2. AES Brasil Group
• Presence in Brazil since 1997
• Comprised of four companies in the sectors of
energy generation and distribution
• 7.4 thousand AES Brasil People
• Investments 1998-2010: R$ 6.9 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 distribution
since 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
4. 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
5. 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 bi
1 - Parent companies, AES Corp and BNDES, have equal voting capital on the Companies: 38.2% on AES Eletropaulo and 35.7% on AES Tietê
2 - Includes Federal Government and Eletrobrás shares in AES Eletropaulo and AES Tietê, respectively
3 - Base: 09/30/2011. Considers preferred shares for AES Eletropaulo and preferred and common shares for AES Tietê
5
6. 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
1
Net Income – 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
6
1 – excluding Eletrobrás Source: Companies’ financial reports
7. AES Tietê is an important player among private
Generation Installed Capacity (MW) - 2012 1
energy generators
Main privately held Companies
AES TIETÊ CPFL DUKE
AES Tietê is the 2nd largest among
EDP
2,3% 2,3% 1,9% 1,6%
TRACTEBEL NEOENERGIA private generation companies and 10th
6,1% 1,2%
ENDESA
0,8% largest overall
LIGHT
0,8%
Approximately 78% of country’s
generation installed capacity is state-
DEMAIS CHESF ³
26% 9% owned2
FURNAS ³ There are three mega hydropower plants
8%
ELETRONORTE ³ under construction in the North region of
8%
COPEL ITAIPU ³
Brazil with 18 GW in installed capacity
4% 6%
PETROBRÁS ELETRONUCLEAR ³
– Santo Antonio and Jirau (Madeira River): 7 GW
5% CEMIG CESP 3%
6% 6% CGTEE ³ – Belo Monte (Xingu River): 11 GW
1%
ELETROSUL³
0,5% 1- Sources: ANEEL – BIG (January, 2012) and Companies websites 2- Source: Merrill Lynch 7
Total Installed Capacity: 117 GW
3 – Eletrobrás, totaling 35%
8. AES Brasil is the largest distribution group
in Brazil
Consumption (GWh) - 2010
13%
• 63 distribution companies in Brazil
distributing 419 TWh
12%
40%
A Brasil
AES
• AES Brasil is the largest electricity
CPFL Energia distribution group in Brazil:
10% – AES Eletropaulo: 43 TWh distributed,
Cemig
representing 10.3% of the Brazilian
7%
6%
6%
6% market
Neo Energia
Consumers – Dec/2010 – AES Sul: 9 TWh distributed,
12% Copel representing 2.2% of the Brazilian
market
30% Light
12% Distribution companies’ operations are
EDP
restricted to their concession areas
12%
Outros Acquisitions must be only performed by
5% the holdings of economic groups
7%
7% 16% 8
10. Energy Sector in Brazil: business segments
Free Clients Distribution Transmission Generation
• Consumption of 105 TWh • 63 companies • 68 companies • 13 groups controlling 76% of
(25% of Brazilian total market) • 415 TWh of energy • 68% private sector total installed capacity
• Conventional sources: distributed in 2010 • 22% private sector
• High voltage transmission
above 3000 kW • 1,862 power plants
• 68 million consumers (>230 kV)
• Alternative sources: • 115 GW of installed capacity
• 67% private sector • 98.648 km in extension
between 500 kW e 3000 kW • 73% hydroelectric
• Annual tariff adjustment lines (SIN)¹
• 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% SHPP
• Free contracting
• Regulated contracting adjusted by inflation)
environment • 1% Wind
environment
¹ Interconected National System
• Contracting environment –
free and regulated markets 10
² Small Hydro Power Plants Sources: EPE, Aneel, ONS and Merrill Lynch
11. 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 PPA1
1 – Power Purchase Agreement 11
12. 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
380 376 the global crisis.
369
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
12
1 - Source: EPE (Energetic Research Company) / ONS (National System Operator) – Second Review – september/11
13. Energy sector in Brazil:
supply perspectives
Installed 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
th: 4.5% p.a.
Annual Grow 2
SHPP: 4%
.a)
(GDP: 5.0% p 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
14. Energy sector in Brazil:
regulatory methodology
Tariff 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 pass trough 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 pass trough 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
Depreciation WACC) and depreciation
Regulatory Parcel A - Non-Manageable Costs
Ebitda
Parcel B - Manageable Costs 14
1 – X Factor: index that captures productivity gains
15. Energy sector in Brazil:
regulatory methodology
3rd 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
APLICATION 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
16.
17. AES Tietê Overview
Generation facilities
17 hydroelectric plants 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
343 employees
17
1 - Amount of energy allowed to be long term contracted
18. Generated energy shows high
operational availability
Generated energy (MW avarage1) Generated energy by power plant (MW avarage1)
130% 125% 129%
126%
118%
1,665 1,703
1,599
1,512 1,550
2008 2009 2010 9M10 9M11
Generation - Mwavg Generation/Physical guarantee
1 – Generated energy divided by the amount of hours * Caconde, Limoeiro, Mogi and SHPPs 18
19. A significant amount of billed energy and net
revenues comes from the bilateral contract with
AES Eletropaulo
Energy Billed (GWh) Net Revenues (%)
14,706 14,729
117 301 -3% 94%
13,148
1,150 1,340 11,483
331 11,114
2,331 215
1,680 1,980 346
1,135
1,188
1,554
1,535
11,138 11,108 11,108
8,578 8,045 1%
3%
2%
AES Eletropaulo
1
2008 2009 2010 9M10 9M11
2
Other bilateral contracts
AES Eletropaulo MRE Spot Market Other bilateral contracts
Spot Market
1 – Leap Year 2 – Energy Reallocation Mechanism MRE 19
20. Investments in the modernization of Nova
Avanhandava, Ibitinga and Caconde
power plants
Investments (R$ million) 9M11 Investments
84%
% 169
44
R:
C AG 18 +122%
119
14
82
53 4% 12%
56 12 151
13 7 105
70
43 46
Equipment and Modernization
2009 2010 2011 (e) 9M10 9M11
New SHPPs*
Investments New SHPPs* IT projects
*Small Hydro Power Plants
20
21. Growth opportunities
Perspectives
• 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 Energy Auction in 2011
• Next events
- Obtain installation license
- Participate in A-3 Auction expected to be realized in
March 2012
- Evaluate energy offering in the free market
21
23. Practice of total net income distribution on
quarterly basis*
Net Income and Dividend Pay-out1 (R$ million)
117%
110%
100%
12%
11% 11%
737
706
692
31
+2%
570 -5% 582
816 784 28
542
(74) (78) (40)
(36)
2008 2009 2010 9M10 9M11
Pay -out Yield Pref Recurring Non-recurring IFRS Effect
1 – Gross value
23
(*) 2009 and 2010 numbers in IFRS
24. Debt profile
Net Debt (R$ billion) Amortization Schedule – Principal (R$ million)
0.3x 0.3x 0.3x 0.4x
0.3x
300 300 300
0.6
0.4 0.4 0.4 0.5
2008 2009 2010 9M10 9M11 2013 2014 2015
Net debt Net debt / EBITDA
• September, 2011:
– Average debt cost in 9M11 was 115% of CDI1 p.a. or 15% p.a.
– Average debt maturity of 2.8 years
– Net debt: R$ 0.6 billion
– Net debt/EBITDA: 0.4x
24
1 – Brazilian Interbank Interest Rate
25. Capital Markets
AES Tietê X Ibovespa X IEE Daily Avg. Volume (R$ thousand)
13,922 12,828
YTD1
110 +5% 10,187
4,239
3,370
+2% 8,160
-2%
2,101
90
2,692
-25%
9,683 9,458
70 8,086
5,468
50
Dec-10 Mar-11 Jun-11 Sep-11
2008 2009 2010 9M11
3
AES TIETÊ PF TSR2 IBOVESPA IEE Preferred Common
• Market Cap4: R$ 8.5 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: 12/30/2010 = 100 2 – Total Shareholders’ Return 3 – Electric Energy Index 4 – Index: 09/30/11 25
26.
27. AES Eletropaulo Overview
Concession 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, 1.2 million electricity poles and
6.1 million consumption units in a concession area of 4,526 km2
Total distributed volume of 43 TWh in 2010
AES Eletropaulo, as a distribution company, can only invest in
assets within its concession area
5,647 employees
27
29. 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%
Jul-07 May-08 Mar-09 Jan-10 Nov-10 Sep-11
• Recent slowdown is influenced
Industrial Production of SP (% 12 months) Industrial (% 12 months)
by the decrease of industrial
Consumption of industrial class by activity – AES Eletropaulo
production in 2011
• Moreover, the migration of clients
to other regions of São Paulo State
Vehicles, and of the country negatively
Chemical, Rubber,
Other industries
Plastic and Metal
50%
products impacts this class
50%
29
30. Residential class
Residential class X Average income in São Paulo Metropolitan Area
1,800 4,800 • Residential class is influenced by
Average Income R$ - SP (q-2*)
income in São Paulo Metropolitan
Residential (GWh)
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
growth of residential class
1,000 2,800
1Q06 3Q06 1Q07 3Q07 1Q08 3Q08 1Q09 3Q09 1Q10 3Q10 1Q11 3Q11 • Average annual growth (2003-
Avg Real Income R$ - SP (t-2) Residential (GWh)
2011):
Consumption per consumer (in kWh) – YTD September – total residential market: 5.5%
y.y.
- 9.7%
260 – consumption per consumer:
2.1% y.y.
235
228 228
220 217 220 Consumption per consumer is
212
206
198 198 still 9.7% lower than in
192
the period before the rationing
* 2 quarters of delay in relation to consumption
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 30
31. Investments amounted
R$ 530 million in 9M11
Investments Breakdown (R$ million) Investments 9M11 (R$ million)
3%
:1 166
GR
CA 744
800
682 29 128
700
47
28 +38%
600 516 530 16
383 16 21
500 37 27
125
400 22
715
654
300
478 513
200 362
Maitenance
100
Client Service
0
System Expansion
2009 2010 2011(e) 9M10 9M11
Losses Recovery
Capex Paid by Customers IT
Paid by the Clients
Others
31
32. SAIDI & SAIFI
SAIDI - System Average Interruption Duration Index SAIFI - System Average Interruption Frequency Index
8.41
7.87
7.39
10,92
10,09
9,32
9,20 11,86 10,60 10,30
11,95
6.17 5.43 6.06 5.42
5.20
2008 2009 2010 9M10 9M11 2008 2009 2010 9M10 9M11
5th 8th 7th 1st 7th 3rd
SAIDI (hours) SAIDI Aneel Reference SAIFI (times) SAIFI Aneel Reference
ABRADEE ranking position among the 28 utilities with more than 500 thousand customers
► 2011 SAIDI ANEEL Reference: 8.68 hours ► 2011 SAIFI ANEEL Reference: 6.93 times
32
Sources: ANEEL, AES Eletropaulo and ABRADEE
33. Operational Indexes
Losses (%) Collection Rate (% over Gross Revenues)
11.6 11.8 11.0 102.4 103.0
10.9 10.6 101.1 100.3
98.5
5.1 5.3 4.4 4.5 4.1
6.5 6.5 6.5 6.5 6.5
2008 2009 2010 9M10 9M11 2008 2009 2010 9M10 9M11
Technical Losses ¹ Commercial Losses
ANEEL References:
From Jul/09 to Jun/10: 12.32% From Jul/10 to Jun/11: 12.45%
33
1 – Current technical losses used retroactively as a reference
39. Commitment with sustainability
DEVELOPMENT & VALUATION INNOVATION IN PRODUCTS
SUSTAINABLE ENERGY EFFICIENCY IN THE USE OF
SAFETY OF COWORKERS, SUPPLIERS
GENERATION RESOURCES AND SERVICES
AND COMMUNITIES
... means using ... means allocating ... means an attitude of ...means knowing, ... means providing an
economic, social and them in such a manner protection of our involving in a environment and
environmental that balanced and employees, suppliers transparent form and culture that inspire
resources in a balanced perennial results are and population. positively influencing solutions that improve
fashion, preserving the ensured for all our coworkers, people’s lives, ensuring
present time and stakeholders, abiding by suppliers and quality and excellence
ensuring the future the values practiced by communities to build a in the services rendered
the company collective agenda that to the customer.
generates value for
everyone
– Education for sustainability
Cross-cutting
– Stakeholders active participation
themes – Communication, knowledge and information
39
40. Social Responsibility: Main Projects
Development and transformation of communities
Education, culture “Casa de Cultura e Cidadania” Project
and sport
It offers courses and activities in culture and sport for 5.2
thousand children and teenagers in 7 units of AES Brazil. In two
AES Eletropaulo’s units the project benefits 1.6 thousand
people in low-income communities.
Children education and development
“Centros Educacionais Luz e Lápis” Project
Two units in São Paulo attending 320 children from 1 to 5 years old, in social
vulnerability.
Education about Safety and Efficiency in energy consumption
“AES Eletropaulo nas Escolas” Project
Education 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.
40
41. Social Responsibility: Main Projects
Inclusive
Women inclusion and income generation
and
Social Business
“Fornecedor Cidadão” Project
Empowerment of female electricians to work on
energy cutting and reconnection. Project started in
2010 with 41 women.
Social inclusion and income generation
“Empreender com energia” Project
In partnership with the “Aliança Empreendedora” Institution,
community residents of Vl. Guacuri neighborhood – SP are
empowered to entrepreneurship, in groups or individually, in order to
improve their income and life quality. Starting in 2010, the project now
has two productive groups and 19 individual entrepreneurs.
41
42. Social Responsibility: Main Projects
Converting Consumers to Clients
A project developed to work on electrical network regularization.
Since 2004, more than 437 thousand families in low income
communities were benefited from better energy supply conditions
and social inclusion.
The project has already substituted:
880 thousand lamps
22 thousand refrigerators and
7 thousand showers
for more efficient equipments
“Energia do Bem” Project
Active participation of employees to transform low income
communities and to work on institutions development. Starting in
2008, the program counts on the participation of 12% of AES
Eletropaulo employees, in activities like winter clothes campaigns
and support in several activities institutions.
www.energiadobem.com.br
42
44. Costs and Expenses
Costs and operational expenses1 (R$ million)
433
415
351
187 299 296
201
112
125 115
239 246
214
174 181
2008 2009 2010 9M10 9M11
Energy Purchase, Transmission and Connection Charges, and Water Resources
Other Costs and Expenses 2
1 – Do not include depreciation and amortization 2 - Personnel, Material, Third Party Services and Other Costs and Expenses 44
45. Costs and Expenses
Costs and operational expenses1 (R$ million) PMS and Other Expenses (R$ million)
1,306
1,255
1,193
6,745 254 165
6,431
5,893 970 909
1,255 379
1,306 5,006 5,129
1,193 352 443 202 67
970 909
329 368
308
5,125 5,490
4,700 700
4,036 4,220 647
485 461 475
3
2008 2009 2010 9M10 9M11 2008 2009 2010 9M10 9M11
Energy Supply and Transmission Charges PMS² and Others Expenses Personnel and Payroll Material and Third Party Others
1 – Do not include depreciation and amortization
2 - Personnel, Material, Third Party Services and Other Costs and Expenses
3 – In 2009 expenses with Pension Fund increased due to inflation rate (IGP-M) increase and reversal of R$ 63 million in 4Q08 caused by actuarial liability adjustment 45
46. Action Plan: R$ 242 million with increase
of R$ 122 million in emergency teams
availability of 353 emergency teams
Concluded in 38% increase in call center positions (150 positions)
September 2011 doubling of SMS receipt capacity to 100 thousand / day
training of 276 maintenance and construction electricians
hiring of 30 additional pruning electricians
training of 240 electricians for emergency attendances in powered grid
beginning of 276 maintenance and construction electricians activities
Concluded in and training conclusion of other 304
November 2011
300 additional stand by positions in call center for emergency
situations
increase of call center service capacity by 27 times from 2 thousand to
54 thousand calls/hours
December to
increase of 120 emergency teams, totaling 473 teams
March
46
47. AES Tiete's expansion obligation
Privatization Notice Judicial Notice:
Aneel informed AES Tietê was summoned to Efforts being made by the
established the The Company was notified by
that the issue is answer a Lawsuit filed by the
obligation to expand the the State of São Paulo Company to meet the
not related to the State of São Paulo, which
installed capacity in 15% Attorney's Office to present its
concession requested the fulfillment of the obligation :
(400 MW) until 2007, understanding on the matter,
agreement and obligation in 24 months.
either in greenfield having filed its response on
must be • Long-term energy
projects and/or through time, the proceedings were An injunction was granted in
addressed with
long term purchase ended, since no other action order to have a project contracts (biomass)
the State of São
agreements with new submitted within 60 days.
Paulo was taken by the Attorney's totaling an average of 10
plants Office
MW
•SHPP São Joaquim -
started operating in July,
1999 2007 2011, with 3 MW of
Ago/08 Out/08 Jul/09 Set/10 Set/11 Nov/11
installed capacity
•SHPP São José – under
construction, with 4 MW
Company faces restrictions until of installed capacity,
Popular Action:
deadline: In response to a Popular Lawsuit: expected to be
Due to the plaintiffs failure
• Insufficiency of hydro resources Action (filed by to specify the persons that The Company operational in 2012
individuals against the should be named as appealed to the
• Environmental restrictions
Federal Government, Defendants, a favorable State of Sao • Thermo-SP - Project of
• Insufficiency of natural gas supply Aneel, AES Tietê and Paulo State Court
decision was rendered by a 550MW gas fired
• 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 thermal plant
(an appeal has been filed)
agreements between generators and before the first instance stayed
distributors
47
48. Eletrobras Lawsuit
State-owned
Eletropaulo was
Next Steps:
spun-off into four Eletrobras, after On July 7, the
companies and, winning the judge determined 1 - The
according to our Eletrobras and Eletrobras auditing
Stated-owned interest Eletropaulo and
understanding CTEEP appealed requested the 1st procedure (AP)
Eletropaulo calculation CTEEP to
based on the to the Superior level of court is expected to
borrowed money discussion, filed present their
spin-off Court of Justice judge to appoint begin by the 1st
from Eletrobras an Execution Suit considerations,
agreement, the (SCJ) an expert half of 2012
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
Nov/86 Dec/88 Jan/98 Apr/98 Sep/01 Sep/03 Oct/05 Jun/06 May/09 Dec/10 Jul/11 decision will be
released
4 - Appealing
to the 2nd
instance court
5 - Foreclosure
starts.
State-owned Presentation of
The 2nd level of Eletrobras
guaranty
Eletropaulo and Privatization requested the
court excluded The SCJ decided
Eletrobras event . State- beginning of the 6 - Request to
AES Eletropaulo to send the
disagreed on how owned appraisal withdraw the
from the Execution Suit
to calculate Eletropaulo procedure, which is guaranty
discussion based back to the 1st
interest over that became AES under 1st. instance
on the spin-off level of court 7 - Appeals to
loan and a lawsuit Eletropaulo court analysis
agreement the 3rd instance
was started
courts
48
49. Shareholders Agreement
On Dec 2003 AES and BNDES signed a Shareholders’ Agreement to regulate their relationship as shareholders of
Brasiliana and its controlled companies. The Agreement is available at www.aeseletropaulo.com.br/ri
Shareholders 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 buy
refusal that participation at the same price offered by a third party
Tag along In the case of change in Brasiliana’s control, tag along rights are triggered for the following
rights 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 shares
Drag along Once the offering party exercises the Drag Along clause, offered party is obligated to dispose of all
rights its shares at the time, if the Right of 1st Refusal is not exercised by offered party
49
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
50
51. Contacts:
ri.aeseletropaulo@aes.com
ri.aestiete@aes.com
+ 55 11 2195 7048
The statements contained in this document with regard to the business prospects, projected operating and financial
results, and growth potential are merely forecasts based on the expectations of the Company’s Management in
relation to its future performance. Such estimates are highly dependent on market behavior and on the conditions
affecting Brazil’s macroeconomic performance as well as the electric sector and international market, and they are
therefore subject to changes.
