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Apresentação institucional 4_q11_en_v3 Apresentação institucional 4_q11_en_v3 Presentation Transcript

  • InstitutionalMarch, 2012 1
  • AES Brasil Group• Presence in Brazil since 1997• Comprised of four companies in the sectors ofenergy generation and distribution• 7.4 thousand AES Brasil People• Investments 1998-2011: R$ 8.1 billion• Good corporate governance practices• Sustainable practices in businesses• Safety as a main value• Strong cash generation capacity• 25% of minimum pay-out according to bylaws• Differentiated practice of dividend distributionsince 2006: – AES Tietê: 100% of net income on quarterly basis – AES Eletropaulo: distribution above the minimum required (25% of net income) on semi-annual basis 2
  • AES Brasil widely recognized in 2009-2011  Management excellence  Quality and safety  Environmental concern(AES Eletropaulo) (AES Tietê) (AES Tietê) (AES Eletropaulo) (AES Sul) (AES Brasil) (AES Eletropaulo) (AES Eletropaulo) (AES Tietê) (AES Brasil) (AES Tietê) (AES Tietê) (AES Tietê) (AES Eletropaulo) (AES Eletropaulo) 3
  • Shareholding Structure AES Corp BNDES C 50.00% + 1 share C 50.00% - 1 share P 0.00% P 100% T 46.15% T 53.85% Cia. Brasiliana de Energia C 71.35% C 76.45% C 99.99% C 99.00% P 32.34% P 7.38%T 99.70% T 99.99% T 99.00% T 52.55% T 34.87% AES AES AES AES AES Sul Infoenergy Uruguaiana Tietê Eletropaulo C = Common Shares P = Preferred Shares T = Total 4
  • Listed Companies Shareholding Composition ¹ ¹ Free Float Others² Market Cap³ 16.1% 19.2% 56.2% 8.5% R$ 4.8 bi 24.2% 28.3% 39.5% 8.0% R$ 8.5 bi1 - Parent companies, AES Corp and BNDES, have similar voting capital on each of the Companies: approx 38.2% on AES Eletropaulo and 35.7% on AES Tietê2 - Includes Federal Government and Eletrobrás shares in AES Eletropaulo and AES Tietê, respectively3 - Base: 09/30/2011. Considers preferred shares for AES Eletropaulo and preferred and common shares for AES Tietê 5
  • AES Brasil is the second largest group in Ebitda1 – 2010 (R$ Billion) electric sector 4.5 4.2 3.4 3.0 2.6 2.0 1.6 1.6 1.5 0.6 CEMIG AES BRASIL CPFL NEOENERGIA TRACTEBEL CESP EDP LIGHT COPEL DUKE Net Income1 – 2010 (R$ Billion) 2.3 2.2 1.8 1.6 1.2 1.0 0.6 0.6 0.2 0.1 CEMIG AES BRASIL NEOENERGIA CPFL TRACTEBEL COPEL EDP LIGHT DUKE CESP 61 – excluding Eletrobrás Source: Companies’ financial reports
  • AES Tietê is an important player among privateGeneration Installed Capacity (MW) - 2012 1 energy generators Main privately held Companies  AES Tietê is the 3rd largest among private AES TIETÊ CPFL DUKE 2,3% 2,4% 1,9% EDP generation companies and 10th largest 1,6% TRACTEBEL NEOENERGIA 6,1% 1,2% overall ENDESA 0,8% LIGHT 0,8%  Approximately 78% of country’s generation installed capacity is state- DEMAIS CHESF ³ owned2 27% 9% FURNAS ³  There are three mega hydropower plants 8% under construction in the North region of ELETRONORTE ³ 8% Brazil with 18 GW in installed capacity COPEL ITAIPU ³ 4% 6% – Santo Antonio and Jirau (Madeira River): 7 GW PETROBRÁS ELETRONUCLEAR ³ 5% CEMIG CESP 3% 6% 6% CGTEE ³ – Belo Monte (Xingu River): 11 GW 1% ELETROSUL ³ 0,4% 1- Sources: ANEEL – BIG (March, 2012) and Companies websites 2- Source: Merrill Lynch Total Installed Capacity: 117 GW 7 3 – Eletrobrás, totaling 35%
  • AES Brasil is the largest distribution group in BrazilConsumption (GWh) - 2010 13% • 63 distribution companies in Brazil distributing 419 TWh 40% 12% AES Brasil AES Brasil • AES Brasil is the largest electricity distribution group in Brazil: CPFL Energia CPFL Energia 10% – AES Eletropaulo: 43 TWh distributed, 7% CEMIG Cemig representing 10.3% of the Brazilian 6% 6% market 6% Neoenergia Neo EnergiaConsumers – Dec/2010 – AES Sul: 9 TWh distributed, 12% Copel Copel representing 2.2% of the Brazilian market 30% Light Light 12%  Distribution companies’ operations are EDP EDP restricted to their concession areas 12% Outros Outros  Acquisitions must be only performed by 5% the holdings of economic groups 7% 7% 16% 8
  • Energy Sector in Brazil
  • Energy Sector in Brazil: business segments Free Clients Distribution Transmission Generation • Consumption of 113 TWh • 63 companies • 68 companies • 13 groups controlling 76% of (26% of Brazilian total market) • 430 TWh of energy • 68% private sector total installed capacity • Conventional sources: distributed in 2011 • 22% private sector • High voltage transmission above 3000 kW • 1,862 power plants • 70 million consumers (>230 kV) • Alternative sources: • 117 GW of installed capacity • 67% private sector • 98.648 km in extension between 500 kW e 3000 kW • 73% hydroelectric • Annual tariff adjustment lines (SIN¹) • Large consumers can • 17% thermoelectric • Tariff reset every four or • Regulated public service purchase energy directly five years with free access • 5% biomass from generators • Regulated public service • Regulated tariff (annually • 4% SHPP2 • Free contracting • Regulated contracting adjusted by inflation) environment • 1% Wind environment • Contracting environment –¹ Interconected National System free and regulated markets 10² Small Hydro Power Plants Sources: EPE, Aneel, ONS and Merrill Lynch
  • Energy sector in Brazil: contracting environment Regulated Market Free Market Generators, Independent Power Producers Generators and Independent (IPPs), Trading companies and Auto producers Power Producers (IPPs) Auctions: New Energy Bilateral contracts (PPAs1) and Existing Energy Distribution companies Free clients • Main auctions (reverse auctions): – New Energy (A-5): Delivery in 5 years, 15-30 years regulated PPA1 – New Energy (A-3): Delivery in 3 years, 15-30 years regulated PPA1 – Existing Energy (A-1): Delivery in 1 year, 5-15 years regulated PPA11 – Power Purchase Agreement 11
  • Energy sector in Brazil: demand perspectives Macroeconomic Scenario GDP - Annual growth (%) EPE’s1 Assumptions: 2004-2008 2010 2011 2012-2015 • Latest EPE’s estimates considers an 3.6 7.2 4.0 5.0 economic activity slowdown in Brazil (industrial stagnation and higher inflation). Brazilian Consumption Evolution (TWh) 5.0% p.a. • For the next years, the good performance of domestic market and the perspectives 3.6% 515 4.0% p.a. 493 of higher investments are factors 469 indicating that the Brazilian economy will 444 423 recover the growth path observed before 408 369 380 376 the global crisis. 349 • Brazil will also benefit from the growth of emerging markets, with impact on exports of primary products. 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 121 - Source: EPE (Energetic Research Company) / ONS (National System Operator) – Second Review – september/11
  • Energy sector in Brazil: supply perspectivesInstalled Energy Capacity in Brazil1 Total installed capacity is expected to reach 171 GW by 2020 Brazilian energy matrix will present higher diversification, but in the next 10 years hydropower plants will continue to prevail 2011: 115 GW 2020: 171 GW 2 SHPP: 4% Natural gas: 7% 2 SHPP: 4% Biomass: 5% Natural gas: 8% Biomass: 5% Oil: 5% Oil: 3% Nuclear: 2% Nuclear: 2% Others: 17% Coal: 2% Hydro: 67% Diesel: 1% Others: 10% Hydro: 73% Coal: 2% Diesel: 1% Wind: 7% Wind: 1% Steam: 1% Steam: 0%1- Source: EPE (Energetic Research Company), Ten-year Energy Plan 2020, May/2011 2 - Small Hydro Power Plant 13
  • Energy sector in Brazil: regulatory methodologyTariff Reset and Readjustment• Tariff Reset is applied each 4 years for AES Eletropaulo − Base date: Jul/2011 • Parcel A Costs − Parcel A: costs are largely passed through to the tariff Energy − Non-manageable costs that are largely Purchase passed through to the tariff − Parcel B: costs are set by ANEEL Transmission − Incentives to reduces costs Sector Charges• Tariff Readjustment: annually − Parcel A : costs are largely passed through to the tariff Regulatory − Parcel B: cost are adjusted by IGPM +/- X(1) Factor Opex • Regulatory Opex: (PMSO) – Efficient operating cost determined by ANEEL (National Electricity Agency) X WACC Investment Remuneration • Remuneration Asset Base: Remuneration Asset Base – Prudent investments used to calculate the investment remuneration (applying X Depreciation WACC) and depreciation Depreciation Regulatory Parcel A - Non-Manageable Costs Ebitda Parcel B - Manageable Costs 14 1 – X Factor: index that captures productivity gains
  • Energy sector in Brazil: regulatory methodology3rd Cycle of Tariff Reset – X Factor X FACTOR Pd Q T = + + Distribution Operational expenses DEFINITION Quality of service productivity trajectory To capture To stimulate the To implement operational OBJECTIVE productivity gains improvement of the expenses trajectory during with distribution service quality the tariff cycle Defined at tariff reset, considering the Defined at each tariff Defined at tariff reset, average productivity of readjustement, considering the sector adjusted by the according to the expenses established by APPLICATION market growth and variation of SAIDI and reference company and variation of consumer SAIFI and comparative benchmarking units of the distributor performance of discos methodologies 15 since last reset
  • AES Tietê OverviewGeneration facilities  17 hydroelectric plants operating within the states of São Paulo and Minas Gerais  30-year concession valid until 2029; renewable for another 30 years  Installed capacity of 2,659 MW, with physical guarantee1 of 1,280 MW average  Almost all the amount of energy that AES Tietê can sell in the long term is contracted to AES Eletropaulo until the end of 2015  AES Tietê can invest in generation, its main activity, and operate in energy trading  355 employees 171 - Amount of energy allowed to be long term contracted
  • Generated energy shows high operational availabilityGenerated energy (MW avarage1) Generated energy by power plant (MW avarage1) 130% 125% 124% 4% Água Vermelha 118% 10% Bariri Barra Bonita 8% Euclides da Cunha 6% 58% Ibitinga 1,665 1,599 3% Nova Avanhandava 1,582 5% Promissão 1,512 6% Other Power Plants* 2008 2009 2010 2011 Generation - Mw avg Generation/Physical guarantee 1 – Generated energy divided by the amount of hours * Caconde, Limoeiro, Mogi and SHPPs 18
  • A significant amount of billed energy and net revenues comes from the bilateral contract with AES EletropauloEnergy Billed (GWh) Net Revenues (%) 94% 94% 14,706 14,729 15,122 13,148 554 117 117 301 301 331 1,1501,150 1,340 1,340 1,519 331 2,3312,331 215 1,980 1,680 1,680 1,980 346 1,942 1,135 1,188 1,554 1,535 11,138 11,108 11,108 11,108 1% 11,138 11,108 11,108 8,578 1% 3% 8,045 2% 2% 3% AES Eletropaulo Other bilateral contracts 20081 2009 2010 2011 2008 2009 2010 9M10 9M11 Spot Market AES Eletropaulo MRE2 Spot Market Other bilateral contracts 1 – Leap Year 2 – Energy Reallocation Mechanism MRE 19
  • Investments in the modernization of Nova Avanhandava, Ibitinga and Caconde power plants Investments (R$ million) 2011 Investments 175 19 85% 82 59 56 174 12 156 13 4% 11% 20 70 39 43 2008 2009 2010 2011 2012(e) Equipment and Modernization Investments New SHPPs* New SHPPs* IT Projects*Small Hydro Power Plants 20
  • Growth opportunitiesPerspectives • Project features - Combined cycle using natural gas - Estimated investment of R$ 1.1 billion - Natural gas consumption: 2.5 million m3/day - 550 MW of installed capacity • Updates - Environmental license obtained on October, 20th 2011 (valid for 5 years) - Gas unavailability for A-5 in 2011 and A-3 Energy Auction in 2012• Next events - Get the installation license - Obtain gas supply in order to: - Participate in the next auctions; or - Evaluate energy offering in the free market 21
  • Financial highlights* Net Revenue (R$ million) Ebitda (R$ million) 1,255 1,320 9 1,254 1,255 1,320 1,035 1,048 1,886 9 1,754 1,605 1,670 1,254 1,309 1,311 1,466 1,309 1,311 (54) 2008 2009 2010 2011 2008 2008 2009 2010 2009 2010 9M10 2011 9M11 78% 75% 75% 78% Recurring Non-recurring Recurring Non-Recurring Ebitda Margin(*) 2009, 2010 and 2011 numbers in IFRS 22
  • Practice of total net income distribution on quarterly basis*Net Income and Dividend Pay-out1 (R$ million) 117% 110% 109% 100% 12% 11% 11% 11% 706 737 31 692 816 784 845 (74) (78) (36) 2008 2009 2010 2011 Pay - out Yield Pref Recurring Non- recurring IFRS Effect1 – Gross value(*) 2009, 2010 and 2011 numbers in IFRS 23
  • Debt profile Net Debt (R$ billion) Amortization Schedule – Principal (R$ million) 0.3x 0.3x 0.3x 0.3x 300 300 300 0.5 0.4 0.4 0.4 2008 2009 2010 2011 2013 2014 2015 Dívida Líquida Net Debt / EBITDA • December, 2011: – Average debt cost in 2011 was 115% of CDI1 p.a. or 15% p.a. – Average debt maturity of 2.6 years 241 – Brazilian Interbank Interest Rate
  • Capital Markets AES Tietê X Ibovespa X IEE Daily Avg. Volume (R$ thousand) 12 Months 1140130 + 22% 17,980 + 21% 13,922 12,970120 + 11%110 10,187 4,344 + 4%100 4,239 -2% 3,397 90 2,101 80 13,635 8,086 9,683 9,573 70 60 Feb-11 May-11 Aug-11 Nov-11 Feb-12 2009 2010 2011 YTD Feb/12 Ibovespa IEE² GETI4 TSR³ GETI3 Preferred Common• Market Cap4: R$ 9.1 billion• BM&FBovespa: GETI3 (common shares) and GETI4 (preferred shares)• ADRs negotiated in US OTC Market: AESAY (common shares) and AESYY (preferred shares)1 – Index: 02/28/2011 = 100 2 – Electric Energy Index 3 – Total Shareholders’ Return 4 – Index: 02/29/2012 25
  • AES Eletropaulo overviewConcession Area  Largest electricity distribution company in Latin America  Serving 24 municipalities in the São Paulo Metropolitan area  Concession contract valid until 2028; renewable for another 30 years  Concession area with the highest GDP in Brazil  45 thousand kilometers of lines and 6.3 million consumption units in a concession area of 4,526 km2  Total distributed volume of 45 TWh in 2011  AES Eletropaulo, as a distribution company, can only invest in assets within its concession area  5,668 employees 27
  • Consumption evolutionTotal Market1 (GWh) 2011 Consumption by Class (%) 6% 9 14 14% 45,102 43,345 36% 26 41,243 41,269 8,284 7,911 7,383 6,832 18% 43 26% 28 17 34,436 35,434 36,817 33,860 36 26 2008 2009 2010 2011 Brazil AES Eletropaulo Captive Market Free Clients Residential Commercial Industrial Others 281 – Net of own consumption
  • Industrial class Industrial class X industrial production in São Paulo State 15% 10% 5% • Industrial consumption is 0% influenced by manufacturing -5% industry performance in São Paulo -10% Economic crisis Economic recovery State -15% Dec/11 • Recent slowdown is influenced by Jul/07 Aug/08 Sep/09 Oct/10 Nov/11 Industrial Production of SP (% 12 months) Industrial (% 12 months) the decrease of industrialConsumption of industrial class by activity – AES Eletropaulo production in 2011 • Moreover, the migration of clients to other regions of São Paulo State and of the country negatively Vehicles, Other industries Chemical, Rubber, Plastic and Metal impacts this class 50% products 50% 29
  • Residential class Residential class X Average income in São Paulo Metropolitan Area 1,800 4,800 •Average Income R$ - SP (q-2¹) Residential class is influenced by Residential (GWh) income in São Paulo Metropolitan 1,600 4,300 Area 1,400 3,800 • Maintenance of the income expansion trend in São Paulo 1,200 3,300 Metropolitan Area will sustain 1,000 2,800 growth of residential class 4Q11 1Q06 3Q06 1Q07 3Q07 1Q08 3Q08 1Q09 3Q09 1Q10 3Q10 1Q11 3Q11 • Average annual growth (2003- Avg Real Income R$ - SP (q-2¹) Residential (GWh) 2011): Consumption per consumer (in kWh) – total residential market: 5.5% y.y. - 9.4% 258 – consumption per consumer: 2.1% y.y. 229 234 223 228 219  Consumption per consumer is 220 213 203 207 199 still 9.4% lower than in 192 the period before the rationing 1 - Two quarters of delay in relation to consumption 30 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
  • Investments amounted R$ 739 million in 2011Investments Breakdown (R$ million) Investments 2011 (R$ million) 841 227 739 46 682 22 172 55 28 22 516 39 457 35 37 189 47 794 717 654 478 410 Maintenance Client Service System Expansion Losses Recovery 2008 2009 2010 2011 2012(e) IT Capex Paid by Customers Paid by the Clients Others 31
  • SAIDI & SAIFI SAIDI - System Average Interruption Duration Index SAIFI - System Average Interruption Frequency Index 7.87 8.41 7.39 6.93 10.92 10.09 9.32 8.68 9.20 11.86 10.60 10.36 5.20 6.17 5.43 5.45 2008 2009 2010 2011 2008 2009 2010 2011 5th 8th 7th 6th 1st 7th 3rd 4th SAIDI (hours) SAIDI Aneel Reference SAIFI (times) SAIFI Aneel Reference ABRADEE ranking position among the 28 utilities with more than 500 thousand customers ► 2012 SAIDI ANEEL Reference: 8.67 hours ► 2012 SAIFI ANEEL Reference: 6.87 timesSources: ANEEL, AES Eletropaulo and ABRADEE 32
  • Operational Indexes Losses (%) Collection Rate (% over Gross Revenues) 11.6 11.8 10.9 10.5 102.4 102.1 101.1 98.5 5.1 5.3 4.4 4.0 6.5 6.5 6.5 6.5 2008 2009 2010 2011 2008 2009 2010 2011 Technical Losses¹ Commercial Losses ANEEL References: From Jul/09 to Jun/10: 12.32% From Jul/10 to Jun/11: 12.45% 331 – Current technical losses used retroactively as a reference
  • “Creating Value” Project Internal process review:(i) operating activities; (ii) support functions Objective: to operate Target definition for productivity within the regulatory increase framework for Reassess organization structure operational costs, Review supply management and seek benchmark position in theReassess and reinforce non-technical losses initiatives sector 34
  • Financial Highlights* Net Revenues (R$ million) Ebitda (R$ million) 2,848 2,413 9,697 9,836 8,786 426 933 1,775 7,530 1,696 339 87 372 - 89 197 1,607 1,491 1,648 1,542 2008 2009 2010 2011 2008 2009 2010 2011 Recurring Regulatory assets and liabilities Non-recurring(*) 2009, 2010 and 2011 numbers in IFRS 35
  • Practice of dividend distribution on semi-annual basis* Net Income and Dividend Payout1 (R$ million) 101,5% 93,4% 100,0% 54,4% 20,4% 28,6% 20,3% 15,8% 1.348 1.572 1.156 1.027 350 652 374 329 236 241 160 698 761 680 622 2008 2009 2010 2011 Pay-out Yield PN Net Income - Ex one-offs, regulatory assets and liabilities Regulatory assets and liabilities 36(*) 2009, 2010 and 2011 numbers in IFRS One-offs 1 – Gross amount
  • Debt Profile Net Debt 2.4x 2.0x 66% 1.5x 1.6x 1% 1.4x 1.3x 2.7 0.9x 0.8x 2.5 2.4 2.3 33% 2008 2009 2010 2011 2008 2009 2010 2011 Gross Debt/Ebitda Adjusted with Fcesp Net Debt (R$ billion) CDI¹ IGP - DI² Others Net Debt/Ebitda Adjusted with Fcesp Amortization Schedule – Principal (R$ million) 941 1 • December, 2011: 574 580 762 - Average debt cost was 110% of CDI¹ 46 434 49 385 439 375 347 391 or 12.1% p.a. 342 347 61 64 272 53 278 279 56 285 - Average debt maturity of 6.7 years 244 94 6743 46 44 527 531 50 52 57 60 281 301 335 373 375 200 281 299 332 225 225 65 223 222 179 65 2H11 2012 2013 2014 2015 2016 2017 2018 2 2012 2013 2014 2015 2016 2017 2018 2019 2020 - 2028 37 21 – Brazilian Interbank Interest Rate 2 – Inflation Index 3 – Pension Fund Local Currency (ex FCesp) Fcesp³
  • Capital MarketsAES Eletropaulo X Ibovespa X IEE Average Daily Volume (R$ thousand) 12 Months 1130 A B + 30% 26,897 26,044 + 22% 24,496120 + 15%110 21,960100 -2%908070 Feb-11 May-11 Aug-11 Nov-11 Feb-12 2009 2010 2011 YTD Feb/12 Ibovespa IEE² AES Eletropaulo PN AES Eletropaulo TSR³ A Ex dividends: 04/30/2011 B Ex dividends: 08/11/2011 • Market cap4: U$ 3.6 billion • BM&FBOVESPA: ELPL3 (common shares) and ELPL4 (preferred shares) • ADRs at US OTC Market: EPUMY (preferred shares)1 – Index: 12/29/2011 = 100 2 – Electric Energy Index 383 – Total Shareholders’ Return 4 - Index: 02/29/12. Calculation includes only preferred shares
  • Sustainability andSocial Responsibility
  • Commitment with sustainabilityOur Commitment with Sustainability We act as a transformer agent understanding, meeting and anticipating our customers electric power needs with safe and innovative solutions for the economic, environmental and social development of the communities in which we are present. 40
  • Commitment with sustainability SUSTAINABLE ENERGY INNOVATION IN PRODUCTS EFFICIENCY IN THE USE OF DEVELOPMENT & VALUATION SAFETY GENERATION AND SERVICES RESOURCES OF COWORKERS, SUPPLIERS AND COMMUNITIES... means an attitude of ... means using ... means providing an ... means allocating ...means knowing, protection of our economic, social and environment and them in such a manner involving in a coworkers, suppliers environmental culture that inspire that balanced and transparent form andand of the population. resources in a balanced solutions that improve perennial results are positively influencing fashion, preserving the people’s life, ensuring ensured for all our coworkers, present time and quality and excellence stakeholders, abiding by suppliers and ensuring the future in the services rendered the values practiced by communities to build a to the customer. the company collective agenda that generates value for everyone TRANSVERSAL THEMES Communication Stakeholders active Education for sustainability Knowledge participation Transversal Information Themes To learn more access: www.aesbrasilsustentabilidade.com.br 41
  • Social Responsibility: Main Projects Development and transformation of communitiesEducation, culture “Casa de Cultura e Cidadania” Project and sport Offers activities in culture and sports, courses, workshops and lectures. Directly benefits approximately 5.6 thousand children and teenagers and, indirectly, 290 thousand people in 7 units located within AES Brazil companies’ area of operation. Children education and development “Centros Educacionais Luz e Lápis” Project Two units in São Paulo attending 320 children from 1 to 6 years old, in social vulnerability. 42
  • Social Responsibility: Main Projects Converting Consumers to Clients A project developed to work on electrical network regularization. Since 2004, more than 500 thousand families in low income communities were benefited from better energy supply conditions and social inclusion. Education about Safety and Efficiency in energy consumption “AES Eletropaulo nas Escolas” ProjectEducation about safe and efficient use of energy to 4.5 thousand teachers and 404 thousand students from 900 public schools, between 2010 and 2011. The actions include recreational activities offered in adapted trucks. 43
  • Attachments
  • Costs and ExpensesCosts and operational expenses1 (R$ million) 415 433 420 351 187 174 112 201 239 214 246 245 2008 2009 2010 2011 Energy Purchase, Transmission and Connection Charges, and Water Resources Other Costs and Expenses 21 – Do not include depreciation and amortization 2 - Personnel, Material, Third Party Services and Other Costs and Expenses 45
  • Costs and ExpensesCosts and operational expenses1 (R$ million) PMS2 and Other Expenses (R$ million) 1,306 1,255 1,272 6,961 1,193 6,745 6,431 254 138 165 5,893 1,272 1,255 379 1,306 1,193 352 443 513 329 5,490 5,689 4,700 5,125 700 647 622 485 2008 2009 2010 2011 2008 2009 2010 2011 Energy Supply and Transmission Charges PMS² and Others Expenses Personnel and Payroll Material and Third Party Others1 – Do not include depreciation and amortization2 - Personnel, Material, Third Party Services and Other Costs and Expenses 46
  • Action Plan: R$ 242 million in 2011-2012  increase of 212 emergency teams, totalizing 353 teams trained to perform attendances in powered grid  hiring and training of 580 maintanance and construction electricians  hiring of 30 additional prunning electriciansConcluded in 2011  38% increase in call center positions (150 positions)  doubling of SMS receipt capacity to 100 thousand / day  increase of call center service capacity by 27 times from 2 thousand to 54 thousand calls / hour  300 additional stand-by positions in call center for emergency situationsDecember/11  increase of 120 emergency teams, totaling 473 teamsto March/12 47
  • AES Tietes expansion obligation Privatization Notice Judicial Notice: AES Tietê was established the Aneel informed summoned to answer a São Paulo State The Company was notifiedobligation to expand the that the issue is Lawsuit filed by the Supreme Court Efforts being made by the State of São Paulo installed capacity in not related to State of São Paulo, rejected AES Tietê’s Attorneys Office to present by the Company to 15% (400 MW) until the concession which requested the appeal. The its understanding on the 2007, either in agreement and fulfillment of the grounds for the meet the obligation : matter, having filed its greenfield projects must be obligation in 24 months. denial and the response on time, the and/or through long addressed with proceedings were ended, An injunction was contents of the • Long-term energy term purchase the State of São since no other action was granted in order to have decision have not contracts (biomass) agreements with new Paulo taken by the Attorneys a project submitted yet been disclosed. plants Office within 60 days. totaling an average of 10 MW • SHPP São Joaquim - started operating in 1999 2007 Aug/08 Oct/08 Jul/09 Sep/10 Sep/11 Nov/11 Feb/12 July, 2011, with 3 MW of installed capacity • SHPP São José – under construction, Company faces restrictions until Popular Action: with 4 MW of installed deadline: In response to a Popular Lawsuit: Due to the plaintiffs failure • Insufficiency of hydro resources Action (filed by to specify the persons that The Company capacity, expected to • Environmental restrictions individuals against the should be named as appealed to the be operational in 1H12 Federal Government, Defendants, a favorable State of Sao • Insufficiency of natural gas supply Aneel, AES Tietê and decision was rendered by Paulo State Court • Thermo-SP - Project• New Model of Electric Sector (Law # Duke), the Company the first Instance Court of Appeals and 10,848/2004), which forbids bilateral presents its defense the injunction was of a 550MW gas fired (an appeal has been filed) agreements between generators and before the first instance stayed thermal plant distributors 48
  • Eletrobras Lawsuit State-owned Eletropaulo was spun-off into four Eletrobras, after On July 7, the Next Steps: companies and, winning the judge determined Eletrobras and Eletrobras 1 - The auditing Stated-owned according to our interest Eletropaulo and CTEEP appealed requested the 1st procedure (AP) Eletropaulo understanding calculation CTEEP to present to the Superior level of court is expected toborrowed money based on the discussion, filed their Court of Justice judge to appoint begin by the 1st from Eletrobras spin-off an Execution Suit considerations, (SCJ) an expert half of 2012 agreement, the to collect the due which occurred in discussion was amount August 2 – AP is transferred to expected to be CTEEP concluded in at least 6 months 3 - After AP’s conclusion, a 1st level court decision will be Nov/86 Dec/88 Jan/98 Apr/98 Sep/01 Sep/03 Oct/05 Jun/06 May/09 Dec/10 Jul/11 released 4 - Appealing to the 2nd instance court 5 - Foreclosure starts. Presentation of State-owned The 2nd level of Eletrobras guaranty Eletropaulo and Privatization requested the court excluded The SCJ decided Eletrobras event . State- 6 - Request to AES Eletropaulo to send the beginning of the disagreed on how owned withdraw the from the Execution Suit appraisal to calculate Eletropaulo guaranty discussion based back to the 1st procedure, which is interest over that became AES under 1st. instance 7 - Appeals to on the spin-off level of court loan and a lawsuit Eletropaulo court analysis the 3rd instance agreement was started courts 49
  • Shareholders AgreementOn Dec 2003 AES and BNDES signed a Shareholders’ Agreement to regulate their relationship as shareholders ofBrasiliana and its controlled companies. The Agreement is available at www.aeseletropaulo.com.br/riShareholders can dispose its share at any time, considering the following terms:Right of 1st  Any party with an intention to dispose its shares should first provide the other party the right to buyrefusal that participation at the same price offered by a third partyTag along  In the case of change in Brasiliana’s control, tag along rights are triggered for the followingrights companies (only if AES is no longer controlling shareholder): – AES Eletropaulo: Tag along of 100% in its common and preferred shares – AES Tietê: Tag along of 80% in its common shares – AES Elpa: Tag along of 80% in its common sharesDrag along  Once the offering party exercises the Drag Along clause, offered party is obligated to dispose of allrights its shares at the time, if the Right of 1st Refusal is not exercised by offered party 50
  • Brazilian Main Taxes AES Tietê AES Eletropaulo• Income Tax / Social Contribution: • Income Tax / Social Contribution: – 34% over taxable income – 34% over taxable income• ICMS (VAT tax) • ICMS: 22% over Revenue (average rate) – deferred tax – Residential: 25%• PIS/Cofins (sales tax): – Industrial and Commercial: 18% – Eletropaulo s PPA: 3.65% over Revenue – Public Entities: free – Other bilateral contracts: 9.25% over Revenue • PIS/Cofins: minus Costs – 9.25% over Revenue minus Costs 51
  • Contacts: ri.aeseletropaulo@aes.com ri.aestiete@aes.com + 55 11 2195 7048The statements contained in this document with regard to the business prospects, projected operating and financialresults, and growth potential are merely forecasts based on the expectations of the Company’s Management inrelation to its future performance. Such estimates are highly dependent on market behavior and on the conditionsaffecting Brazil’s macroeconomic performance as well as the electric sector and international market, and they aretherefore subject to changes.