2. » Safe Harbor Disclosure
Certain statements in the following presentation regarding AES’s business operations may constitute
“forward-looking statements.” Such forward-looking statements include, but are not limited to, those
related to future earnings, growth and financial and operating performance. Forward-looking statements
are not intended to be a guarantee of future results, but instead constitute AES’s current expectations
based on reasonable assumptions. Forecasted financial information is based on certain material
assumptions. These assumptions include, but are not limited to, continued normal or better levels of
operating performance and electricity demand at our distribution companies and operational
performance at our generation businesses consistent with historical levels, as well as achievements of
planned productivity improvements and incremental growth from investments at investment levels and
rates of return consistent with prior experience. For additional assumptions see the Appendix to this
presentation. Actual results could differ materially from those projected in our forward-looking statements
due to risks, uncertainties and other factors. Important factors that could affect actual results are
discussed in AES’s filings with the Securities and Exchange Commission including but not limited to the
risks discussed under Item 1A “Risk Factors” in the Company’s Annual Report on Form 10-K/A for the
year ended December 31, 2006, as well as our other SEC filings. AES undertakes no obligation to
update or revise any forward-looking statements, whether as a result of new information, future events or
otherwise.
AES Corporation 1
Third Quarter 2007 Financial Review
3. » Highlights
› Q3 Revenues up 18% to $3.5 Billion and Gross Margin up 2% to $840 Million
› Q3 and year-to-date Adjusted EPS of $0.18 and $0.82
– Q3 reflects impacts of higher costs and lower volumes in Chile & Argentina, partially offset by
operational improvements in North America and contributions from new businesses
› Excluding the impacts of EDC, sold in May 2007:
–3Q07 net cash from operating activities would have decreased by $19 million to $741 million and
free cash flow would have increased by $20 million to $573 million
–For the first nine months of 2007, net cash from operating activities would have increased by
$162 million to $1.8 billion and free cash flow would have increased by $81 million to $1.2 billion
› Portfolio and Capital Structure Optimization Plans on Track
– Sold 10% stake in Chilean subsidiary (Gener) for approximately $300 million
– Issued $2 billion unsecured notes, primarily to refinance 2nd Lien notes
› On Track to Achieve our 2011 Growth Targets
– Announced as Winner of Bids in Philippines and South Africa totaling 1,762 MW
– Announced Commencement of Construction of 170 MW Expansion to Buffalo Gap Wind Farm
(Buffalo Gap 3)
AES Corporation 2
Third Quarter 2007 Financial Review
4. » Recent Parent Refinancing Improves Maturity Profile
Contains Forward Looking Statements
› The refinancing of our 2008 Unsecured notes and our 2nd lien notes will:
–Decrease secured debt as a percentage of total parent debt from 41% to approximately
17%
–Raise the average life of parent debt from approximately 6.3 years to 7.6 years
$1,500
$1,000
(millions)
$500
$0
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Beyond
2017
Parent Maturities as of 9/30/07 Pro Forma Maturities AES Corporation 3
Third Quarter 2007 Financial Review
5. » Third Quarter 2007 Highlights
($ Millions Except Earnings Per Share and Percent)
Third Third
Consolidated Highlights
% Change
Quarter 2007 Quarter 2006
$3,471 $2,947 18%
Revenues › Gross margin increased by $14 million to $840 million, primarily due
to:
840 826 2%
Gross Margin – Favorable foreign currency translation ~ $52 MM
– Higher prices in North America and contributions from TEG and
400 (178) NA
Income Before Taxes TEP in Mexico of ~ $47 MM
and Minority Interest – Unfavorable impacts of gas curtailments and lower hydrology in
(IBT & MI)(1) Argentina and Chile ~ $102 MM
› Excluding the impacts of the Brazil restructuring in Q306, quarter-
0.14 (0.56) NA
Diluted EPS from
over-quarter differences in EPS primarily due to:
Continuing Operations(2)
– Operations in Argentina and Chile impacted both diluted and
adjusted EPS by ~ ($0.07)
0.18 $0.30 (40%)
EPS(3)(4)
Adjusted – Impairments in North America businesses impacted diluted
EPS by ~ ($0.03). No impact on adjusted EPS
– Partially offset by higher prices in North America and
741 928 (20%)
Net Cash from Operating
contributions from new businesses
Activities
› Excluding contributions from EDC, net cash from operating activities
would have decreased ~ $19 million.
573 732 (22%)
Free Cash Flow(3) › Excluding contributions from EDC, free cash flow would have
increased by ~ $20 million.
(1)Third quarter 2006 income before taxes & minority interest includes impacts of ($554) million associated with the Brazil restructuring
(2)Third quarter 2006 income from continuing operations and diluted earnings per share include after-tax impacts of ($500) million or ($0.76) per diluted share associated
with the Brazil restructuring
(3)A non-GAAP financial measure. See Appendix.
(4)Third quarter 2006 adjusted earnings per share includes a one-time favorable benefit of $0.07 associated with the Brazil restructuring AES Corporation 4
Note: All prior period results in this presentation reflect businesses placed in discontinued operations effective March 31, 2007.
Third Quarter 2007 Financial Review
6. » Reconciliation of Adjusted Earnings Per Share(1)
($ Per Share)
Nine Months Ended
Third Quarter September 30, 2007
2007 2006 2007 2006
Diluted Earnings Per Share from Continuing $0.14 ($0.56) $0.71 $0.22
Operations
FAS 133 Mark to Market (Gains)/Losses 0.01 0.02 0.02 -
Currency Transaction (Gains)/Losses - 0.01 - 0.01
Net Asset (Gains)/Losses and Impairments 0.03 0.83 0.09 0.69
Debt Retirement (Gains)/Losses - - - 0.04
Adjusted Earnings Per Share(1) $0.18 $0.30 $0.82 $0.96
(1)Adjusted earnings per share (a non-GAAP financial measure) is defined as diluted earnings per share from continuing operations excluding gains or losses associated with
(a) mark to market amounts related to FAS 133 derivative transactions, (b) foreign currency transaction impacts on the net monetary position related to Brazil and Argentina,
(c) significant asset gains or losses due to disposition transactions and impairments, and (d) costs related to early retirement of recourse debt. AES believes that adjusted
earnings per share better reflects the underlying business performance of the Company, and is considered in the Company’s internal evaluation of financial performance.
Factors in this determination include the variability associated with mark-to-market gains or losses related to certain derivative transactions, currency transaction gains or
losses, periodic strategic decisions to dispose of certain assets which may influence results in a given period, and the early retirement of corporate debt.
AES Corporation 5
Third Quarter 2007 Financial Review
7. » Third Quarter 2007 Bridge
($ Per Share)
$0.76 $0.04
$0.03 $0.03
$0.18
($0.02)
($0.07) $0.14
($0.03)
($0.56)
Brazil Chile & Improvements Higher Adjusted
3Q06 Diluted Impairments in 3Q07 Diluted 3Q07
Lower Non-
Restructuring Argentina in Gross G&A EPS
EPS from North EPS from Adjusted
Operating
Impacts(1) Margin(2) Expense(2) Factors(3)
America(2) EPS(3)
Operations
Continuing Continuing
Expense
Impacts(2)
Operations Operations
› Unfavorable impacts of gas curtailments and lower hydrology in Argentina and Chile impacted results by approximately $0.07
› Other operational improvements, primarily due to higher prices in New York and the contributions of TEG/TEP in Mexico
› Higher G&A, primarily due to increased spending to strengthen our financial infrastructure, including the accelerated
implementation of SAP, and to support new business development initiatives
(1)Calculated as $500 million divided by 658 million shares
(2)Estimate, shown on a post-tax, ownership-adjusted basis (using consolidated effective tax rate)
(3)A non-GAAP financial measure. See Appendix.
AES Corporation 6
Third Quarter 2007 Financial Review
8. » Cash Flow Highlights
($ Millions)
Nine Months Ended
Third Quarter September 30,
2007 2006 2007 2006
Consolidated
Net Cash from Operating Activities(1) $741 $928 $1,848 $1,879
Maintenance Capital Expenditures:
Operational Maintenance Capex(3) $112 $153 $508 $447
Environmental Capex(3) $56 $43 $171 $128
Less: Total Maintenance Capital Expenditures(3) $168 $196 $679 $575
Free Cash Flow(2)(3) $573 $732 $1,169 $1,304
› Excluding the impacts of EDC, net cash from operating activities would have decreased by $19 million for 3Q07
compared to 3Q06 and increased by $162 million for the first nine months of 2007 compared to the first nine months
of 2006
› Excluding the impacts of EDC, free cash flow would have increased by $20 million for 3Q07 compared to 3Q06 and
increased by $81 million for the first nine months of 2007 compared to the first nine months of 2006
(1)Excluding the impacts of EDC, net cash from operating activities would have been $760 million for 3Q06, $1,794 million for the first nine months of 2007 and $1,632
million for the first nine months of 2006
(2)Excluding the impacts of EDC, free cash flow would have been $553 million for 3Q06, $1,159 million for the first nine months of 2007 and $1,078 million for the first nine
months of 2006 AES Corporation 7
(3)A non-GAAP financial measure. See Appendix.
Third Quarter 2007 Financial Review
9. » Subsidiary Distributions
($ Millions)
Third Quarter/Nine Months Ended September 30, 2007 Subsidiary Distributions(1)
North Europe &
Other(2)
Latin America Asia Total
America Africa
Utilities 42 / 116 57 / 174 -/1 -/- 99 / 291
Generation 150 / 268 24 / 39 45 / 102 35 / 43 254 / 452
Other 8 / 13 8 / 13
Total 192 / 384 81 / 213 45 / 103 35 / 43 8 / 13 361 / 756
Top 10 Nine Months Ended September 30, 2007 Subsidiary Distributions(1)
Business Amount Segment Business Amount Segment
New York 121 NA Generation Cartagena 35 E&A Generation
IPALCO 116 NA Utilities Shady Point 29 NA Generation
EDC(3) 97 LA Utilities Andres 24 LA Generation
Brasiliana 77 LA Utilities Ekibastuz 24 E&A Generation
Hawaii 42 NA Generation Southland 24 NA Generation
(1)Anon-GAAP financial measure. See Appendix.
(2)Otherincludes wind and other alternative energy projects AES Corporation 8
(3)AES sold its interest in EDC in second quarter 2007
Third Quarter 2007 Financial Review
10. » Third Quarter Segment Highlights
Latin America Generation
($ Millions except as noted)
Third Quarter
2007 2006 % Change Segment Highlights
› Latin America Generation revenue increased by
Revenues $914 $685 33%
$229 million to $914 million, primarily due to
higher rates and volumes in Chile and Argentina
Gross Margin 183 267 -31%
of approximately $150 million and approximately
$32 million in higher intercompany sales at Tiete
IBT & MI 141 212 (33%)
in Brazil.
› Gross margin decreased by $84 million to $183
million, primarily impacted by gas supply
curtailments and lower hydrology in Chile and
Revenue Comparison (QOQ) % Change Argentina of approximately $102 million, partially
offset by increased intercompany sales at Tiete.
Volume/Price/Mix 31%
› IBT&MI decreased by $71 million to $141
million, primarily due to gas supply curtailments
New Businesses/Projects 0%
and lower hydrology in Chile and Argentina,
partially offset by increases in intercompany
Currency (Net) 2%
sales at Tiete.
Total 33%
AES Corporation 9
Third Quarter 2007 Financial Review
11. » Third Quarter Segment Highlights
Latin America Utilities
($ Millions except as noted)
Third Quarter
Segment Highlights
2007 2006 % Change
› Latin America Utility revenue increased by $141
Revenues $1,311 $1,170 12%
million to $1.3 billion, primarily due to
approximately $135 million in favorable foreign
Gross Margin 259 188 38%
currency translation and approximately $26
million in increased volumes at Eletropaulo in
IBT & MI 193 (444) 143%
Brazil, partially offset by decreased rates at
Eletropaulo due to the 2007 tariff reset.
› Gross margin increased by $71 million to $259
million, primarily due to approximately $55
Revenue Comparison (QOQ) % Change million in favorable foreign currency translation
and approximately $33 million in lower costs in
Volume/Price/Mix 0%
Brazil.
New Businesses/Projects 0% › IBT&MI increased by $637 million to $193
million, primarily due to the $554 million charge
Currency (Net) 12% in the third quarter of 2006 related to the Brazil
restructuring as well as favorable foreign
currency translation and lower costs in Brazil in
Total 12%
2007.
AES Corporation 10
Third Quarter 2007 Financial Review
12. » Third Quarter Segment Highlights
North America Generation
($ Millions except as noted)
Third Quarter
2007 2006 % Change Segment Highlights
› North America Generation revenue increased by
Revenues $566 $490 16%
$76 million to $566 million, primarily due to
approximately $57 million in contributions from
Gross Margin 196 149 32%
the newly acquired TEG and TEP businesses in
Mexico and approximately $25 million in higher
IBT & MI 83 62 34%
spot prices and volumes at Eastern Energy in
New York.
› Gross margin increased by $47 million to $196
million, primarily due to the higher prices and
Revenue Comparison (QOQ) % Change volumes as well as lower costs at Eastern
Energy, an impact of approximately $27 million,
Volume/Price/Mix 4%
and contributions from TEG and TEP of
approximately $20 million.
New Businesses/Projects(1) 12%
› IBT&MI increased by $21 million, primarily due
to higher prices and volumes as well as lower
Currency (Net) 0%
costs at Eastern Energy and contributions from
TEG and TEP totaling approximately $47 million,
Total 16%
offset by $35 million of impairment expense at
Placerita and Cavanal Minerals.
(1)Includes TEG and TEP in Mexico AES Corporation 11
Third Quarter 2007 Financial Review
13. » Third Quarter Segment Highlights
North America Utilities
($ Millions except as noted)
Third Quarter
2007 2006 % Change Segment Highlights
› North America Utility revenue remained flat at
Revenues $274 $274 0%
$274 million.
Gross Margin 86 89 (3%) › Consistent with revenues, gross margin
remained relatively flat with a decrease of $3
IBT & MI 57 58 (2%) million to $86 million.
› Consistent with revenues and gross margin,
IBT&MI remained relatively flat with a decrease
of $1 million to $57 million.
Revenue Comparison (QOQ) % Change
Volume/Price/Mix 0%
New Businesses/Projects 0%
Currency (Net) 0%
Total 0%
AES Corporation 12
Third Quarter 2007 Financial Review
14. » Third Quarter Segment Highlights
Europe & Africa Generation(1)
($ Millions except as noted)
Third Quarter
2007 2006 % Change Segment Highlights
› Europe & Africa Generation revenue increased
Revenues $216 $196 10%
by $20 million to $216 million, primarily due to
increased rates and volumes of approximately
Gross Margin 35 38 (8%)
$15 million in Kazakhstan and approximately $3
million in favorable foreign currency translation.
IBT & MI 26 13 100%
› Gross margin decreased by $3 million, primarily
due decreased sales of excess emission
allowances in Hungary.
› IBT&MI increased by $13 million to $26 million,
Revenue Comparison (QOQ) % Change
primarily due to $11 million in foreign currency
Volume/Price/Mix 1% transaction losses in Kazakhstan during third
quarter 2006.
New Businesses/Projects 0%
Currency (Net) 9%
Total 10%
(1)Includes CIS countries AES Corporation 13
Third Quarter 2007 Financial Review
15. » Third Quarter Segment Highlights
Europe & Africa Utilities(1)
($ Millions except as noted)
Third Quarter
2007 2006 % Change Segment Highlights
› Europe & Africa Utility revenue increased by $26
Revenues $157 $131 20%
million to $157 million, primarily due to increased
rates of approximately $14 million in Ukraine and
Gross Margin 22 30 (27%)
approximately $6 million in favorable foreign
currency translation.
IBT & MI 20 25 (20%)
› Gross margins decreased by $8 million to $22
million, primarily due to the reversal of
approximately $7 million in VAT tax accrual
during third quarter 2006 at SONEL in
Revenue Comparison (QOQ) % Change Cameroon.
Volume/Price/Mix 15% › Consistent with gross margin, IBT&MI
decreased by $5 million to $20 million primarily
New Businesses/Projects 0% due to the reversal of the VAT tax accrual during
the third quarter 2006 at SONEL in Cameroon.
Currency (Net) 5%
Total 20%
(1)Includes CIS countries AES Corporation 14
Third Quarter 2007 Financial Review
16. » Third Quarter Segment Highlights
Asia Generation(1)
($ Millions except as noted)
Third Quarter
2007 2006 % Change Segment Highlights
› Asia Generation revenue increased by $44
Revenues $235 $191 23%
million to $235 million, primarily due to higher
dispatch in Pakistan and higher volume in Sri
Gross Margin 47 53 (11%)
Lanka.
IBT & MI 35 40 (13%) › Gross margin decreased by $6 million to $47
million, primarily due to lower volumes in China.
Increased revenue in Pakistan and Sri Lanka
had a relatively flat impact on gross margin due
to a related increase in costs.
Revenue Comparison (QOQ) % Change
› Consistent with gross margin, IBT&MI
Volume/Price/Mix 22% decreased by $5 million to $35 million primarily
due to lower volumes in China.
New Businesses/Projects 0%
Currency (Net) 1%
Total 23%
(1)Includes the Middle East AES Corporation 15
Third Quarter 2007 Financial Review
17. » 2007 Guidance Update
2007 Full Year Nine Months Ended
2007 Guidance Element Guidance September 30, 2007
Gross Margin $3.5 to 3.6 billion $2.6 billion
Income Before Tax & Minority Interest $2.0 to 2.1 billion $1.6 billion
Diluted Earnings Per Share from Continuing Operations $1.04 $0.71
Adjusted Earnings Per Share Factors(1) $0.03 $0.11
Adjusted Earnings Per Share(1) $1.07 $0.82
Net Cash from Operating Activities $2.2 to 2.3 billion $1.8 billion
Maintenance Capital Expenditures $0.9 to 1.0 billion $679 million
Free Cash Flow(1) $1.2 to 1.4 billion $1.2 billion
Growth Capital Expenditures $1.4 to 1.5 billion $1.1 billion
Subsidiary Distributions(1)(2) $1.1 billion $756 million
(1)A non-GAAP financial measure. See Appendix.
(2)Includes dividends received from EDC of approximately $100 million
AES Corporation 16
Third Quarter 2007 Financial Review
19. » Parent Sources and Uses of Cash
Third Quarter Nine Months Ended
($ Millions)
2007 September 30, 2007
Sources
Total Subsidiary Distributions(1) 361 756
Proceeds from Asset Sales, Net 54 789
Refinancing Proceeds, Net - -
Increased Credit Facility Commitments - -
Issuance of Common Stock, Net 5 30
Total Returns of Capital Distributions and Project Financing Proceeds 35 85
Beginning Liquidity(1) 1,378 1,146
Total Sources 1,833 2,806
Uses
Repayments of Debt - -
Investments in Subsidiaries, Net (174) (852)
Cash for Development, Selling, General and Administrative and Taxes (89) (255)
Cash Payments for Interest (83) (297)
Changes in Letters of Credit and Other, Net 28 113
Ending Liquidity(1) (1,515) (1,515)
Total Uses (1,833) (2,806)
(1)A non-GAAP financial measure AES Corporation 18
Third Quarter 2007 Financial Review
20. » Third Quarter 2007 Consolidated Cash Flow
($ Millions)
3Q ‘07 3Q ‘06
Net Cash Provided by Operating Activities(1)(2) $741 $928
Capital Expenditures (538) (445)
Acquisitions, Net of Cash Acquired (60) -
Proceeds from the Sale of Business 54 583
Proceeds from the Sales of Assets 5 3
Sale/(Purchase) of Short-Term Investments, Net 265 (115)
Decrease in Restricted Cash 74 67
Proceeds from the Sale of Emission Allowances - 8
Purchase of Emission Allowances (1) (5)
Decrease in Debt Service Reserves and Other Assets (46) (4)
Repayment of Affiliate Loan 55 -
Other Investing 4 13
(188) 105
Net Cash (Used in) Provided by Investing Activities
Borrowings/(Repayments) under the Revolving Credit Facilities, Net 101 (39)
Issuance of Non-Recourse Debt 371 237
Repayments of Non-Recourse Debt (538) (353)
Payments of Deferred Financing Costs (15) (9)
Distributions to Minority Interests (305) (85)
Contributions from Minority Interests 34 -
Issuance of Common Stock 7 31
Financed Capital Expenditures (19) (30)
Other Financing 1 (4)
Net Cash Used in Financing Activities (363) (252)
Total Increase in Cash & Cash Equivalents 190 781
Effect of Exchange Rate Changes on Cash (4) (14)
Cash & Cash Equivalents, Beginning 1,478 1,032
Cash & Cash Equivalents, Ending 1,664 1,799
(1)Depreciationand amortization from continuing operations was $238 million for 3Q07 and $211 million for 3Q06.
(2)Depreciationand amortization from continuing operations was $686 million for the nine months ended September 30, 2007 and $623 million for the nine months ended
September 30, 2006.
Note: Certain amounts have been netted, condensed and rounded for presentation purposes.
AES Corporation 19
Third Quarter 2007 Financial Review
21. » Reconciliation of Subsidiary
Distributions and Parent Liquidity
($ Millions)
Quarter Ended
Sept. 30, Jun. 30, Mar. 31, Dec. 31,
2007 2007 2007 2006
Total subsidiary Distributions $361 $259 $137 $311
Total returns of capital distributions 35 34 15 9
Total subsidiary distributions & returns of $396 $293 $152 $320
capital to Parent
Balance as of
Parent Company Liquidity(2) Sept. 30, Jun. 30, Mar. 31, Dec. 31,
2007 2007 2007 2006
Cash at Parent & QHCs(1)(2) $619 $405 $74 $257
Availability under revolver 896 973 804 889
Ending liquidity $1,515 $1,378 $878 $1,146
(1)Qualified Holding Company. See “Assumptions”
(2)A non-GAAP financial measure AES Corporation 20
Third Quarter 2007 Financial Review
22. » Assumptions
Forecasted financial information is based on certain material assumptions. Such assumptions include, but
are not limited to: (a) no unforeseen external events such as wars, depressions, or economic or political
disruptions occur; (b) businesses continue to operate in a manner consistent with or better than prior
operating performance, including achievement of planned productivity improvements including benefits of
global sourcing, and in accordance with the provisions of their relevant contracts or concessions; (c) new
business opportunities are available to AES in sufficient quantity to achieve its growth objectives; (d) no
material disruptions or discontinuities occur in GDP, foreign exchange rates, inflation or interest rates during
the forecast period; and (e) material business-specific risks as described in the Company’s SEC filings do not
occur individually or cumulatively. In addition, benefits from global sourcing include avoided costs, reduction
in capital project costs versus budgetary estimates, and projected savings based on assumed spend volume
which may or may not actually be achieved. Also, improvement in certain KPIs such as equivalent forced
outage rate and commercial availability may not improve financial performance at all facilities based on
commercial terms and conditions. These benefits will not be fully reflected in the Company’s consolidated
financial results.
The cash held at qualifying holding companies (QHCs) represents cash sent to subsidiaries of the Company
domiciled outside of the U.S. Such subsidiaries had no contractual restrictions on their ability to send cash to
AES, the Parent Company. Cash at those subsidiaries was used for investment and related activities outside
of the U.S. These investments included equity investments and loans to other foreign subsidiaries as well as
development and general costs and expenses incurred outside the U.S. Since the cash held by these QHCs
is available to the Parent, AES uses the combined measure of subsidiary distributions to Parent and QHCs as
a useful measure of cash available to the Parent to meet its international liquidity needs. AES believes that
unconsolidated parent company liquidity is important to the liquidity position of AES as a parent company
because of the non-recourse nature of most of AES’s indebtedness.
AES Corporation 21
Third Quarter 2007 Financial Review
23. » Definitions of Non-GAAP Financial Measures
› Adjusted earnings per share – Defined as diluted earnings per share from continuing operations
excluding gains or losses associated with (a) mark-to-market amounts related to FAS 133 derivative
transactions, (b) foreign currency transaction impacts on the net monetary position related to Brazil and
Argentina, (c) significant asset gains or losses due to disposition transactions and impairments, and (d)
early retirement of recourse debt. AES believes that adjusted earnings per share better reflects the
underlying business performance of the Company, and is considered in the Company’s internal
evaluation of financial performance. Factors in this determination include the variability associated with
mark-to-market gains or losses related to certain derivative transactions, currency gains and losses,
periodic strategic decisions to dispose of certain assets which may influence results in a given period,
and the early retirement of corporate debt.
› Free cash flow – Defined as net cash flow from operating activities less maintenance capital
expenditures (including environmental capital expenditures). Maintenance capital expenditures reflect
property additions less growth capital expenditures. AES believes that free cash flow is a useful measure
for evaluating our financial condition because it represents the amount of cash provided by operations
less maintenance capital expenditures as defined by our businesses, that may be available for investing
or for repaying debt.
› Liquidity – Defined as cash at the parent company plus availability under corporate revolver plus cash at
qualifying holding companies (QHCs). AES believes that unconsolidated parent company liquidity is
important to the liquidity position of AES as a parent company because of the non-recourse nature of
most of AES’s indebtedness.
› Subsidiary distributions – Defined as cash distributions (primarily dividends and interest income) from
subsidiary companies to the parent company and qualified holding companies. AES believes subsidiary
distributions are an important measure, as these cash flows are the source of cash flow to the parent to
meet corporate interest, overhead, cash taxes, and discretionary uses such as recourse debt reductions
and corporate investments. AES Corporation 22
Third Quarter 2007 Financial Review
24. » Reconciliation of Cash Flow Items
($ Millions)
Nine Months Ended
Third Quarter September 30,
2007 2006 2007 2006
Capital Expenditures
Maintenance Capital Expenditures $168 $196 $679 $575
Growth Capital Expenditures $389 $279 $1,076 $469
Capital Expenditures $557 $475 $1,755 $1,044
Nine Months Ended
Third Quarter September 30,
Reconciliation of Free Cash Flow 2007 2006 2007 2006
Net Cash from Operating Activities $741 $928 $1,848 $1,879
Less: Maintenance Capital Expenditures $168 $196 $679 $575
Free Cash Flow(1) $573 $732 $1,169 $1,304
AES Corporation 23
(1)A non-GAAP Financial Measure
Third Quarter 2007 Financial Review
25. » Reconciliation of Quarterly Adjusted Earnings per Share(1)
1Q06 2Q06 3Q06 4Q06 FY2006 1Q07
(Restated) (Restated) (Restated) (Restated) (Restated) (Restated)
Diluted Earnings Per Share from
$0.48 $0.29 ($0.56) ($0.02) $0.20 $0.17
Continuing Operations
FAS 133 Mark to Market
(0.01) (0.01) 0.02 - - 0.01
(Gains)/Losses
Currency Transaction
- - 0.01 (0.01) 0.01 -
(Gains)/Losses
Net Asset (Gains)/Losses and
(0.13) - 0.83 - 0.68 0.05
Impairments
Debt Retirement (Gains)/Losses 0.04 - - - 0.04 -
Adjusted Earnings Per Share(1) $0.38 $0.28 $0.30 ($0.03) $0.93 $0.23
(1)A non-GAAP Financial Measure
AES Corporation 24
Third Quarter 2007 Financial Review