Apresentação institucional 3Q10
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Transcript of Apresentação institucional 3Q10
1
InstitutionalJanuary, 2011
2
AES Brasil Group
• Presence in Brazil since 1997
• Comprised of seven companies in the sectors of energy generation, distribution, trade and telecommunications
• 7.7 thousand AES Brasil People
• Investments 1998-2009: R$ 5.8 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 dividend practice since 2006: – AES Tietê: 100% pay-out on quarterly basis
– AES Eletropaulo: 95% pay-out on semi-annually basis
3
AES Brasil widely recognized in 2009-2010
Environmental concern
Management excellence
Quality and safety
(AES Eletropaulo) (AES Sul) (AES Eletropaulo) (AES Eletropaulo)
(AES Tietê) (AES Eletropaulo) (AES Tietê) (AES Tietê)
(AES Brasil) (AES Tietê)
4
AESInfoenergy
AESUruguaiana
AESCom Rio¹
AESEletropaulo
AESTietê
AES EletropauloTelecom¹AES Sul
AES Corp BNDES
C = Common SharesP = Preferred Shares
T = Total
Shareholding Structure
C 99.99 %T 99.99 %
C 99.99%T 99.99%
C 76.45%P 7.38%T 34.87%
Cia. Brasiliana de Energia
C 50.00% - 1 shareP 100%T 53.85%
C 50.00% + 1 shareP 0.00%T 46.15%
C 71.35%P 32.34%T 52.55%
C 98.25%T 98.25%T 99.70%
C 99.00%T 99.00%
1 – AES Atimus
5
24.2% 28.3% 39.5% 8.0%
8.5%56.2%19.2%16.1%
Others¹Free Float
Listed Companies Shareholding Composition
1 – includes Federal Government and Eletrobrás shares in AES Eletropaulo and AES Tietê, respectively
6CEMIG AES BRASIL NEOENERGIA CPFL TRACTEBEL COPEL CESP EDP LIGHT DUKE
1.9 1.81.6
1.3 1.11.0
0.80.6 0.6
0.2
CEMIG AES BRASIL CPFL NEOENERGIA TRACTEBEL CESP COPEL EDP LIGHT DUKE
4.0
3.22.8 2.6
2.21.8 1.7
1.4 1.2
0.5
AES Brasil is the second largest group in electric sector
Ebitda1 – 2009 (R$ Billion)
Net Income1 – 2009 (R$ Billion)
1 – excluding Eletrobrás Source: Companies’ financial reports
7
AES TIETÊ DUKE
TRACTEBEL COPEL
PETROBRÁS CEMIG
ITAIPU CESP
ELETRONORTE FURNAS
CHESF OTHERS
2% 2%6%
4%
5%
6%
6%
7%
8%9%
10%
35%
Source: ANEEL (Regulator) – BIG (October, 2010)
AES Tietê is the 2nd largest among private
generation companies and 10th largest overall
10 largest gencos correspond to 63% of the total
installed capacity
There are three mega hydropower plants under
construction in the North region of Brazil with 18 GW
in installed capacity
– Santo Antonio and Jirau (Madeira River): 7GW
– Belo Monte (Xingu River): 11GW
Generation Installed Capacity (MW) - 2010Privately held companies
111 GW
AES Tietê is an important player among private energy generators
8
13%
12%
12%
16%6%7%
5%
30%
13%
13%
10%
7%6%6%5%
40%
AES Brasil is the largest distribution group in Brazil
Consumption (GWh) - 2009
Consumers – Dec/2009
• 64 discos in Brazil distributing 388 TWh
• AES Brasil is the largest electricity distribution group in Brazil:
– AES Eletropaulo: 41 TWh distributed,
representing 10.6% of the Brazilian
market
– AES Sul: 8 TWh distributed,
representing 1.9% of the Brazilian
market
There is a limited opportunity for competition in Brazil as discos are restricted to operate within their concession areas
AES Brasil
CPFL Energia
CEMIG
Neoenergia
Copel
Light
EDP
Others
10
AES Tietê Overview
16 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 2,657 MW, with physical guarantee1 of
1,280 MW
All amount of energy that AES Tietê can sell in the long
term is contracted to AES Eletropaulo until the end of 2015
As a pure energy generator, AES Tietê can only invest in
its core business
335 employees
Concession Area
1 - Amount of energy allowed to be long term contracted
11
2010 2019
Total installed capacity is expected to reach 167 GW by 2019
Brazilian energy matrix is not expected to materially change over the next 10 years
1 - Small Hydro Power Plant Source: EPE (Energetic Research Company)
167 GWAnnual Growth: 4.5% p.a. 112 GW
Energy sector in Brazil:supply perspectives
Installed Energy Capacity in Brazil
Hydro; 74%
Natural gas; 8%
Biomass; 5%
SHPP; 4%
Oil; 3%
Nuclear; 2%
Coal; 1%
Diesel; 1%Wind; 1%
Steam; 1%
Others; 9%Hydro; 70%
Natural gas; 7%
Biomass; 5%
SHPP; 4%
Oil; 5%
Nuclear; 2%
Coal; 2%
Diesel; 1%Wind; 4%
Steam; 0%
Others; 9%
12
Distribution CompaniesTrading
Companies
Distribution Companies
Free Clients
Auctions
Energy sector in Brazil:contracting environment
Regulated Market Free Market
Spot Market PPAs1
1 – Power Purchase Agreement
• 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 PPA
– Existing Energy (A-1): Delivery in 1 year,
5-15 years PPA
Trading Companies
Free Clients
13
121% 118%
130%
2007 2008 2009 9M09 9M10
1,545 1,512
1,665 1,6491,703
Generation - MWAvg
127%129%
Generation / Physical Guarantee
2007 2008 2009 9M09 9M10
11,108 11,138 11,1088,521 8,578
1,740 1,680 2,331
1,640 1,554
573 331 1,150
701 1,135
117
55 215
13,421 13,14814,706
10,917 11,483
AES Eletropaulo MRE Spot market Other bilateral contracts
Energy Generation (MW average1) Billed Energy (GWh)
Operational Performance: billed energy growth due to high availability and bilateral contracts
1- Generated energy divided by the amount of hours 2- Energy Reallocation Mechanism
14
2007 2008 2009 2010 (e) 9M09 9M10
43 39 43
80
2246
8 20 13
12
11
7
51 59 57
93
33
54
Investments New SHHPs
Investments Breakdown (R$ million)
2010: higher investments in maintenance and modernization of power plants
9M10 Investments
1 – Small Hydro Power Plants
1
83%
13%
2%2%
Equipment and Maintenance
New SHHPs
IT
Environment
15
6 MW of co-generation through biomass, contracted for 15 years beginning in 2010
7 MW of hydro generation through SHPPs2 in Jaguari Mirim River– São José SHPP (4 MW) has an estimated start-up in 1H11– São Joaquim SHPP (3 MW) has an estimated start-up in 1H11
550 MW of thermo generation through natural gas– Location has been defined in Nov/2009– Initiation of the environmental licensing process, conclusion estimated for 1H11– Technical feasibility study concluded– Participation in public auction (A-5) estimated for 2H11
AES Tietê has been seeking opportunities to increase its installed capacity to comply with the 15% increase requirement in the State of São Paulo
1 – Power Purchase Agreement 2 – Small Hydro Power Plants
Projects - Expansion Requirement
Under Construction
Under Development
Concluded (PPA1)
16
2007 2008 2009 9M09 9M10
1,4491,605 1,670
1,277 1,334
2007 2008 2009 9M09 9M10
1,0991,254 1,260
1,028 1,041
Ebitda (R$ million)Net Revenue (R$ million)
Financial highlights
CAGR: 7% CAGR: 5%
17
Net Income and Dividend Payout1 (R$ million)
Financial highlights: 100% pay-out on quarterly basis
1 – Gross amount
18
• September, 2010:– Average debt cost in 9M10 was 110% of CDI1 or 13.1% p.a.– Average debt maturity of 3.5 years– Net debt: R$ 0.4 billion– Net debt/EBITDA: 0.3x
Amortization Schedule – Principal (R$ million)
1- Brazilian Interbank Interest Rate
Low debt with stable Net Debt/Ebitda ratioNet Debt (R$ billion)
19
Capital Markets
1 – Index: 09/30/09= 100
AES Tietê X Ibovespa X IEE Daily Avg. Volume - R$ thousand
Last 12 months1
• Common shares and preferred shares listed on BM&FBOVESPA under the tickers GETI3 and GETI4
• ADRs at US OTC Market under the tickers AESAY and AESYY
2 – Total Shareholder Return – considers preferred shares price variation and dividends declared in the period
+ 13%+ 13%+ 14%
+ 24%
85
90
95
100
105
110
115
120
125
Sep-09 Dec-09 Mar-10 Jun-10 Sep-10
GETI4 IEE IBOV TSR
2007 2008 2009 9M10
5,531 5,4688,086 9,436
3,566 2,692
2,101
4,1989,096 8,160
10,187
13,634
Preferred Common
21
AES Eletropaulo Overview
Largest electricity distribution company in Latin America
Serving 24 municipalities in the São Paulo Metropolitan area
Concession contract valid until 2028
Concession area with the highest GDP in Brazil
46 thousand kilometers of lines, 1.1 million electricity poles and
6.0 million consumption units in a concession area of 4,526 km2
Total distributed volume of 41 TWh in 2009
As a pure energy distributor, AES Eletropaulo can only invest
within its concession area
4,557 employees
Concession Area
222004 2005 2006 2007 2008 2009 2010 2019
331 346 358 378 393 388420
633
Energy sector in Brazil:demand perspectives
4.4% p.a.
5.0% p.a
Macroeconomic Scenario
Brazilian Consumption Evolution (TWh)
EPE’s1 Assumptions:
• Global financial sector recovery will not
take longer;
• Brazilian economic growth will outpace
global average growth, even in an
international context of moderate
expansion;
• Emerging markets – especially China –
will grow faster than developed
economies, positively affecting industrial
sector in Brazil;
• Income elasticity of energy demand (2010-
2019): 1.04
• Households growth: 2.2% p.a
1 - Source: EPE (Energetic Research Company)
2004-2008 2010-2014 2015-2019
World 4.6 4.2 4.0
Brazil 4.7 5.2 5.0
GDP - Annual growth
23
Reference Company(PMSO)
Investment Remuneration
Depreciation
Energy Purchase
TransmissionSector Charges
Tariff Reset and Readjustment
• Tariff Reset is applied each 4 years for AES Eletropaulo − Next Jul/2011− Parcel A: costs pass trough the tariff− Parcel B: costs are set by ANEEL
• Tariff Readjustment: annually − Parcel A costs pass trough the tariff− Parcel B cost are adjusted by IGPM +/- X(1) Factor
RemunerationAsset Base
X Depreciation
X WACC
Regulatory Ebitda
Parcel A - Non-Manageable Costs
Parcel B - Manageable Costs
• Remuneration Asset Base:– Applicable investments used to
calculate the Investment Remuneration (applying WACC) and Depreciation
• Reference Company:– Efficient cost structure, determined by
ANEEL (National Electricity Agency)
• Parcel A Costs− Non-manageable costs that totally
pass- through to the tariff− Losses reduction improve the pass-
through effectiveness
(1) X Factor: index that capture productivity gains
Energy sector in Brazil:regulatory methodology
24
Consumption Evolution
Total Market (GWh1) 9M10 Consumption Share (GWh1)
36%
14%
18%
26%
6%CAGR: 1%
1 – Net of own consumption
36%
26%
18%
14%
6%
Residential
Commercial
Free Clients
Industrial
Others
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2007 2008 2009 9M09 9M10
32,577 33,860 34,43625,353 26,352
7,355 7,383 6,832
5,024 5,834
39,932 41,243 41,269
30,37732,186
Captive Market Free Clients
25
Investments amounted R$ 383 million in 9M10
Investments Breakdown (R$ million) Investments 9M10
52%
24%
13%
6%
3% 3%
Customer Service / System Expansion
Maintenance
Losses Recovery
Paid by the Clients
Others
IT
0
100
200
300
400
500
600
700
800
2008 2009 2010(e) 9M09 9M10
410 478637
298 362
4737
36
2622
457516
673
324383
Capex Paid by Customers
26
0.00
2.00
4.00
6.00
8.00
10.00
12.00
2007 2008 2009 9M09 9M10
8.90 9.2011.86 11.01 11.95
SAIDI (hours)
8.49 8.417.87
4.00
4.50
5.00
5.50
6.00
6.50
7.00
7.50
8.00
8.50
9.00
SAIFI Aneel Target
11.34 10.9210.09
1
3
5
7
9
11
13
15
SAIDI Aneel Target
SAIFI - System Average Interruption Frequency Index SAIDI - System Average Interruption Duration Index
SAIDI & SAIFI
8th
1 – System Average interruption Duration Index 2 – System Average Interruption Frequency Index Sources: ANEEL. AES Eletropaulo and ABRADEE
ABRADEE ranking position among the 28 utilities with more than 500 thousand customers
► 2010 SAIDI ANEEL Target: 9.32 hours ► 2010 SAIFI ANEEL Target: 7.39 times
5th3rd
4.00
4.50
5.00
5.50
6.00
6.50
2007 2008 2009 9M09 9M10
5.645.20
6.175.78 6.06
SAIFI (times)
7th1st1st
27
• Fraud and Illegal Connections (9M10)
– 348 thousand inspections e 32 thousand frauds detected
– 47 thousand illegal connections regularized
• Disconnections and Reconnections – Monthly Average (9M09 X 9M10)
– Disconnections: increase from 81 thousand to 97 thousand
– Reconnection: increase from 54 thousand to 87 thousand
• Past due bill credit report (9M10 monthly average): 255 thousand
80.0
85.0
90.0
95.0
100.0
105.0
110.0
2007¹ 2008 2009 9M09 9M10
99.5 98.5101.1 101.4 101.5
Losses (%)Collection Rate (% over gross revenue)
Operational Indexes
1.6 p.p. 0.2 p.p.
1 – The previous calculation methodology 2 - Current technical losses used retroactively as reference
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
2007 2008 2009 9M09 9M10
6.5 6.5 6.5 6.5 6.5
5.0 5.1 5.2 5.5 4.5
11.5 11.6 11.7 12.011.0
Technical Losses² Commercial Losses
28
3,000
4,000
5,000
6,000
7,000
8,000
9,000
2007 2008 2009 9M09 9M10
7,1937,530
8,050
5,8556,534
Ebitda (R$ million)Net Revenues (R$ million)
CAGR: 4.2%
Financial Highlights
0
500
1,000
1,500
2,000
2,500
2007 2008 2009 9M09 9M10
1,5661,696
1,573
1,142
1,590
CAGR: 0.2%
291 – Gross amount
Net Income and Dividend Payout1 (R$ million)
100.3% 101.5% 101.6%
14.4%
20.3% 20.4%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
20.0%
22.0%
24.0%
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
Pay-out Yeld PNB
2007 2008 2009 9M09 9M10
713
1,027 1,063
538
911
Net Income
Practice of 95% pay-outon semi-annually basis
30
Amortization Schedule – Principal (R$ million)
1- Brazilian Interbank Interest Rate
• September, 2010:– Average debt cost in 9M10 was 110% of CDI1 or 12.9% p.a.– Average debt maturity of 7 years– Net debt: R$ 3.1 billion – Net debt/EBITDA of 1.8x adjusted with Pension Fund
Debt Profile
2010 2011 2012 2013 2014 2015 2016 2017 2018 -2028
251 277 296525
223 333 22355371 65 69
74
7984 89
1.361
20322 342 365
599
301416
312
1.914
Local Currency (ex FCesp) Fcesp¹
1.8x1.5x
1.8x
Net Debt/Ebitda Adjusted with Fcesp
2007 2008 2009 3Q09 3Q10
3.0 2.5
3.2 2.7 3.1
Net Debt (R$ billion)
1.5x1.4x
Net Debt (R$ billion)
31
Average Daily Volume (R$ thousand)
7580859095
100105110115120
Sep-09 Dec-09 Mar-10 Jun-10 Sep-10
Ibovespa IEE AES Eletropaulo PNB AES Eletropaulo TSR²
Capital Markets
AES Eletropaulo X Ibovespa X IEE
• Common shares and preferred shares class A and B listed on BM&FBOVESPA under the tickers ELPL3, ELPL5 and ELPL6
• ADRs at US OTC Market under the tickers EPUMY and ELPSY
1 – Index: 09/30/2009 = 100
Last 12 months¹
- 16%
+ 13%+ 14%
AB
A BEx dividends: 05/01/2010 Ex dividends: 08/06/2010
+ 7%
2 – Total Shareholder Return - considers preferred shares price variation and dividends declared in the period
15,000.00
17,000.00
19,000.00
21,000.00
23,000.00
25,000.00
27,000.00
2007 2008 2009 9M10
26,066 25,677
21,960
25,482
Social Responsibility
33
• 300 benefited children between 1 and 6 years old
• Own investments amounting R$ 1.5 million in 2009
• Units: Santo Amaro and Guarapiranga
• Over 6.7 thousand children, teenagers,
and adults have been benefited
• Own and incentive investments:
approximately R$ 15 million in 2009
• Activities of acting, dancing, circus arts, visual arts, music, gymnastics, courses of income generation, and education of safe use of electrical power and the right use of natural resources
• 7 operating units
“Casa da Cultura e Cidadania” Project
“Centros Educacionais Infantis Luz e Lápis” - Project
Social Responsibility
34
Social Responsibility
• Launched in December, 2008;• Objective: to get the co-workers committed to the transformation of low income communities and development of
non-governmental institutions;• 1,137 volunteers
Volunteering Program
Acting to Transform
Distributing Energy of
Good
Specific social mobilization or emergency campaign.
Winter clothes, Christmas campaign, among others.
Opportunities for volunteering in social organizations, which are
partners of AES Brazil
Co-workers can enroll in volunteer activities available at AES Brazil volunteering portal
since September/09www.energiadobem.com.br
Attachments
36
6.15.2
-0.6
7.35.7
3.6
-2.2
5.65.3
3.1
-2.2
3.9
2007 2008 2009 2010
Brazil Emerging markets (ex Brazil, India and China) OECD
Brazilian Economy: good performance, fast recovery after financial crisis
(1)
1) Expected – Monthly Inflation Report (Brazilian Central Bank) 2) OECD (Organization for Economic Co-operation and Development) – international organization of 31 developed countries.
Brazil - GDP and Investment - Annual growth - % (IBGE)
GDP growth - Brazil x Other countries (IBGE, BCB, IMF and OECD)
• Strong growth was interrupted by the financial crisis
• The GDP for 2009 was mainly affected by lower investment (reversal of expectations)
• Brazil´s economic performance during crisis was better than other countries
• Expectations for 2010 are optimistic
(2)
6.1 5.2
(0.6)
7.3
13.9 13.6
(10.3)
20.9
2007 2008 2009 2010
GDP Investment (Gross Fixed Capital Formation)
37
Brazilian Economy: industry recovery and recent foreign trade expansion
Brazil – Industrial production - Annual growth - % (IBGE)
Brazil – Trade Balance – US$ billion (Funcex)
• Brazilian industry has reached pre-crisis level since mar/10
• In 2010, industry is expected to grow 10.5%
• Exports limited the recovery in 2009
• 2010: growth of exports (world economy recovery) and imports (capital goods)
-20-15-10-505
10152025
Jan-
07
Apr
-07
Jul-0
7
Oct
-07
Jan-
08
Apr
-08
Jul-0
8
Oct
-08
Jan-
09
Apr
-09
Jul-0
9
Oct
-09
Jan-
10
Apr
-10
Jul-1
0
Exports Imports Trade Balance
3.1 2.8 6.0
3.1
(7.4)
11.1
2005 2006 2007 2008 2009 Jan-Nov/2010
38
1,21
0
1,21
2
1,24
0
1,29
5
1,34
1
1,39
4
1,42
7
1,49
2
0.583
0.5720.569
0.563
0.5560.548
0.543
0,52
0,53
0,54
0,55
0,56
0,57
0,58
0,59
1.000
1.100
1.200
1.300
1.400
1.500
1.600
2003 2004 2005 2006 2007 2008 2009 2010
Real average income Gini Index
Real average income (R$) and income inequality (IBGE and IPEA)
Domestic market is responsible for thegood performance
1) It measures the degree of income inequality. It may vary from 0 (complete equality) to 1 (complete inequality).
Unemployment rate - % (IBGE)
• Brazilian´s good performance
was driven by the expansion of
the domestic market
– Unemployment rate has been
decreasing over the years
– Real income has been growing
persistently since 2005
– There was an improvement in
income distribution
(1)
10.7
9.6 9.6
8.37.6 7.4
5.7
56789
1011121314
Jan-
04
Jul-0
4
Jan-
05
Jul-0
5
Jan-
06
Jul-0
6
Jan-
07
Jul-0
7
Jan-
08
Jul-0
8
Jan-
09
Jul-0
9
Jan-
10
Jul-1
0
39
Brazil – Retail Sales – seasonally adjusted – 2003 = 100 (IBGE)
Brazil – Loans to individuals – R$ million (BCB)
• Besides the improvement on
labor market, credit expansion
was also responsible for the
good performance
• Retail sales is growing fast:
– 5.9% in 2009 despite the crisis
– 7.2% p. a. between 2005 and 2009
– 11.1% in 2010 (Jan-Oct)
Domestic market is responsible for thegood performance
100110120130140150160170180
Jan-
05
Jul-0
5
Jan-
06
Jul-0
6
Jan-
07
Jul-0
7
Jan-
08
Jul-0
8
Jan-
09
Jul-0
9
Jan-
10
Jul-1
0
191 238
318
394
470
537
100
200
300
400
500
600
2005 2006 2007 2008 2009 Oct*
40
2007 2008 2009 9M09 9M10
281 239 214159 174
84112 196
90 119
365 351
409
249 292
Energy Purchase, Transmission and Connection Charges, and Water Resources
Other Costs and Expenses
Costs and Expenses
Costs and operational expenses1 (R$ million)
1 – Do not include depreciation and amortization 2 - Personnel, Material, Third Party Services and Other Costs and Expenses
2
41
Costs and Expenses
Costs and operational expenses1 (R$ million)
1 – Do not include depreciation and amortization 2 - Personnel, Material, Third Party Services and Other Costs and Expenses
2007 2008 2009 9M09 9M10
4,097 4,700 5,1103,759 4,172
1,4401,193
1,312
919965
5,537 5,8936,422
4,6785,137
Energy Supply and Transmission Charges PMS² and Others Expenses
42
Expansion Requirement of 15% Increase installed capacity in Sao Paulo State by 15% (400 MW), either in greenfield projects or through long term
purchase agreement with new plants
The obligation was supposed to be accomplished by December 2007, however AES Tietê was not able to comply with this requirement due to the following restrictions:
– Insufficient remaining hydro resources within the State of São Paulo
– Environmental restrictions
– Insufficiency of gas supply / timing issue
– More restricted regulation on energy sale established by the New Model of Electric Sector (Law # 10,848/2004) which eliminated the self dealing
• In August 2008, Aneel informed that the issue is not linked to the concession
• On July 27, 2009, AES Tietê was notified by the State Government Attorney’s Office to present arguments on compliance with the expansion obligation
– The Company filed a response on July, 29th, which exhausts the procedure for notification. Possible deployment depends on new manifestation of the Prosecution
• Popular law action against Federal Government, Aneel, AES Tietê, and Duke– 2008 – In October, defense filed on first instance by AES Tietê; In December, the author replied AES Tietê defense
– 2010 – In September, due to the plaintiffs failure to specify the individuals that should be named as Defendants, a favorable decision was rendered by the 1st Instance Court (but there can be appeals)
43
Eletrobras Lawsuit
Nov/86
Stated-owned Eletropaulo
borrowed money from Eletrobras
Dec/88
State-owned Eletropaulo and
Eletrobras disagreed on how
to calculate interest over that loan and a lawsuit
was started
Sep/03
The 2nd level of court excluded AES Eletropaulo
from the discussion based
on the spin-off agreement
Jun/06
The SCJ decided to send the
Execution Suit back to the 1st
level of court
May/09
Eletrobras requested the 1st
level of court judge to appoint
an expert
Next Steps:
1- Eletrobras will request the
auditing process
2 - The auditing procedure will be concluded at least
in 6 months
3 - After conclusion of the
expert work, the 1st
level of court decision will be
released
4 - Appealing to the 2nd level of
court
5 - Appealing to the 3rd level of
court
Jan/98 Oct/05
Eletrobras and CTEEP appealed
to the Superior Court of Justice
(SCJ)
Feb/10
The Judge appointed the expert who will
indicate the amount and the debtor
Due to a paperwork issue, Eletrobras will request the expert selection
again
Sep/01
Eletrobras, after winning the
interest calculation
discussion, filed an Execution Suit to collect the due
amount
State-owned Eletropaulo was spun-off into four companies and, according to our understanding based on the
spin-off agreement, the discussion was transferred to
CTEEP
Privatization event . State-
owned Eletropaulo
became AES Eletropaulo
Apr/98
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Any party with an intention to dispose its shares should first provide the other party the right to buythat participation at the same price offered by a third party
Once the offering party exercises the Drag Along clause, offered party is obligated to dispose of all its shares at the time, if the Right of 1st Refusal is not exercised by offered party
In the case of change in Brasiliana’s control, tag along rights are triggered for the following 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
Shareholders AgreementOn 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 refusal
Drag alongrights
Tag alongrights
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Brazilian Main Taxes
AES Eletropaulo
• Income Tax / Social Contribution:
– 34% over taxable income
• ICMS: 22% over Revenue (average rate)
– Residential: 25%
– Industrial and Commercial: 18%
– Public Entities: free
• PIS/Cofins:
– 9.25% over Revenue minus Costs
AES Tietê
• Income Tax / Social Contribution:
– 34% over taxable income
• ICMS (VAT tax)
– deferred tax
• PIS/Cofins (sales tax):
– Eletropaulo´s PPA: 3.65% over Revenue
– Other bilateral contracts: 9.25% over Revenue
minus Costs
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.
Contacts:[email protected]
+ 55 11 2195 7048