Colbún into the red in Q1 on Argentine gas cuts

Chilean generator Colbún posted consolidated first quarter net losses of 7.54bn pesos (US$12.9mn) compared to a profit of 1.68bn pesos in the same period of 2004, mainly due to higher operating costs as a result of Argentina's gas crisis, the company told securities regulator SVS. Colbún's 1Q05 revenues increased 21.6% to 54.7bn pesos, but a 63.1% increase in operating costs to 51.7bn pesos meant that operating profits fell 87.8% to 1.44bn pesos. The higher operating costs were due mainly to higher consumption of diesel at Colbún's Nehuenco I and Nehuenco III plants due to the natural gas export restrictions from Argentina and higher power purchases on the spot market. Diesel purchases cost the company 10.8bn pesos in the first quarter compared to a mere 46mn pesos in 1Q04. Spot market purchases increased to 15.9bn pesos from 6.07bn pesos in the same period of 2004. Non-operating losses increased 9.7% to 9.58bn pesos, primarily due to higher losses from exchange rate differences, which increased 74% to 7.8bn pesos as a result of the higher depreciation of the peso against the dollar. Electricity sales rose 31% to 39.2bn pesos in 1Q05, while capacity sales increased 11% to 13.4bn pesos in the three-month period. Colbún's generation increased 10% to 1,730GWh, of which 931GWh was thermoelectric (up 4% year-on-year) and 799GWh was hydroelectric (up 18% year-on-year). Physical electricity sales increased 20% to 2,111GWh due to higher sales to regulated and non-regulated clients. Sales to regulated clients increased 5.5% to 1,245GWh thanks to higher demand from distributor Chilectra and higher node prices. Sales to non-regulated clients increased 41% to 769GWh, due to higher demand from mining company Codelco's El Teniente division. Sales to distributors without long-term contracts increased 185% to 97GWh due to higher sales to distributors such as Saesa and Empresa Eléctrica Puente Alto. On March 31, 2005, the company increased its equity 7% to 683bn pesos, up from 639bn pesos in March 2004. As of March 31, Colbún had 1,650MW installed capacity, 852MW thermo and the rest hydro. Belgium's Tractebel controls Colbún.