Informe Financiero

1Financial Report Third Quarter 2014 ISAGEN S.A. E.S.P.

As of September 2014, ISAGEN’s revenue totaled $1,726,766 million, 16% over that obtained in the same period for the previous year. The net profit was $302,542 million, showing a reduction of 4% compared to the same period in 2013.

Listed below are the major regulatory events that occurred in the energy market during the third quarter this year.

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P R O D U C T I V E E N E R G Y

Third Quarter 2014

Industry Regulation

Modified the schedule applicable to the sale of natural gas on the primary mar-ket and for the implementation of the transportation transition mechanism for the long-term “Use it or Sell it” process for 2014. The main changes for ISAGEN are as follows:

• The new period of direct negotiation and contract signing will be between September 22 and October 3, 2014.

• Direct negotiation shall be held on November 5, 2014 regarding the terms under which the owners of excess capacity will allow its use by the owners of supply rights.

Modifies CREG Resolution 089 of 2013, which regulates the wholesale natural gas market. Listed below are the most important aspects that are modified:

• Eliminates the limitation on allowing non-regulated users to buy directly in the “Use it or Sell it” market, which before they had to do through a reseller.

• Creates a procedure to avoid penalties for gas consumption schedule variations at thermal power plants when they are due to energy re-dispatches and authorizations from the National Dispatch Center.

CREG Resolution 113 of August 28, 2014

Resolution 122 of September 12

of 2014

Regulation in the natural gas market

2 Financial Report Third Quarter 2014 ISAGEN S.A. E.S.P.

• Specifies that in order to determine the type of negotiation in annual sales, auctions or direct negotiation processes, the average demand curve of UPME’s balance shall be used, and not low demand as had been established.

• Gives more flexibility to the notice times required to declare the end of extenuating circumstances or events of force majeure.

Regulates the signing of firm natural gas bi-monthly contracts in the primary market. The aim of this new type of contract is to allow producers to sell sur-plus amounts from annual sale processes defined by CREG Resolution 089 of 2013.

These contracts shall be awarded through monthly First-Price Sealed-Bid Auctions organized by the Market Manager. The Resolution includes all the operating details for these auctions, including base price, type of auction, award mechanism, etc.

CREG Circular 045 of 2014 published a review to the 2014 Regulatory Agenda, featuring:

• The 2014 agenda includes modifications to Resolution 202 of 2013 (remu-neration for distribution), modification to the distribution code, and modi-fication of natural gas wholesale sales regulation. These resolutions are expected to be issued in the fourth quarter of 2014.

• Regulations pertaining to the rate formula of jet fuel as a liquid fuel and the basis for the fuel transport by pipeline rate methodology are expected to be issued in the last quarter of 2014.

• The definitive Resolution of the Organized Regulated Market (ORM) was delayed for the third quarter of 2014, but it is still pending.

According to the financial stability criteria stipulated by law, rate formulas established by the CREG must remunerate shareholder equity in the same way an efficient company in a sector of comparable risk would. To do so, two Draft Resolutions were issued that apply to natural gas transport, gas fuel distribution, LPG transport by pipeline, electric energy transmission and distribution in the National Electric Grid, and electricity generation and distribution in unconnected areas.

CREG Resolution 136 of September 17

of 2014

CREG Circular 045 of July 9, 2014 -

REGULATORY AGENDA REVIEW 2014

CREG Draft Resolutions 083 of June 12 of 2014

and 112 of August 5 of 2014

Other Regulations


This regulation extends the application of the concept of Firm Energy Obligation assignments to cases that already have extended maintenance and delays in building power plants. Firm Energy Obligation assignments cover the entire Reliability Premium period (December 1 year x to November 30 year x+1).

Firm Energy Obligation assignments may be undertaken with the power plants of other agents, negotiating the price conditions bilaterally. It should be noted that this mechanism is a last-resort coverage option for the power plant, subsequent to the use of Sale Reconfiguration Auctions.

In the case of power plants under construction, the assignments may be made provided progress in the project is under 80%, and similar to the case of the Sale Reconfiguration Auctions. Assignments may delay the start of the OEF’s obligation period for projects under construction by one year.

Resolution 114 of August 28, 2014

The first draft published with CREG Resolution 083 of 2014 attempts to define the methodology to calculate the discount rate established for network transmission activities in the National Electric Grid and electricity generation in unconnected areas. Said rate corresponds to that calculated from the estimate of the weighted average capital cost (WACC).

Draft resolution 112 clarifies that the discount rate for each activity shall be defined by the CREG in a subsequent resolution, as well as the delta beta value (Δ ).


Energy Market

Energy Demand

So far in 2014, domestic energy demand has been 47,461 GWh. This is 4.5% greater than the figure for the first nine months of 2013.

This increase in total demand so far this year is primarily explained by climatological conditions (warming,) which directly affects regulated demand, moving from 3% to 4.5% average growth. This increase in demand is evident in the country’s hot regions.

National Energy Demand (GWh)

Source: XM- Portal BI

National EnergyDemand

ISAGEN EnergyGeneration

4.5% 3%

Average SpotPrice as of September 2014

Average ContractPrice as of September 2014

239.6 $/kWh 131.1 $/kWh

Domestic Demand 2013 Domestic Demand 2014

January

5,025 5,167 4,610 4,902 5,033 5,316 5,106 5,169 4,955 5,218

February March April June

5,163 5,411

May

5,206 5,513

July

5,196 5,419

August

5,085 5,346

September

The growth of regulated energy demand accumulated to September 2014 was 5.1%, while the growth of non-regulated energy demand was 3.5%.

Moreover, in the last twelve months (October 2013 - September 2014), Colombian electricity demand was 62,972 GWh, a 4.0% increase from that of the October 2012 - September 2013 (60,403 GWh).

Accumulated to September

2013: 45,379 GWh 2014: 47,461 GWh


Water Levels and Evolution of National Electric Grid Reserves

The following diagram shows the monthly trends of water flows to the National Electric Grid. As observed, in 2014 water levels have been below the historical average in general terms. However, as compared to last quarter, this period shows a slight increase in the levels in the system, although some of the areas where ISAGEN’s power plants are located have remained below the historical average.

Source: XM

Source: XM

Water Contributions to the National Electric Grid

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25

0

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0

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7

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8

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8

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9

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9

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Jul/1

0

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0Ja

n/11

Apr/

11

Jul/1

1

Oct/1

1

Jan/

12

Apr/

12

Jul/1

2

Jan/

13

Apr/

13

Jul/1

3

Oct/1

3

Jan/

14

Apr/

14

Jul/1

4

Oct/1

2

50

75

100

125

150

175

200

225

250(% media)

Natural water flows in % of historical levels

January February March April May June July August September

Antioquia 97.6 122.4 105.7 77.1 81.2 82.9 60.4 73.4 76.0

East 70.5 65.3 88.2 91.9 55.3 130.0 123.3 94.3 102.8

Center 103.3 83.2 164.3 66.5 75.0 134.0 140.3 107.0 105.0

Caribbean 75.3 50.0 73.4 61.3 78.4 98.4 66.4 81.4 103.9

Valle 113.7 125.2 143.6 90.1 113.1 83.9 74.0 68.9 69.4

National Electric Grid 96.9 110.3 113.9 79.4 76.4 106.8 97.4 85.1 86.1

San Carlos (Punchiná) 145.9 202.5 198.0 105.8 119.6 116.8 95.7 93.1 107.7

Miel I (Amaní) 124.2 131.6 100.0 50.5 91.6 63.2 49.8 35.6 59.1

Jaguas (San Lorenzo) 108.2 202.0 124.5 85.0 97.7 99.4 75.6 91.0 101.2


Source: XM - Portal BI

National Electric Grid Reserves (GWh)

The following diagram analyzes the trends of the National Electric Grid reserves, highlighting the last quarter of each year. With regard to what has been exhibited so far this year, there is evidence of a recovery in reserves in the last quarter of the year thanks to improved water levels and the projection for next summer made by some generators given the expectation of El Niño phenomenon.

Spot Market Prices Thus far in 2014, the average market price has been 239.6 $/kWh, and most months have been higher than last year.

The third quarter shows that the average market price was below the price in the second quarter of the year, which had the highest prices for the year. This is due to better reserve levels at the National Electric Grid thanks to higher water levels, especially in the eastern region of Colombia.

Average contract prices have been in line with the IPP and market conditions.

Jan012006

April012006

July012006

Oct012006

Jan012007

April012007

July012007

Oct012007

Jan012008

April012008

July012008

Oct012008

Jan012009

April012009

July012009

Oct012009

Jan012010

April012010

July012010

Oct012010

Jan012011

April012011

July012011

Oct012011

Jan012012

April012012

Jan012013

April012013

July012013

Jan012014

July012012

Oct012012

2,000.00

4,000.00

6,000.00

8,000.00

10,000.00

12,000.00

GWh

14,000.00

16,000.00

Abr012014

July012014

Oct012013


Spot Market Price ($/kWh)

Wholesale Energy Market Contract Price ($/KWh)

Source: XM – Portal BI

161.0

185.0 182.2 137.7 234.3 139.1 141.2

189.6 151.6 371.9 338.8

236.5

180.6

151.8

203.7

143.8

176.0382.7


Spot Market Price 2013 Spot Market Price 2014

126.1

126.0 126.2 124.1 126.6 124.1 125.3

128.7 130.0 136.7 132.1

127.8

130.4

125.7

131.2

125.7

131.4133.5


Contract Price 2013 Contract Price 2014



ISAGEN’S Monthly Generation (GWh)

The reduction in generation by ISAGEN is due primarily to less energy generated at the San Carlos Power Plant, which was 15% under the number recorded in the first nine months of the previous year. This reduction is attributed to the Nare Chain operation.

However, it should be noted that this decreased generation at San Carlos has been partly compensated by thermal power generation at the Termocentro Power Plant, which had an 18% increase as compared to the same period in 2013.

The following image depicts generation by ISAGEN power plant, both quarterly and accumulated.

ISAGEN’S Generation

ISAGEN’s accumulated generation as of September 2014 was 7,477 GWh, 3% lower than the figure recorded for the same period of the previous year. This generation supplied 16% of the national demand.

Energy Generated 2013 Energy Generated 2014

January

872 1,003 799 923 951 1,073 784 842 886 823 872 749

February March April May June

744 610

July

913 619

August

890 835

September

Accumulated to September

2013: 7,711 GWh 2014: 7,477 GWh



Quarterly generation at ISAGEN’S Power Plants (GWh)

65.98122.21122.42

184.48169.99149.68

639.52356.56143.51

19.2718.4016.41

565.29529.30488.41

Q3 2014Q1 2014 Q2 2014

Amoyá

Termocentro

San Carlos

Jaguas

Miel I

Calderas

1,524.481,217.281,143.42

Accumulated to September 2013


Amoyá

Termocentro

San Carlos

Jaguas

Miel I

Calderas

4,550.00

504.17

503.60

1,139.60

1,093.80

54.10

55.50

310.62

163.10

1,583.01

1,345.30

3,885.19

Accumulated generation at ISAGEN’S Power Plants (GWh)


2014 Third Quarter Results

Operating Revenues

MAIN FIGURES Q1 2014 Q2 2014 Q3 2014 Q3 2013 % Variation

Energy Generated (GWh) 2,999 2,414 2,064 2,547 -19

Operating Revenues (COP Millions) 526,202 612,407 588,157 484,814 21

Operating Costs (COP Millions) 293,304 486,218 458,231 340,979 34

Operating Profit (COP Millions) 208,053 99,164 96,007 118,213 -19

Operating Margin 40% 16% 16% 24% -

EBITDA (COP Millions) 237,347 128,051 124,979 146,967 -15

EBITDA Margin 45% 21% 21% 30% -

Income Tax Allowance (COP Millions) (56,917) (13,256) (16,846) (21,401) -21

Net Profit (COP Millions) 147,073 83,676 71,793 93,677 -23

Net Margin 28% 14% 12% 19% -

Q1 2014 Q2 2014 Q3 2014 Q3 2013 % Variation

Domestic contracts 409,251 464,701 495,079 347,792 42

International Contracts 1,993 4,970 0 44,111 -100

Spot Market Transactions 96,337 69,388 12,526 74,489 -83

AGC 15,796 69,802 78,140 10,546 641

Deviations 130 412 101 220 -54

Gas 295 1,626 340 6,113 -94

Technical Services 2,400 1,508 1,971 1,542 28

TOTAL 526,202 612,407 588,157 484,814 21

* Amount in millions of COP

EnergyGeneration

19%

OperatingRevenues

21%

OperatingCosts

34%

OperatingProfit

19%

EBITDA

15%

NetProfit

23%


Third quarter 2014 revenue totaled $588,157 million, 21% higher than that of the same quarter of the previous year. This increase is primarily attributable to:

• Revenue from contract energy sales has been progressively increasing this year, with a 42% increase in revenue from this category as compared to the same quarter of the previous year. This increase is primarily attributable to increased energy sales to Industrial and Wholesale end clients in anticipa-tion of the start-up of the Sogamoso power plant.

The graph below shows that contract sales over the year grew by 15%. Specifically in the quarter analyzed, there was a 7% increase compared to the same period last year.

CONTRACT SALES (GWh) 2013 2014 % Variation

January 805.6 885.1 10

February 747.4 842.7 13

March 843.6 865.8 3

April 850.8 845.4 -1

May 879.2 990.7 13

June 807.9 1,000.0 24

July 845.7 1,004.6 19

August 821.9 1,021.6 24

September 774.4 997.8 29

TOTAL 7,376.5 8,453.7 15 Source: XM – Portal BI

• There were no energy exports to Venezuela in the third quarter of the year.

• Energy sales on the spot market accounted for 2% of all revenue this quarter. This quarter has had low revenue from this category as compared to previous quarters, which is attributed to decreased generation at the Company, more energy generated used to cover contracts, and majority market share in providing automatic generation control service.

• Revenue for providing the Automatic Generation Control Service (AGC) accounted for 13% of the total revenue for the quarter. This is due in part to the optimization of our commercial operations.

• Revenue from gas sales was lower because, as in previous quarters, this quarter the Company continued to have an active share of the thermal power generation as part of its total production.


Operating Costs

In the third quarter of 2014, ISAGEN’s operating costs were $458,231 million, 34% greater than that obtained in the same period for the previous year, which can be attributed to the following:

• Energy purchases accounted for 54% of the total operating costs in the quarter, and are broken down as follows:


Q1 2014 Q2 2014 Q3 2014 Q3 2013 % Variation

Energy purchases 85,089 280,839 245,826 126,639 94

Usage and connection to the National Transmission System charges

47,792 53,026 48,091 57,052 -16

NDC, CRDs and Commercial Exchange System 1,960 1,956 2,846 1,918 48

Transfer Law 99/93 11,249 8,955 7,609 9,259 -18

FAZNI contribution 3,421 2,751 2,351 2,914 -19

Depreciation 27,990 27,965 28,043 26,924 4

Fuels 69,211 63,637 64,942 67,827 -4

Other operating costs 46,592 47,089 58,523 48,446 21

TOTAL 293,304 486,218 458,231 340,979 34

Operating Revenues Q3 2013 Operating Revenues Q3 2014

72%DomesticContracts

9%InternationalContracts

15%Spot MarketTransactions

2,2%AGC

1%Gas 0,4%

Other


2%Spot MarketTransactions

13%AGC

0,1%Gas

0,4%Other

Source: ISAGEN



According to the information displayed in the chart above, energy purchases were higher than sales in the same quarter last year, and lower than sales recorded in the previous quarter of this year. This increase in sales is due to a greater need for energy to cover contracts due to reduced generation in the quarter as compared to the forecast.

Furthermore, hedging transactions continued. These consist of energy exchanges between generators in different time periods.

There was a decrease in the Reliability Premium refund compared to the same quarter of last year, mainly due to the decrease in power generation.

• Operating costs associated with usage and connection charges to the National Transmission System repre-sented a 16% decrease against those recorded in the same quarter of the previous year.

• Other operating costs accounted for 13% of the quarter’s total costs. The increase when compared to pre-vious quarters is because of Termocentro maintenance expenses, computer equipment maintenance expen-ses and security service expenses of the quarter.

Operating Costs Q3 2013 Operating Costs Q3 2014

Q1 2014 Q2 2014 Q3 2014 Q3 2013 % Variation

Energy Purchases 85,089 280,839 245,825 126,639 94

Energy Purchases 34,591 246,779 201,325 80,947 149

Energy Purchases to Cover 5,616 5,728 29,730 0

Reliability Charge Refund 32,535 18,628 5,237 22,820 -77

Restrictions and Others 12,347 9,704 9,533 22,872 -58

8%Depreciation

20%Fuels

4%Transfers required by law and others

14%Other operating costs

37%EnergyPurchases

17%Usage and connection

to the National Transmission System

charges

6%Depreciationn

14%Fuels



54%EnergyPurchases


to the National Transmission System charges

Source: ISAGEN


Operating Revenues


Accumulated results as of September 2014

MAIN FIGURES Accumulated to September 2014

Accumulated to September 2013 % Variation

Energy Generated (GWh) 7,477 7,711 -3

Operating Revenues (COP Millions) 1,726,766 1,488,420 16

Operating Costs (COP Millions) 1,237,753 977,208 27

Operating Profit (COP Millions) 403,224 433,396 -7

Operating Margin 23% 29% -

EBITDA (COP Millions) 490,377 513,560 -5

EBITDA Margin 28% 35% -

Income Tax Allowance (COP Millions) (86,659) (99,958) -13

Net Profit (COP Millions) 302,542 314,422 -4

Net Margin 18% 21% -



Domestic contracts 1,369,031 1,025,079 34

International Contracts 6,963 179,623 -96

Spot Market Transactions 178,251 199,507 -11

AGC 163,738 44,480 268

Deviations 643 725 -11

Gas 2,261 34,100 -93

Technical Services 5,879 4,904 20

TOTAL 1,726,766 1,488,418 16

EnergyGeneration

3%

OperatingRevenues

16%

OperatingCosts

27%

OperatingProfit

7%

EBITDA

5%

NetProfit

4%


So far this year, revenue has grown 16% as compared to the same period for the previous year. Revenue trends so far this year have been influenced by the following:

• Greater revenue from domestic energy sale contracts were due to a 15% increase in quantities of energy sold to Industrial and Wholesale End Clients because greater generation was expected, which did not happen because of lower rainfall and the start-up of the Sogamoso power plant.

Source: ISAGEN

Operating Revenues accumulated to September 2013

Operating Revenues accumulated to September 2014

• Revenue from energy sales on the spot market was slightly inferior to that obtained last year, mainly because of reduced energy generation at the Company.

• Not much energy has been exported to Venezuela over the year because of reduced demand in the neighboring country.

• Revenue from Automatic Generation Control (AGC) has increased.

Operating Costs




Energy purchases 611,754 359,878 70

Usage and connection to the National Transmission System charges

148,909 174,376 -15

NDC, CRDs and Commercial Exchange System 6,762 5,968 13

Transfer Law 99/93 27,813 28,223 -1

FAZNI contribution 8,523 8,834 -4

Depreciation 83,998 74,771 12

Fuels 197,790 192,157 3

Other operating costs 152,204 133,001 14

TOTAL 1,237,753 977,208 27


12%InternationalContracts

13%Spot Market Transactions

3%AGC

2%Gas 0,4%

Other


0.4%InternationalContracts

10%Spot Market Transactions

9%AGC

0.1%Gas 0.4%

Other



Operating costs accumulated to September 2014 were $1,237,753 million, a 27% increase from the result obtained in the same period of the previous year. This is attributed to the following:

• Energy purchased grew by 70% as compared to the previous year. This category is comprised as follows:

Operating Costs accumulated to September 2013

Operating Costs accumulated to September 2014

Source: ISAGEN



Energy Purchases 611,754 359,878 70

Energy purchases 482,695 207,034 133

Energy purchases for coverage 41,074 0 100

Reliability premium refund 56,400 76,278 -26

Restrictions and others 31,584 76,565 -59

Energy purchases showed a significant increase because of greater energy needed to cover contracts, reduced generation, high spot market prices, and an increase in commercial commitments, which has been explained herein.

Reliability premium refunds decreased by 26% as a result of decreased energy generation.

• Decrease in connection and usage fees due to fewer sales to Venezuela.

8%Deprecition

20%Fuels



37%Energy

Purchases


to the National Transmission System

charges

7%Depreciation

16%Fuels



49%Energy

Purchases


to the National Transmission System charges


Operating Profit and EBITDA

Revenue in the third quarter of this year was reflected in the operating profit and the EBITDA, demonstrating a negative trend compared to previous quarters. This trend is explained by decreased generation, greater rainfall and increased energy purchases needed to cover the commitments of energy sale contracts that were made several years in advance in anticipation of the start-up of Sogamoso.

EBITDA and EBITDA Margin

Source: ISAGEN

Source: ISAGEN

513,

560

490,

377

2013 2014

Q1

45%

39%34%

37%

35%

28%

21% 21%

Q2 Q3 Accumulated to September

192,

790

237,

347

173,

803

128,

051

146,

967

124,

979

2013 2014

In regards to results accumulated so far this year, the operating profit was $403,224 million, 7% lower than that obtained in the same period of 2013, and the EBITDA was $490,377 million, also 4.5% lower. This situation is explained throughout this document.

Operational and EBITDA margins sat at 23% and 28%, respectively, in September.

Operating Profit and Operating Margin

433,

396

403,

224

2013 2014

Q1

40%

34%29%

24%

29%

23%

16% 16%


167,

297

208,

053

147,

885

99,1

64

118,

213

96,0

07

2013 2014


Net Profit

Net profit for the quarter decreased 11% as compared to the same quarter last year, which is due to the revenue as explained above, attenuated by a lower income tax allowance.

In accumulated figures, net profit decreased by 4% so far this year compared with the same period the previous year, resulting from a combination of the various quarters.

Net Profit and Net Margin

Source: ISAGEN

314,

420

302,

542

2013 2014

Q1

28%

22% 22%

19%

21%

18%

14%

12%


110,

891

147,

073

109,

852

83,6

76

93,6

77

71,7

93

2013 2014


* Amount in COP millions

* Amount in COP millions

Liabilities and EquityThe following were the main variations in liabilities in the third quarter:

• Disbursements of the lease loan of $2,933 million and USD 459,840 from JBIC were received. Both were required to finance the Sogamoso Power Plant.

• Interest was paid in pesos to the Leasing, Club Deal, bonds and other loans in the total amount of $78,566 million, and in dollars to the Santander Bank of Spain and BTMU loans in the total amount of USD 842,818. Moreover, payments for the loan capital from Santander Bank of Spain were made in the amount of USD 1.6 million.

• The last installment of the equity tax of $15,161 million was paid.

Balance Sheet

AssetsThe main asset variations during the third quarter of 2014 correspond to the capitalization of project costs at a value of $219,289 million, for a yearly total of $691,809 million.

Furthermore, current assets decreased due to the use of resources required for construction of the Sogamoso Power Plant.

As of September 2014

As of June 2014

As of December 2013

% Quarterly Variation

Current Assets 886,553 1,043,529 652,631 -15.0

Non-current Assets 6,704,134 6,514,445 6,109,626 2.9

Valuations 793,084 793,084 793,084 0.0

TOTAL ASSETS 8,383,771 8,351,058 7,555,341 0.4

As of September 2014

As of June 2014

As of December 2013

% Quarterly Variation

Liabilities 4,269,047 4,308,127 3,525,891 -0.9

Equity 4,114,724 4,042,931 4,029,450 1.8


Balance SheetAs of September 30, 2014 and December 2013 (COP Millions)

ASSETSSeptember

2014December

2013%

Variationn

CURRENT ASSETS

Cash 334,125 228,943 45.9Democratic shareholding collection

215 212 1.4

Investment portfolio 84,418 20,335 315.1

Accounts receivable 352,581 282,205 24.9

Expenses paid in advance 8,602 21,113 -59.3

Inventories 96,590 89,434 8.0

Trust rights 0 347 0.0

Other assets 10,022 10,042 -0.2

TOTAL CURRENT ASSETS 886,553 652,631 35.8

NON-CURRENT ASSETS

Accounts Receivable

Difficult collections 1,435 1435 0.0

Other 29,652 23,205 27.8

Project advances 32,281 53,805 -40.0

Debtors allowance (1,435) (1,435) 0.0

61,933 77,010 -19.6

Investments 525 513 2.3Property, Plant and Equipment, Net

6,452,322 5,838,541 10.5

6,452,847 5,839,054 10.5

Deferred and other Assets

Deferred charges 29,857 33,978 -12.1

Other Assets 79,743 83,481 -4.5

Acq. Property Leasing 79,754 76,103 4.8

189,354 193,562 -2.2

TOTAL NON-CURRENT ASSETS

6,704,134 6,109,626 9.7

Valuations 793,084 793,084 0.0

TOTAL ASSETS 8,383,771 7,555,341 11.0

LIABILITIES AND EQUITYSeptember

2014December

2013%

Variation

CURRENT LIABILITIES

Borrowings 44,782 35,176 27.3

Bond issuance premium 6,232 6,232 0.0

Accounts payable 250,301 182,918 36.8

Taxes and contributions 18,962 51,555 -63.2

Labor obligations 5,734 12,208 -53.0

Estimated liabilities 87,840 67,053 31.0

Other liabilities 30,505 43,520 -29.9

TOTAL CURRENT LIABILITIES 444,356 398,662 11.5

NON-CURRENT LIABILITIES

Foreign borrowings 582,364 593,004 -1.8

Bond obligations 850,000 850,000 0.0

Bond premiums 29,982 34,713 -13.6

Club Deal credit obligations 1,755,923 1,084,250 61.9

Leasing LP 79,754 76,103 4.8

Labor obligations 62,051 62,051 0.0

Contractual withholdings 67,632 56,252 20.2

Claims and litigations 6,476 2,929 121.1

Solidaridad fund deposit 1,099 1,070 2.7

Deferred income tax 389,410 366,857 6.1TOTAL NON-CURRENT LIABILITIES

3,824,691 3,127,229 22.3

TOTAL LIABILITIES 4,269,047 3,525,891 21.1

SOCIAL CAPITAL

Authorized: 2,726,072,000 common shares with a unit value of COP 25

Subscribed and paid 68,152 68,152 0.0

.130 E.T art reserve 806,884 755,188 6.8

Legal reserve 51,134 51,134 0.0

Share premium 49,344 49,344 0.0

Equity revaluation 1,113,794 1,113,794 0.0

Occasional reserve investments 949,189 784,187 21.0

FISCAL YEAR PROFIT 302,542 433,966 -30.3Pgcp-amort accum exchange effect

-19,399 -19,399 0.0

Revaluation reserve 793,084 793,084 0.0

TOTAL EQUITY 4,114,724 4,029,450 2.1

TOTAL LIABILITY AND EQUITY 8,383,771 7,555,341 11.0

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Phones: Medellín +57 (4) 325 79 79 / 325 79 78E.mail: [email protected]

Investors Relations:

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Statement of IncomeAs of September 30, 2013 and 2014 (COP Millions)

Quarterly Accumulated

Q1 Q2 Q3 September 2013

September 2014 % Variation

OPERATING REVENUE 526,202 612,407 588,157 1,488,420 1,726,766 16

Energy 523,506 609,274 585,846 1,449,415 1,718,626 19

Gas 295 1,625 340 34,100 2,260 -93

Technical Services 2,401 1,508 1,971 4,905 5,880 20

SALES COSTS 293,304 486,218 458,231 977,208 1,237,753 27

Energy purchases 85,089 280,839 245,826 359,878 611,754 70

Usage and connection charges to the NTS 47,792 53,026 48,091 174,376 148,909 -15

NDC, CRDs and Commercial Exchange System 1,960 1,956 2,846 5,968 6,762 13

Transfer Law 99/93 11,249 8,955 7,609 28,223 27,813 -1

FAZNI contribution 3,421 2,751 2,351 8,834 8,523 -4

Depreciation 27,990 27,965 28,043 74,771 83,998 12

Fuels 69,211 63,637 64,942 192,157 197,790 3

Other operating costs 46,592 47,089 58,523 133,001 152,204 14

GROSS PROFIT 232,898 126,189 129,926 511,212 489,013 -4

ADMINISTRATIVE EXPENSES 24,845 27,025 33,919 77,816 85,789 10

OPERATING PROFIT 208,053 99,164 96,007 433,396 403,224 -7

OPERATING MARGIN 40% 16% 16% 29% 23%

NON-OPERATING INCOME

Interest 3,391 3,964 5,444 13,347 12,799 -4

Loan portfolio 153 - 802 66 955 1347

Exchange rate difference 112 473 48 1,412 633 -55

Other revenue 5,577 6,107 1,506 13,981 13,190 -6

9,233 10,544 7,800 28,806 27,577 -4

NON-OPERATING EXPENSES

Interest 7,979 9,433 8,277 27,127 25,689 -5

Loan portfolio - - - 847 - -100

Exchange rate difference 402 381 671 2,283 1,454 -36

Other income 4,915 2,962 6,580 17,565 14,457 -18

13,296 12,776 15,528 47,822 41,600 -13

PROFIT BEFORE TAXES 203,990 96,932 88,279 414,380 389,201 -6

INCOME TAX ALLOWANCE (56,917) (13,256) (16,486) (99,958) (86,659) -13

NET PROFIT 147,073 83,676 71,793 314,422 302,542 -4

NET MARGIN 28% 14% 12% 21% 18%

Informe Financiero

Documents

creg resolution

wholesale natural gas

sale of natural gas

definitive resolution

energy market

primary market

type of negotiation

market manager