as a positive factor of change. Next, so we have messages to finish where you have a group that is focused with the competencies and capability to growth and enormous leverage capability with draft. It is part of the opportunities of the country as a whole. In this convergence of transmission and transport, the opportunity to take advantage of synergies that Colombia could have with leaders, companies, the opportunities of growth in Europe, United States are evident in Brazil. There are more than 16 million transmission lines that will be built. This is a technological change close to the cities. Now we need infrastructure to move energy, wind and solar energy that are now close to cities more than 16 million of kilometers of transmission lines that will have to be built. That is why the strategy is fundamental. As long as we take advantage of opportunities, our global level of growth for more profitability that allows us to capitalize on operational competencies that we are going to strengthen on which we have a company that is competitive with enormous opportunities to generate value, as you saw in the results this year. These results -- outstanding results are a product of people who are committed, honest, working, hard working part of the vision that goes beyond simply of the results -- financial results, but living print of being part of a public company and those rhythms of infrastructure you saw the previous year in the lockdown. This year, if we work with the peaks, you will see we are going to ensure our health and safety policies are focused on guaranteeing that the communities are safe, our people are safe. We have been showing that for 7 months. And this solid position -- finance position gives you the -- we are capable of growing and being part of the opportunity of the country to take advantage of one of the biggest transformation in centuries hadn't happened. Thank you very much. I hope you are clear now with the growth opportunity and the profit that we are expecting. Thank you very much. Valeria?

So we will start the Q&A session. We have received a lot of questions on the ASR process. For a time, we consider is better, Jorge Tabares eventually, you, Andrés Baracaldo, you update on the state of the process. You can answer in general all these questions that we have received.

Let me just speak briefly. Group Energía Bogotá aware of the needs of the country. And with a series of meetings will be paired since last year, the possibility to support and see the synergies, the partnerships is one of the best companies of the country. Together, we could build marvelous things in the continent. We work with 12 banks, 4 consortiums. We have the financial capability to support this process. We have the approvals of the credit. We could have [indiscernible] some months ago, we are eager, willing to hear what the government has to offer. We have the financial capability. We have the support. We have the decision of the Board the will to offer an excellent corporate government, enormous growth opportunities to ISA if it is an alternative, we are open to what the government states. We respect their decisions, and we are here firm available, but also looking at all the alternatives that are arising because our objective is to show the country we are capable to grow and generate value, if the opportunity is given. I don't know if you would like to complement.

Well, I would add that we are watching for the process. Either was an opportunity, we are interested that to the benefits that Juan Ricardo mentioned in the ISA process.

Another question from Andrés Duarte, Corficolombiana. Which markets you will invest on, which will be the total amount of the investment?

This investment will be carried out this year or it will take time. It starts this year, the process. We start -- we are analyzing Promigas with minor investments. We see growth opportunities, we are analyzing. Andres can provide you with more detail. We are going to see Guatemala. There's no point in having 2 structures. The same in Brazil. Clearly ISA is a company that doesn't have too many options. The government part of the packages to buy as a whole to guarantee corporate government. But I believe that Jorge Andres can give you details on the operational part, so that you see the next 2 years, most of these actions.

Thank you, Ricardo. In terms, our plan doesn't include specific goals of investments. We have defined 2 things. One is, we're going to focus the portfolio. When you see the participation, we have either industry that are alike and we'd like, maybe they don't have the strategic profile. That is one of the decisions we have made, but we don't have specific goals. We want to grow inorganically. So if there is no possibility to buy ISA, we are in the standby, waiting for the owner on how they want to monetize their participation. We are looking for other opportunities in the continent and gas businesses. And as long as we have an opportunity, then we will see the size of the transaction. That is what we will be doing for these 18 months, looking for leveraging, taking advantage of the investment capability and the knowledge of the industry. And industry, as we said, we believe it has the future, all the new technologies and world trends of carbonization, generate an opportunity and a challenge where we believe we can have a role and deliver to the citizens and the welfare of the citizens.

We have a question of [indiscernible] about TGI. Here, we have Mónica Contreras, President of TGI; Mariana Monera, Financial Vice President of the company.

Excellent presentation. Regarding the 2021, how income would be affected on EBITDA due to the expiry of contracts agreements in TGI. Do you have strategies to overcome this fall?

Mónica, you can start.

Yes, here I am. Good morning. As we present in the call 2 days ago, the TGI strategy is taking 2 topics, innovation and unlock to the demand, looking for growing in the gas demand. In the case of the Colombian market, still we have a high participation of energies that are not so clean that we have -- if we have a competitive proposal, we will move the energies towards cash. That is an important part. And three, as I mentioned in the call, we continue to work hard to create capabilities like digitalization, et cetera, that allows us somehow a sustainable results, sustainable profitability and somehow face the situation. In the future, we are committed to the 2027 strategy we introduced. We will continue growing in a profitable manner. And complementing Mónica's message as a group, we are in a drastic process of reduction of non necessary expenditure to guarantee the profitability of the group this year. And we are in conversations because the country will require at least organize the infrastructure to have gas available. In case, there is a sequence, we have seen the impact of the climate change in Colombia. We need to be prepared to guarantee enough gas despite the domestic offer is decreasing. The change in the infrastructure guarantee occupation and use of these pillars in the next years that I'll ask to know that the strategy is consistent with the TGI income, we have to reduce costs all along the branches and the group to -- for the situation of TGI, that is a challenging situation.

So complementing with numbers, clearly, this is a typical situation of the pipes that serve great fields of hydrocarbons, either oil or gas. Gas in our case, there is a decline in time. The effective volume that TGI has been transporting is relatively stable in the last 2, 3 years. So it is not about the offer disappeared, but the contract expired. And with the current use, they are not renewed. So the impact in 2021 was $70 million. In the EBITDA of TGI, the company -- the efforts in the order of $20 million, $26 million we can capture. But the problem is when we can capture that when it is reflected in the statements of 2021 and the costs that we will see in the following years Juan Ricardo says that is an effort. Now the rest of the year to try to keep and protect a little bit more of the EBITDA, we are losing the TGI, and those are the austerity efforts and innovation and take advantage of the technologies to lower costs. That is the effort -- complementary effort at the level of group that will lead us to mitigate a little bit the impact of the -- to finish the contract of TGI.

So to finish with some questions of TGI, Diego Buitrago asks TGI mentioned this week, the alternative of internationalized in 2023.

Yes, for us to see the market of the Andean region is important. We see the Andean market, Peru is important to know how the capabilities of TGI has developed in the Colombian market of the handling of mainstream. Really, it's a competitive advantage. We have a focus on the short term that could be Peru. We can advance in the markets. Chile in the second stage and final think of Brazil later.

We have a question of Nicolas Erazo for Tabares. Nicolas Erazo. The options of disinvestments are appropriate. My question is with the excess of cash flow, subject to the situation when you do disinvestments, which strategy you would do, reduction of debt, dividends, more investments in the main business?

Nicolas. We believe the industry offers opportunities and our capabilities, our possibilities are the main option. I think the level of leverage is 3.3 is low. We have a potential. As I told you before, the investment, the main strategy of growth is increase our business and the customers that we can serve. The dividend, we haven't defined the policy of profit, but we have an intention to generate a sustainable growth of dividend. We had a GNC of 7%. That is the highest of the Colombian market and profitability and cash flow should allow us that not lowering the debt. I think it is cheap. It helps us generate value. We have access to the capital markets, and we have diversified sources. So the main is to invest in the business and grow, recover the organic, and we will continue acquiring companies.

I believe this would be the last question. We -- that answers many of the questions of the same topic. The process in the Americas, good update. The expectation in terms of the operation of this new agreement benefit, economic benefits, et cetera, whatever you can contribute with.

And with that, we answer to the rest of questions. First is to be conscious to be aware that the link between Energía Bogotá and Enel Americas an organic partnership. Conflict will not solve the challenges of being able to grow and continue developing the business together. The city is part of the business of -- for the ISA, and the future energy transformation go hand-in-hand. So a clear debate on what we have together. We have so many opportunities the sector offers. So promising future that just staying in an argument destroys value for everyone. So knowing the competencies and legitimate programs to build a framework without problems, this litigation is in course it depends on how the arbitration and the control entities acknowledge the potential negotiation is something that generates value to the city, to the group Energía Bogotá. And it allows to solve conflicts that are part a result of issues in 1997 generated in a context of political difficulties to clarify part of the fact as the control of Enel and Bogotá still many people have the doubt the question, if Grupo Energía Bogotá controls Codensa and the reality is not. That was a business in 1997. And they have ordinary shares that allow them to make decisions. But a minority group like Energía Bogotá, is a partner that adds value because we have a relationship with the city and coordination capability with the city and certain rights to guarantee the excellent handling and growth of these 2 strategic companies. So there is a plan. We have built trust. We depend on the legal process in -- and we cannot provide with details because the problem is not solved. And the courts have the last word. So if I missed anything, please, somebody want to add.

Yes, I'd like to add that the process that Juan Ricardo mentioned regarding the decisions of the courts is basically associated to the process that we currently have of presenting conciliation to the litigation. The procedure established is that once is presented in court, they analyze. And as long as they receive the agreement, the process will finish by accepting the negotiation. I just wanted to add that.

Thank you very much all of you for your questions and answers. With this, I think we addressed most of the questions. If we have more questions, we will answer from the investment relations. All documentation is in the web page. You can contact us for the result delivery or any other topic. We would finish, if you want to say a closing message.

Yes, we are an excellent group of collaborators that are your service. In 2020, we solved the problems of what people saw it was a risk to finish the infrastructure in Guatemala, we renewed. We renewed the infrastructure because people trust us. And we are working in [indiscernible]. We are convinced that we're going to be able to solve problems of the past as long as we focus on the future. The sector is a winning sector, and you will see that in the next 20 years, here, we have one of the greatest opportunities of Colombia in an energy sector that could be leader of development of growth not only in the country but also in the continent and God willing [ same ] part of the world, too. So have a very good day, everyone. And we are turning 125 years. So we are celebrating the birth of the group. So we will send a virtual cake. Thank you very much. [Statements in English on this transcript were spoken by an interpreter present on the live call.]