Central Puerto Q3 2026 Earnings Call Transcript

Central Puerto (NYSE:CEPU) reported third-quarter financial results on Thursday. The transcript from the company’s third-quarter earnings call has been provided below.

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View the webcast at https://mzgroup.zoom.us/webinar/register/WN_eIsLLROZTp2r6QkaFgFSpg#/registration

Summary

Central Puerto reported third-quarter adjusted EBITDA of $185.3 million, marking a 27.8% increase from the previous quarter and a 70.3% rise year-on-year.

Revenues for the quarter were $532.4 million, reflecting a 17.4% increase quarter-on-quarter and a 157.6% increase year-on-year, driven largely by spot thermal revenues and self-procured fuel.

The company signed a significant natural gas supply agreement with Pluspetrol, marking a strategic move in the sector that covers approximately half of Central Puerto’s daily gas needs.

Capital expenditures for the quarter were $36.7 million, with significant progress in battery energy storage projects, which are expected to contribute $25-$27 million to EBITDA in 2027.

The net financial leverage ratio improved to 0.72 times adjusted EBITDA, down from 1.2 times last quarter, with net financial debt of $343.7 million.

Central Puerto is on track to meet its full-year adjusted EBITDA guidance of $500-$550 million, despite expected reduced EBITDA in Q4 due to maintenance activities.

Management highlighted opportunities for new acquisitions and organic growth, particularly in light of reduced leverage, and mentioned potential for future dividends depending on growth opportunities.

The company is actively pursuing exploration and development in the oil and gas sector, with strategic plans for the Aguada del Chivato and Corralera blocks.

Full Transcript

OPERATOR

Good morning, ladies and gentlemen. Welcome to Central Puerto’s third quarter 2026 earnings conference call. A slide presentation is accompanying today’s webcast and will also be available on the Investors section of the company’s website. All participants will be in a listen-only mode during the presentation. After that, there will be an opportunity to ask questions. Please note this event is being recorded. If you do not have a copy of the press release, please refer to the Investor Relations section on the company’s corporate website at www.centralpuerto.com. In addition, a replay of today’s call will be available in the coming days by accessing the webcast link in the same section of Central Puerto’s website.

Our hosts today will be Mr. Fernando Bonnet, Central Puerto CEO; Mr. Enrique Terraneo, the company’s CFO; Mrs. Maria Laura Feller, Head of Investor Relations; Mr. Osbaldo Cado, our Finance Manager; and Mr. Alejandro Diaz Lopez, Head of Corporate Finance. Maria Laura, please go ahead.

Maria Laura Feller (Head of Investor Relations)

Good morning, everyone, and thank you for your time today. We’ll cover our third quarter results and then we will direct your questions. As always, please keep in mind the disclaimer on slide 2 regarding forward-looking statements and non-IFRS measures, including adjusted EBITDA. Also, as a reminder, since January 1st of this year, our functional currency is the US dollar rather than the Argentine peso, and we have refined how we convert historical peso figures into dollars.

You’ll find the full detail in note 2.2 to our financial statements. All figures are in US dollars, unless otherwise stated. Let’s turn to slide 3 for the highlights of the quarter. Third-quarter adjusted EBITDA came in at $185.3 million. That’s up 27.8% from the $145.0 million achieved in the second quarter and up 70.3% versus the $108.8 million in the third quarter of 2025. Adjusted EBITDA for the first nine months of the year reached $451.0 million and our last 12 months adjusted EBITDA stands at $480.3 million. Revenues totaled $532.4 million, up 17.4% quarter on quarter from $453.3 million and up 157.6% year on year from $206.7 million.

This figure includes $218.6 million of spot revenues related to self-procured fuel. Total generation reached 4,791 GWh, representing approximately 13.6% of total generation on Argentina’s grid. In the quarter, our assets’ generation decreased 5.2% from the second quarter’s 5,055 GWh and increased 5.6% versus the 4,539 GWh generated in the third quarter of last year. Such effect was explained by programmed maintenance works in Central Puerto and Central Costanera assets.

On the investment side, capital expenditures were $36.7 million in the quarter and $458.6 million for the first nine months of 2026. That includes progress made during the quarter in our battery energy storage projects, which are expected to be completed in the following months, and maintenance works. Our balance sheet continues to show strength with a net financial leverage of 0.72 times adjusted EBITDA, from 1.2 times last quarter, with net financial debt of $343.7 million.

On the commercial front, on October 1st we signed the first direct natural gas supply agreement of its kind in the sector. Together with Pluspetrol we became the first non-integrated companies to withdraw planned gas volumes from the CAMMESA pool. The agreement will run through December 2028, the end of the current planned gas program. The 2 million cubic meters per day represents approximately half of the gas needed for the average daily operations of the Central Puerto complex.

Briefly, total market demand in this quarter was 36.7 TWh, up 3.8% quarter on quarter and 4.1% year on year, driven mainly by residential demand which grew 7.0% versus the second quarter. Also in this quarter the generation mix shifted. Hydro generation increased 35.2% quarter on quarter on better hydrological conditions while thermal generation declined 15.7%. Gas volumes under the Gas Acuerdo program fell during the winter months and were compensated by fuels procured directly by generators.

Regarding Central Puerto, our total generation was 4,791 GWh. Compared to the second quarter, we had lower thermal dispatch at some Central Puerto and Central Costanera assets which underwent scheduled maintenance, and this was partially offset by higher output at Brigadier Lopez, San Lorenzo, Piedra del Aguila, and the renewables. Year on year, Piedra del Aguila nearly doubled its output, up 93.6%, and Brigadier Lopez added 371 GWh as its new combined cycle ramped up.

Our renewables generated 469 GWh, up 8.4% quarter on quarter, with the Cafayate and San Carlos new solar farms. Revenues were $532.4 million, up 17.4% quarter on quarter and 157.6% year on year. Energy sales were $509.5 million, representing 95.7% of the total. Spot thermal revenues were the main driver, reaching $289.8 million, up 35.0% quarter on quarter and 192.2% year on year. Such increase is explained by higher seasonal marginal system prices during the winter months and the fuel cost component that is reflected in revenues when we self-procure fuel for spot generation in the third quarter.

This included approximately $218.6 million of natural gas, LNG, and liquid fuels purchased directly, compared to $182.8 million in the second quarter. When CAMMESA supplies the fuel under the Gas Acuerdo program, that cost is managed by CAMMESA and therefore is not recognized as revenue by the company. Contracted revenues totaled $219.7 million, and within that figure thermal MAT and PPA revenues were $167.3 million, renewables $29.8 million, and hydro $22.5 million. As spot revenues grew faster with the self-procured fuel component, contracted revenues represented 43% of energy sales compared to 51% last quarter.

Adjusted EBITDA was $185.3 million, up 27.8% quarter on quarter and 70.3% year on year, with a margin of 34.8% compared to 32.0% last quarter. Because our revenues now include the fuel cost component of self-procured fuel, margins are not directly comparable to last year. The improvement was mainly driven by the margin captured on self-procured fuels and seasonal winter spot prices, together with higher volumes from all three PPA thermal assets, including the new Brigadier Lopez combined cycle, and from Piedra del Aguila on better water resources.

The solar farms we acquired, Cafayate, and built, San Carlos, in 2025 added further volume. Self-procured fuel reached 55.3% of our total fuel consumption in the third quarter, up from 37.2% in the second quarter and 18.1% in the first. That is an average of almost 4 million cubic meters per day of gas equivalent out of 7.2 million in total. Our adjusted EBITDA for the first nine months of the year was $451.0 million, and we are on track to reach our full-year guidance of $500 to $550 million. Capital expenditures for the quarter were $36.7 million and $458.6 million for the first nine months. Of that amount, $108.9 million correspond to the battery storage projects. Regarding such projects, all civil works are complete and the battery containers have been installed. Construction is 81% complete at Central Puerto and 87% at Central Costanera, and 82% of the total project capex has already been executed.

Our projects are expected to be the first to reach commercial operation among all the projects under the ALMA GBA and ALMA SADI programs. Once operational, we expect these projects to contribute between $25 and $27 million to our consolidated adjusted EBITDA in 2027. On oil and gas, we continue to work with the Neuquen provincial authorities on the CENGE process for the Aguada del Chivato and Aguada de Bocarei blocks, and we are preparing the documentation for our EEG presentation. In addition, on October 21st the province awarded the Corralera Noroeste block to our subsidiary PESA.

As of September 30th, our total outstanding financial debt was $681.5 million against cash, cash equivalents, and financial current assets of $337.8 million. That leaves us with net debt of $343.7 million. Additionally, our last 12 months adjusted EBITDA was $480.3 million, and that is how our net leverage ratio was 0.72 times the adjusted EBITDA in the quarter. In July we issued the Class E notes for $94.3 million, and after quarter end, on October 6th, we issued the Class F notes for $50.0 million.

Thank you very much for your time and for your continued confidence in Central Puerto. I will now hand over for the Q&A and then our CEO will share his closing remarks.

OPERATOR

Thank you very much for the presentation. We will now begin the Q&A section for investors and analysts. If you wish to ask a question, please press the Raise Hand button. Our first question comes from Guilher Milima. You can open your microphone.

Guilher Milima (Analyst)

Good morning, guys. Thanks for the opportunity to ask a question. I have two quick questions here. First, if you could comment on the full-year EBITDA expectations. As you wrote in the earnings release, you were expecting around 500 US dollars and 500–550 million. Just wanted to understand what are your expectations for the fourth quarter comparing to last year’s fourth quarter, as last year the EBITDA was around 100 million if I’m not mistaken. If you just could comment on what you are seeing for the rest of the year and your expectations for the full-year EBITDA in 2026.

And the other question is related to capital allocation. We saw leverage decrease to around 0.7 times net debt to EBITDA. If you could just comment on the opportunities you are seeing for this low level of leverage and if we should expect a recurring dividend for 2027. That’s it. Thank you.

Enrique Terraneo (Chief Financial Officer)

Thank you for your question. Going to the first one, talking about the expectation, as you mentioned we are seeing something around 500 to 550 depending on the dispatch of the units, the hydro levels, the inflows coming from the Collón Curá River and the main river that in the third quarter were very, very high, and we are seeing that they are reducing right now, and the fuel consumption. We are not expecting liquid fuels for this final quarter and the dispatch of our units.

So comparing to last year I think will be more or less similar. We have more contracts today, but on the other hand we have a big maintenance, programmed maintenance, in our Costanera combined cycle — more or less 60 days of maintenance on one GT and 30 days of maintenance on the other one. So the EBITDA will be reduced — that 100 that you mentioned will be perhaps between 75–80 million dollars, and depending, as I mentioned, on the inflows from Piedra del Aguila and the dispatch of the steam turbines that are very sensitive to temperatures.

Right now we are seeing the dispatch of the TB6 and TB9 from Central Puerto that were out of dispatch since the end of August. So we are right now seeing a ramp-up of temperature, so it could increase our EBITDA a little bit depending, as I mentioned, on the temperature. So we can see it in the range of $75–80 million, and could be $90 if the temperature goes up higher than we are seeing right now. Going to the second one, the leverage ratio, as you mentioned, we are reducing that from increasing EBITDA. So this gives us full flexibility to enter a new acquisition. We are seeing opportunities in the government assets the government is planning to sell, talking about the hydro and the thermal units, and other opportunities to acquire. We are looking to acquire and organic opportunities of growth. Talking about dividends, this will be the decision of the shareholders’ meeting.

Depending on the growth opportunities we will perhaps advise the board on some dividends, but that will depend on the opportunities that we see as a measure — a decision — of new assets and new developments, organic developments.

Guilher Milima (Analyst)

Thank you.

OPERATOR

Our next question comes from Tomas Perrochin with Balance. You can open your microphone.

Tomas Perrochin (Analyst at Balance)

Hi, good morning. Thank you for taking my questions. Congrats on the results. Fuel self-procurement. We have seen that you are making progress with self-procurement. As we understand, to get gas in the spot market, you also need firm gas transportation capacity. Do you think you will be able to secure enough firm transportation capacity to cover 100% of your thermal fleet? And regarding the Pluspetrol agreement, could you give us some color on the average price you are paying compared to the Plan Gas?

Enrique Terraneo (Chief Financial Officer)

Okay, going to the first question first. Thank you for your question. Going to the first one. I don’t see easily to cover 100% of our gas capacity with firm transportation. Right now we have we acquired transportation from TGS around 400 cubic meters and we expect to and we are analyzing the opportunity to enter in the in the TGN new pipeline that goes for mostly for the center of the county and the north. So we are advising that for the San Lorenzo plant, the PIA developers plant and in some cases some for Buenos Aires area.

But with the TGS and TGN I think we could be benefit from the liberation of the transportation of CAMMESA that will come to us sooner or later. So I don’t see the need to have 100% of our capacity contracted because the fluctuation of the production of the combined cycle right now are not easily to predict or are not I think wealthy to have 100% correcting the prices that we are seeing of this transportation. But at the end of the day I assuming that in the near future with TGS and TGN we can at least reach the level of between 40%, 50% of our capacity efficient thermal capacity contracted.

Talking to your going to your second question. The price that we have with the Pluspetrol is the same price that Pluspetrol has with the Plan Gas is between 2.7 and 4.1 depending on the dollar per million cubic meter and depending on winter time. On summertime, it’s the same price that Pluspetrol has at the Plan Gas.

Tomas Perrochin (Analyst at Balance)

Okay, very clear. So my second question is regarding the updates on the recent changes from the Secretary of Energy. Especially the increase of intercontracting limit to 60% for existing spot thermal start in April 2027. How is that going for you? How much you have already contracted and how do you expect that to evolve in 27. And just a quick one regarding the capacity auction that is taking longer than expected. You have some information there.

And also in the Von EBM privatization process

Enrique Terraneo (Chief Financial Officer)

Going to the first one, we right now we reach the limit of 20% that the former regulation established and we are looking for to increase that for the for sure for the next the next year reaching the 60%. We are seeing that difficult without entering in a contract with the distribution companies. I think we could reach perhaps 10%, 15% more the next coming quarters, but reaching the 60% of our thermal capacity. We will need to enter in a contract with distribution companies that are as you know, or requires additional regulation in terms to mainly back through of those contracts to the demand.

And that requires for federal regulation and for the rest of distribution companies a provincial regulation, a local regulations in order to as I mentioned, to have this pass through directly to the demand working without the delays that they need to have right now. Every contract they sign to to this to this new scheme and requires as I mentioned, perhaps automatic schemes that are not set right now. So we expect to increase that to reach the levels of the new regulation will require time and a new regulation for distribution companies.

And the last one, talking about cerca, I don’t know. We talk every. Every every week with the authorities and they are working in order to to have this process established at least at the end of the of the year and try to to move forward at the beginning of the of the next one. But I don’t know, we. We don’t have a certain timeline for that. We expect to if not this end of this year, we expect for the first quarter next one and the same of only privatization.

We are talking every week and they say that they are ready to launch, but they still have some approvals and some paperwork. But we don’t have also a clear time then.

Tomas Perrochin (Analyst at Balance)

Okay, thank you very much. And my last question is on the oil and gas side, how is the process of building your team going? You mentioned that you are preparing the RIGI application. Could you share a bit more about your development plans for the blocks, especially the expected timeline for the exploration activities? Thank you very much.

Enrique Terraneo (Chief Financial Officer)

Well, as you mentioned, we are building the team. We are stronger. We are stronger in the team every day. So we are setting the challenge or the most important position challenging right now. And in terms of RIGI, we are working very hard with the lawyers and all the team in order to have all the documentation ready to present or to apply to RIGI as soon as possible. So we are expecting this or this year or the beginning of the next one when we have all the information ready in terms of exploration.

First, as I mentioned, we need to reach the sedge for Aguada, Chivato and Bucare and then we are expecting to move forward perhaps first quarter next year or early second quarter next year.

Tomas Perrochin (Analyst at Balance)

Okay, thank you very much.

OPERATOR

Thank you. Our next question comes from Matteo St. Versity. You can open your microphone.

Matteo St. Versity (Analyst)

Hi, thanks for taking my question and congratulations on another good set of results. My question is on the oil and gas side. So you reported some Capex disbursements of some 55 million in the results yesterday. I was just wondering if you could share some color on what that was for. Specifically if it was the payment for Agua de Chivato, Bucare or any other exploration expenses that you may have incurred. Also still on the oil and gas side, if you could share any preliminary capex expectations for Q4 and next year.

And lastly we already saw Geopark come out with some draft development plans for the block that they bought which is neighboring to yours and it’s also a block of the same size and their development points to a potential production of 50,000 barrels per day. I know it’s still early to gauge the potential on any of the blocks but I was just sharing if you’re thinking of something in that magnitude and if that was the case, if you would be willing to bring a partner to help you develop that block.

Yes, those would be my questions. Thank you.

Enrique Terraneo (Chief Financial Officer)

Okay, thank you for your questions. Talking about the expenditures that you mentioned, this was the decision and not yet any development ready in that area. So was the acquisition of the chibatron of Array coast and as we talked earlier we are planning to present, we’re working hard to present the saints requirement and the RIGI for end of this year early for the first quarter and then after that we are planning to enter in an exploration phase for Aguada Chivato and Bucare and then as if we enter an RIGI regime we need to spend at least $240 million in the next two years.

So this was more or less the capital expenditure that we expect for the areas. And talking about Corralera, as you mentioned, it’s very, very early stage to say what the possible or the potential of the area are. But as you mentioned, if everything goes as we expect and the implementation information that we saw when we evaluate the area goes well, it will be more or less the same possible production as you mentioned of Geopark are expected. So we are seeing more or less in the, in the, in a situation that we confirm, all the information that we saw would be some of this, as you mentioned, in that level of production, whenever it was fully developed.

So Corralera it’s an earlier stage than Chivato. So we signed agreement for exploration with the Neuquén oil company and we have an agreement to drill 2, 3 wells in 4 years to develop the risk of the area. So we are planning to enter in that exploration phase next year and then after that we will see if we need to, if we can go to exploitation phase and to move over to an exploration, an exploitation phase, the same as we expect on Chivato.

Matteo St. Versity (Analyst)

Okay, thank you. And just to follow up is, and you, you would be willing to look into partnering with an operator to, to develop Corralera and potentially also Chivato and Bucare?

Enrique Terraneo (Chief Financial Officer)

No, no, in fact we are developing our own resources. We have agreement with, with a, a very well known company that worked for in US and in Permian, i.e. Radius Energy and they are working with us in order to develop and to, and to operate the areas by ourselves.

Matteo St. Versity (Analyst)

Okay, thank you. Thank you very much and congratulations again.

Enrique Terraneo (Chief Financial Officer)

Thank you.

OPERATOR

Thank you. Our next question comes from Martin Adamsett. Could you give us more color on the 4Q26 major maintenance at Centro Costanera? If I’m not mistaken, when did you have the last major maintenance on the asset and how much capex would this major maintenance require?

Enrique Terraneo (Chief Financial Officer)

Okay, thank you Martin for your question. The previous major maintenance was in 2000. The previous year was a big maintenance on the GT number eight. And the boiler was a big intervention of the boiler that this unit never has. So the boiler was at the original stage or with a major intervention of the boiler and the GT number eight. And this time was the time for the GT number nine intervention. The intervention. So we changed the hot parts of the steam turbine.

We made an abramic of the hot parts of the steam turbine, sorry, the gas turbine. And we don’t expect a new intervention for this unit until 2029. And the CapEx around that was around $40 million.

OPERATOR

Thank you. Our next question comes from Jamiro Guerrero.

Jamiro Guerrero (Analyst)

Thanks for taking my question and congratulations on the results. What capex should we expect for fourth quarter and for 2027 and on the Costanera combined cycle overhaul, how much will it cost and how long will the unit be offline? Thank you.

Enrique Terraneo (Chief Financial Officer)

Well, talking about the electricity part, we are finishing our best battery system storage projects and at the end of the year, at the beginning of the next quarter. So in that sense we are not expecting new growing capex at least until that we don’t see the new thermal auction so that will determine if we get awarded on that auction or not. But right now we are finishing the expansion capex of the of the storage system projects so we are not expecting additional ones.

As we mentioned aside from new awarding of the cerca capacity auction and turning the normal maintenance will be as I mentioned we are not expecting big maintenance of the unit so will be the regular maintenance capex. And in oil sector as I mentioned if we enter in a RIGI scheme we will see that 240 million is to next year’s perhaps separating the half year and year and that’s aside from acquisitions and new wording projects. This will be more or less how the topics will be

OPERATOR

Thank you. We have a couple of questions from Alejandro Christensen with Latency Securities. How much of second Q26 and third Q26 EBITDA came from margins on self-procured LNG and liquids? Do the new CVP caps reduce that margin going forward? In your view, what’s the government intention in accelerating contracting for legacy units and moving liberalization up to 2029? Do you expect contract prices to come down? Can you give guidance on contract prices per megawatt including fuel?

What’s the drilling timeline and deadline for the Corralera Norte commitment and the plan at Pista? Would you consider a partner farm-down or selling the acreage once it’s de-risked?

Enrique Terraneo (Chief Financial Officer)

Hi. Well, a lot of questions. Going one by one: talking about the fuel margin, or the fuel earnings, the full year were between 7 million and 75 million. We are not expecting a reduction talking about Resolution 293. In fact, the margin will be reduced, but we are expecting to bring online the DGS transportation that we acquired, so that gives us an opportunity to make more margin in terms of FR regulation, so that will compensate the reduction, and also the agreement that we reached with loose petrol.

So I think this reduction of margin that’s coming from Resolution 283 will be covered by the increase of margin coming from the self‑procure gas, petrol, and others. We are expecting to enter in new agreements and the additional margin that we could capture having the transportation coming from DGS. So we expect more or less a compensation around that and, for sure, depending on the final numbers for next year, depending on how cold the winter comes and how much LNG we can use and procure.

Going to the other one: What is the government intention in accelerating contractualization? I think one big point for the government is the price spikes that the spot consumers—especially commercial consumers and small industrial consumers—suffered during the winter. So they are willing to encourage new contractualization, and the other kind is that they need to release energy for new contractualization. The 20% is not enough to contractualize all the residential—sorry, commercial and industrial—end users.

So, in that sense, the government will increase that so we can go and try to contractualize those customers that suffered big spikes during winter. But as I mentioned, reaching the 60% is higher even with those customers. So after that, if you want to reach 60%, we need to go to the distribution companies and not have that regulatory issue that we mentioned about Westerns. And the last one—I think that we already talked about it—for Halera, we reached an agreement of four years of exploration with three wells that we need to do in order to risk the area, and in case it’s different. As you mentioned, we are not going to enter NS directly, so that will be a different timeline. So we expect in PESA at the time of the WIGI that we are planning to establish, or to set—establish this. As I mentioned, $240 million in the next two years.

OPERATOR

Thank you very much for the answers. This concludes our Q&A session, and I would now like to turn the conference back to Mr. Fernando Bonnet for his closing remarks.

Fernando Roberto Bonnet (Chief Executive Officer)

To wrap up, this was another quarter of strong execution for Central Puerto. We delivered solid financial results, continued to strengthen our commercial position, maintained a disciplined balance sheet, and made meaningful progress across our strategic role initiatives. Looking ahead, we are focused on bringing our battery storage project into operation as scheduled, advancing the development of our newly acquired Vaca Muerta assets, and pursuing new business expansion opportunities to create long‑term value for our shareholders while preserving financial stability.

I would like to thank our people for their commitment, our customers and business partners for their trust, the financial sector, and our shareholders for their continued support. See you soon. Thank you for joining us today. Operator, we can disconnect.

OPERATOR

Thank you very much. This concludes today’s presentation, and you may now disconnect.

Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company’s SEC filings and official press releases. Corporate participants’ and analysts’ statements reflect their views as of the date of this call and are subject to change without notice.