6-K 1 ednfs2q24_6k.htm 6-K


UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 6-K

 

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of August, 2024

 

EMPRESA DISTRIBUIDORA Y COMERCIALIZADORA NORTE S.A. (EDENOR)

(DISTRIBUTION AND MARKETING COMPANY OF THE NORTH )

 

(Translation of Registrant's Name Into English)

 

Argentina

 

(Jurisdiction of incorporation or organization)

 

 

Av. del Libertador 6363,

12th Floor,

City of Buenos Aires (A1428ARG),

Tel: 54-11-4346-5000

 

(Address of principal executive offices)

 

(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)

 

Form 20-F  X     Form 40-F        

 

(Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)

 

Yes          No  X  

 

(If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-             .)

 

 
 

 

 

 

 

 

 

 

 

 

 

 

CONDENSED INTERIM FINANCIAL STATEMENTS

 

 

 

AS OF JUNE 30, 2024 AND FOR THE

SIX AND THREE-MONTH PERIOD ENDED JUNE 30, 2024

PRESENTED IN COMPARATIVE FORM

(Stated in millions of constant pesos – Note 3)

 

 

 
 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

   

 

 

Legal Information

 2  
Condensed Interim Statement of Comprehensive Income (Loss) 3  
Condensed Interim Statement of Financial Position 4  
Condensed Interim Statement of Changes in Equity 6  
Condensed Interim Statement of Cash Flows 7  
   
Notes to the Condensed Interim Financial Statements:  
1 | General information 9  
2 | Regulatory framework 10  
3 | Basis of preparation 12  
4 | Accounting policies 13  
5 | Financial risk management 14  
6 | Critical accounting estimates and judgments 16  
7 | Contingencies and lawsuits 16  
8 | Revenue from sales and energy purchases 18  
9 | Expenses by nature 20  
10 | Other operating income (expense), net 21  
11 | Net finance costs 21  
12 | Basic and diluted earnings (loss) per share 22  
13 | Property, plant and equipment 23  
14 | Right-of-use assets 25  
15 | Inventories 25  
16 | Other receivables 25  
17 | Trade receivables 26  
18 | Financial assets at fair value through profit or loss 26  
19 | Cash and cash equivalents 27  
20 | Share capital and additional paid-in capital 27  
21 | Allocation of profits 27  
22 | Trade payables 28  
23 | Other payables 28  
24 | Borrowings 29  
25 | Salaries and social security taxes payable 32  
26 | Income tax and deferred tax 32  
27 | Tax liabilities 33  
28 | Provisions 33  
29 | Related-party transactions 34  
30 | Shareholders’ Meeting 34  
31 | Events after the reporting period 35  
     
     
     
           

 

 
 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

   

Glossary of Terms

 

The following definitions, which are not technical ones, will help readers understand some of the terms used in the text of the notes to the Company’s Condensed Interim Financial Statements.

 

Terms Definitions
AMBA Buenos Aires Metropolitan Area
BCRA Central Bank of Argentina
BNA Banco de la Nación Argentina
CABA City of Buenos Aires
CAMMESA

Compañía Administradora del Mercado Mayorista Eléctrico S.A.

(the company in charge of the regulation and operation of the wholesale electricity market)
CNV National Securities Commission
CPD Distribution Own Cost
edenor Empresa Distribuidora y Comercializadora Norte S.A.
ENRE National Regulatory Authority for the Distribution of Electricity
FACPCE Argentine Federation of Professional Councils in Economic Sciences
GWh Gigawatt hour
IAS International Accounting Standards
IASB International Accounting Standards Board
IFRIC International Financial Reporting Interpretations Committee
IFRS International Financial Reporting Standards
IGJ Inspección General de Justicia (the Argentine governmental regulatory agency of corporations)
INDEC National Institute of Statistics and Census
KWh Kilowatt hour
MEM Wholesale Electricity Market
MWh Megawatt hour
PBA Province of Buenos Aires
PEN Federal Executive Power
RASE Registry of Access to Energy Subsidies
RECPAM Gain (Loss) on exposure to the changes in the purchasing power of the currency
RT Electricity Rate Review
SACME S.A. Centro de Movimiento de Energía
SE Energy Secretariat
SINTYS National Social and Tax Identification System
VAD Distribution Added Value
   
   

 

 

1 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

  

 

Legal Information

Corporate name: Empresa Distribuidora y Comercializadora Norte S.A.

Legal address: 6363 Av. Del Libertador Ave., City of Buenos Aires

Main business: Distribution and sale of electricity in the area and under the terms of the Concession Agreement by which this public service is regulated

Date of registration with the Public Registry of Commerce:

·of the Articles of Incorporation: August 3, 1992
·of the last amendment to the Bylaws: April 10, 2023 (Note 30)

 

Term of the Corporation: August 3, 2087

 

Registration number with the “Inspección General de Justicia” (the Argentine governmental regulatory agency of corporations): 1,559,940

 

Parent company: Empresa de Energía del Cono Sur S.A.

 

Legal address: 1252 Maipú St., 12th Floor - CABA

 

Main business of the parent company: Investment company and provider of services related to the distribution of electricity, renewable energies and development of sustainable technology

 

Interest held by the parent company in capital stock and votes: 51%

 

CAPITAL STRUCTURE

AS OF JUNE 30, 2024

(amounts stated in pesos)

 

Class of shares    Subscribed and paid-in
(See Note 20) 
Common, book-entry shares, face value 1 and 1 vote per share    
Class A        462,292,111
Class B (1)        442,566,330
Class C (2)           1,596,659
         906,455,100

 

 

(1)Includes 30,772,779 treasury shares as of June 30, 2024 (Note 20).
(2)Relates to the Employee Stock Ownership Program Class C shares (Note 20).

 

 

 

 

 

2 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

  

edenor

Condensed Interim Statement of Comprehensive Income (Loss)

for the six and three-month period ended June 30, 2024

presented in comparative form

(Stated in millions of constant pesos – Note 3)

 

       Six months at     Three months at 
  Note   06.30.24   06.30.23   06.30.24   06.30.23
                   
Revenue 8               764,151               662,629             436,721            341,585
Energy purchases 8            (409,853)            (461,345)           (219,650)          (229,478)
Distribution margin     354,298   201,284   217,071   112,107
Transmission and distribution expenses 9            (186,287)            (179,596)             (98,936)            (96,990)
Gross profit     168,011   21,688   118,135   15,117
                   
Selling expenses 9              (87,583)              (84,681)             (38,763)            (49,276)
Administrative expenses 9              (58,747)              (53,217)             (30,213)            (26,283)
Other operating income 10                13,569                17,964                 7,127                8,168
Other operating expense 10              (17,253)              (16,780)             (11,964)             (9,710)
(Loss) Income from interest in joint ventures                      (42)                       16                   (42)                    16
Operating result                  17,955            (115,010)               44,280            (61,968)
                   
                   
Financial income 11                     531                     159                    395                   153
Financial costs 11            (194,895)            (316,521)             (60,217)          (142,560)
Other financial results 11            (191,932)                25,808             (72,683)              12,009
Net financial costs              (386,296)            (290,554)           (132,505)          (130,398)
                   
Monetary gain (RECPAM)                 390,197               395,521             127,582            209,336
                   
Income (Loss) before taxes                  21,856              (10,043)               39,357              16,970
                   
Income tax  26                85,724              (53,682)                 7,912            (34,882)
Income (Loss) for the period                 107,580              (63,725)               47,269            (17,912)
                   
                   
Comprehensive income (loss) for the period attributable to:                  
Owners of the parent                  107,580              (63,725)               47,269            (17,912)
Comprehensive income (loss) for the period                 107,580              (63,725)               47,269            (17,912)
                   
Basic and diluted income (loss) per share:                  
Income (Loss) per share (argentine pesos per share) 12                122.95                (72.83)                 54.02             (20.47)

 

 

The accompanying notes are an integral part of the Condensed Interim Financial Statements.

 

3 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

  

 

edenor

Condensed Interim Statement of Financial Position

as of June 30, 2024 presented in comparative form

(Stated in millions of constant pesos – Note 3)

 

  Note    06.30.24     12.31.23 
ASSETS          
Non-current assets           
Property, plant and equipment 13            2,362,182            2,288,486
Interest in joint ventures                         69                     102
Right-of-use asset 14                  5,778                  6,364
Other receivables 16                        3                        4
Total non-current assets              2,368,032            2,294,956
           
Current assets          
Inventories 15              108,167                71,578
Other receivables 16                44,320                61,206
Trade receivables 17              289,513              119,723
Financial assets at fair value through profit or loss 18              175,491              148,542
Cash and cash equivalents 19                  1,534                16,410
Total current assets                619,025              417,459
TOTAL ASSETS              2,987,057            2,712,415

 

 

 

 

4 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

  

 

 

edenor

Condensed Interim Statement of Financial Position

as of June 30, 2024 presented in comparative form (continued)

(Stated in millions of constant pesos – Note 3)

 

  Note    06.30.24     12.31.23 
EQUITY          
Share capital and reserve attributable to the owners of the Company           
Share capital 20                     875                     875
Adjustment to share capital 20              612,752              612,718
Treasury stock 20                       31                       31
Adjustment to treasury stock 20                13,106                13,140
Additional paid-in capital 20                  8,530                  8,480
Cost treasury stock                (50,232)              (50,232)
Legal reserve                  42,464                42,464
Voluntary reserve                411,222              411,222
Other comprehensive loss                  (6,234)                (6,234)
Accumulated losses              (136,016)            (243,596)
TOTAL EQUITY                896,498              788,868
           
LIABILITIES          
Non-current liabilities          
Trade payables 22                  2,128                  2,872
Other payables 23              359,264              285,702
Borrowings 24                85,016                79,720
Deferred revenue                  24,894                24,223
Salaries and social security payable 25                  5,560                  4,403
Benefit plans                  11,923                  8,849
Deferred tax liability 26              774,862              860,561
Provisions 28                13,498                17,727
Total non-current liabilities              1,277,145            1,284,057
Current liabilities          
Trade payables 22              531,374              433,158
Other payables 23              106,185                52,744
Borrowings 24              130,193                91,078
Deferred revenue                         50                       90
Salaries and social security payable 25                28,372                47,884
Benefit plans                       578                  1,039
Tax liabilities 27                  9,812                  8,339
Provisions 28                  6,850                  5,158
Total current liabilities                813,414              639,490
TOTAL LIABILITIES              2,090,559            1,923,547
           
TOTAL LIABILITIES AND EQUITY              2,987,057            2,712,415

 

The accompanying notes are an integral part of the Condensed Interim Financial Statements.

 

 

 

5 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

  

 

edenor

Condensed Interim Statement of Changes in Equity

for the six-month period ended June 30, 2024

presented in comparative form

(Stated in millions of constant pesos – Note 3)

 

  Share capital   Adjust- ment to share capital   Treasury stock   Adjust- ment to treasury stock   Additional paid-in capital   Cost treasury stock   Legal reserve   Voluntary reserve   Other reserve    Other comprehen- sive results    Accumula- ted (losses) profits   Total equity
Balance at December 31, 2022 875   612,659   31   13,199   8,402   (50,232)   42,464   411,222   -   (4,544)   (330,554)   703,522
                                               
Other Reserve Constitution - Share-based compensation plan -   -   -   -   -   -   -   -   78   -   -   78
Payment of Other Reserve Constitution - Share-based compensation plan -   59   -   (59)   78   -   -   -   (78)   -   -   -
Loss for the six-month period -   -   -   -   -   -   -   -   -   -   (63,725)   (63,725)
Balance at June 30, 2023 875   612,718   31   13,140   8,480   (50,232)   42,464   411,222   -   (4,544)   (394,279)   639,875
Other comprehensive results -   -   -   -   -   -   -   -   -   (1,690)   -   (1,690)
Income for the six-month complementary period -   -   -   -   -   -   -   -   -   -   150,683   150,683
Balance at December 31, 2023 875   612,718   31   13,140   8,480   (50,232)   42,464   411,222   -   (6,234)   (243,596)   788,868
                                               
Other Reserve Constitution - Share-based compensation plan (Note 20)  -     -   -   -     -    -     -     -    50    -   -   50
Payment of Other Reserve Constitution - Share-based compensation plan (Note 20)  -   34   -    (34)   50    -     -     -     (50)    -   -   -
Income for the six-month period  -     -   -   -     -    -     -     -    -    -    107,580   107,580
Balance at June 30, 2024 875   612,752   31   13,106   8,530   (50,232)   42,464   411,222   -   (6,234)   (136,016)   896,498

 

 

The accompanying notes are an integral part of the Condensed Interim Financial Statements.

 

6 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

  

edenor

Condensed Interim Statement of Cash Flows

for the six-month period ended June 30, 2024

presented in comparative form

(Stated in millions of constant pesos – Note 3)

 

  Note   06.30.24   06.30.23
Cash flows from operating activities          
Income (Loss) for the period             107,580           (63,725)
           
Adjustments to reconcile net (loss) income to net cash flows from operating activities:          
Depreciation of property, plant and equipment 13             60,836             61,224
Depreciation of right-of-use assets 14               3,859               2,423
Loss on disposals of property, plant and equipment 13               1,480               1,233
Net accrued interest 11           192,345           315,418
Income from customer surcharges 10             (9,654)             (9,762)
Exchange difference 11               5,201               9,256
Income tax 26           (85,724)             53,682
Allowance for the impairment of trade and other receivables 9               3,931             10,320
Adjustment to present value of receivables 11               2,496                  849
Provision for contingencies 28               9,567               6,840
Changes in fair value of financial assets and financial liabilities 11           169,085           (48,730)
Accrual of benefit plans 9               8,113               7,545
Loss on integration in kind of Corporate Notes 11               1,156                      -
Income from non-reimbursable customer contributions 10               (132)                 (99)
Other financial costs 11             13,994             12,817
Result from interest in joint ventures                      42                 (16)
Monetary gain (RECPAM)           (390,197)         (395,521)
Changes in operating assets and liabilities:           
Increase in trade receivables            (213,797)         (135,802)
Increase in other receivables                (3,016)           (44,287)
Increase in inventories             (25,649)           (12,636)
Increase in deferred revenue                    714                    15
Increase in trade payables             183,804           265,452
Increase in salaries and social security payable                 4,847                  754
Decrease in benefit plans               (1,112)             (3,214)
Increase in tax liabilities                 5,152               2,642
Increase in other payables               28,811             18,153
Decrease in provisions 28             (1,452)             (1,107)
Net cash flows generated by operating activities               72,280             53,724

 

 

7 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

  

 

edenor

Condensed Interim Statement of Cash Flows

for the six-month period ended June 30, 2024

presented in comparative form (continued)

(Stated in millions of constant pesos – Note 3)

 

  Note   06.30.24   06.30.23
Cash flows from investing activities          
Payment of property, plants and equipments            (126,339)           (96,843)
(Purchase) Sale net of Mutual funds and negotiable instruments           (64,233)             21,828
Net cash flows used in investing activities           (190,572)           (75,015)
           
Cash flows from financing activities          
Proceeds from borrowings               93,213             31,030
Payment of lease liability               (4,949)             (3,864)
Payment of interests from borrowings             (10,047)             (2,092)
Payment of Corporate Notes issuance expenses               (2,817)             (1,323)
Net cash flows generated by financing activities               75,400             22,900
           
Decrease (Increase) in cash and cash equivalents     (42,892)   1,609
           
Cash and cash equivalents at the beginning of the year 19             16,410               9,125
Exchange difference in cash and cash equivalents                 1,529               5,376
Result from exposure to inflation                   (31)                 (63)
Decrease (Increase) in cash and cash equivalents             (42,892)               1,609
Cash and cash equivalents at the end of the period 19   (24,984)   16,047
           
           
Supplemental cash flows information          
Non-cash activities          
Adquisition of advances to suppliers, property, plant and equipment through increased trade payables               (9,673)             (6,107)
           
Adquisition of advances to suppliers, right-of-use assets through increased trade payables               (3,273)             (1,274)

 

 

The accompanying notes are an integral part of the Condensed Interim Financial Statements.

 

 

8 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

Note1 |        General information

 

Empresa Distribuidora y Comercializadora Norte S.A. (hereinafter “edenor” or “the Company”) is a corporation (sociedad anónima) organized under the laws of Argentina, with legal address at 6363 Av. Del Libertador Ave - City of Buenos Aires, Argentine Republic, whose shares are traded on Bolsas y Mercados Argentinos S.A. (ByMA) (Argentine Stock Exchange and Securities Market) and the New York Stock Exchange (NYSE).

 

The corporate purpose of edenor is to engage in the distribution and sale of electricity within the concession area. Furthermore, among other activities, the Company may subscribe or acquire shares of other electricity distribution companies, subject to the approval of the regulatory agency, assign the use of the network to provide electricity transmission or other voice, data and image transmission services, and render advisory, training, maintenance, consulting, and management services and know-how related to the distribution of electricity both in Argentina and abroad. These activities may be conducted directly by edenor or through subsidiaries or related companies. In addition, the Company may act as trustee of trusts created under Argentine laws.

 

The Company’s economic and financial situation

 

In the first six-month period of 2024, the Company shows an improvement in its economic performance, as a consequence of the recent electricity rate increases. Furthermore, the likelihood of periodical rate adjustments and reduction of subsidies in the short term will allow for the improvement of the Company’s electricity rate situation and its economic and financial equation, ensuring the economic self-sufficiency of the electricity system for a foreseeable future.

 

In particular, the electricity rate adjustments of February 2024 implied an increase in the CPD of 319.2% (Note 2.a), which resulted in an increase of the Company’s gross profit for the current period.

 

At the same time, Executive Order No. 70/2023 issued by the Federal Government provided for the economic, financial, fiscal, pension, tariff, health, social and administrative emergency until December 31, 2025, together with other measures of a deregulatory nature for the economy as a whole, whose primary goal, as stated, is to achieve fiscal balance.

 

In this regard, on July 8, 2024, Law No. 27,742 -entitled law of bases and starting points for the freedom of the Argentine people-, which includes State reform, delegation of powers to the Executive Branch, promotion of registered employment, labor modernization, an energy-related chapter, an incentive regime for large investments, and tax measures (amendments to the income tax and the tax on personal assets, and tax amnesty program), was enacted, declaring the emergency only in administrative, economic, financial and energy matters for a term of one year.

 

Furthermore, the context of volatility and uncertainty continues at the date of issuance of these condensed interim financial statements. At this point in time, neither the development of the reforms proposed by the new administration nor the new measures that could be announced can be predicted. The Company’s Management permanently monitors the development of the variables that affect the Company’s business, in order to define its course of action and identify the potential impacts on its financial and cash position. Within the described context, the Company continues making the investments necessary, both for the operation of the network and for maintaining and even improving the quality of the service.

 

The Company’s condensed interim financial statements must be read in the light of these circumstances.

 

 

9 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

Notwithstanding the above-described situation, it is worth pointing out that even though in the last few fiscal years the Company recorded negative working capital, as a consequence of the insufficient adjustments of the electricity rate over the last few years, in general terms, the quality of the electricity distribution service has been improved, both in duration and frequency of power cuts. In this regard, the Company is optimistic that the new electricity rates will result in the Company’s operating once again under a regulatory framework with clear and precise rules, which will make it possible to meet the costs associated with both the provision of the service and the need for additional investments to satisfy the demand, in order to maintain the provision of the public service, object of the concession, in a satisfactory manner in terms of quality and reliability. Therefore, these condensed interim financial statements have been prepared using the ongoing concern basis of accounting.

 

Note2 |        Regulatory framework

 

At the date of issuance of these condensed interim financial statements, there exist the following changes with respect to the situation reported by the Company in the Financial Statements as of December 31, 2023:

 

a)Electricity rate situation

 

As provided for in ENRE Resolution No. 102/2024, edenor’s electricity rates are provisionally adjusted on account of the next Electricity Rate Review (RT), which consisted of a 319.2% increase of the CPD. This resolution also provides that from May 2024 and until the completion of the RT process, the electricity rates are to be adjusted on a monthly basis by an index (the “Provisional Adjustment Index”) comprised of the following: 55% by the Wage Index of the Registered Private Sector published by the INDEC, 25% by the Domestic Wholesale Price Index (IPIM), and 20% by the Consumer Price Index. Subsequently, the adjustment formula applicable to the monthly rate charges of the CPD for the July-December 2024 period was replaced by a factor to be calculated based on the cumulative inflation of such six-month period on the basis of the expected monthly inflation rates. However, as instructed by the National Economy Ministry, those adjustments have been postponed until August 1, 2024, having no impact on the revenue recorded in these condensed interim financial statements. Such decision to postpone the adjustments, as well as the change of the formula based on estimated inflation, has been questioned by the Company at the administrative level.

 

Furthermore, by means of Resolution No. 198/2024, the ENRE approved the values of the Company’s electricity rate schedule effective from the billing relating to the reading of meters subsequent to 12:00 AM on April 1, 2024, changing the structure of Tariff T1-R, opening R3 and R4 categories and adding two additional consumption segments referred to as R5 and R6.

 

Additionally, by means of Resolution No. 92/2024, the SE approved the new values of the Seasonal Price of Energy and the Power Reference Price, along with the Winter Seasonal Programming defined for the MEM submitted by CAMMESA, relating to the May 1, 2024-October 31, 2024 period. Therefore, by means of Resolution No. 335/2024, the ENRE approved the values of the Company’s electricity rate schedule effective from the billing relating to the reading of meters subsequent to 12:00 AM on June 1, 2024.

 

With regard to the RT, on May 8, 2024, by means of Resolution No. 270/2024, the ENRE approved the Program for the carrying out of the electricity rate review, which sets forth the review objectives for fiscal year 2024, which include different reports to be submitted by the Company. edenor, together with its external advisors, who have been hired to conduct an assessment of the RT, is currently working on those reports and on the preparation of the Definitive Electricity Rate Schedule to be proposed.

 

Furthermore, with regard to the system of subsidies applied to our users, the National Executive Power provided for the restructuring of the systems of energy subsidies of national jurisdiction, in order to ensure a gradual transition over a period of six months, which ends on November 30, 2024, and which could be extended until May 2025 (the “Transition Period”).

 

 

 

10 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

Within the aforementioned transition program, the first reduction step was adopted on May 28, 2024 by means of Executive Order No. 465/2024 of the PEN, which suspended the limits of the impact on the bill caused by the variation of the Salary Variation Coefficient (CVS) (caps of 40% and 80% according to the user category under the rate segmentation system).

 

The second step consisted of the implementation as from June 1 of higher caps on subsidized energy consumption, which by means of SE Resolution No. 90/2024 were set at 350kWh/month and 250 kWh/month for our N2 and N3 users, respectively.

 

Additionally, on June 26, 2024, by means of Executive Order No. 940/2024 of the Executive Branch and Resolution No. 771/2024 of the Infrastructure and Public Services Ministry, both of the Province of Buenos Aires, and ENRE Resolution No. 437/2024, a new system was established for the users of such province benefited from the “Social Tariff”. In the first place, the universe of persons eligible for the “Social Tariff” is extended to include the users arising from the crosschecking of data through the SINTYS, those incorporated by the ENRE and those comprising Level 2 of the RASE. In the second place, the application of such subsidy will be paid through the Distribution Company, thus rendering invalid the exchange through CAMMESA and significantly reducing the subsidy amounts available for each category. Finally, the rate of the Tax on the Electricity Service, whose proceeds constitute the “Special Fund for the PBA’s Electricity Development” and which edenor collects in the name and on behalf of the Province, is reduced from 4% to 0.01%.

 

Finally, on August 1, 2024, by means of Resolution No. 192/2024, the SE approved the new values of the Seasonal Price of Energy and the Power Reference Price, along with the definitive Winter Seasonal Reprogramming for the MEM submitted by CAMMESA, relating to the August 1, 2024-October 31, 2024 period. Therefore, on August 2, 2024, by means of Resolution No. 520/2024, the ENRE approved the values of the Company’s electricity rate schedule effective from the billing relating to the reading of meters subsequent to 12:00 AM on August 1, 2024, with a 3% average increase of the CPD.

 

b)Agreements on the Regularization of Payment Obligations with CAMMESA – Debt for the purchase of energy in the MEM

 

The Company entered into two agreements on the regularization of its debts with CAMMESA for energy purchases, fines and charges accrued through February 2023. The Payment plan liability resulting from the two Agreements signed by and between the Company and CAMMESA, including the financial components accrued, payments made and the offsetting against receivables under the Framework Agreement (Note 2.c), amounts to $ 328,676, and is disclosed in the Other payables account of the Statement of Financial Position, with the Company’s being up to date with the payments of the installments thereof.

 

The Payment plan for the debts incurred until August 31, 2022 stipulated in the agreement entered into on December 29 of that same year, after the application of the credit recognized by the Federal Government equivalent to five bills of consumption at the average value of 2020, consists of 96 progressively increasing installments at the interest rate in effect in the MEM, reduced by 50%, whose average installment according to the payment schedule is increased by 133% each year until the fifth year, and by 268% from the sixth through the eighth year.

 

The Payment plan for the debts incurred until February 28, 2023 stipulated in the agreement entered into on July 28 of that same year, consists of 96 monthly and consecutive installments adjusted in accordance with the development of the MWh value in effect. Therefore, as of June 30, 2024, due to the energy price increase mentioned in caption a) of this Note, the debt relating to this Payment plan has increased to $ 242,162.

 

Furthermore, outstanding principal on the debts for the purchase of energy accrued between March 1, 2023 and June 30, 2024 amounts to $ 127,667. As from the maturities taking place on April 1, 2024, the Company’s payments of CAMMESA’s current billing are up to date.

 

 

11 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

On May 6, 2024, by means of Resolution No. 58/2024, the SE instructed CAMMESA to provide for a new access plan to regularize the amounts owed by distribution agents for the period maturing between February 1 and April 30, 2024 and submit a proposal for entering into agreements for the payment thereof, which at the date of issuance of these condensed interim financial statements has not been implemented.

 

c)Framework Agreement

 

In accordance with the Agreement entered into with the Federal Government and the Province of Buenos Aires, electricity consumption of 2023, which must be contributed by the Federal Government and the Province of Buenos Aires, amounts to $ 1,784 and $ 1,317, respectively. In respect thereof, as of the date of issuance of these condensed interim financial statements, the amounts whose crediting and/or offsetting against debts with CAMMESA are still pending total $ 352 and $ 1,317, respectively.

 

With regard to electricity consumption owed as of June 30, 2024, the amounts thereof have been informed to the ENRE for validation purposes against receivables from the Federal Government and the Province of Buenos Aires for $ 721 and $ 533, respectively.

 

Note3 |        Basis of preparation

 

These condensed interim financial statements for the six-month period ended June 30, 2024 have been prepared in accordance with the provisions of IAS 34 “Interim Financial Reporting”. They were approved for issue by the Company’s Board of Directors on August 6, 2024.

 

By means of General Resolution No. 622/2013, the CNV provided for the application of Technical Resolution No. 26 of the FACPCE, which adopts the IFRS issued by the IASB, for those entities that are included in the public offering system of Law No. 17,811, as amended, whether on account of their capital or their corporate notes, or have requested authorization to be included in the aforementioned system.

 

These condensed interim financial statements include all the necessary information in order for the users to properly understand the relevant facts and transactions that have occurred subsequent to the issuance of the last Financial Statements for the year ended December 31, 2023 and until the date of issuance of these condensed interim financial statements. The Company’s Management estimates that they include all the necessary adjustments to fairly present the results of operations for each period. The results of operations for the six and three-month period ended June 30, 2024 and its comparative period as of June 30, 2023 do not necessarily reflect the Company’s results in proportion to the full fiscal year. Therefore, the condensed interim financial statements should be read together with the audited Financial Statements as of December 31, 2023 prepared under IFRS.

 

The Company’s condensed interim financial statements are measured in pesos (the legal currency in Argentina) restated in accordance with that mentioned in this Note, which is also the presentation currency.

 

Comparative information

 

The balances as of December 31 and June 30, 2023, as the case may be, disclosed in these condensed interim financial statements for comparative purposes, arise as a result of restating the annual Financial Statements and the Condensed Interim Financial Statements as of those dates, respectively, to the purchasing power of the currency at June 30, 2024, as a consequence of the restatement of financial information described hereunder. Furthermore, certain amounts of the financial statements presented in comparative form have been reclassified in order to maintain consistency of presentation with the amounts of the current periods.

 

 

12 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

Restatement of financial information

 

The condensed interim financial statements, including the figures relating to the previous year/period, have been stated in terms of the measuring unit current at June 30, 2024, in accordance with IAS 29 “Financial reporting in hyperinflationary economies”, using the indexes published by the FACPCE. The inflation rate applied for the January 1, 2024 - June 30, 2024 period was 79.8%.

 

Note4 |        Accounting policies

 

The accounting policies adopted for these condensed interim financial statements are consistent with those used in the Financial Statements for the last financial year, which ended on December 31, 2023.

 

Detailed below are the accounting standards, amendments and interpretations issued by the IASB in the last few years that are effective as of June 30, 2024 and have been adopted by the Company:

 

- IAS 1 “Presentation of financial statements”, amended in January and July 2020, February 2021 and October 2022. It incorporates amendments to the classification of liabilities as current or non-current.

 

- IFRS 16 “Leases”, amended in September 2022. It clarifies how a seller-lessee subsequently measures sale and leaseback transactions that satisfy the requirements in IFRS 15 to be accounted for as a sale.

 

- IFRS Sustainability Disclosure Standards, amended in June 2023. IFRS S1 sets out overall requirements in order for an entity to disclose information about its sustainability-related risks and opportunities that is useful to the users of general purpose financial reports in making decisions relating to providing resources to the entity. IFRS S2 sets out the requirements for identifying, measuring and disclosing information about climate-related risks and opportunities that is useful to the users of general purpose financial reports in making decisions relating to providing resources to the entity.

 

There are no new IFRS or IFRIC applicable as from this period that have a material impact on the Company’s condensed interim financial statements.

 

New accounting standards issued by the IASB that are not yet effective and have not been early adopted by the Company

 

- IFRS 18 “Presentation and disclosure in financial statements”, issued in April 2024. It includes new requirements for all entities applying IFRS for the presentation and disclosure of information in financial statements. It introduces three defined categories of income and expenses (operating, investing and financing) that modify the structure of the statement of profit or loss, and requires companies to present new defined subtotals, including operating profit or loss, in order to analyze the companies’ financial performance and facilitate comparison between companies. The standard requires companies to disclose explanations of those company-specific measures that are related to the statement of profit or loss, referred to as management-defined performance measures. It provides enhanced guidance on how to organize information and whether to provide it in the primary financial statements or in the notes. It requires that companies provide more transparency about operating expenses. The management-defined performance measures, as defined by IFRS 18, consist of measures that are subtotals of income and expenses. IFRS 18 does not require companies to provide management-defined performance measures but does require companies to explain them if they are provided.

 

 

13 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

IFRS 18 replaces IAS 1 “Presentation of financial statements”, but carries forward many requirements from IAS 1 unchanged. IFRS 18 is effective for annual reporting periods beginning as from January 1, 2027, with early adoption permitted. In this regard, the Company is currently assessing the impact of IFRS 18 and estimates that there will be significant changes in the disclosure of the Comprehensive Statement of Income and its related notes.

 

Note5 |        Financial risk management

 

Note5.1 |        Financial risk factors

 

The Company’s activities and the market in which it operates expose the Company to a number of financial risks: market risk (including currency risk, cash flows interest rate risk, fair value interest rate risk and price risk), credit risk and liquidity risk.

 

Additionally, the difficulty in obtaining financing in international or national markets could affect certain variables of the Company’s business, such as interest rates, foreign currency exchange rates and the access to sources of financing.

 

With regard to the Company’s risk management policies, there have been no significant changes since the last fiscal year end.

 

a.Market risks

 

i.Currency risk

 

As of June 30, 2024 and December 31, 2023, the Company’s balances in foreign currency are as follow:

    Currency    Amount in foreign currency    Exchange rate (1)   Total
06.30.24		   Total
12.31.23
           
ASSETS                    
CURRENT ASSETS                    
Other receivables   USD              23.5   909.000            21,362             38,081
Financial assets at fair value through profit or loss   USD             118.0   909.000          107,262             73,992
Cash and cash equivalents   USD                0.1   909.000                   91                 289
TOTAL CURRENT ASSETS                      128,715           112,362
TOTAL ASSETS                      128,715           112,362
                     
LIABILITIES                    
NON-CURRENT LIABILITIES                    
Borrowings   USD              93.2   912.000            85,016             79,720
TOTAL NON-CURRENT LIABILITIES                        85,016             79,720
CURRENT LIABILITIES                    
Trade payables   USD              23.7   912.000            21,614             33,283
    EUR                0.6   978.667                 587                 965
    CHF                0.3   1016.116                 305                 520
Borrowings   USD              85.5   912.000            77,951             90,568
    CNY                2.7   125.446                 339                 510
Other payables    USD                1.5   912.000              1,325               2,030
TOTAL CURRENT LIABILITIES                      102,121           127,876
TOTAL LIABILITIES                      187,137           207,596

(1)The exchange rates used are the BNA exchange rates in effect as of June 30, 2024 for United States dollars (USD), Euros (EUR), Swiss francs (CHF) and Chinese yuans (CNY).

 

 

14 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

ii.Fair value estimate

 

The Company classifies the measurements of financial instruments at fair value using a fair value hierarchy that reflects the relevance of the variables used for carrying out such measurements. The fair value hierarchy has the following levels:

 

· Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.


· Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. prices) or indirectly (i.e. derived from the prices).


· Level 3: inputs for the asset or liability that are not based on observable market data (i.e. unobservable inputs).

 

The table below shows the Company’s financial assets and liabilities measured at fair value as of June 30, 2024 and December 31, 2023:

 

     LEVEL 1     LEVEL 2 
         
At June 30, 2024        
Assets        
Other receivables        
Assigned assets and in custody             20,430                   -   
Financial assets at fair value through profit or loss:        
Negotiable instruments             10,102                   -   
Mutual funds           165,389                   -   
Cash and cash equivalents:        
Mutual funds                 377                   -   
Total assets           196,298                     -
         
Liabilities        
Other liabilities:        
Payment plan - CAMMESA                     -           242,162
Total liabilities                     -           242,162
         
         
     LEVEL 1     LEVEL 2 
At December 31, 2023        
Assets        
Other receivables        
Transferred assets and in custody             36,684                     -
Financial assets at fair value through profit or loss:        
Negotiable instruments              1,057                     -
Mutual funds           147,485                     -
Cash and cash equivalents        
Mutual funds             13,897                     -
Total assets           199,123                     -
         
Liabilities        
Other liabilities:        
Payment plan - CAMMESA                     -           107,842
Total liabilities                     -           107,842

 

 

 

 

 

 

 

15 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  
iii.Interest rate risk

 

Interest rate risk is the risk of fluctuation in the fair value or cash flows of an instrument due to changes in market interest rates. The Company’s exposure to interest rate risk is mainly related to its long-term debt obligations.

 

Indebtedness at floating rates exposes the Company to interest rate risk on its cash flows. Indebtedness at fixed rates exposes the Company to interest rate risk on the fair value of its liabilities. As of June 30, 2024 and December 31, 2023, except for both the Class No. 4 Corporate Notes issued by the Company in Argentine pesos, at the private BADLAR floating interest rate plus an annual 3% fixed margin (Note 24), and the Payment plan with CAMMESA that is disclosed in the Other payables account (Notes 2.b and 23), all the loans were obtained at fixed interest rates. The Company’s policy is to keep the largest percentage of its indebtedness in instruments that accrue interest at fixed rates.

 

Note6 |        Critical accounting estimates and judgments

 

The preparation of the condensed interim financial statements requires the Company’s Management to make estimates and assessments concerning the future, exercise critical judgment and make assumptions that affect the application of the accounting policies and the reported amounts of assets and liabilities and revenues and expenses. 

 

These estimates and judgments are permanently evaluated and are based upon past experience and other factors that are reasonable under the existing circumstances. Future actual results may differ from the estimates and assessments made at the date of preparation of these condensed interim financial statements.

 

In the preparation of these condensed interim financial statements, there were no changes in either the critical judgments made by the Company when applying its accounting policies or the sources of estimation uncertainty used with respect to those applied in the Financial Statements for the year ended December 31, 2023.

 

Note7 |        Contingencies and lawsuits

 

The provision for contingencies has been recorded to face situations existing at the end of each period that may result in a loss for the Company if one or more future events occurred or failed to occur.

 

At the date of issuance of these condensed interim financial statements, there are no significant changes with respect to the situation reported by the Company in the Financial Statements as of December 31, 2023, except for the following:

 

- Federal Administration of Public Revenues (“AFIP”) – Difference in contribution rate to the Single Social Security System (“SUSS”) (executive order 814/2001) for the 12/2011- 11/2019 fiscal periods

 

(i)       Edenor S.A. VS AFIP, CHALLENGE OF DEBT, Court record 20408/2021 (CI 25,329) (OI No. 1,578,472- for the 12/2011-12/2016 tax periods):

 

On February 29, 2024 proof that the Company is unable to comply with the “Pay First” requirement due to the long-overdue readjustment of revenue, as with rates, which must be issued by the relevant authorities, was filed in the court record.

 

 

16 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

On June 27, 2024, the Company was served notice of the Court of Appeals’ decision, whereby the appeal filed by the Company was rejected as inadmissible, inasmuch as the appellate court does not agree with the criterion of the other courtrooms that accept the surety bond as a replacement for the “Pay First” requirement. In that regard, it stated that in order for the surety bond to be accepted, the impossibility of payment must be founded. In view of this decision, on July 12, 2024, the Company filed a federal extraordinary appeal (“recurso extraordinario federal”) with the Supreme Court of Justice.

 

(ii)       Edenor S.A. VS AFIP, CHALLENGE OF DEBT, Court record 11840/2021 (CI 25,329) (OI No. 1,806,371- for the 01/2017-06/2019 tax periods):

 

On February 22, 2024, the Company was served notice of the Court of Appeals’ decision, whereby the appeal filed by the Company was rejected as inadmissible, inasmuch as the appellate court does not agree with the criterion of the other courtrooms that accept the surety bond as a replacement for the “Pay First” requirement. In that regard, it stated that in order for the surety bond to be accepted, the impossibility of payment must be founded. The Company filed a federal extraordinary appeal (“recurso extraordinario federal”) with the Supreme Court of Justice, which was denied, and an appeal against the denial to admit the extraordinary appeal (“recurso de queja”), which is currently in process. The fact that this appeal is granted without a stay of execution would imply the AFIP’s right to judicially demand the immediate availability of the funds to continue with the Company’s defense.

 

(iii)       Edenor S.A. VS AFIP, SOCIAL SECURITY CONTRIBUTIONS (CI 24,920) (OI: 1893337- for the 07/2019-11/2019 tax periods- Court record No.: CSS 053731/2022):

 

Furthermore, on February 29, 2024 proof that the Company is unable to comply with the “Pay First” requirement was filed in the court record, in the same way as in the court record mentioned in (i).

 

Based on the enactment of Law No. 27,743 on “Palliative and Relevant Tax Measures”, which provides for an “Exceptional Regularization System of Tax, Custom and Social Security-related Payment Obligations”, regulated by Executive Order No. 608/2024 and implemented by the AFIP by means of General Resolution No. 5525/2024 dated July 16, 2024, the Company with the aim of defending itself against the tax claims optimizing its tax burden, is currently assessing the payment facilitation plans provided therein. As of June 30, 2024, an amount of $ 1,451 has been recorded by the Company for this concept in the Provisions account of the Statement of Financial Position.

 

-AFIP’s tax claim for Income Tax, Undocumented outflows and VAT

 

On April 12, 2024, as a consequence of the analysis of the submitted expert’s report, Federal Court in Criminal Matters of San Martín No. 1 rendered judgment, stating that the investigation is exhausted and that as a result thereof not only the execution of the works and transactions documented in the billing declared in the 2017-2018 period by edenor to the tax collecting agency, but also the existence and operating capacity of both contractors to manage and carry out the works paid by edenor was verified, acquitting the Company, the Company’s former chairman and former Board of Directors members, CYSE S.A., and Fuentes y Asociados S.A. of the criminal charges related to this court record. At the date of issuance of these condensed interim financial statements, the judgment has been appealed.

On August 6, 2024, the Federal Appellate Court of San Martín considered the analysis of criminal liability of the defendants to be exhausted and concluded that the court decision under review should be confirmed, thus resolving to affirm judgment.

 

 

 

17 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

Note8 |        Revenue from sales and energy purchases

 

We provide below a brief description of the main services provided by the Company:

 

Sales of electricity

Small demand segment: Residential use and public lighting (T1) Relates to the highest demand average recorded over 15 consecutive minutes that is less than 10 kilowatts. In turn, this segment is subdivided into different residential categories based on consumption. This segment also includes a subcategory for public lighting. Users are categorized by the Company according to their consumption.
Medium demand segment: Commercial and industrial customers (T2) Relates to the highest demand average recorded over 15 consecutive minutes that is equal to or greater than 10 Kilowatts but less than 50 Kilowatts. The Company agrees with the user the supply capacity.
Large demand segment (T3) Relates to the highest demand average recorded over 15 consecutive minutes that is greater than 50 Kilowatts. In turn, this segment is subdivided into categories according to the supply voltage -low, medium or high-, from voltages of up to 1 Kilovolt to voltages greater than 66 Kilovolts.

Other: (Shantytowns/

Wheeling system)

 Revenue is recognized to the extent that a renewal of the Framework Agreement has been formalized for the period in which the service was accrued. In the case of the service related to the Wheeling system, revenue is recognized when the Company allows third parties (generators and large users) to access the available transmission capacity within its distribution system upon payment of a wheeling fee.

 

The KWh price relating to the Company’s sales of electricity is determined by the ENRE by means of the periodic publication of electricity rate schedules (Note 2.a), for those distributors that are regulated by the aforementioned Regulatory Authority, based on the rate setting and adjustment process set forth in the Concession Agreement.

 

 

Other services

Right of use of poles Revenue is recognized to the extent that the rental value of the right of use of the poles used by the Company’s electricity network has been agreed upon for the benefit of third parties.
Connection and reconnection charges Relate to revenue accrued for the carrying out of the electricity supply connection of new customers or the reconnection of already existing users.

 

 

18 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

Energy purchases

Energy purchase The Company bills its users the cost of its purchases of energy, which includes charges for purchases of energy and power. The Company purchases electric power at seasonal prices approved by the SE. The price of the Company’s electric power reflects the costs of transmission and other regulatory charges.

Energy

losses

 Energy losses are equivalent to the difference between energy purchased and energy sold. These losses can be classified into technical and non-technical losses. Technical losses represent the energy lost during transmission and distribution within the network as a consequence of the natural heating of the conductors and transformers that carry electricity from power generation plants to users. Non-technical losses represent the remainder of the Company’s energy losses and are mainly due to the illegal use of its services or the theft of energy. Energy losses require that the Company purchase additional energy in order to meet the demand and its Concession Agreement allows it to recover from its users the cost of these purchases up to a loss factor specified in its concession for each rate category. The current loss factor recognized in the tariff by virtue of its concession amounts approximately to 9.1%.

 

 

    06.30.24   06.30.23
    GWh   $   GWh   $
Sales of electricity                
Small demand segment: Residential use and public lighting (T1)         6,754      461,039         7,133      392,023
Medium demand segment: Commercial and industrial (T2)           767      100,134           798        70,879
Large demand segment (T3)         1,763      171,992         1,881      168,464
Other: (Shantytowns/Wheeling system)
         2,262        28,309         2,365        28,208
Subtotal - Sales of electricity       11,546      761,474       12,177      659,574
                 
Other services                
Right of use of poles              2,109              2,803
Connection and reconnection charges                568                252
Subtotal - Other services              2,677              3,055
                 
                 
Total - Revenue          764,151          662,629
                 
                 
                 
                 
    06.30.24   06.30.23
    GWh   $   GWh   $
                 
Energy purchases (1)      13,552      (409,853)      14,280      (461,345)

 

(1)    As of June 30, 2024 and 2023, the cost of energy purchases includes technical and non-technical energy losses for 2,006 GWh and 2,103 GWh, respectively.

 

19 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  
Note9 |        Expenses by nature

 

The detail of expenses by nature is as follows:

 

Expenses by nature at 06.30.24
 Description     Transmission and distribution expenses     Selling expenses     Administrative expenses     Total 
Salaries and social security taxes                  66,540                   8,716                  20,308                 95,564
Pension plans                   5,649                      740                    1,724                   8,113
Communications expenses                   2,654                   1,865                          4                   4,523
Allowance for the impairment of trade and other receivables                          -                   3,931                           -                   3,931
Supplies consumption                  14,042                          -                    1,309                 15,351
Leases and insurance                        513                        11                    1,686                   2,210
Security service                   4,402                      296                       320                   5,018
Fees and remuneration for services                 33,752                 15,874                  24,145                 73,771
Public relations and marketing                          -                   4,415                           -                   4,415
Advertising and sponsorship                           -                   2,274                           -                   2,274
Reimbursements to personnel                           -                          -                          3                         3
Depreciation of property, plant and equipment               47,854                   7,131                    5,851                 60,836
Depreciation of right-of-use asset                    386                      772                    2,701                   3,859
Directors and Supervisory Committee
members’ fees 		                        -                          -                       161                      161
ENRE penalties                 10,488                 32,183                           -                 42,671
Taxes and charges                           -                   9,373                       364                   9,737
Other                         7                         2                       171                      180
At 06.30.24               186,287                 87,583                  58,747               332,617

 

The expenses included in the chart above are net of the Company’s own expenses capitalized in property, plant and equipment as of June 30, 2024 for $ 14,004.

 

Expenses by nature at 06.30.23
 Description     Transmission and distribution expenses     Selling expenses     Administrative expenses     Total 
Salaries and social security taxes                  62,708                   8,612                  19,668                 90,988
Pension plans                   5,200                      714                    1,631                   7,545
Communications expenses                   1,834                   2,352                         13                   4,199
Allowance for the impairment of trade and other receivables                          -                 10,320                           -                 10,320
Supplies consumption                  11,939                          -                    1,062                 13,001
Leases and insurance                            -                         2                    2,403                   2,405
Security service                   3,355                      294                       897                   4,546
Fees and remuneration for services                 38,113                 15,819                  19,300                 73,232
Public relations and marketing                          -                   5,119                           -                   5,119
Advertising and sponsorship                           -                   2,637                           -                   2,637
Reimbursements to personnel                           -                          -                          4                         4
Depreciation of property, plant and equipment               48,159                   7,177                    5,888                 61,224
Depreciation of right-of-use asset                      242                      485                    1,696                   2,423
Directors and Supervisory Committee
members’ fees 		                        -                          -                         80                        80
ENRE penalties                   8,040                 21,831                           -                 29,871
Taxes and charges                           -                   9,318                       420                   9,738
Other                         6                         1                       155                      162
At 06.30.23               179,596                 84,681                  53,217               317,494

 

The expenses included in the chart above are net of the Company’s own expenses capitalized in property, plant and equipment as of June 30, 2023 for $ 12,803.

 

 

20 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  
Note10 |        Other operating income (expense), net

 

  Note   06.30.24   06.30.23
Other operating income          
Income from customer surcharges                     9,654                  9,762
Commissions on municipal taxes collection                     1,131                  2,085
Fines to suppliers                          436                    523
Services provided to third parties                     1,331                  2,533
Income from non-reimbursable customer
contributions		                       132                      99
Expense recovery                       125                        2
Framework agreement 2.c                          -                  2,824
Other                       760                    136
Total other operating income                   13,569                17,964
           
Other operating expense          
Gratifications for services                     (948)               (1,186)
Cost for services provided to third parties                  (1,071)               (1,805)
Severance paid                      (110)                  (184)
Debit and Credit Tax                  (5,615)               (5,673)
Provision for contingencies 28                (8,116)               (6,840)
Disposals of property, plant and equipment                 (1,359)                  (733)
Other                       (34)                  (359)
Total other operating expense                (17,253)             (16,780)

 

 

Note11 |     Net finance costs

 

    06.30.24   06.30.23
Financial income        
Financial interest   531   159
         
Financial costs        
Commercial interest            (133,258)            (273,268)
Interest and other               (59,597)              (42,283)
Fiscal interest                    (21)                    (26)
Bank fees and expenses                (2,019)                  (944)
Total financial costs   (194,895)   (316,521)
         
Other financial results        
Changes in fair value of financial assets and financial liabilities            (169,085)                48,730
Loss on integration in kind of Corporate Notes                (1,156)                         -
Exchange differences                (5,201)                (9,256)
Adjustment to present value of receivables                (2,496)                  (849)
Other financial costs (*)              (13,994)              (12,817)
Total other financial results   (191,932)   25,808
Total net financial costs   (386,296)   (290,554)

 

 

(*) As of June 30, 2024 and 2023, $ 13,994 and $ 12,814, respectively, relate to Empresa de Energía del Cono Sur S.A. technical assistance.

 

 

21 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

Note12 |        Basic and diluted earnings (loss) per share

 

Basic

 

The basic earnings (loss) per share is calculated by dividing the profit (loss) attributable to the holders of the Company’s equity instruments by the weighted average number of common shares outstanding as of June 30, 2024 and 2023, excluding common shares purchased by the Company and held as treasury shares.

 

The basic earnings (loss) per share coincides with the diluted earnings (loss) per share, inasmuch as there exist neither preferred shares nor Corporate Notes convertible into common shares.

 

    Six months at   Three months at
    06.30.24   06.30.23   06.30.24   06.30.23
Income (Loss) for the period attributable to the owners of the Company             107,580          (63,725)             47,269           (17,912)
Weighted average number of common shares outstanding                   875                 875                 875                  875
Basic and diluted income (loss) per share – in pesos              122.95            (72.83)              54.02             (20.47)

 

 

 

 

 

 

 

22 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  
Note13 |        Property, plant and equipment

 

     Lands and buildings     Substations     High, medium and low voltage lines     Meters and Transformer chambers and platforms     Tools, Furniture, vehicles, equipment and communications     Construction in process      Supplies and spare parts     Total 
 At 12.31.23                                 
Cost           65,917           593,629            1,490,576                661,223                 210,600           584,939             10,805         3,617,689
Accumulated depreciation        (18,844)        (237,313)            (661,741)              (301,199)               (110,106)                     -                      -      (1,329,203)
 Net amount            47,073           356,316              828,835                360,024                 100,494           584,939             10,805         2,288,486
                                 
Additions               323                     3                     619                    4,309                     6,470           124,288                      -           136,012
Disposals                    -                  (1)                (1,280)                    (139)                       (60)                     -                      -             (1,480)
Transfers               390              6,241                19,899                    7,621                        954          (45,978)             10,873                      -
Depreciation for the period           (900)          (11,496)              (26,620)                (13,850)                  (7,970)                     -                      -           (60,836)
 Net amount 06.30.24            46,886           351,063              821,453                357,965                   99,888           663,249             21,678         2,362,182
                                 
 At 06.30.24                                 
Cost           66,630           599,871            1,507,181                672,953                 217,781           663,249             21,678         3,749,343
Accumulated depreciation        (19,744)        (248,808)            (685,728)              (314,988)               (117,893)                     -                      -      (1,387,161)
 Net amount            46,886           351,063              821,453                357,965                   99,888           663,249             21,678         2,362,182

 

 

 

·     During the period ended June 30, 2024, the Company capitalized as direct own costs $ 14,004.

 

 

 

 

 

 

 

 

 

 

 

23 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

 

     Lands and buildings     Substations     High, medium and low voltage lines     Meters and Transformer chambers and platforms     Tools, Furniture, vehicles, equipment and communications     Construction in process      Supplies and spare parts     Total 
 At 12.31.22                                 
Cost           62,161           581,830            1,444,965                635,765                 164,901           502,876               6,740         3,399,238
Accumulated depreciation        (14,141)        (211,944)            (597,420)              (269,918)                 (89,212)                     -                      -      (1,182,635)
 Net amount            48,020           369,886              847,545                365,847                   75,689           502,876               6,740         2,216,603
                                 
Additions               328                     4                     944                    6,468                     5,517             89,689                      -           102,950
Disposals               (59)                     -                  (724)                    (450)                            -                     -                      -             (1,233)
Transfers             5,859              2,181                31,413                  14,211                     9,396          (63,673)                  613                      -
Depreciation for the period        (1,077)          (11,462)              (26,921)                (13,895)                  (7,869)                     -                      -           (61,224)
 Net amount 06.30.23            53,071           360,609              852,257                372,181                   82,733           528,892               7,353         2,257,096
                                 
 At 06.30.23                                 
Cost           68,270           584,015            1,475,149                655,808                 179,818           528,892               7,353         3,499,305
Accumulated depreciation        (15,199)        (223,406)            (622,892)              (283,627)                 (97,085)                     -                      -      (1,242,209)
 Net amount            53,071           360,609              852,257                372,181                   82,733           528,892               7,353         2,257,096

 

 

·      During the period ended June 30, 2023, the Company capitalized as direct own costs $ 12,803.

 

 

 

 

24 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  
Note14 |        Right-of-use assets

 

The leases recognized as right-of-use assets in accordance with IFRS 16 are disclosed below:

 

   06.30.24     12.31.23 
Right of uses asset by leases                 5,778                  6,364

 

 

The development of right-of-use assets is as follows:

 

   06.30.24     06.30.23 
Balance at beginning of the year                 6,364                  3,957
Additions                 3,273                  1,274
Depreciation for the period               (3,859)               (2,423)
Balance at end of the period                 5,778                  2,808

 

 

Note15 |     Inventories

 

    06.30.24   12.31.23
         
Supplies and spare-parts              108,167                71,577
Advance to suppliers                         -                        1
Total inventories              108,167                71,578

 

 

Note16 |     Other receivables

 

  Note    06.30.24     12.31.23 
Non-current:          
Related parties  29.c                         3                        4
           
Current:          
Assigned assets and in custody (1)                  20,430                36,684
Judicial deposits                       785                     673
Security deposits                       413                     657
Prepaid expenses                       527                  1,613
Advances to suppliers                    3,955                  2,469
Tax credits                  14,309                15,741
Debtors for complementary activities                    4,106                  2,951
Framework agreement (2)                           -                     497
Other                      8                       27
Allowance for the impairment of other receivables                    (213)                  (106)
Total current                  44,320                61,206

(1)As of June 30, 2024 and December 31, 2023, relate to Securities issued by private companies for NV 13,787,646 and NV 19,610,291, respectively, assigned to Global Valores S.A. The Company retains the risks and rewards of the aforementioned assets and may make use of them at any time, at its own request.
(2)As of December 31, 2023, relates to the Framework Agreement related to the Recognition of consumption in vulnerable neighborhoods period 2022.

 

The value of the Company’s other financial receivables approximates their fair value.

 

The non-current other receivables are measured at amortized cost, which does not differ significantly from their fair value.

 

25 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

The roll forward of the allowance for the impairment of other receivables is as follows:

 

       06.30.24     06.30.23 
Balance at beginning of the year                       106                     245
Increase                       181                       26
Result from exposure to inflation                      (74)                    (93)
Balance at end of the period                       213                     178

 

 

Note17 |     Trade receivables

 

       06.30.24     12.31.23 
Current:          
Sales of electricity – Billed                 111,427                63,938
Receivables in litigation                       200                     187
Allowance for the impairment of trade receivables                  (8,769)              (11,220)
Subtotal                102,858                52,905
           
Sales of electricity – Unbilled                177,525                61,507
PBA & CABA government credit                    9,128                  5,307
Fee payable for the expansion of the transportation and others                          2                        4
Total current                289,513              119,723

 

The value of the Company’s trade receivables approximates their fair value.

 

The roll forward of the allowance for the impairment of trade receivables is as follows:

 

       06.30.24     06.30.23 
Balance at beginning of the year                  11,220                25,944
Increase                    3,750                10,294
Decrease                  (1,435)                (3,162)
Result from exposure to inflation                  (4,766)                (9,129)
Balance at end of the period                    8,769                23,947

 

Note18 |     Financial assets at fair value through profit or loss

 

 

       06.30.24     12.31.23 
           
           
Negotiable instruments                  10,102                  1,057
Mutual funds                 165,389              147,485
Total Financial assets at fair value through profit or loss                175,491              148,542

 

 

 

 

 

26 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

Note19 |        Cash and cash equivalents

 

     06.30.24     12.31.23     06.30.23 
Cash and banks                  1,157                  2,513                  5,027
Mutual funds                      377                13,897                11,020
Total cash and cash equivalents                  1,534                16,410                16,047

 

The above figures reconcile to the amount of cash shown in the statement of cash flows at the end of the period as follows:

 

     06.30.24     12.31.23     06.30.23 
Balances as above                  1,534                16,410                16,047
Bank overdrafts (Note 24)              (26,518)                         -                         -
Balances per statement of cash flows              (24,984)                16,410                16,047

 

Note20 |     Share capital and additional paid-in capital

 

     Share capital     Additional paid-in capital     Total 
Balance at December 31, 2022             626,764                8,402             635,166
Payment of Other reserve constitution - Share-based compensation plan                        -                     78                     78
Balance at December 31, 2023             626,764                8,480             635,244
             
Payment of Other reserve constitution - Share-based compensation plan                       -                     50                     50
Balance at June 30, 2024             626,764                8,530             635,294

 

As of June 30, 2024, the Company’s share capital amounts to 906,455,100 shares, divided into 462,292,111 common, book-entry Class A shares with a par value of one peso each and the right to one vote per share, 442,566,330 common, book-entry Class B shares with a par value of one peso each and the right to one vote per share, and 1,596,659 common, book-entry Class C shares with a par value of one peso each and the right to one vote per share.

 

On April 16, 2024, 79,472 treasury shares were awarded, as part of the implementation of the Share-based Compensation Plan, to certain employees, beneficiaries of that plan. At the date of issuance of these condensed interim financial statements, treasury shares amounted to 30,772,779, with no share-based incentive plan being currently in effect.

 

Note21 |     Allocation of profits

 

The restrictions on the distribution of dividends by the Company are those provided for by the Business Organizations Law and by the negative covenants established by the Corporate Notes program.

 

If the Company’s Debt Ratio were higher than 3.75, the negative covenants set out in the Corporate Notes program, which establish, among other issues, the Company’s impossibility to make certain payments, such as dividends, would apply.

 

Additionally, in accordance with Title IV, Chapter III, section 3.11.c of the CNV, the amounts subject to distribution will be restricted to the amount equivalent to the acquisition cost of the Company’s own shares.

 

 

 

27 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

Note22 |        Trade payables

 

       06.30.24     12.31.23 
Non-current          
Customer guarantees                    1,751                  2,221
Customer contributions                       377                     651
Total non-current                    2,128                  2,872
           
Current          
Payables for purchase of electricity - CAMMESA (1)              328,139              243,828
Provision for unbilled electricity purchases - CAMMESA                121,357                78,629
Suppliers                  71,908              107,246
Related parties   29.c                   8,244                  1,122
Advance to customer                     1,688                  2,202
Customer contributions                         38                       66
Discounts to customers                           -                       65
Total current                531,374              433,158

 

(1) As of June 30, 2024 and December 31, 2023, includes $ 950 and $ 40,539 relating to post-dated checks issued by the Company in favor of CAMMESA, respectively.

 

The fair values of non-current customer contributions as of June 30, 2024 and December 31, 2023 amount to $ 48 and $ 78, respectively. The fair values are determined based on estimated discounted cash flows in accordance with a representative market rate for this type of transactions. The applicable fair value category is Level 3.

 

The value of the rest of the financial liabilities included in the Company’s trade payables approximates their fair value.

 

Note23 |     Other payables

 

  Note    06.30.24     12.31.23 
Non-current          
Payment plan - CAMMESA  2.b               270,014              191,094
ENRE penalties and discounts (1)                  88,677                93,258
Financial Lease Liability  (2)                       573                  1,350
Total Non-current                359,264              285,702
           
Current          
Payment plan - CAMMESA  2.b                 58,662                26,832
ENRE penalties and discounts (1)                  43,262                19,783
Related parties  29.c                   1,416                  2,219
Advances for works to be performed                         13                       23
Financial Lease Liability   (2)                    2,740                  3,885
Other                         92                        2
Total Current                106,185                52,744

 

(1) As of June 30, 2024 and December 31, 2023, $ 88,003 and $ 92,385 relate to penalties payable to users as stipulated in Article 2 of the Agreement on the Regularization of Payment Obligations signed in May 2019.

 

The fair values of the payment plan with CAMMESA, adjusted in accordance with the development of the MWh value (Note 2.b) as of June 30, 2024 and December 31, 2023 amount to $ 242,162 and $ 107,842, respectively. Such values have been determined on the basis of the MWh monomic price published by CAMMESA at the end of each period. The applicable fair value category is Level 2.

 

28 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

The value of the rest of the financial liabilities included in the Company’s other payables approximates their fair value.

 

(2) The development of the finance lease liability is as follows:

 

   06.30.24     06.30.23 
Balance at beginning of the year                 5,235                  2,786
Increase                 2,261                    973
Payments               (4,949)               (3,864)
Exchange difference                    955                  2,296
Interest                 2,135                    724
Result from exposure to inlfation               (2,324)                  (940)
Balance at end of the period                 3,313                  1,975

Note24 |     Borrowings

 

     06.30.24     12.31.23 
Non-current        
Corporate notes (1)                85,016                79,720
         
Current        
Corporate notes (1)              100,219                88,576
Interest from corporate notes                  2,477                  1,992
Bank overdrafts                26,518                         -
Financial loans (2)                     979                     510
Total current              130,193                91,078

 

(1)Net of debt issuance, repurchase and redemption expenses.
(2)Relate to Import financing loans taken with ICBC bank, for USD 657,597 and CNY 2,421,819. Annual interest rate: 16.6% and 15.5%, respectively.

 

The fair values of the Company’s Corporate Notes as of June 30, 2024 and December 31, 2023 amount approximately to $ 189,099 and $ 170,107 respectively. Such values have been determined on the basis of the estimated market price of the Company’s Corporate Notes at the end of each period/year. The applicable fair value category is Level 1.

 

On January 30, 2024 the Company approved the terms and conditions of issue of Class No. 3 and Class No. 4 Corporate Notes, for an aggregate nominal value of USD 60,000,000, which may be extended to USD 100,000,000, in the framework of the Global Program for the Issuance of Simple non-convertible into shares Corporate Notes for a nominal value of up to USD 750,000,000, or its equivalent in other currencies, in accordance with the provisions of the Prospectus Supplement dated February 22, 2024.

 

On March 7, 2024, the Company issued the new Class No. 3 and Class No. 4 Corporate Notes for a nominal value of USD 95,762,688 and $ 3,577, respectively.

 

The new Class No. 3 Corporate Notes were paid-in in accordance with the following detail: (i) USD 34,157,571 relates to the Integration in Kind Tranche through the delivery of Class No. 2 Corporate Notes at the Exchange Ratio; and (ii) USD 61,605,117 relates to the Regular Integration Tranche. The exchange ratio for each USD 1.00 of nominal value of Class No. 2 Corporate Notes that the Eligible Holders thereof applied for the integration in kind of Class No. 3 Corporate Notes, received USD 1.0425 of nominal value of Class No. 3 Corporate Notes.

 

29 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

Consequently, Class No. 2 Corporate Notes for a nominal value of USD 32,766,541 (value including paid-in surplus: USD 33,028,852) have been settled, with the remaining balance in outstanding nominal value (USD 27,233,459) maturing on November 22, 2024.

 

The principal on the new Class No. 3 Corporate Notes will be repaid in a lump sum on November 22, 2026. Furthermore, they will accrue interest at a fixed nominal annual rate of 9.75%, payable semiannually in arrears on May 22 and November 22 of each year, commencing on May 22, 2024.

 

With regard to the new Class No. 4 Corporate Notes, the principal thereon will be repaid in a lump sum on March 7, 2025. Furthermore, they will accrue interest at a floating rate equivalent to the Private BADLAR rate (relating to the simple average interest rate for term deposits over one million Argentine pesos with a maturity of 30 to 35 days of private banks published by the BCRA), plus an annual fixed margin of 3%, payable quarterly in arrears on June 7, September 7, December 7, 2024 and March 7, 2025.

 

On March 27, 2024, the Company issued new Class No. 4 Additional Corporate Notes for a nominal value of $ 20,821. The issuance was above par, with the issuance total value thus amounting to $ 21,502.

 

As of June 30, 2024, an amount of $ 975 (USD 1,128,719) has been recognized in the Other finance income (costs) account as recognized additional to the Eligible Holders that applied for the integration in kind of Class No. 3 Corporate Notes.

 

Furthermore, an amount of $ 2,817 has been disbursed as issuance expenses of the new Class No. 3 and Class No. 4 Corporate Notes.

 

The Company is subject to covenants that limit its ability to incur indebtedness pursuant to the terms and conditions of Classes Nos. 1, 2, 3 and 4 Corporate Notes, which indicate that the Company may not incur new Indebtedness, except for certain Permitted Indebtedness or when the Debt ratio is not greater than 3.75 or less than zero and the Interest Expense Coverage ratio is less than 2. As of June 30, 2024, the values of the above-mentioned ratios meet the established parameters.

 

Based on the above, the Company’s Corporate Note debt structure is comprised of as follows:

 

     in USD     in millions of $ 
 Corporate Notes   Class  Financial debt at 12/31/2023 Exchange Issue Financial debt at 06/30/2024   Financial debt at 12/31/2023 Financial debt at 06/30/2024
 Fixed rate - Maturity 2024  2        60,945,000  (33,028,852)                  -      27,916,148           89,624         25,234
 Floating rate - Maturity 2025 (*)  4                       -                    -  29,229,760      29,229,760                    -         25,385
 Fixed rate - Maturity 2025  1        55,244,538                    -                  -      55,244,538           80,664         50,918
 Fixed rate - Maturity 2026  3                       -     34,157,571  61,605,117      95,762,688                    -         86,175
 Total         116,189,538       1,128,719  90,834,877    208,153,134         170,288       187,712
                 
                 
     in USD     in millions of $ 
 Corporate Notes   Class  Financial debt at 12/31/2022 Exchange Issue Financial debt at 12/31/2023   Financial debt at 12/31/2022 Financial debt at 12/31/2023
 Fixed rate - Maturity 2024  2        30,000,000                    -  30,945,000      60,945,000           28,782         89,624
 Fixed rate - Maturity 2025  1        55,244,538                    -                  -      55,244,538           53,628         80,664
 Total           85,244,538                    -  30,945,000    116,189,538           82,410       170,288

 

(*) Issuance in ARS, translated into USD at the exchange rate detailed in Note 5.

 

 

30 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

The Company’s borrowings are denominated in the following currencies:

 

     06.30.24     12.31.23 
Argentine peso                51,903                         -
US dollars              162,967              170,288
Chinese yuans                     339                     510
Total Borrowings              215,209              170,798

The maturities of the Company’s borrowings and their exposure to interest rates are as follow:

 

     06.30.24     12.31.23 
Fixed rate        
Less than 1 year              104,808                91,078
From 1 to 2 years                85,016                79,720
Total fixed rate              189,824              170,798
Floating rate        
Less than 1 year                25,385                         -
Total floating rate                25,385                         -

Furthermore, the Company approved the terms and conditions of issue of Class No. 5 and Class No. 6 Corporate Notes, for an aggregate nominal value of USD 50,000,000, which may be extended to USD 175,000,000, in the framework of the Global Program for the Issuance of Simple Corporate Notes, in accordance with the provisions of the Prospectus Supplement dated July 26, 2024.

 

On August 5, 2024, the Company issued Class No. 5 and Class No. 6 Corporate Notes, for a nominal value of USD 81.920.187 and $ 17.313, respectively.

 

The Class No. 5 Corporate Notes were paid-in in accordance with the following detail: (i) USD 6,881,682 relates to the Integration in Kind Tranche through the delivery of Class 2 Corporate Notes at the Exchange Ratio; and (ii) USD 75,038,505 relates to the Regular Integration Tranche.

 

Consequently, Class No. 2 Corporate Notes for a nominal value of USD 6,649,091 have been settled, with the remaining balance in outstanding nominal value (USD 20,584,368) maturing on November 22, 2024.

 

In the first quarter of 2024, credit rating agencies S&P Ratings, Moody’s and Fix SCr improved their credit ratings for the Company’s long-term debt issued in local and foreign currency, including its Corporate Notes.

 

Furthermore, on July 26, 2024, Fix SCr ratified the credit ratings assigned to the Company for both Long-Term Issuer and the previously issued Corporate Notes, and assigned an A (Arg.) rating to Class No. 5 Corporate Notes and an A1 (Arg.) rating to both Short-Term Issuer and Class No. 6 Corporate Notes. This implies an improvement in those agencies’ assessment of edenor’s ability to meet its indebtedness.

 

 

 

 

 

 

 

 

 

 

 

 

31 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

 

 

 

 

Note25 |     Salaries and social security taxes payable

 

     06.30.24     12.31.23 
Non-current        
Seniority-based bonus                  5,560                  4,403
         
Current        
Salaries payable and provisions                21,366                42,021
Social security payable                  6,717                  5,372
Early retirements payable                     289                     491
Total current                28,372                47,884

 

The value of the Company’s salaries and social security taxes payable approximates their fair value.

 

Note26 |     Income tax and deferred tax

 

The breakdown of income tax, determined in accordance with the provisions of IAS 12 is as follows:

 

    06.30.24   06.30.23
Deferred tax                  83,514   (52,096)
Difference between provision and tax return                   2,210   (1,586)
Income tax benefit (expense)   85,724   (53,682)

 

The detail of the income tax benefit (expense) for the period includes two effects: (i) the current tax for the period payable in accordance with the tax legislation applicable to the Company; and (ii) the effect of applying the deferred tax method on the temporary differences arising from the valuation of assets and liabilities for accounting and tax purposes.

 

The breakdown of deferred tax assets and liabilities is as follows:

 

  06.30.24   12.31.23
Deferred tax assets      
Tax loss carry forward (1) 67,388   47,604
Trade receivables and other receivables 3,615   4,375
Trade payables and other payables 14,674   12,561
Salaries and social security payable and Benefit plans 6,190   4,847
Tax liabilities 726   187
Provisions 6,648   8,071
Deferred tax asset 99,241   77,645
       
Deferred tax liabilities      
Property, plants and equipments (780,165)   (736,752)
Financial assets at fair value through profit or loss (22,913)   (30,996)
Borrowings (826)   (24)
Adjustment effect on tax inflation (70,199)   (170,434)
Deferred tax liability (874,103)   (938,206)
       
Net deferred tax liability (774,862)   (860,561)

(1)The accumulated tax losses and the years in which they become statute-barred are as follow:

 

32 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  
Tax loss - Year of origin   Nominal value   Year of prescription
2022   45,419   2027
2023   37,517   2028
2024   109,602   2029
    192,538    

 

 

As of June 30, 2024 and December 31, 2023, the accumulated tax losses do not exceed their recoverable value.

 

The reconciliation between the income tax benefit (expense) recognized in profit or loss and the amount that would result from applying the applicable tax rate to the accounting income (loss) before taxes, is as follows:

 

    06.30.24   06.30.23
Income (loss) for the period before taxes   21,856   (10,043)
Applicable tax rate   35%   35%
Result for the period at the tax rate   (7,650)   3,515
Gain on net monetary position   125,695   52,921
Adjustment effect on tax inflation   (34,529)   (107,380)
Non-taxable income    (2)   (1,152)
Difference between provision and tax return                   2,210   (1,586)
Income tax benefit (expense)   85,724   (53,682)

 

Note27 |     Tax liabilities

 

    06.30.24   12.31.23
Non-current        
Current        
Provincial, municipal and federal contributions and taxes                  3,604                  3,196
Tax withholdings                  3,907                  3,442
SUSS withholdings                   183                     268
Municipal taxes                  2,118                  1,433
Total current                  9,812                  8,339

 

Note28 |     Provisions

 

Included in non-current liabilities      
  For contingencies
  06.30.24   06.30.23
Balance at the beggining of the year 17,727   20,073
Increases 3,993   3,987
Result from exposure to inflation for the period (8,222)   (10,916)
Balance at the end of the period              13,498                13,144
       
       
Included in current liabilities      
       
  For contingencies
  06.30.24   06.30.23
Balance at the beggining of the year 5,158   8,400
Increases 5,574   2,853
Decreases (1,452)   (1,107)
Result from exposure to inflation for the period (2,430)   (2,965)
Balance at the end of the period                6,850                  7,181

 

 

 

33 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  

 

Note29 |     Related-party transactions

 

The following transactions were carried out with related parties:

 

a.Expense

 

Company   Concept   06.30.24   06.30.23
             
EDELCOS S.A.   Technical advisory services on financial matters            (13,994)            (12,814)
SACME   Operation and oversight of the electric power transmission system                (702)                (877)
Andina PLC   Financial interest                  (91)                (108)
Quantum Finanzas S.A.   Legal fees                (918)                       -
Grieco Maria Teresa   Legal fees                    (2)                       -
Estudio Cuneo Libarona Abogados   Legal fees                       -                    (7)
                 (15,707)            (13,806)

 

 

b.Key Management personnel’s remuneration

 

    06.30.24   06.30.23
         
Salaries                 6,912                6,662

 

The balances with related parties are as follow:

 

c.Receivables and payables

 

 

    06.30.24   12.31.23
Other receivables - Non current        
SACME                      3                      4
         
Trade payables      
EDELCOS           (8,244)             (1,122)
Other payables        
Andina PLC             (1,325)             (2,030)
SACME                  (91)                (189)
              (1,416)             (2,219)

 

Note30 | Shareholders’ Meeting

 

The Company’s Ordinary and Extraordinary Shareholders’ Meeting held on April 25, 2024 resolved, among other issues, the following:

 

-To approve the Company’s Annual Report and Financial Statements as of December 31, 2023.

 

34 
 

CONDENSED INTERIM

FINANCIAL STATEMENTS

NOTES

  
-To allocate the $ 48,371 profit for the year ended December 31, 2023 (which at the purchasing power of the currency at June 30, 2024 amounts to $ 86,958) to the absorption of the accumulated deficit of the Unappropriated Retained Earnings account, in accordance with the terms of section 70, 3rd paragraph, of Business Organizations Law No. 19,550.
-To approve the actions taken by the Directors and Supervisory Committee members, together with their respective remunerations.
-To appoint Directors, Supervisory Committee members and the external auditors for the current fiscal year.
-To extend for a period of five years the term of the Simple Corporate Notes Program for up to USD 750,000,000 and to delegate powers to the Board of Directors.
-To extend the term for the holding of the Company’s treasury shares.
-To amend section 4 of the Bylaws, subject to its approval by the ENRE.

 

On May 9, 2024, by means of Resolution No. 271/2024, the ENRE approved the amendment to the bylaws resolved by the shareholders’ meeting, which was assented to by the CNV by means of General Resolution No. 22,743/2024 dated June 18, 2024 and sent to the IGJ for registration purposes.

 

Note31 | Events after the reporting period

 

The following are the events that occurred subsequent to June 30, 2024:

 

-Enactment of Law No. 27,742 “Bases and starting points for the freedom of the Argentine people”, Note 1.
-CNV’s assent to the approval of the Bylaws, Note 30.
-Incorporation of Edenor Tech S.A., bylaws dated July 23, 2024. The capital is subscribed and integrated by edenor, 100,000,000 ordinary, registered, non-transferable shares, with one vote and $1 par value per share and with the right to one vote per share.
-Issuance of New Class No. 5 and Class No. 6 Corporate Notes, Note 24.
-Amendment to both the seasonal reference prices and the values of the Company’s electricity rate schedules – SE Resolution No. 192/2024 and ENRE Resolution No. 520/2024, see Note 2.a.
-AFIP’s tax claim for Income Tax, Undocumented outflows and VAT, confirmation of court decision, see Note 7.

 

 

 

 

NEIL BLEASDALE

Chairman

 


 

 

 

 

 

 

35 

SIGNATURES

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

Empresa Distribuidora y Comercializadora Norte S.A.

 

 

 

 

 

 

 

By:

 /s/ Germán Ranftl

 

Germán Ranftl

 

Chief Financial Officer

 

 

Date: August 7, 2024