Annual Public Meeting of Analysts and Investors 2011

Transcription

1 Annual Public Meeting of Analysts and Investors 2011 MAURO ARCE CEO ARMANDO SHALDERS NETO Administrative Officer MITUO HIROTA Generation Officer VICENTE OKAZAKI CFO / IRO December 14, 2011

2 Summary 1. Sector Overview General sector overview The market in 2011 Current generation outlook 2. CESP Overview General CESP overview Operational situation Financial situation Sustainability & Awards 3. Expiration of Concessions 4. Questions and Answers 2

3 1. Sector Overview 3

4 Electricity Generation in 2009 World x Brazil 74.3% General Sector Overview (by source) 40.6% 16.2% 13.4% 1.3% 2.7% 21.4% 5.7% 5.1% 2.7% 3.3% 13.3% Hydro Coal Nuclear Gas Oil Others World Brazil Source: MME and IEA - International Energy Agency 4

5 General Sector Overview 10 largest electricity generators (TWh) 2010 Total 21,325.0 (100%) USA 4,325.9 (20.3%) China 4,206.5 (19.7%) Japan Russian 1, ,036.8 (5.4%) (4.9%) India Canada (4.3%) (3.0%) Germany (2.9%) France South Korea (2.7%) (2.3%) Brazil (2.2%) 10 th PLACE Source: BP Statistical Review of World Energy June 2011 and National Energy Statement

6 The Market in 2011 National Consumption (+ 3.8%) Consumption by Class (TW/h) (Jan-Oct accrued) Southeast Consumption (+3.9%) Industrial Residential Commercial Others Total Industrial Residential Commercial Others Total Source: Electric Research Agency 6

7 Current Generation Outlook (Reservoir Level) % EARmax SE/CO % % J F M A M J J A S O N D EAR Stored Energy Source: ONS 7

8 Current Generation Outlook 160,00 140,00 120,00 100,00 Average PLD 2010 x Southeast / Midwest Average Price to the 2nd Week of December ,00 60,00 40,00 20,00 0,00 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec PLD Difference Settlement Price Source: CCEE 8

9 2. CESP Overview 9

10 General CESP Overview Controller Shareholder: State of São Paulo (95.3% of Common Shares and 40.6% of Total Capital) 100% hydroelectric generation (largest generator in the state and 4 th largest in Brazil) Electricity production in 2010: 4,674 Average MW (approximately 56% of the state and 9% of Brazil) 79 clients 1,341 employees Installed capacity: 7,456 MW (Guaranteed Power: 3,916 Average MW) Assets: R$18.3bn / Liabilities: R$7.9bn / Equity: R$10.4bn EBITDA R$1.9bn (last 12 months) Debt / EBITDA: 2.1x 10

11 Operational Situation Ilha Solteira Três Irmãos Jupiá Porto Primavera Jaguari Paraibuna 11

12 9.4% 8.6% 8.0% Operational Situation 10 largest electricity generators (by installed power in MW) 6.6% 6.3% 6.2% 6.0% 5.3% 4º 4.0% 2.3% Source: ANEEL

13 Operational Situation CESP s Generation Park BASIN/PLANT NO. OF UNITS INSTALLED CAPACITY GUARANTEED POWER AVERAGE MW START-UP END OF CONCESSION ILHA SOLTEIRA (IS) TRÊS IRMÃOS (TI) 20 3,444 - July 18, 1973 July 7, Nov. 28, 1993 Nov. 18, 2011 COMPLEX (IS/TI) 25 4,252 1, JUPIÁ PORTO PRIMAVERA RIO PARANÁ PARAIBUNA JAGUARI RIO PARAÍBA TOTAL 14 1, April 14, 1969 July 7, ,540 1,017 Jan. 23, 1999 May 21, ,343 3, April 20, 1978 Mar. 9, May 5, 1972 May 20, ,455 3,

14 Operational Situation Electricity Production (GWh) 42,896 41,203 41,139 37,899 39,831 40,947 37,177 34, nov/11 Guaranteed Power (Nominal Production: 34,304 = 3,916 average MW) Source: CESP 14

15 Operational Situation Source: ABRAGE 15

16 Operational Situation Prices - R$/MWh (09/30/2011) Average Prices of Agreements and Non-Contracted Energy (%) % 46% 51% 67% 70% 70% 71% 73% Non-Contracted Free Contracting Market Regulated Market Source: CESP 16

17 Financial Situation 17

18 Revenue Gross Revenue Net Revenue 2,987 3,084 3,319 2,398 2,626 2,471 2,103 1,840 2,0612,184 2,480 2,653 2,905 2, M M11 Source: CESP (R$ million) 18

19 Expenses Operating Expenses 1,635 1,523 1,713 Adjusted Financial Expenses (excluding exchange variation) 1,277 1,244 1,122 1,302 1,324 1, M M11 Source: CESP (R$ million) 19

20 Number of Employees 1,284 1, * * 1, Sep/2011 * Net result of admissions through public examinations and terminations. Source: CESP 20

21 Adjusted EBITDA Trends Adjusted EBITDA and (R$ million) 1,628 1,231 1,333 1,410 Adjusted EBITDA Margin (%) 1,849 1,957 1, M11 Source: CESP 21

22 Financial Debt % Evolution of Debt by Currency -56% % 64% % 65% Domestic Currency R$ billion % 68% 45% 55% 36% 39% 35% 37% 32% Sept/11 Debt/ EBITDA

23 Financial Debt Debt Breakdown Total: R$4,277 million FOUNDATION R$211 5% * OTHER R$2 0% *BRADY PLAN R$218 5% *BONUS R$413 10% FIDC R$1,229 29% BNDES Finame R$21 0% *BNDES/BRADY R$743 17% PN R$162 4% Series 8 BONUS R$963 22% * In US$ BIB's R$116 3% Eletrobrás R$199 5% Source: CESP Sept. 30,

24 Financial Debt Debt Profile: R$4,277 million 924 Dec/2010 1, T After 2015 Source: CESP (R$ million) 24

25 CAPEX Capital Investments M11 Maintenance/Modernization Primavera Port Source: CESP (R$ million) 25

26 Risk Classification Prime High Grade Upper Medium Grade Lower Medium Grade S & P Equival. Apr/03 Oct/03 Dec/05 Apr/06 Jun/06 Nov/06 Oct/07 Sep/09 Aug/10 Dec/10 S&P Domestic Scale A- X BBB+ BBB BBB- BB+ Moody's X Speculative BB X BB- X X X B+ X Highly Speculative B X X AAA AA+ AA AA- A+ A B- X CCC+ X Risk of Insolvency CCC X CCC- Substantial Risk CC Probable Insolvency C SD X In default DDD DD D X Standard & Poor s - S&P Apr/03 Oct/03 Dec/05 Apr/06 Jun/06 Nov/06 Oct/07 Sep/09 Aug/10 Dec/10 Source: Standard & Poor s and Moody s 26

27 Dividends and IOE Interest on Equity Paid R$25 million on 07/20/2011 R$50 million on 10/21/2011 Profit Reserves (Installments to be paid) Year /19 Total Installment Equity Valuation Adjustment IFRS Annual Realization (Additional Depreciation Deferred Taxes) Year Realization * * Amount expected for 2011 Source: CESP (R$ million) 27

28 Breakdown of Capital Stock Breakdown of CESP s Capital Stock Type Amount SHARES Capital (R$ million) Market Cap (R$ million) Common 109,167,558 1, ,880.9 Preferred A 8,119, Preferred B 210,215,567 3, ,623.9 TOTAL 327,502,673 5, ,763.8 Nov. 30, 2011 Source: CESP 28

29 CESP Ownership Breakdown Nov. 30,2011 in percents (%) Shareholder ON PNA PNB Total S.P. State Finance Dept São Paulo Metro CPP Sabesp Subtotal State of SP ,60 HSBC Bank, Plc UBS AG London Branch Santander Inv. Part Eletrobrás S.A Other Shareholders Subtotal Other shareholders TOTAL Source: CESP 29

30 Share Price Trends Share price trends from Nov. 30, 2010 to Nov. 30, 2011 IEE: 11.6% CESP6: 9.7% IBOVESPA: -15.9% IEE- Electrical Energy Index Source: AE Broadcast 30

31 Corporate Governance Additional Commitments (incorporated into the Bylaws) Index Inclusion 100% Tag-Along for Preferred B Shares 20% Independent Board Members Adherence to the Bovespa Arbitration Chamber Source: CESP 31

32 Sustainability & Awards 32

33 Recent Highlights Included in the BM&Fbovespa s ISE Corporate Sustainability Index for the 6th consecutive time Included in the Carbon Efficient Index of the BM&FBovespa - BNDES Standard & Poor s changes the outlook for CESP s ratings from stable to positive, reaffirming BB- for global scale and bra- for domestic scale. 33

34 Awards São Paulo Diversity Seal 2011 In 2011, for the second time, CESP was awarded the São Paulo Diversity Seal in the Senior Category (with external auditing) by the Institutional Relations Department of the São Paulo State Government for its social inclusion and equal opportunity policies and practices. Best Corporate Governance Awarded by the British magazine World Finance, this award represents international recognition for the Company s good corporate governance practices. ET Scope 3 Disclosure Leader Award Granted within the CDP Carbon Disclosure Project by the EIO - Environmental Investment Organization, which awards corporate initiatives to reduce greenhouse gas emissions. CESP was the only company in the Brazilian energy sector to earn this award. 34

35 3. End of Concessions 35

36 National Energy Sector Data by Segment SEGMENT GENERATION TRANSMISSION AMOUNT 18,277 MW 73,000 Km of transmission lines and substations PERCENTAGE OVER ENTIRE SEGMENT 23% of installed capacity of Brazil s hydroelectric complex 82% of the SIN - National Interlinked System DISTRIBUTION (2015 to 2017) 42 Concessionaires 35% of the energy sold in ACR - Regulated Market System SOURCE: ANEEL 36

37 End of Concessions in 2015 Total MW and percentages of total installed power of each of the main generation companies for which concessions expire in ,615 1,401 9,703 9,131 9, % 7,221 2,460 9,055 6,105 2, ,456 6,782 4,996 4,545 4,284 2,175 1, % 0.8% 67.0% 10.0% 5.7% 19.0% CHESF FURNAS ELETRONORTE CESP CEMIG COPEL CEEE Others

38 End of Concessions in 2015 (CESP s Generation Park) BASIN/PLANT NO. OF UNITS INSTALLED CAPACITY GUARANTEED POWER AVERAGE MW START-UP END OF CONCESSION ILHA SOLTEIRA (IS) TRÊS IRMÃOS (TI) 20 3,444 - July 18, 1973 July 7, Nov. 28, 1993 Nov. 18, 2011 COMPLEX (IS/TI) 25 4,252 1, JUPIÁ PORTO PRIMAVERA RIO PARANÁ PARAIBUNA JAGUARI RIO PARAÍBA TOTAL 14 1, Apr. 14, 1969 July 7, ,540 1,017 Jan. 23, 1999 May 21, Apr. 20, 1978 Mar. 9, May 05, 1972 May 20, ,456 3,

39 4. Questions and Answers 39

40 Investor Relations (11)