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Company Overview Market Overview and Business Strategy Financial Overview Development Key Takeaways 2
COMPANY OVERVIEW 3
About AES Gener Operations in 4 markets: SIC and SING in Chile, SIN in Colombia and SADI in Argentina Diversified asset portfolio: Generation Sources, Customers and Markets Long-term Contractual Position Installed Operating Capacity: 5,082 MW (Successful completion of projects for 1,696 MW from 2007 to 2013) Capacity under Construction: 1,256 MW International and Local Investment Grade Rating : AES Gener: BBB- (Fitch; S&P s), Baa3 (Moody s) A+ (local, Fitch; Feller) Angamos: BBB- (Fitch) and Baa3 (Moody s) Guacolda BBB- (Fitch; S&P s) Chivor 1 Eléctrica Ventanas 7 8 5 7 9 6 10 14 16 1 2 3 5 Eléctrica Cochrane under construction Norgener 2 15 4 15 Eléctrica Angamos 3 TermoAndes 4 Guacolda 5 OWNERSHIP AS OF JUNE 2015 11 12 13 Eléctrica Campiche 6 Alto Maipo under construction 16 70.7% Pension Funds 16.7% Gener 5 12 13 14 Other 12.7% Eléctrica Santiago 8 9 10 11 4 1: As of June 2015, Source: Bloomberg MARKET CAP 1 : US$4.6 BILLION
Electricity Revenues 2014 US$2,028 million Regulated Unregulated Customers 39% Customers 37% Spot Sales 24% Installed Capacity by Technology 2014* Guacolda Sales are not included Installed Capacity by Market 2014 46% 25% 20% 9% COAL HYDRO NATURAL GAS / DIESEL DIESEL 0.3% BIOMASS 51% 20% 16% 13% *Installed capacity as of December 31, 2014, including Guacolda SIC:2,618 MW SIN: 1,000 MW SING: 822 MW SADI: 643 MW Installed capacity as of December 31, 2014, TermoAndes is connected to the SING and the Argentine system (SADI). 5,082 MW in operation & 1,256 MW in construction 5 Diversified Asset Portfolio
MARKET OVERVIEW AND BUSINESS STRATEGY 6
Credit Rating: AA- (S&P) Aa3 (Moody s) A+ (Fitch) CHILE Developed and liquid domestic capital market Pioneer (1982), market-oriented and stable regulatory framework Historically resilient electricity sector with growth potential Energy sales CAGR for the next 10 years* SIC: 4.3% p.y. SING: 5.4% p.y Credit Rating: BBB (S&P) Baa2 (Moody s) BBB (Fitch) COLOMBIA Rapidly growing and liquid capital market Established (1994), market-oriented and stable regulatory framework Low per capita electricity consumption and steady industry growth Energy sales CAGR for the next 10 years** of 2.7% p.y. * Note: CNE projections as of April 2015 ** Note: UPME projections 7 Stable Environment in Principal Markets
Electricity Market in Chile and Colombia CHILE COLOMBIA Generation 20,076 MW installed capacity as of December 2014 32% hydro 63% thermo 5% wind and solar Dispatch based on lowest cost of production (marginal cost) Sales Regulated customers Unregulated customers Spot sales Generation 15,528 MW installed capacity as of December 2014 69% hydro 30% thermo 1% other Dispatch based on lowest price offered Sales Regulated customers Unregulated customers and traders Spot sales Transmission Transmission (>33 kv) >14,000 km Open access transmission Transmission Regional regulated monopolies >24,000 km Open access transmission Distribution 5.6 million customers 55% of total demand Exclusive geographic concessions for regulated customers Distribution 10.2 million customers 69% of total demand Regional regulated monopolies Tariffs paid to generators set via LT public auctions Tariffs paid to generators set through public bids 8
Electricity System Overview System Data Expected Energy Sales Growth (CAGR 2015-2025) Energy Sales (GWh) Generation by Fuel Type Main Players (% of Installed Capacity) SING Installed capacity 4,724 MW Generation 17,688 GWh 5.9% 12% 88% Regulated Unregulated 2% 98% Renewable Thermal AES Gener E-CL Endesa Others 21% 20% 0,5% 3% 48% 31% 31% 45% 4,724 MW AES Gener first coal generator in 2014 SIC Installed capacity 15,181 MW Generation 52,207 GWh 4.2% 70% 30% Regulated Unregulated Hydro Thermal Other AES Gener 17% 22% 26% 35% Endesa Colbun 21% 22% Others 40% 17% 15,181 MW AES Gener first coal generator in 2014 AES Gener was the leader in energy generation in Chile in 2014 and in 1H 2015, contributing with 28% of the total generation, in both periods 9 Note: Figures as of December 2014. SING Includes TermoAndes in Argentina, as reported by the CNE..
System Data Expected Energy Sales Growth (CAGR 2015-2025) Energy Sales (GWh) Generation by Fuel Type Main Players (% of Installed Capacity) Installed capacity 14,600 MW Generation 64,328 GWh 2.7% 67% 33% Regulated Unregulated 1% 69% 30% Hydro Thermal Other AES Chivor Celsia Endesa EPM Gecelca Isagen Others 16% 19% 7%12% 21% 8% 15% 6% 20% 20% 8% 7% 22% 19% 14,600 MW Colombia Installed capacity 33,014 MW Generation 131,138 GWh 4.3% 13% 40% 47% Large Customers Residential Commercial Hydro Thermal Other TermoAndes S.A. 2% 14% Pampa Energía S.A. 7% AES Argentina 41% 40% 12% 9% SADESA 8% 12% ENDESA 15% 7% Argentine Government 16% 15% Other 2% 33,014 MW Note: Figures as of December 2014. In Generation by Fuel Type in Colombia, Other includes cogeneration, wind, small hydros and small thermal generation. 6% 63% 31% Argentina Electricity System Overview 10
Balanced Commercial Strategy: Chile CHILE Electricity Revenue 2014 US$1,477 million Unregulated Customers 50% Efficient generation Regulated Customers 36% Gross Spot Sales 14% Long term contracts (up to 22 years*) Commercial strategy maximizes cash flow and minimizes volatility to generate stability Contract prices include indexation mechanisms which periodically adjust prices based on generation cost structure, specifically coal and U.S. CPI, changes in law Contract customers include large creditworthy distribution and unregulated customers (mining and industrial) Back-up generation Spot sales Firm capacity Capacity charge revenue * SING Contracts 111
Commercial Strategy Colombia and Argentina COLOMBIA Electricity Revenue 2014 US$551 million ARGENTINA Electricity Revenue 2014 US$156 million Regulated Customers 46% Gross Spot Sales 54% Contract Sales 52% Gross Spot Sales 48% 75% - 85% of expected generation Remaining generation Firm energy (~3,000 GWh) Medium term contracts (1-4 years) Spot and frequency regulation sales Reliability charge revenue Energía Plus sales to unregulated customers for 220 MW Available to contract up to 306 MW Average term of SADI contracts ~1 year Remaining energy is sold to the spot market Integrated risk management to optimize use of reservoir and determine level of contracts 12
FINANCIAL OVERVIEW 13
US$ Million EBITDA* BY MARKET US$ million 738 30% 660 623 671 474 4% 37% 34% 39% 43% 1% 39% 18% 32% 33% 9% 10% 5% 18% 27% 24% 27% 33% 38% 160 26% 54% 20% 2010 2011 2012 2013 2014 Q1-15 SIN SADI SING SIC 200 160 120 128 45 15 20 10 160 80 40 0 EBITDA Q1-14 SIC SING SIN SADI EBITDA Q1-15 * EBITDA = Gross profit + administrative expenses + depreciation 14 EBITDA by Market
Financial Indicators (1) DEBT (2) (US$ MILLION) 2,120 2,268 2,282 1.010 1.154 1.126 2,785 1.298 2,734 1.520 3,038 1.856 NET DEBT / EBITDA (TIMES) 1.110 1.114 1.156 1.487 1.214 1.182 2010 2011 2012 2013 2014 Q1-15 PF Debt / Non Recourse Debt Corporate Debt 3.2x 2.3x 2.8x 3.3x 3.7x 3.9x CAPEX (US$ MILLION) 829 511 395 419 532 407 2010 2011 2012 2013 2014 Q1-2015 2010 2011 2012 2013 2014 Q1-15 Note: (1) AES Gener does not consolidate Guacolda into its financial statements (2) Other Financial Liabilities 15
Debt Profile Q1-15 TOTAL DEBT US$ 3,158 MILLION 97.5% denominated in US$ 89.4% at fixed interest rate 1,218 34.8% 25.3% 14.3% 12.7% 9.9% 4.0% Project Finance Senior Notes Angamos Junior Subordinated Notes Senior Notes Gener Chilean Bonds Leasing and Syndicated Credit 582 141 175 284 184 207 151 158 27 32 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 25-73 16 Project Finance Chilean Bonds Senior Notes Angamos Gener Senior Notes Leasing Syndicated Credit Junior Subordinated Bonds Amortization Schedule (US$ Million)
DEVELOPMENT 17
Project Related (non-recourse to Gener) Cochrane Project: US$ 1,000 million (PF) Alto Maipo Project: US$ 1,217 million (PF) Guacolda V Project: US$ 318 million Tunjita Project: US$ 63 million (leasing) Equity Contribution Partner Equity: Mitsubishi Corporation (40% Cochrane equity) and Minera Los Pelambres (40% Alto Maipo equity) Junior Subordinated Notes: US$ 300 million Capital Increase of US$150 million Total Investment ~ US$ 4 Billion Majority shareholder at Guacolda Ownership 50% plus 1 share. Partner equity from GIP Balanced Financial Structure 18 2nd Expansion Phase: Fully Funded Plan
Projects Under Construction Capacity under construction: 1,256 (+25%) +531 MW +552 MW Alto Maipo 531 MW +173 MW Guacolda V 152 MW Solar Andes - 21 MW Angamos desalinization plant Tunjita 20 MW Cochrane (1) 532 MW 5,082 6,339 2014 2015 2016 2018 2019 Total Capex : US$4 billion (1) Cochrane project includes Battery Energy Storage System for 20 MW 19
Other Projects EMISSION CONTROL EQUIPMENT (RETROFITS) As of March, 2015: ~ US$110 million at Norgener ~ US$103 million at Ventanas Installation in Units I, II and IV at Guacolda Complex ~ US$166 million SING SADI INTERCONNECTION Technical testing successfully performed AES Gener requested an exportation permit to the Ministry of Energy in July 2014 Chilean government announced authorization to export energy in February 2015, however final approval has not been granted yet OTHER PROJECTS The Company continues to evaluate opportunities in Chile and Colombia Renewable projects: Solar to reach to 220 MW Desalinization plants 20
KEY TAKEAWAYS 21
22 KEY TAKEAWAYS CONTINUING SOLID FUNDAMENTALS COMPANY Q1 2015 EBITDA HIGHER THAN Q1 2014 US$160 million, 25% increase compared to last year Historical record first quarter EBITDA in SIC of US$87 million LEADER IN GENERATION IN CHILE Contributed with 27.4% of country generation Operational excellence proven by high availability DIVERSIFIED ASSET PORTFOLIO Geographical, technological, customers base and fuel sources Important presence in Chile and Colombia MOVING FORWARD WITH SECOND EXPANSION PHASE Generator with more projects under construction in Chile Expansion plan fully funded World class partners: GIP, Mitsubishi, Antofagasta Minerals STRONG AND ENHANCED CAPITAL STRUCTURE Committed to investment grade rating Strong liquidity Extended debt maturity profile
APPENDIX 23
Projects Under Construction PLATFORM EXPANSION 2015 GUACOLDA V 152 MW COAL FIRED CHILE - SIC Progress (1) : 95% 50% + 1 share ownership Partner: GIP Total Investment: ~US$455 million ANGAMOS DESALINIZATION PLANT CHILE SING Progress (1) : 65% 1 st stage for efficient self-consumption Potential sale to third parties Total investment ~US$15 million SOLAR ANDES 21 MW CHILE SING Progress (1) : 34% Adjacent to Andes substation Total investment: ~US$45 million 24 (1): Progress as of March 31, 2015
2016 2018 COCHRANE 532 MW COAL - FIRED SING Progress (1) : 84% Adjacent to Angamos 60% ownership Partner: Mitsubishi Corporation Total investment: ~US$1,35 billion 74% Debt / 26% Equity ALTO MAIPO 531 MW HYDRO (RUN-OF-RIVER) SIC Progress (1) : 16% 50 km from Santiago 60% ownership Partner: Minera los Pelambres (AMSA) Total investment: ~US$2 billion 60% Debt / 40% Equity Cochrane project includes Battery Energy Storage System for 20 MW TUNJITA 20 MW HYDRO (RUN-OF-RIVER) COLOMBIA Progress (1) : 93% AES Chivor s Esmeralda Reservoir Use of flows from Tunjita river deviation Total investment: ~US$67 million (1): Progress as of March 31, 2015 25 Projects under construction (Cont.)