Transportadora de Gas del Sur S A : 2Q 2023

Contacts in Buenos Aires, Argentina:

Investor Relations	Media Relations
Leandro Perez Castaño, Finance and IR Manager.	Mario Yaniskowski
 [e-mail]	 [e-mail]
Carlos Almagro, Investor Relations Officer
 [e-mail]

tgs announces results for the

second quarter ended on June 30, 2023 ("2Q2023")(1)

Transportadora de Gas del Sur ("tgs", "the Company", "us", "our", or "we") is the leader in Argentina in the transportation of natural gas, transporting approximately 60% of the gas consumed in the country, through more than 5,700 miles of gas pipelines, with a firm-contracted capacity of 83.4 MMm3/d. We are one of the main natural gas processors. In addition, our infrastructure investments in the Vaca Muerta formation place us as one of the main Midstreamers in Argentina.

Our shares are traded on NYSE (New York Stock Exchange) and BYMA (Bolsas y Mercados Argentinos S.A.).

Our controlling company is Compañía de Inversiones de Energía S.A. ("CIESA"), which owns 51% of the total share capital. CIESA's shareholders are: (i) Pampa Energía S.A. with 50%, (ii) led by the Sielecki family, Grupo Investor Petroquímica S.L. (GIP), and PCT L.L.C. hold the remaining 50%.

For further information, see our website https://www.tgs.com.ar/inversores/servicio-para-inversores?lang=EN

Stock Information

BYMA Symbol: TGSU2

NYSE Symbol: TGS (1 ADS = 5 ordinary shares)

Shareholding structure as of June 30, 2023 tgs holds 794,495,283 issued shares and 752,761,058 outstanding shares.

Buenos Aires, Argentina, August 7, 2023

During the 2Q2023, total comprehensive income amounted to Ps. 12,101 million, or Ps. 80.38 per share (Ps. 37.61 per ADS), compared to a total comprehensive income of Ps. 11,439 million, or Ps. 15.20 per share (Ps. 75,98 per ADS) in the second quarter ended on June 30, 2022 ("2Q2022").

	2Q2023	2Q2022
Revenues*	56,709	60,461
Operating profit*	15,119	20,087
Depreciation*	7,056	7,257
Operating profit before depreciation* (1)	22,175	27,344
Total comprehensive income*	12,101	11,439
Earnings per shares in Ps.	16.08	15.20
Earnings per ADS in Ps.	80.38	75.98
* (in million of Argentine Pesos)

1. Operating profit before depreciation is a non-IFRS financial measure, we define the operating profit before depreciation as operating profit plus depreciation of PPE . We believe that this measure provides complementary information to investors and stakeholders for decision making. Operating profit before depreciation should not be interpreted as an alternative to other measures calculated in accordance with IFRS as it may not be comparable with similar denomination measures reported by other entities.

Operating profit for 2Q2023 amounted to Ps. 15,119 million, which was Ps. 4,968 million below 2Q2022. This variation was mainly due to lower revenues from the Natural Gas Transportation and Production and Commercialization of the Natural Gas Liquids (Liquids) segments amounting to Ps. 4,207 million and Ps. 1,212 million, respectively.

Operating costs increased Ps. 1,291 million.

These effects were partially offset by higher revenues from Other Services of Ps. 1,668 million.

Financial results recorded a positive variation of Ps. 6,873 million.

1. The financial information presented in this press release is based on interim consolidated financial statements presented in constant Argentine pesos as of June 30, 2023 (Ps.) which is based on the application of the International Financial Reporting Standards (IFRS).

Transportadora de Gas del Sur S.A.

1

Edificio Madero Office - 355 Cecilia Grierson St. 26th floor

(C1107CPG), Autonomous City of Buenos Aires, Argentina. https://www.tgs.com.ar/investors/Press-releases

2Q2023 EARNINGS RELEASE

Highlights during 2Q2023 and beyond

• On June 5, 2023, ENARSA awarded us through a private tender, the operation and maintenance service of the President Néstor Kirchner Gas Pipeline ("GPNK") Tratayén - Salliqueló section. The terms of the contract are five years with an option to extend it for an additional 12 months. The operation and maintenance contract granted to tgs also includes the corresponding subway and surface facilities, in addition to the associated compressor plants in Tratayén and Salliqueló.
• On July 9, 2023, the GPNK system was inaugurated and as planned by schedule it was initiated, and is now currently in operation. This natural gas pipeline crosses the provinces of Neuquén, Río Negro, La Pampa and Buenos Aires, reaching an extension of 573 km with an initial transportation capacity of up to 11 MMm3/day.

Analysis of the results

Total revenues amounted to Ps. 56,709 million in 2Q2023, a Ps. 3,751 million decrease compared to Ps. 60,461 million in 2Q2022.

The breakdown of operating costs, administrative and commercialization expenses, excluding depreciation, for 2Q2023 and 2Q2022 is shown in the table below:

	2Q2023		2Q2022	Variation
Concept	MM of Ps.	% s/ total	MM of Ps.	% s/ total	MM of Ps.	%
Natural gas purchase (RTP)	17,806	43%	16,867	42%	939	6%
Labor costs	6,054	15%	6,235	16%	(181)	(3%)
Taxes, fees and contributions	3,653	9%	3,883	10%	(230)	(6%)
Repair and maintenance	2,687	6%	2,153	5%	534	25%
Other fees and third parties services	2,976	7%	2,873	7%	103	4%
Depreciation	7,056	17%	7,257	18%	(201)	(3%)
Other charges	1,009	3%	950	2%	299	31%
Total	41,482		40,218		1,264

Operating costs and administrative and selling expenses increased by Ps. 1,291 million in 2Q2023 from 2Q2022. This variation was due to higher: (i) cost of natural gas consumed for liquids production (higher price due to exchange rate increase, while US dollar price was lower, and volume; partially offset by IAS 29 restatement effect) by Ps. 939 million, (ii) repair and maintenance PPE operating expenses of Ps. 534 million, (iii) export taxes (due to higher volumes sold) of Ps. 294 million, and (iv) other third-partyfees amounting to Ps. 131 million. These effects were partially offset by lower: (i) tax and contributions (without considering export taxes) by Ps. 532 million, (ii) depreciation of Ps. 201 million, and (iii) labor costs of Ps. 181 million.

Transportadora de Gas del Sur S.A.

2

Edificio Madero Office - 355 Cecilia Grierson St. 26th floor

(C1107CPG), Autonomous City of Buenos Aires, Argentina. https://www.tgs.com.ar/investors/Press-releases

2Q2023 EARNINGS RELEASE

Financial results are presented in gross terms considering the effect of change in the currency purchasing power ("(Loss) / gain on monetary position") in a single separate line. In 2Q2023, the financial results recorded a positive variation of Ps. 6,873 million compared to 2Q2022. This variation was mainly due to the higher positive result generated by financial assets of Ps. 13,464 million. This effect was partially offset by a higher negative exchange difference of Ps. 5,331 million (as a consequence of the higher exchange rate variation during 2Q2023) and the lower gain on monetary position of Ps. 1,505 million.

Natural Gas Transportation

Operating profit of the Natural Gas Transportation segment was Ps. 67 million in 2Q2023 compared to a profit of Ps. 3,803 million in 2Q2022.

		Natural Gas Transportation
	2Q2023	2Q2022	Variation	Variation in %
	(In million of Argentine pesos)
Revenues	13,541	17,748	(4,207)	(24%)
Intercompany revenues	290	590	(300)	(51%)
Operating and maintenance costs	(10,900)	(11,379)	479	(4%)
Other administrative and selling expenses	(2,725)	(2,987)	262	(9%)
Other operating results	(139)	(169)	30	(18%)
Operating profit	67	3,803	(3,736)	(98%)
Depreciation of PPE	(5,034)	(5,344)	311	(6%)

Natural gas transportation revenues accounted for approximately 24% and 29% of total revenues in 2Q2023 and 2Q2022, respectively.

Revenues from this segment are derived mainly from firm natural gas transportation contracts which represent approximately 85% and 84%, respectively, of the total revenues for this segment in 2Q2023 and 2Q2022.

Transportadora de Gas del Sur S.A.

3

Edificio Madero Office - 355 Cecilia Grierson St. 26th floor

(C1107CPG), Autonomous City of Buenos Aires, Argentina. https://www.tgs.com.ar/investors/Press-releases

2Q2023 EARNINGS RELEASE

This tariff segment, subject to ENARGAS regulation, received its last tariff increase of 95% starting April 29, 2023. Previously, and effective on March 1, 2022, we received a tariff increase of 60%.

The decrease in operating profit was mainly due to lower revenues following the tariffs adjustment, which were not enough to offset the negative variation associated with the inflation restatement effect under IAS 29. This effect was partially offset by lower operating expenses.

Liquids Production and Commercialization

Liquids Production and Commercialization revenues accounted for approximately 59% and 58% of total revenues in 2Q2023 and 2Q2022, respectively. During 2Q2023, production increased by 17,300 tons reaching 283,372 tons.

	Production and Commercialization of Liquids
	2Q2023	2Q2022	Variation	Variation in %
	(In million of Argentine pesos)
Revenues	33,690	34,902	(1,212)	(3%)
Operating costs	(21,389)	(20,453)	(937)	5%
Administrative and selling expenses	(2,053)	(1,899)	(154)	8%
Other operating results	24	10	14	139%
Operating profit	10,272	12,560	(2,289)	(18%)
Depreciation of PPE	(542)	(451)	(91)	20%

The operating profit of this business segment for 2Q2023 was Ps. 2,289 million below 2Q2022, reaching Ps. 10,272 million (compared to Ps. 12,560 million recorded in 2Q2022). This decrease was mainly due to lower revenues of Ps. 1,212 million and an increase in the cost of natural gas consumed of Ps. 940 million.

In terms of the Liquids revenues, which amounted to Ps. 33,690 million in 2Q2023 (Ps. 34,902 million in 2Q2022), we can highlight the impact of the IAS 29 restatement, which resulted in a decrease of Ps. 17.757 million, and the decrease in prices of Ps. 4.817 million. These effects were partially offset by the nominal variation of the exchange rate on U.S. dollar-denominated revenues amounting to Ps. 11,763 million, higher volumes shipped totaling Ps. 7,013 million and higher income under the take-or-pay clause of the ethane contract with PBB Polisur S.R.L. for Ps. 1,243 million.

Total volumes dispatched increased 24%, or 55,475 tons, compared to 2Q2022. This increase was mainly due to higher propane and butane exports and ethane tons shipped. These effects were partially offset by lower tons of propane and butane sold in the local market.

Transportadora de Gas del Sur S.A.

4

Edificio Madero Office - 355 Cecilia Grierson St. 26th floor

(C1107CPG), Autonomous City of Buenos Aires, Argentina. https://www.tgs.com.ar/investors/Press-releases

2Q2023 EARNINGS RELEASE

The breakdown of volumes dispatched by market and product and revenues by market is included below:

	2Q2023	2Q2022	Variation
(in tons)
Local market
Ethane	103,858	80,699	23,159
Propane	56,667	70,735	(14,068)
Butane	45,682	45,928	(246)
Subtotal	206,207	197,362	8,845
Foreign market
Propane	38,374	1,019	37,355
Butane	14,067	1,668	12,399
Natural gasoline	28,551	31,675	(3,124)
Subtotal	80,992	34,362	46,630
Total	287,199	231,724	55,475
	2Q2023	2Q2022
(in million of Argentine Pesos)
Local market	24,276	26,756
Foreign market	9,415	8,146
Total Revenues	33,690	34,902

Other Services and Telecommunications

The Other Services business segment includes mainly services provided by tgs in Vaca Muerta, representing approximately 17% and 13% of our total revenues for 2Q2023 and 2Q2022, respectively.

			Other Services and Telecommunications
			2Q2023	2Q2022	Variation	Variation in %
			(In million of Argentine pesos)
Revenues	9,479	7,811	1,668	21%
Operating and maintenance costs	(3,573)	(3,263)	(310)	9%
Other administrative and selling expenses	(1,159)	(827)	(332)	40%
Other operating results	34	3	30	n/a
Operating profit	4,781	3,724	1,057	28%
Depreciation of PPE		(1,481)	(1,461)	(20)	1%
	Transportadora de Gas del Sur S.A.				5

Edificio Madero Office - 355 Cecilia Grierson St. 26th floor

(C1107CPG), Autonomous City of Buenos Aires, Argentina. https://www.tgs.com.ar/investors/Press-releases