4Q-2017 Earnings Call

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1 4Q-2017 Earnings Call AES Gener February 27th, 2018

2 Disclaimer This presentation is not an offer for sale of securities. This material has been prepared solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities and should not be treated as giving investment advice. No representation or warranty, either express or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein. Any opinions expressed in this material are subject to change without notice and neither the Company nor any other person is under obligation to update or keep current the information contained herein. The information contained herein does not purport to be complete and is subject to qualifications and assumptions, and neither the Company nor any agent can give any representations as to the accuracy thereof. The Company and its respective affiliates, agents, directors, partners and employees accept no liability whatsoever for any loss or damage of any kind arising out of the use of all or any part of this material. This presentation may contain statements that are forward-looking subject to risk and uncertainties and factors, which are based on current expectations and projections about future events and trends that may affect the Company s business. Investors are cautioned that any such forward looking statements are not guarantees of future performance. Several factors may adversely affect the estimates and assumptions on which these forward-looking statements are based, many of which are beyond our control. The successful execution and commencement of operation of the investment projects that we are developing or constructing depends on numerous external factors, including (i) delays in obtaining regulatory approvals, including environmental permits; (ii) court rulings against governmental approvals already granted, such as environmental permits; (iii) shortages or increases in the price of equipment reflected through change orders, materials or labor; (iv) the failure of contractors to complete or commission the facilities or auxiliary facilities by the agreed-upon date; (v) opposition by local and/or international political, environmental and ethnic groups; (vi) strikes; (vii) adverse changes in the political and regulatory environment in Chile; (viii) adverse weather conditions (ix) poor geological conditions; and (x) natural disasters, accidents or other unforeseen events. This presentation may not be reproduced in any manner whatsoever. Any reproduction of this document in whole or in part is unauthorized. Failure to comply with this directive may result in a violation of the Securities Act or the applicable laws of other jurisdiction. The information contained should not be relied upon by any person. Furthermore, you should consult with own legal, regulatory, tax, business, investment, financial and accounting advisers to the extent that you deem it necessary, and make your own investment, hedging and trading decision based upon your own judgment and advice from such advisers as you deem necessary and not upon any view expressed in this material. The Company is an issuer in Chile of securities registered with the Comisión para el Mercado Financiero, the Chilean Superintendency of Securities and Insurance, or CMF. Shares of our common stock are traded on the Bolsa de Comercio de Santiago Bolsa de Valores, or the Santiago Stock Exchange, the Bolsa Electrónica de Chile Bolsa de Valores, or Electronic Stock Exchange, and the Bolsa de Corredores Bolsa de Valores, or the Valparaiso Stock Exchange, which we jointly refer to as the Chilean Stock Exchanges, under the symbol AESGENER. Accordingly, we are currently required to file quarterly and annual reports in Spanish and issue hechos esenciales o relevantes (notices of essential or material events) to the CMF, and provide copies of such reports and notices to the Chilean Stock Exchanges. All such reports are available at and

3 Agenda 2017 Fourth Quarter and Full Year Earnings Call 1. Highlights 2. Financial Review 3. Key Takeaways 4. Q&A

4 1 Highlights 2017 Fourth Quarter and Full Year

5 1 Highlights 2017 Fourth Quarter and Full Year 4Q-2017 EBITDA reached $231 mn, 12% increase over 2016 Since 2014 AES Gener has been the largest energy producer in Chile Cochrane Project of 550 MW fully operational and contracted since October 2016 Accrual of Green Taxes since January 2017 Full year EBITDA of $793 mn in 2017, 2% increase over

6 1 Highlights (cont d) 2017 Fourth Quarter and Full Year $261 mn in dividend distributions for 2017 Aligning organizational structure to accelerate path to cleaner energy future, achieve $15 mn savings per year and gain further operational efficiencies Great Place to Work AES Gener ranked 10th in Chile and Argentina and 14th in Colombia Executed a fixed price, lump sum EPC Contract with Strabag for the full scope of the Alto Maipo Project 6

7 1 Highlights (cont d) We continue securing PPAs with unregulated customers to drive growth in wind and solar During 2017 we secured 90 PPAs for ~3,800 GWh per year with Commercial & Industrial (C&I) and Mining Customers AES Gener secured 37 PPAs totaling ~2,430 GWh per year with an average life of ~8 years Guacolda secured 53 PPAs totaling ~1,370 GWh per year with an average life of ~4 years Mining Customers 34% C&I Customers 66% Mining Customers 59% C&I Customers 41% ~2,430 GWh ~1,370 GWh 7

1 Highlights (cont d) We continue advancing with non-core assets sale process to strengthen the company s capital structure

and AME) Attractive valuation on assets that are not essential to the execution of our long term strategy Proceeds will be

antitrust regulator 750MW in gas/diesel fired assets Transmission Assets AES Gener owns ~1,500 kms of transmission lines,

essential to the execution of the long term strategy 316 kms of transmission line assets to be sold 132 kms under National

8 1 Highlights (cont d) We continue advancing with non-core assets sale process to strengthen the company s capital structure Electrica Santiago (ESSA) Assets Accepted an offer to sell 750MW for $300mn to Generadora Metropolitana Spa (JV between EDF and AME) Attractive valuation on assets that are not essential to the execution of our long term strategy Proceeds will be used to prepay debt, strengthen liquidity and growth Closing expected for April 2018 Obtained approval from the Chilean antitrust regulator 750MW in gas/diesel fired assets Transmission Assets AES Gener owns ~1,500 kms of transmission lines, including the Interandes international line Launched a process to sell regulated transmission assets owned by AES Gener, not essential to the execution of the long term strategy 316 kms of transmission line assets to be sold 132 kms under National Trunk System 154 kms under Zonal System 30 kms in Dedicated System Nueva Renca 379MW Renca 100MW Los Vientos 132MW Santa Lidia 139MW 8

9 1 Highlights (cont d) We remain committed to make strong efforts to decrease leverage to strengthen our balance sheet In December 2017 prepaid $328 mn of bonds maturing in 2021 and 2025 In February 2018 closed renewal of committed revolving credit facility for $250 mn until 2021 Total debt as of December 31 st, 2017 reached $3,741 mn Consolidated Net Leverage Recourse Net Debt 4.4x Net Debt/ EBITDA 2.2x Net Debt/ EBITDA Net Debt EBITDA Net Debt EBITDA 9

10 1 Highlights (cont d) Largest Energy Producer In Chile AES Gener maintains leading position as largest energy producer in Chile providing 29% of gross generation during 2017 SIC AES Gener 22% ~54.9 TWh SIC + SING AES Gener 29% SING AES Gener 47% ~74.2 TWh ~19.3 TWh 10

11 1 Highlights (cont d) Alto Maipo Construction Update Project Layout Overall project progress of 62% (*) Total tunnel progress of 50% (*) 37.3 km over 74.6 km L1 VL-4 2 VL-8 VA-1 1 VA Alfalfal II. 264MW Unit Las Lajas. 267MW Unit Tunnel Construction continues with more than 4,000 workers 14 working fronts Strabag has taken over El Yeso and El Volcan works, previously Project Location Metropolitan Region VA-4 V5 assigned to CNM V1 (*) Construction progress as of February 20,

1 Highlights (cont d) Alto Maipo Restructuring Update Project Works Executed

risk Guaranteed dates backed by parent guarantees and LCs Includes supplier

Ongoing negotiations with lenders Approval of a new construction budget Debt

12 1 Highlights (cont d) Alto Maipo Restructuring Update Project Works Executed lump-sum Contract with Strabag for the full Project Full transfer of geological risk Guaranteed dates backed by parent guarantees and LCs Includes supplier financing and payments in shares Additional equity contributions from AES Gener Ongoing negotiations with lenders Approval of a new construction budget Debt restructuring and additional financing Expect to finalize the restructuring during 2Q

13 2 Financial Review Fourth Quarter 2017 Earnings Call

14 2 Consolidated Financials Fourth Quarter and Full Year Key Financials (US$ mn) 4Q Q Var. (%) Var. (%) Operating Revenue % 2,437 2,286 7% Gross Profit % % EBITDA % % EBITDA Margin 35% 37% 33% 34% Net Income % % EBITDA BY MARKET Fourth Quarter EBITDA BY MARKET Full Year 4Q % 37% 14% 5% % 39% 22% 4% 793 4Q % 35% 21% 4% % 31% 22% 3% 778 SIC SING SIN SADI 14

15 2 EBITDA Bridge Fourth Quarter and Full Year EBITDA Variation Fourth Quarter EBITDA Increased 12%, $24 mn Full Year EBITDA Increased 2%, $15 mn SIC SING SIN SADI SIC SING SIN SADI

16 2 SIC Market 2017 EBITDA Decreased by $59 mn Main Drivers of 2017 Higher maintenance activities at the Ventanas Complex Accrual of green taxes since January 2017 Lower margin from Nueva Renca profit sharing agreement EBITDA Variation (2017) Electricity Revenue Breakdown (2017) % Higher prices in contracted sales Spot 3% Unregulated Customers 38% $897mn Regulated Customers 59% Q Var 2Q Var 3Q Var 4Q Var Q 3Q 2Q 1Q 16

17 2 SING Market 2017 EBITDA Increased by $68 mn Main Drivers of 2017 Full year of Cochrane and Andes Solar operations Accrual of green taxes not yet passed through to customers Lower margin in old Norgener contracts already expired EBITDA Variation (2017) Electricity Revenue Breakdown (2017) % Spot 20% $808mn Unregulated Customers 80% Q Var 2Q Var 3Q Var 4Q Var Q 3Q 2Q 1Q 17

generation and prices EBITDA Variation (2017) Electricity Revenue Breakdown (2017) 172.1 27.6 43.9 72.8 42.0 13.4 1.

18 2 SIN Market 2017 EBITDA Increased by $2 mn Main Drivers of 2017 Increase in contract sales as a result of higher contracted level and price Favorable impact from COP appreciation Decrease in net spot sales as a result of lower generation and prices EBITDA Variation (2017) Electricity Revenue Breakdown (2017) % Spot 19% $308mn Contract Sales 81% Q Var 2Q Var 3Q Var 4Q Var Q 3Q 2Q 1Q 18

2 SADI Market 2017 EBITDA Increased by $4 mn Main Drivers of 2017 Increase in energy prices in the Energía Base Market (Resolution 19/2017) Higher prices and volume with Energía Plus customers Higher

19 2 SADI Market 2017 EBITDA Increased by $4 mn Main Drivers of 2017 Increase in energy prices in the Energía Base Market (Resolution 19/2017) Higher prices and volume with Energía Plus customers Higher fuel and transmission costs EBITDA Variation (2017) Electricity Revenue Breakdown (2017) % Energía Base 45% Contract Sales 55% $139mn Q Var 2Q Var 3Q Var 4Q Var Q 3Q 2Q 1Q 19

20 Net Income 2 Full Year 2017, Attributable to AES Gener (US$ mn) EBITDA Variance Depreciation Interest Expense Other Income/ Expense Non- Controlling Interest Equity Earnings FX Gains/ Losses Income Tax Includes one time impacts: $20 mn related to the bond tender premium and $19 mn associated with the water rights write off Includes one time impact of $7 mn related to ESSA sale transaction

21 Cash Flow and Liquidity 2 Full Year 2017 (US$ mn) Annual Cash Flow Liquidity as of December 31, 2017 Operating CF Investing CF Financing CF FX Variation Cash and Cash Equivalents $276 mn 41% Undrawn Committed Facilities $392 mn 59% 340,7 419,6 $668mn ,2 1,5 276 Dec-16 Dec-17 21

22 2 AES Gener Debt Profile Total Debt as of December 31, 2017 $3,741 mn Debt Overview AVERAGE COST 5.5% AVERAGE LIFE 14 years Debt by Type Recourse Debt $1,354 mn 36% Non-Recourse Debt $2,387 mn 64% NET DEBT/EBITDA CURRENCY RATE 4.4x (2.2x excluding non recourse debt) 96% denominated in USD 93% at fixed interest rate $3,741mn Amortization Schedule (US$ mn) /

23 3 Key Takeaways Fourth Quarter 2017 Earnings Call

24 3 Key Takeaways Fourth Quarter 2017 Earnings Call STRONG EBITDA GENERATION ALTO MAIPO LEADING GENERATOR IN CHILE DIVERSIFIED PORTFOLIO 2017 EBITDA of $793 mn Cochrane fully operational since October 2016 Executed a fixed price, lump-sum EPC Contract with Strabag for the full Project Restructuring expected to close in 2Q-2018 AES Gener contributed 29% of the total energy generated in Chile during 2017 Securing PPAs with Commercial and Industrial customers to drive NCRE growth Diversified by conventional and renewable technologies, customers and markets Long term dollarized PPAs with creditworthy off-takers ASSET SALES Sale of non-core assets to strengthen capital structure and growth ORGANIZATIONAL CHANGES STRONG CAPITAL STRUCTURE New organizational structure to accelerate path to cleaner energy future Achieve $15 mn savings per year and gain further operational efficiencies Strong Liquidity and extended debt maturity profile Competitive financing cost and at fixed rate 24

25 4Q-2017 EARNINGS CALL AES Gener

1Q-2018 Earnings Call. May 8th, 2018

1Q-2018 Earnings Call. May 8th, 2018 1Q-2018 Earnings Call May 8th, 2018 Disclaimer This presentation is not an offer for sale of securities. This material has been prepared solely for informational purposes and is not to be construed as