Grupo Energía de Bogotá

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1 Grupo Energía de Bogotá First Half 2016 Key Results and Developments August 18th 2016

2 DISCLAIMER The information provided herein is for informational and illustrative purposes only and is not, and does not seek to be, a source of legal, investment or financial advice on any subject. This presentation does not purport to address any specific investment objectives, financial situation or particular needs of any recipient. It should not be regarded by recipients as a substitute for the exercise of their own judgment. This information does not constitute an offer of any sort and is subject to change without notice. EEB is no obligation to update or keep current the information contained herein. EEB expressly disclaims any responsibility for actions taken or not taken based on this information. EEB does not accept any responsibility for losses that might result from the execution of the proposals or recommendations presented. EEB is not responsible for any content that may originate with third parties. EEB may have provided, or might provide in the future, information that is inconsistent with the information herein presented. No representation or warranty, either express or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein. This presentation may contain statements that are forward-looking within the meaning of Section 27A of the Securities Act and Section 21E of the U.S. Securities Exchange Act of Such forward-looking statements are based on current expectations, projections and assumptions about future events and trends that may affect EEB and are not guarantees of future performance. The shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the Securities Act ) or any U.S. State securities laws. Accordingly, the shares are being offered and sold in the United States only to qualified institutional buyers as defined under Rule 144A under the Securities Act, and outside the United States in accordance with Regulation S of the Securities Act. We converted some amounts from Colombian pesos into U.S. dollars solely for the convenience of the reader at the TRM published by the SFC as of each period. These convenience translations are not in accordance with U.S. GAAP and have not been audited. These translations should not be construed as a representation that the Colombian peso amounts were, have been or could be converted into U.S. dollars at those or any other rates. 2

3 Contenido EEB Overview Expansion Projects Financial Performance 04 Q&A

4 01 EEB Overview

5 EEB Corporate Structure EEB generally controls its subsidiaries or partners with world class operators following a long track record of success. Electricity Natural Gas Services Generation Transmission Distribution Transport Distribution 51.5% 100% 51.5% 15.6% 100% 51% (1) Colombia 2.5% 1.7% 16.2% 99.97% (2) 25% 100% 40% 100% (3) Peru 40% 66% (3) Guatemala 95.3% Brazil 100% (4) (1) EEB ownership through DECSA Special Purpose Vehicle. (2) EEB ownership directly and indirectly through IELAH Spain (additional 31.92%). (3) EEB effective ownership via direct and indirect stakes. (4) Through GEBBRAS Special Purpose Vehicle acquired on August 21, % stake in four concessions for ~USD158 mm. Selling process Law 226 Companies in process of merger 5

6 KEY UPDATES Corporate Highligths Dividends Payment 05/07/2016: EEB paid dividends for its minority shareholders, in one (1) installment, as following: Extraordinary Dividend: COP ~49.98 per share, related with the release of occasional reserves approved on July 6 th Ordinary dividend: COP ~24.43 per share, approved in the shareholders meeting last march 31 st /07/2016: EEB paid dividends for its major shareholder, Bogotá Municipality, as following: 40% of the ordinary dividend: COP ~24.43 per share. The remaining 60% of the ordinary dividend will be paid up to October 28 th /07/2017: EEB will start the payment of the extraordinary dividend, COP ~49.98 per share, for its major shareholder in 10 annual installments until 2026, with the respective interest recognition. ISAGEN Divestiture Bogota s municipality council authorized EEB on March 31 st 2016 to divest ISAGEN shares. On April 20 th, the first phase addressed to the solidarity sector (Law 226/95) started and it was open until June 20 th 2016 On July 21th, the second phase addressed to the general public and it was open until July 28 th After that date, the share was offer to any Open Tender Offer - OPA (Oferta Publica de Acciones). On July 29 th EEB accepted the BRE Colombia Investment and BRE Colombia Hydro Investment Limited L.P. tender offer. The Acceptance consists of sixty-eight million seven hundred sixteen thousand ( ) ordinary shares owned by EEB in Isagen S.A. E.S.P. On September 2016, EEB expects the final acceptance by the purchaser (OPA) and to receive COP ~284,000 Mm for this sale. 6

7 KEY UPDATES Corporate Highligths Ecopetrol selling process Ecopetrol S.A. made public the announcement to Offer the second phase of the Program to sell and award the shares it owns. This stake sale is ruled by Law 226 of Ecopetrol s final share value was COP 1,815 which was according to Law final value after applying CPI indexation to initial price of phase one (COP1,740/share). 3.03% of Ecopetrol s stake in EEB was offered to international investors and no orders were placed. On May 23 rd, Ecopetrol announced the second offering of its EEB s participation of 3.03%. On June 1 st 2016 the auction was open in the Colombian Securities Exchange. In this second auction, Ecopetrol sold 191,639,698 shares, 77% was acquired by the pension funds and the remaining 23 % was allocated to retail investors. At this date, Ecopetrol has an outstanding shares of 86,585,888, 0.94% of EEB s total shares. TRECSA Financing June 15 th, the Ministry of Finance by resolution No. 1733, authorized EEB to guarantee payment obligations of its subsidiary Transportadora de Energía de Centroamérica S.A. TRECSA, for up to EIGHTY SEVEN MILLION DOLLARS (US$87,000,000). (TRECSA ) signed a credit agreement, due on June 29 th 2028, with Citibank Europe PLC UK Branch and Canadian export agency EDC (Exporting Development Canada), to finance the project PET The disbursement was made on August 8 th. EEBIS Financing June 23 rd, the Ministry of Finance by resolution No. 1902, authorized EEB to guarantee payment obligations of its subsidiary EEB Ingeniería y Servicios S.A. EEBIS, for up to FORTY EIGHT MILLION DOLLARS (US$48,000,000). 7

8 KEY UPDATES Natural gas transportation & distribution activities IELAH Merging: On May 11 th 2016 TGI finalized the merger with IELAH; which was the Final Phase of the acquisition plan. As a result the remaining debt of that entity will be in TGI s BS Current outstanding debt of IELAH is USD 219 MM (1), after three partial repayments done: i) March 2015 (USD 76 MM) ; ii) September 2015 (USD 175 MM); iii) On March 11 th 2016 (USD 175 MM). Moody s Rating Action TGI On June 2 nd, Moody s ratings affirmed TGI s corporate debt and issuer rating in Baa3 stable outlook. Cálidda Cálidda s client base has increased 32% compared to first half of 2015, at the closing of the first half 2016 Calidda has a client base of ~ 396,000 clients During the first half, 804 km of network were built, whereby the distribution system has reached a total of 6,793 km of underground pipelines. The EBITDA finalize in USD Mm, increasing in 13% compared with the same period of This increase was mainly due to higher distribution services, mainly from Takeor-Pay contracts, and residential clients connection services and lower operational expenses in USD from services and contracts in Soles. (1) Excluding intercompanies loans 8

9 02 Expansion Projects

10 EXPANSION PROJECTS REVIEW Revenue growth has been sustained by a strong capex plan at the subsidiary and the associate level. Subsidiaries Executed Capex by Segment (1) (USD Mm) 2Q Q 2015 Electricity Transmission Gas Distribution Electricity Distribution Gas Transportation Capex by Company (2Q 16) USD 74.6 Mm EEBIS GTM/PE 10.2% Trecsa 14.2% EEB Trans. 17.5% EEC 6.7% Cálidda 29.5% TGI 21.1% Contugas 0.8% Projects Update (2Q 2016) UPME Project Status EAR(2) USD MM On Stream Chivor II 53,80% /07/2017 Cartagena Bolívar 44,20% /03/2017 Río Córdoba 43,20% /11/2016 Armenia 95,04% /11/2015 Tesalia 81,30% /02/2016 Sogamoso Norte 35,80% /09/2017 Refuerzo Suroccidental 500 kv 14,60% /09/2018 Ecopetrol San Fernando 38,40% /04/2017 Río Cordoba Transformadores 46,10% /11/2016 La Loma 500 Kv 48,03% /11/2016 La Loma 100 Kv 4,30% /06/2018 Drummond Rio Cordoba 20.62% /11/2016 Source: Company filings. (1) Excludes Brazil GEBBRAS Capex (2) Expected annual revenues.

11 Expansion Projects Review Revenue growth has been sustained by a strong capex plan at the subsidiary and the associate level. Associates Executed Capex by Segment (USD Mm) Capex by Company (2Q 16) USD Mm Projects Update (2Q 2016) 2Q2016 2Q2015 Electricity Generation Electricity Transmission Electricity Distribution Gas Transportation Emgesa 10.1% CTM 27.0% Promigas 15.8% Codensa 43.7% Gas Natural 0.5% REP 2.9% On-going projects: Nueva Esperanza, Norte. New and existing demand Quality service and continuity Control operational risk Gas Distribution On-going projects: CONCESION - MANTARO MARCONA LA PLANICIE INDUSTRIALES FRIASPATA MOLLEPATA and ORCOTUNA Substation 11

12 FINANCIAL PLAN Investments and Funding Sources Funding Investments (USD mm) EEB Capex Profile Controlled Companies $745 USD mm % Executed Capex $1,330 49% Cash Generation After Dividends $1,324 Incremental Debt $225 Subtotal (1) $1,549 51% TOTAL $2, $597 (2) 88 $ $ $347 (3) $ $83 $ E 2017E 2018E 2019E 2020E Electricity Colombia Electricity Overseas Natural Gas Colombia Natural Gas Overseas M&A Natural Gas M&A Electricity Source: Company filings. (1) Mainly concentrated on electricity transmission businesses (COL / Overseas). (2) 2014 Incliudes M&A transaction IELAH Equity Portion (3) 2015 Includes M&A transaction Brazil Equity portion 12

13 03 Financial Performance

14 CONSISTENT FINANCIAL PERFORMANCE Consolidated Results (IFRS) 2Q2015 2Q2016 EEB's Operating Revenues By Segment 2Q 16-2Q 15 COP Millions - Growth Rate -1.6% 13.7% Gross EEB's Operating Profit By Segment (1) 2Q 16-2Q 15 COP Millions - Growth Rate 37% 61% 1,581,969 2Q % 135,868 Electricity Transmission 19.6% 197,822 Electricity Distribution 1,798,639 Revenues: On YTD Basis: June 2016 compare to June 2015 showed positive increase of 13.7% (+45.2%; COP 42,277 mm) Electricity Transmission: coming on stream of new projects (+28%; COP 154,124 mm) Natural Gas transportation. (+19.6%; COP 32,412 mm) Electricity Distribution (-1.6%; -COP 12,143 mm) Natural Gas distribution: 1% decrease in Cálidda s revenues due to tariff and FX conversion effects. 28% 704,629 Natural Gas Transportation 760,320 Natural Gas Distribution 2Q , % 54% 42,271 69,141 2Q 15 Electricity Distribution Electricity Transmission 857,379 Gross Profit from Operating Activities: On a YTD Basis (+61%). by: (103%;COP 21,454 mm) ) Electricity distribution. Increase on energy sales through EEC. (+54%;COP 24,354 mm) Electricity Transmission: new projects under execution and some already on stream. (+140%; COP 143,633 mm) Natural gas distribution, new connected clients. (+37% COP 134,581 mm) Natural gas Transportation: Increase on transported volume. Operational costs and expenses on YTD showed an decrease -10% 140% 246,379 Natural Gas Distribution 499,588 Natural Gas Transportation 2Q 16 (1) Excludes administrative expenses & net of other expenses and gains 14

15 CONSISTENT FINANCIAL PERFORMANCE Consolidated Results (IFRS) 2Q2015 2Q2016 COP Million (1) 2Q 15 2Q 16 COP % Net Profit from operating activities(1) 462, , ,337 43% Financial Income 66,722 62,627 7,328-6% Financial Expenses -191, ,555-21,564 29% Exchange gain (loss) -82, , , % Share of profit (loss) of associates for using equity method 409, ,655 91,001 22% Tax income (expense) -145, ,227-5,349 4% Net Profit (loss) 519, , ,548 87% Ow ners of parent 492, , ,023 88% Non-controlling interests 26,775 45,300 18,525 69% 462,762 2Q 15 2Q 16 43% 662,099 66,722 29% 20% 62, , , , % Var. 969, , , ,534 Finance income decreased 6% due to (a) Valuation on hedging operations (b) less Interest returns on financial investments. Finance costs increased 29% due to:(a) Greater Interest payments; (b) Exchange difference in interest payments, commisions and other banking costs. Net Exchange difference increase over 1H 15 in 273% Increase in equity method of Associates by 22% Net profit, grew by 87% due to operational results and equity method contribution from associates. -82, % -191, ,555 22% -145, ,227 88% Profit from operating activities Financial Income Financial Expenses Exchange gain (loss) Share of profit (loss) of associates for using equity method Tax income (expense) Profit (loss) 87% Owners of parent (1) Includes administrative expenses & net of other expenses, other gains 15

16 EVOLUTION OF EBITDA Operational EBITDA has increased from 19% to 74% of Consolidated Adjusted EBITDA over the last 10 years demonstrating increased strength of EEB s controlled assets. (COP mm) 33% 539,319 19% 67% 81% , Normalized Consolidated Adjusted EBITDA (1) 56% 55% 61% 44% EEB has significantly increased its operational EBITDA generation 45% 1,775,908 1,447,335 52% 1,369,533 55% 1,122,343 56% 1,053, ,163 45% 39% 44% % ,964,666 56% 44% ,543,833 2,413,812 64% 36% % 24% 2Q 2016 LTM 906 (USD mm) Consolidated Adjusted EBITDA 2Q 16 LTM by Subsidiary Gas Natural 2% Promigás 1% Codensa 6% Emgesa 10% Cálidda, Contugás & EEBIS Perú 16% ISA, REP & CTM 2% Decsa/EEC 4% EEB Transmisión, Trecsa & EEBIS Guate 6% Consolidated Adjusted EBITDA 2Q 16 LTM by Segment Gas Distribution 17.8% Source: Company filings. Note: Figures for the years are presented under ColGaap standards. For 2014, 2015 & 2016 are presented under IFRS (1) Normalized for timing differences in dividends declared and paid excludes dividends declared based on an early close of Gas Natural, Emgesa and Codensa s financial statements. These figures are included in 2011, when such dividends would normally have been declared. Anticipated dividends declared by Codensa on first half 2011, were included in excludes dividends declared based on an early close of Gas Natural, Emgesa and Codensa s financial statements. These figures are included in 2015, when such dividends would normally have been declared. Otros 1% TGI 49% Others 0.4% Gas Transportation 49.7% Electricity Generation 14.2% Electricity Transmission 7.5% Electricity Distribution 10.2% 16

17 DESCRIPTION OF INDEBTEDNESS Investments and Funding Sources Net Debt / Consolidated Adjusted EBITDA (1)(2) Consolidated Adjusted EBITDA / Net Interest (1)(2) 2.41x 3.27x 4.50x 3.20x 2.78x 2.63x 15.83x 11.12x 7.30x 8.80x 7.55x 2.25x 2Q 15 3Q 15 4Q 15 1Q 16 2Q 16 2Q 15 3Q 15 4Q 15 1Q 16 2Q 16 (USD mm) USD COP PEN 3.4% 96.6% $1,543 Consolidated Debt Composition Debt Maturity Profile (3) (USD mm) % 99.3% 1.2% 3.11% % 2.2% 96.9% 6.4% 2.9% 97.8% 93.6% 97.1% $3,009 $2,803 $2,646 $2,218 $1,737 $1, Q Source: Company filings. (1) Covenant associated to this indicator is currently suspended since the bond EEB 2021 has investment grade, granted by two out of three risk rating agencies monitoring the latter. Covenant established in Offering Memorandum of USD749,000,000 EEB 6.125% Senior Notes due It includes anticipated dividends. (2) Increase is mainly explained by increase of foreign exchange (USD/COP movements). (3) 2019:Syndicated loan acquired by Contugas (USD342 mm) and additional indebtedness incurred by SPV in order to reacquire 31.92% shares of TGI IELAH (USD219 mm outstanding debt) Debt maturity profile as of 2Q

18 Price (Indexed 100) Volume (COP mm) TRACK RECORD OF CREATING VALUE SHARE PRICE APPRECIATION EEB s shares have outperformed the Colcap over the last year providing stable returns in a volatile market environment. 140 Historical Share Price Evolution 35, (14.4%) 30, , Volume EEB Equity Colcap Colombia Colcap (-0.3%) 20,000 15, , , / / / / / / / / / / / / Ticker EEB: CB Part of COLCAP, COLEQTY and COLIR and DJSI As of June 30 th 2016 EEB s marketcap was USD 5.6 Billion Average Target Price COP1,865 (USD 0.59) (1) Dividend Payout Ratio 2015: 26% Avg : 77% Dividend Yield 2015: 4.3 % Avg : 4.2% Source: Bloomnerg since July 1 st 2015 until June 30 t (1) Average target price calculated as the average of the following brokers: Credicorp: COP1,810; BTG: COP1,820; Gobal Securities Colombia: COP1,900; Asesores en Valores: COP1,740; Corredores Asociados: COP1,940; Ultrabursatiles: COP1,850 & Valores Bancolombia: COP1,810. Larrainvial: COP 2,

19 04 Q&A

20 BUSINESS REGULATORY UPDATE Electricity Transmission Ongoing discussions on a new methodological proposal to remunerate the electricity transmission activity (Res CREG 023 de 2016). The main issue currently under discussion is the transition to a new scheme to remunerate assets from the methodology Net Replacement Value (NRV) to a methodology of Depreciated Assets (DORC). The cross-sectional methodology was issued (for all regulated activates undertaken by CREG) to calculate WACC rate. To date, WACC has not been calculated for the transmission activity. Electricity Transmission- Guatemala Trecsa began a process at Ministry of Energy and Mines aimed at being acknowledged US$331, per year, on account of force majeure of Acts of God during the performance of the project; this petition was accepted by the Ministry as per Resolution 599 of 23 February To date, it awaits that the National Commission for Electric Power (CNEE - for its Spanish acronym) issues the final resolution to include those additional resources to TRECSA. Natural Gas Transportation Issuance of new cross-sectional methodology (for all GREG regulated activities) for the calculation to WACC rate. To date WACC has not been calculated for gas transport Procedure undertaken at CREG to assess 10 gas pipelines that completed the Useful Life Standars (20 years). investment acknowledged in this pipelines, if are maintained working, increased 13.4% with respect to the value acknowledged in the last tariff review (Res CREG 121 of 2012), from US$ 56,5 to US$ 64,1 million. Natural gas Distribution Issuance of new cross sectional methodology (for all activities regulated by CREG) to calculate WACC rate. The actual WACC rate before taxes was established annually for as follows: Res.096/ ,28% 13,51% 13,97% 14,23% 12,47%

EEB CORPORATE GOVERNANCE Experienced Management and Board of Directors The government of the District of Bogotá is responsible for appointing a

Astrid Álvarez President 2016 Leonardo Garnica Investments VP 2016 Ernesto Moreno Transmission VP 1997 Felipe Castilla Financial VP 2013 Lina

Hernan Mejia Strategic Supply Chain Director 2016 Sandra Aguillón Internal Audit Director 2011 Maria José Quiceno Communications Director 2016

Ruiz Llano Vice-president Colvivienda CEO 2016 Alberto Gutiérrez Bernal Director Titularizadora Colombiana CEO 2016 Gisele Manrique Director

Sandoval Reyes Director Structured Finance VP FDN 2016 Antonio J.

del Petróleo VP 2016 Gustavo Ramirez Director (2) Investment VP Corficolombiana 2012 Corporate Governance and Transparency Shareholder s Meeting

High quality practices and standards in accordance with national listing requirements given that EEB is listed on the Colombian securities

The Board of Directors has created operations, management and control committees to aid in efficiently carrying out the activities of the Company

External Controls Tax Review, External Audit, specialized audits, City Controllers Office, SSPD and SFC Corporate Governance Committee Three

21 EEB CORPORATE GOVERNANCE Experienced Management and Board of Directors The government of the District of Bogotá is responsible for appointing a majority of the members of EEB s board of directors and executive officers, including EEB s president Executives Position Year of a appointment Astrid Álvarez President 2016 Leonardo Garnica Investments VP 2016 Ernesto Moreno Transmission VP 1997 Felipe Castilla Financial VP 2013 Lina Toro Human Resources & Services VP 2016 Diana Vivas Legal & Regulation VP 2016 Juan Daniel Avila Sustainable Development Director 2016 Mauro Hernan Mejia Strategic Supply Chain Director 2016 Sandra Aguillón Internal Audit Director 2011 Maria José Quiceno Communications Director 2016 Board of Director (1) Possition Actual Position Year Beatriz E. Arbeláez Martínez President District s Finance Secretary 2016 Jaime E. Ruiz Llano Vice-president Colvivienda CEO 2016 Alberto Gutiérrez Bernal Director Titularizadora Colombiana CEO 2016 Gisele Manrique Director Major s Office Chief Counsel 2016 Margarita Ma. Rehbein Dávila Director CFO Sanford Management 2016 Carlos A. Sandoval Reyes Director Structured Finance VP FDN 2016 Antonio J. Núñez Trujillo Director (2) Partner Nuñez Rincon Lawyers 2016 Rafael Herz Stenberg Director (2) Asoc. Colom. del Petróleo VP 2016 Gustavo Ramirez Director (2) Investment VP Corficolombiana 2012 Corporate Governance and Transparency Shareholder s Meeting approved new bylaws according to the OCDE. High quality practices and standards in accordance with national listing requirements given that EEB is listed on the Colombian securities exchange. The Board of Directors has created operations, management and control committees to aid in efficiently carrying out the activities of the Company Shareholders Meeting Peak governance body Compensation Committee and Financial insvestments Committee Made up by three independent board members External Controls Tax Review, External Audit, specialized audits, City Controllers Office, SSPD and SFC Corporate Governance Committee Three board members. At least one of them must be independent Audit and risk Committee Made up by three independent board members Strategic Supply Chain Committee and Executive Contract Committee Analysis of contracting procedures and recommendations to the Executive Committee Note: (1) The Board of Directors is responsible for establishing general business policies and guidelines, as well as long-term strategy. All directors are elected for an unlimited duration. Directors must remain in office until their successors are elected and have taken office (2) independent member.. 21

INVESTOR RELATIONS For more information about Grupo Energía de Bogotá (GEB) contact our Investor Relations team: Felipe Castilla Canales CFO Rafael Andrés Salamanca Investor Relations Advisor GEB +57

22 INVESTOR RELATIONS For more information about Grupo Energía de Bogotá (GEB) contact our Investor Relations team: Felipe Castilla Canales CFO Rafael Andrés Salamanca Investor Relations Advisor GEB +57 (1) Ext (1) Ext 1675 Fabián Sánchez Aldana Investor Relations Advisor GEB +57 (1) Ext

23 Para uso restringido del Grupo de Energía de Bogotá. Todos los derechos reservados. Ninguna parte de esta presentación puede ser reproducida o utilizada en ninguna forma o por ningún medio sin permiso explícito de el Grupo de Energía de Bogotá.

Grupo Energía de Bogotá

Grupo Energía de Bogotá 2016 Key Results and Developments March 23 rd 2017 1 Disclaimer The information provided herein is for informational and illustrative purposes only and is not, and does not seek