- The document discusses Latin Energy, Brazil's largest electricity distribution company. It summarizes Latin Energy's shareholding structure, concession area, market and operational performance, tariff adjustments, and financial results. - Latin Energy has a large concession area in Brazil with over 16 million people and distributes over 35,000 GWh per year. It has seen increased energy consumption and revenue. - Tariffs are adjusted annually with periodic reviews to reposition rates every 5 years to balance required and actual revenue.

1. Latin Energy 2005
December, 2005

2. • Shareholding Structure
• Concession Area
• Market and Operational Performance
• Tariff Adjustment
• Financial Results
• Conclusion

3. Shareholding Structure
AES BNDES
50.01% ON 49.99% ON
100.00% PN
Brasiliana
7.38% PN
100.00% 98.26%
Minorities
1.74%
Minorities Fed. Gov. BNDES
AES Transgás AES Elpa 2.16% ON
62.85% PN 77.81% ON 20.03% ON 0.73% PN
29.05% PN
3

4. Concession Area
• Largest electricity distribution company in Latin America in terms of
revenue
• Net Revenue in 2004 – R$ 7,394 million
• Density of billed energy consumption: 7,220 MWh/Km2
• Attractive concession area in Brazil Brazil Eletropaulo %
• Demographic density
Km² 8,547,403 4,526 0.05%
• Solid economic base
Population 184,434,438 16,062,101 8.71%
Energy Distributed
320,772 35,341 11.02%
(GWh/year)
4

5. Consumer Market Profile
consumption
9m 2004 - GWh 9m 2005 - GWh
7.1% 12.7% Consumption- GWh
9.3%
7.3% 32.5% 3000.0
32.0%
2600.0
2200.0
26.9%
26.4%
1800.0
21.1% 1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05
24.7%
9m 2004 – R$ 9m 2005 – R$
1.5% 3.3%
Residential
7.5%
6.6%
revenue
Industrial
40.7% 41.2%
Commercial
29.9%
Others
29.8%
TUSD
20.4% 19.2%
5

6. Consumption in GWh
4.8% 1.6% 3.4%
8,819 -2.8%
8,417 -11.5% 27,178
26,273
7,064 7,175 24,404
6,490 23,720
5,743 85.0%
-18.5%
3,458
2,433
1,982 1,869
er
SD
l
l
al
ti a
ia
th Market Billed Market Billed
ci
r
TU
en
st
er
O
du
with TUSD
id
m
es
In
om
R
C
9m 2004 9m 2005 9m 2004 9m 2005
NOTE: Charts do not consider own consumption
6

7. Retention of Potentially Free Consumers
Net Revenues with TUSD - R$ million
84
78
54
48
38
30
19
1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05
Captive Consumers X Free
% total load of concession area of 2005 (e) 36,511 GWh
13.4%
83.5%
3.1%
Captive Consumers Free Consumers Potentially Free Consumers
7

8. Energy Supply
GWh
1% 2%
7%
15%
27% Auction
2%
Other bilateral contracts
60%
21%
51%
Bilateral contract with
19% Tietê
Initial contracts
32% 32% 31% Itaipu
2003 2004 2005
• Initial Contracts end by January 2006
8

9. Loss Reduction – YTD 2005
• 370 thousand inspections
• Revenue recovery of R$ 86.8 million (billed value)
• Annual recovery perspective of 320 GWh (agreements)
Losses
13.53% 13.35%
13.01%
7.93% 7.75%
7.41%
2004 1H05 3Q05
Commercial Total
9

10. Tariff Adjustments
Privatization 1998 Review 2003 Review 2007
Year 0 1 2 3 4 5 6 7 8 9 10
Annual Adjustment
(Factor X = 0 in the first 4 years) 2.12%
Annual Adjustment
(Factor X = 0)
Annual Adjustment Periodic Review
Tariff Adjustment Rate Tariff Repositioning
VPA + VPB (IGPM +/- X) (Required Revenue – Deductions from Required Revenue)
Revenue Actual Revenue
10

11. Tariff Evolution
20% 18.6%
17.6%
13.8% 14.3%
15%
11.1% 11.6%
10% 7.6% 12.1% 16.9%
11.8% 6.4%
7.5% 7.3% 7.1%
5% 1.6%
6.3% 4.5% 4.8% Adjustment
3.7% 2.5% 3.6%
1.7%
0% 2.12%
-4.3%
-5%
-10%
1999 2000 2001 2002 2003 2004 2005
Parcel B Parcel A PIS/COFINS IGPM
X Factor = 2.43%
11

12. Completion of Tariff Review 2003
• Authorized increase in adjustment rate from 10.95% to 11.65%
• R$ 42 million added to the remuneration granted for tariff year 2003-2004
Item – R$ thousand Previous Present Variation
Net remuneration base R$5,242 R$ 4,771
Remuneration rate 17.07% 17.07%
Remuneration R$ 895 R$ 814 (R$ 81)
Gross remuneration base R 8,275 R$ 9,885
Depreciation rate 3.95% 4.31%
Depreciation R$ 327 R$ 426 R$ 99
Additional O&M costs - R$ 24 R$ 24
TOTAL R$ 42
R$ 42
• The accrued value amounted R$ 106.9 million, with an impact on 2Q05
results
• Recovery of resources will take place during tariff year 2005-2006
12

13. Results
in R$ million
Net Revenues Adjusted EBITDA Margin
7.430 23,2% 22,9% 22,6% 23,5% 22,1%
6.462 6.257
5.800 1.672
5.370 1.472
1.343 400 1.377
1.256
412
490 293 550
1.272
1.060 963
755 827
2002 2003 2004 9m04 9m05
2002 2003 2004 9m04 9m05 Adjusts EBITDA Adjusted EBITDA Margin
Financial Results Profit / Loss
24 86 6
(12)
(319) (204)
(453) (434)
(871)
(1.265)
2002 2003 2004 9m04 9m05 2002 2003 2004 9m04 9m05
13
Adjusted EBITDA = EBITDA + RTE + all payments made by the Company with respect to pension fund obligations.

14. Negative Impacts – 3Q05
Provision - Agreement signed with MGSP R$ thousand
MGSP debt balance provision (346.369)
Financial Expenses - Present Value Adjustment Reversal 55.227
Tax Effects (34%) - Credit 98.988
Reversal of Tax Credit (36.143)
Net Effect on the Result (228.297)
increase in Pis/Cofins' taxes - Agreement with AES Tiet R$ thousand
Pis/Cofins payment to AES Tietê (43.692)
Tax Effects (34%) - Credit 14.855
Net Effect on the Result (28.837)
Other impacts - 3Q05 R$ thousand
Allowance for doubtful debts - Other Municipal Governments (23.953)
Present Value Adjustment - Other Municipal Governments (9.102)
IPTU tax – MGSP – Monetary Correction (9.444)
Diferred Amortization - Debt downpayment (15.992)
Tax Effects (34%) - Credit 19.887
Reversal of Tax Credit (14.810)
Net Effect on the Result (53.414)
Total - Net Effect on the Result (310.548)
2005 results were also affected by the recognition of R$256 million (9 months) in connection with our
pension fund obligations
In 2006, our results will still be affected by the remaining recognition of approximately R$340 million
14

15. CAPEX – YTD 2005
R$ million
Capex – YTD05
Customer Service and
88
System Expansion
33 Maintenance 23
Loss Recovery 12
36
32 370 Personnel 53
297 Others 26
203
186 Total 203
Self Financed 36
Total Recorded 239
2003 2004 YTD 2005 2005
Capex Self Financed
15

16. Consolidated Indebtedness
R$ million
Short Term vs. Long Term Debt Evolution
5,278 5,284 5,280 5,278 5,284 5,280
100% Debentures
819
Bonds
29% 2.403 501 2,338
3.091
765
Reprofiling
74% 253
Others
77%
50% 949
1.102
762
71%
1.779 1.993
1.424
23% 26%
0% 2003 2004 3Q05
2003 2004 3Q05 FCESP CVA /RT E Private Creditors
ST LT
Amortization Schedule Hedging Strategy
R$5,278 R$5,284 R$5,280
132
2%
Effective 100%
8%
payments 35% 17%
285
158 3%
99 1,972 50%
56
444 159 49 62% 83% 90%
474 93
905 43
469 522 506 367
144 335
70 0%
Dow- YTD05 4Q05 2006 2007 2008 2009 2010-17 2003 2004 3Q05
npayments
R$ BNDES US$ * Local Currency Hedge Foreign Currency
* Conversion rate on 09/30/2005 US$ 1,00 = R$2,2222 16

17. 2005 Debt Issuances
Down payments made to banks
BONDS (June 2005)
• Bonds: 50% R$237,030,000
• Principal: R$ 474 million
• Tenor: 5 years • Debentures: 90% R$720,000,000
• Interest rate: 19.125% p.a.
• Interest and Amortization:
• semiannual interes, bullet principal
DEBENTURES (September 2005)
Debentures (September 2005)
Basis: September 2005
• Principal: R$ 800 million
Average Cost Average Life
• Tenor: 5 years Before After Before After
• Interest rate: CDI +2.90% p.a. Issuances Issuances Issuances Issuances
Private
128.1% CDI 126.7% CDI 1.58 years 2.75 years
• Interest and Amortization: Creditors’ Debt
Total Debt w/o
• Semiannual interest, Annual Principal FCESP
117.8% CDI 117.0% CDI 1.41 years 2.05 years
• Grace period: 23 months Total Debt 102.1% CDI 101.9% CDI 3.12 years 3.43 years
17

18. Financial Strategy
Ratings – International Scale
• Successful issuances B
2005
• Estimates of growth in
operating revenues and cash
flow
• Expected decrease in debt
servicing
B–
• Better outlook for the 2004
electric sector
D
2003
S&P
Fitch Ratings 18

19. Conclusion
• Affected by extraordinary events, the company had a loss of
R$ 204 million on the 9 months of 2005
• Future Upsides:
• Reduce in commercial losses
• Financial Strategy: Increase duration and decrease costs of debt
• Better results:
• No recurring provisions in regards to the City Government of
São Paulo
• In 2007 the Pension Fund liability will be fully recognized in
the Balance Sheet
19

20. Latin Energy 2005
December, 2005
The statements contained in this document relative to the Company’s business
prospects, operating and financial result projections, and growth potential are
mere forecasts based on the expectations of Company Management about the
future. Such expectations are highly dependent on market shifts and on the
performance of Brazil’s economy, the electricity sector and the international
market. They are therefore subject to change.