2. Summary
Brazilian Electricity Sector
Balanço dos 3–anos de IPO
CPFL Energia Highlights and Results
CPFL Energia – Performance in the Capital Markets
2
3. Brazilian market has 64 distribution’s companies
Distribution Business: Distribution Market Share1 %
2006
Distributors (#) 64
CELESC 4.8%
Clients (million) 59.1 COPEL 6.7% EdB 5.7%
ENDESA 4.2%
Neoenergia
Distributed Energy (TWh) 347.4 7.3% Ashmore Energy
3.7%
CEMIG
Companhia
Energética
8.6%
Market Breakdown Brasiliana
Others 33,1%
Energia 12.1%
The 5 largest groups have 50% of market-share CPFL Energia
13.8%
State-owned companies: 34%
Private Company: 66%
Spreading proposes consolidation opportunities
1) 1Q07
3 Source: Aneel – Installed capacity: PDEE 2007-2016 Market breakdown: Acende Brasil
4. Brazilian market has 1,600 generation companies.
The public sector concentrates 72% of the assets
Generation Business: Generation Market Share %
2006
Generation Companies (#) 1,660
Installed Capacity
104,822
(MW)
Others 35%
CPFL Energia 2%
Chesf 10%
Duke 2%
AES Tietê 3%
Furnas 9%
Market Breakdown Copel 4%
Tractebel 6%
Eletronorte 9%
Cemig 6%
The 5 largest groups have 50% of the market CESP 7%
Itaipu 7%
State-owned companies: 72%
Private Company: 28%
Source: Aneel – Installed capacity: PDEE 2007-2016
4 Market breakdown: Acende Brasil
6. Summary
Brazilian Electricity Sector
Balanço dos 3–anos de IPO
CPFL Energia Highlights and Results
CPFL Energia – Performance in the Capital Markets
6
7. Since 1997, CPFL Energia has developed an aggressive strategy of
growth in distribution, generation and commercialization of energy
IPO
CPFL
Jaguariúna1
1997 1998 2000 2001 2002 2003 2004 2005 2006 2007
• CPFL Paulista’s Privatization Recent Acquisitions:
• Acquisitions: 12 companies • CPFL Jaguariúna1 in Apr/07
• Creation of 2 companies • CPFL Santa Cruz in Oct/06
• Spin-off and Restructuring: 5 companies • 11% of CEEE stake in HPP Foz do Chapecó in
• Generation projects: 6 HPP (hydroelectric Aug/06
power plant)
• 32.69% of PSEG stake in RGE in May/06
7 1) Old company name: CMS Energy Brasil
8. The solidity achieved by CPFL reflects its operational efficiency
and the quality of the markets in which it operates
Distribution – 2007
Distribuitors (#) 8
Municipalities 568
Concession Area (in thousand km2) 208
Market Share (%) 13,8
Customers (million) 6,3
Energy Sales (GWh) 34.578
8
9. Strong growth in distribution: organic and by acquisitions
DISTRIBUTION
IPO (Sep/04) – Distribution: 3 companies Sep/07 – Distribution: 8 companies
• May/06 – Acquisition of 32,69% stake of RGE
• Oct/06 – Acquisition of Cia. Luz e Força Santa Cruz
• Apr/07 – Acquisition of CMS Energy Brasil
• Companhia Paulista de Energia Elétrica
• Companhia Jaguari de Energia
(67.07%) • Companhia Sul Paulista de Energia
• Companhia Luz e Força Mococa
• Aug/07 – Acquisition of CERFRA’s assets
Operations in SP and RS States Operations in SP, RS, PR and MG States
Growth by
IPO – Sep/041 Organic Growth Sep/07 Var. %
Acquisition
Municipalities (#) 523 - 45 568 8.6%
Distribution Network (km) 165,8272 15,332 14,196 196,075 18.2%
Customers (thousand) 5,411 459 350 6,220 14.5%
Concession Area Sales
27,1223 4,282 2,866 34,270 26.4%
9M (GWh)
Market Share 12.2% 0.8% 0.8% 13.8% 1.6 p.p.
1) Considers 100% of RGE, except for Concession area Sales 2) Data basis: Jun,04
9 3) Considers 67.07% of RGE Note: Concession Areas Sales (TUSD + captive market)
10. CPFL Energia: Distribution Business
DISTRIBUTION
Net Revenue – R$ billion EBITDA – R$ billion
28%
8.061
7.070 55%
6.313 6.064
1
2.011 1.888
1.595
1.295
2004 2005 2006 9M07 2004 2005 2006 9M07
Net Income – R$ billion Nº Customers – in million
232% 5%
6,3
1.073 1.037 5,5 5,6 5,7
756
323
2004 2005 2006 9M07 2004 2005 2006 9M07
10 1) Not comparable - considers CCC and CDE within revenue deductions
11. Construction and repowering of power plants in line with the
generation growth strategy
GENERATION
Generation – 2007
In operation
Installed Capacity (MW) 1,588
Assured Energy (MWmedium) 800
HPPs (#) 8
SPPs (#) 32
Under Construction
Installed Capacity (MW) 586
Assured Energy (MWmedium) 282
HPPs (#) 3
Installed Capacity until 2010 (MW) 2,174
Campos Novos HPP Castro Alves HPP CPFL Sul Centrais Elétricas
11
12. Construction and repowering of power plants in line with the
generation growth strategy
GENERATION
33 HPP HPP HPP Complexo Ceran HPP
HPP
Power Plant Serra da Barra Campos Foz do
Lajeado HPP Monte HPP Castro HPP 14 de
SPP's Mesa Grande Novos Chapecó
Claro Alves Julho
CPFL Ownership (%) 100% 51,54% 25,01% 48,72% 6,93% 65% 65% 65% 51%
Installed capacity (MW) 147 657 173 429 63 85 85 65 436
Assured energy (MWmedium) 75 346 95 184 36 38 42 33 220
Commercial start-up (year) in operation 1Q08 3Q08 2010
12 * Installed Capacity and Assured Energy related to CPFL´s stake.
19. CPFL Energia – Results
EBITDA1 – last twelve months - R$ million EBITDA Breakdown2 9M07
G
25% 16%
D
C 73%
3,004 3,159 3,247
2,593 2,789 11%
2,530
3T06 4T06 1T07 2T07 3T07
Net Income - last twelve months - R$ million Net Income Breakdown 9M07
G
12% 15%
D
C 72%
13%
1,634 1,616
1,571
1,439 1,404
1,322
3T06 4T06 1T07 2T07 3T07
19 1) Including non-recurring effects 2) Intercompany transactions excluded
20. Dividend distribution aligned with the shareholder’s
value creation
CPFL distributes 100% of net income in dividends:
R$ 842 million in 1H07 – R$ 1,76 per share
Declared dividend1 (R$ million) vs. CPFE3 Price (R$)
Declared dividend
31.74
30.05
28.25
Average Price
23.33
18.85
16.58 842
722
612
498
401
140
2H04 1H05 2H05 1H06 2H06 1H07
Annualized Dividend Yield
(average price2) 3.7% 9.3% 8.9% 8.5% 10.7% 11.1%
Since the IPO (2H04), CPFL Energia’s dividend yield has already reached 39.3%3
1) Declared dividend: payment in the next half year 2) Half year daily closing price average
20
21. Financial discipline and debt profile
Adjusted net debt (R$ million)
(6540)
(5,781) (759) (5,438)
390
712
Financial debt 3T06¹ Private pension fund Cash and Cash Regulatory Assets Adjusted net debt
Equivalents 3T07
Adjusted net debt / EBITDA2 (R$ billion)
6.28
5.44
4.92
4.39 4.42 4.11
3.78 3.70
4,92
2,85 2,25 1,74 1,57 1,37 1,55 1,67
2002 2003 2004 2005 2006 1T07 2T07 3T07
Adjusted net debt Adjusted net debt / EBITDA
1) Includes derivatives and excludes judicial deposit of R$ 364 million
21 2) Last twelve months EBITDA
23. Differentiated Corporate Governance: commitment with the best
practices
Shares lited on the Bovespa’s Novo Mercado
and ADR Level III – NYSE
100% common shares with 100% tag along
Free Float above 25%
Subsidiaries’ Bylaws aligned with CPFL
Energia’s Bylaws
Annual Report in compliance with the Global
Reporting Initiative – GRI
Ethics Code aligned with Sarbanes Oxley Law’s
recommendations
1 Independent Director
3 Commitees supporting the Board: Process
Management, Human Resources and Related-
Parties Committees
Dividend policy of minimum 50% semi-
annually
Disclosure and Trading of Securities Policies
23
24. Summary
Brazilian Electricity Sector
Balanço dos 3–anos de IPO
CPFL Energia Highlights and Results
CPFL Energia – Performance in the Capital Markets
24
25. Since the IPO, appreciation and substancial increase in liquidity
Share performance1 – IPO to Dec,2007
BOVESPA NYSE
175.0% 297.6%
162.0% 282.0%
147.0%
30.9%
IBOVESPA IEE CPFE3 Dow Jones DJ Br 20 CPL
Market Cap – R$ billion2 Daily average volume – R$ thousand
363% 32,561
108%
16,2
17,270 19,755
7,027 9,141
7,8
3,521 12,807
8,128
3,506
2005 2006 2007
IPO 2006 2006 2007
NYSE BOVESPA
1) Closing price adjusted for dividends
25 2) Closing price not adjusted for dividends
26. CPFL Energia has consolidated its participation in the capital markets
Listed on the main indexes
MSCI Index
+ +
IPO 2005/2006 2007
Transparency and capital market proximity
• 37 APIMEC’s meetings – 12 per year
• 35 Conferences – 17 local and 18 international
• 19 Teleconferences and Webcast Results
594 one-on-one meetings... almost 1 meeting per business day
Sell side coverage 2004 2005 2006 2007
# of institutions 7 14 22 24
26 Events since the IPO
27. Market Recognition
• 1st place in Corporate Governance – Latin
America Electric Utilities – 2004
• 2nd place in Investor Relations – Latin America
• Best Publicly-traded Company – 2004
Electric Utilities – Sell Side – 2004
• 2nd place in Investor Relations – Latin America
Electric Utilities – Buy Side – 2004
• CPFL Energia – Deal of the Year in
• Quality Award – Best 2005 and 2007 Presentation
Latin America 2004 – Equity Category
• ExpoMoney 2006 Award – Respect to • ABERJE 2006 “Investor Relations”
Individual Investor • ABERJE 2006 and 2007: “Company of the Year in
• Special Mention Expomoney Circuit 2006 Corporate Communication”
• 9th ABRASCA Award – Annual Report
• 8th Best Company to Invest in – 2006
2007 Edition – 5th place
• Honorable Mention – Best
• Best Investor Relations
Corporate Governance
• Honorable Mention – Best Performance by a CEO/CFO
• Best Conference Call
Investor Relations in IPO • Honorable Mention – Best
• Best Investor Relations Program
Corporate Governance
(large cap)
27
