What Central Puerto (CEPU) Said on Its Q3 Earnings Call

Key Points

• Third-quarter adjusted EBITDA rose 70.3% to $185.3 million, supported by seasonal winter power prices, fuel procurement margins and higher generation. Central Puerto maintained its full-year EBITDA guidance of $500 million to $550 million, with fourth-quarter results dependent on dispatch, weather and water inflows.
• Battery projects at Central Puerto and Central Costanera are 81% and 87% complete, respectively; once operational, they are expected to add $25 million to $27 million to adjusted EBITDA in 2027. Net financial debt was $343.7 million, or 0.72 times trailing adjusted EBITDA.
• Central Puerto is advancing oil and gas development in Neuquén, including plans to apply for Argentina’s RIGI investment regime for two blocks and begin exploration at the Corralera Noroeste block next year.

Central Puerto NYSE: CEPU reported a 70.3% increase in third-quarter adjusted EBITDA as higher winter electricity prices, fuel procurement margins and increased output from several generating assets boosted results.

Adjusted EBITDA rose to $185.3 million from $108.8 million a year earlier, while revenue climbed 157.6% to $532.4 million, Head of Investor Relations María Laura Feller said on the company’s third-quarter 2026 earnings call. Revenue included $218.6 million associated with fuel the company purchased directly for spot generation.

Central Puerto maintained its full-year adjusted EBITDA guidance of $500 million to $550 million after reporting $451 million for the first nine months. CEO Fernando Bonnet said fourth-quarter adjusted EBITDA could be $75 million to $80 million, or as much as $90 million if higher temperatures support additional dispatch.

Bonnet said the outlook depends on unit dispatch and water inflows at Piedra del Águila, among other factors. He also cited a major maintenance program at the Costanera combined-cycle plant, including approximately 60 days of maintenance on one gas turbine and 30 days on another. The overhaul cost around $40 million, he said.

Fuel purchases lift reported revenue

Central Puerto generated 4,791 gigawatt-hours during the quarter, up 5.6% from a year earlier but down 5.2% from the second quarter. Feller attributed the sequential decline in part to scheduled maintenance at Central Puerto and Central Costanera assets.

Year over year, output at Piedra del Águila rose 93.6%, while Brigadier López added 371 gigawatt-hours as its new combined cycle ramped up, Feller said. Renewable generation increased 8.4% from the second quarter to 469 gigawatt-hours.

Spot thermal revenue rose to $289.8 million, helped by seasonal winter prices and the fuel-cost component recorded when Central Puerto procures fuel itself. When grid administrator CAMMESA supplies fuel under the Gas Acuerdo program, that cost is not recognized as revenue by the company, Feller said.

Self-procured fuel accounted for 55.3% of Central Puerto’s total fuel consumption in the third quarter, up from 37.2% in the second. Feller cautioned that the inclusion of those fuel costs in revenue means adjusted EBITDA margins are not directly comparable with the prior year. The third-quarter margin was 34.8%, compared with 32.0% in the second quarter.

On Oct. 1, Central Puerto signed a direct natural gas supply agreement with Pluspetrol running through December 2028. The agreement covers 2 million cubic meters per day, approximately half the gas needed for average daily operations at the Central Puerto complex, Feller said.

Battery projects near completion

Capital expenditures totaled $36.7 million in the third quarter and $458.6 million for the first nine months of 2026. The nine-month total included $108.9 million for battery storage projects.

Feller said civil works were complete and battery containers installed, with construction 81% complete at Central Puerto and 87% complete at Central Costanera. The company expects the projects to contribute $25 million to $27 million in consolidated adjusted EBITDA in 2027 once operational.

Bonnet said the company does not currently expect additional growth capital spending in electricity beyond completing the storage projects, unless it wins projects in a future thermal capacity auction. He said regular maintenance spending would continue.

Net financial debt stood at $343.7 million at Sept. 30, equivalent to 0.72 times adjusted EBITDA for the preceding 12 months, down from 1.2 times in the prior quarter. Bonnet said the lower leverage gives the company flexibility to pursue acquisitions and organic growth. Any dividend would be decided at a shareholders meeting and would depend on investment opportunities, he said.

Oil and gas plans advance

Central Puerto is working with Neuquén provincial authorities on the CENCH process for the Aguada del Chivato and Aguada Bocarey blocks and preparing an application for Argentina’s RIGI investment regime. Bonnet said the company hopes to submit the RIGI documentation by year-end or early 2027 and move toward exploration after securing the necessary approvals.

If the projects enter the RIGI regime, the company would need to spend at least $240 million over the following two years, Bonnet said. He suggested spending could be approximately $120 million a year, excluding acquisitions and newly awarded projects.

The province also awarded the Corralera Noroeste block to Central Puerto subsidiary PESA on Oct. 21. Bonnet said the company has an agreement to drill three exploration wells over four years and plans to begin the exploration phase next year.

Asked whether Central Puerto would seek an operating partner for its blocks, Bonnet said the company is developing its own resources and is working with Radius Energy to develop and operate the areas itself.

About Central Puerto (NYSE:CEPU)

Central Puerto S.A. is an Argentina-based electric power generation company. It operates power plants that produce electricity for the country's wholesale electricity market, serving utilities, businesses and other users through Argentina's electricity system. The company's generation portfolio includes thermal, hydroelectric and renewable energy assets, including wind and solar facilities. Its thermal plants use fuels such as natural gas, while its renewable operations add electricity from non-fossil sources to the portfolio.

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