Empresas Lipigas S.A, leader in commercializing and distributing gas in Chile with operations in Colombia and Peru, announced today its consolidated financial results for the second quarter ended June 30, 2017.
Angel Mafucci, General Manager of Empresas Lipigas said: “EBITDA generated in the first half of 2017 reached CLP 40,891 million and grew 9.5% compared to the previous year. LPG sales volume in Chile grew 3.8% regarding 2016. This increase, although influenced by a winter season with lower temperatures in the central zone, is a reflection of our strategy to be each day closer to the end customer. In Colombia, results continue to evolve favorably. In Peru, a situation of weakness in margins persists caused by the informality in the LPG market. Yet, we have achieved better results. On the other hand, in Chile we have continued with the construction of natural gas distribution networks in the cities of Puerto Montt and Osorno and a small power plant (6 MW) in Concón. Both projects, which shall begin operating during the second half of the year, are a sample of multi-energy solutions adapted to the needs of our customers”.
Consolidated revenues reached CLP 124,792 million, representing a 13.2% increase that occurs in all three countries. Chile and Colombia increased revenues by CLP 10,168 million (12.9%) and CLP 1,593 million (17.3%), respectively, mainly due to greater volumes and higher unit prices influenced by the price increase of oil by-products. In Peru, higher revenues of CLP 2,780 million (12.7 %) regarding the 2Q16 was generated by greater sales volume. Consolidated sales volume in equivalent LPG tons increased by 6.5%.
Gross margin reached CLP 53,763 million, increasing by 10.8%. In Chile, gross margin increased by 11.0% compared to 2Q16, due to greater volumes and improved unit margins. In Colombia, gross margin increased by 24.5% due to better unit margins and increased sales volume. In Peru, gross margin slightly increases by 2.4% although sales in equivalent LPG tons increased by 13.7%. This basically originates in lower unites of the LPG business, a situation that is influenced by the informality level in the market.
Operating expenses increased by CLP 1,148 million (4.2%). Expenses in Chile increased by CLP 1,172 million (6.3%) mainly by salaries, freight, tank and meter re-inspections, marketing and outsourced services, the increase relates to the development of strategies of integration of the distribution chain to the end customer. In Colombia, expenses increased by CLP 328 million (11.3%) due to greater expenses in freight, salaries and taxes. In Peru expenses decreased by CLP 351 million.
Negative non-operating income decreased by CLP 306 million mainly by lower losses in the restatement of collateral liabilities in Chile and Colombia and lower negative results by adjustment units compared to 2Q16 given lower inflation in Chile.
Earnings after taxes increased by 24.7% due to improved operating income, also driven by greater sales volume and unit margins during the quarter and by an improved non-operating income partially offset by greater income taxes during the period.