Presentation aes eletropaulo_2_q12_sem discurso_v3
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The company reported a 2.5% increase in energy consumption in 2Q12. Revenues increased 2.8% to R$3.8 billion due to growth in residential and commercial classes. However, EBITDA declined 53.6% to R$244 million due to a 16.3% increase in energy costs. Net income fell 77.8% to R$57 million, impacted by higher energy prices and lower financial results. Operational improvements led to reductions in SAIDI and SAIFI indices. The company continues its efficiency programs to control costs.
Presentation aes eletropaulo_2_q12_sem discurso_v3
- 2. 2Q12 Highligths Operational Increase of 2.5% in energy consumption within Company’s concession area, totaling 11,529 GWh Implementation of the Action Plan in 2011 resulted in a reduction of 12.2% in SAIDI and 10.3% in SAIFI in 2Q12 Investments of R$ 184 million, 7.1% higher than 2Q11 Financial Gross revenue totaled R$ 3,838 million, a 2.8% increase when compared to 2Q11 Ebitda of R$ 244 million in the 2Q12, reduction of 53.6% when compared to the same period of the last year Net Income of R$ 57 million, 77.8% lower than 2Q11 Regulatory In July 2nd , 2012, Aneel approved Company’s final tariff review rate of -9.33% (average effect to be perceived by the consumer) and -5.60% (economical effect) . In July 3rd , 2012, Aneel authorized an average Tariff adjustment of +5.51% (average effect to be perceived by the consumer) and + 4.45% (economical effect) The amount to be returned to the consumer through the tariff, due to the postponement of tariff review application, is R$ 1,053 million 2
- 3. 3rd Cycle of the Periodic Tariff Reset Gross Regulatory Asset Base: R$ 10,748.8 million Tariff Review Net Regulatory Asset Base: R$ 4,445.1 million Parcel B: R$ 2,007.1 million Non Technical Losses(referenced in the low voltage market): start point at 11.56% and getting to 8,56%, by the end of the cycle Average effect to be perceived by the consumer: -9.33% Economical Effect: -5.60% Average effect to be perceived by the consumer : +5.51% Tariff Adjustment Economical Effect: +4.45% Tariff Review + Adjustment Average effect to be perceived by the consumer : -2.26% Administrative In 17th July, Company filed a request for reconsideration of the Homologation Resolution 1,327/2012 Appeal about the Regulatory Asset Base and the non-technical losses trajectory 3
- 4. Performance of residential and commercial clients offset the drop in industrial class Consumption evolution (GWh)¹ +7.1% -3.2% +3.0% +7.6% +4.1% -4.5% +2.5% 11,246 11,529 9,515 9,138 4,339 4,053 2,879 2,965 2,109 2,014 1,513 1,465 694 747 Residential Industrial Commercial Public Sector Captive Market Free Clientes Total Market and Others 2Q11 2Q12 1 – Own consumption not considered 4
- 5. SAIDI reduction in the last 12 months as a result of the Action Plan SAIDI¹ (last 12 months) SAIDI¹ (YTD) - 12.2% 10.09 -21.2% 9.32 8.68 6.53 11.86 10.60 10.36 10.40 8.97 5.14 9.13 2009 2010 2011 2Q11 2Q12 Jul-12 Jan-Jul/11 Jan-Jul/12 SAIDI Aneel Reference SAIDI (hours) SAIDI (hours) 1 - System Average Interruption Duration Index 5 Source: ANEEL and AES Eletropaulo
- 6. SAIFI remains below the regulatory limit and keeps presenting a decrease SAIFI ¹ (last 12 months) SAIFI¹ (YTD) 7.87 7.39 6.93 -18.7% -10.2% 6.17 5.46 5.45 5.48 3.37 2.74 4.92 4.81 2009 2010 2011 2Q11 2Q12 Jul-12 Jan-Jul/11 Jan-Jul/12 SAIFI Aneel Reference SAIFI (times) SAIFI (times) 1- System Average Interruption Frequency Index 6 Source: ANEEL and AES Eletropaulo
- 7. Losses level below regulatory reference for the 3rd Cycle Losses (last 12 months) Regulatory Reference² - Total Losses (last 12 months) 11.8 10.7 10.3 10.9 10.5 10.6 10.5 9.8 9.4 5.3 4.4 4.0 4.1 4.2 6.5 6.5 6.5 6.5 6.3 2009 2010 2011 2Q11 2Q12 2011/2012 2012/2013 2013/2014 2014/2015 Perdas Técnicas¹ Perdas não Técnicas 1 – In January 2012, AES Eletropaulo improved the calculation of technical losses who have been reduced to a level around 6.1%. As the percentage of losses is calculated based on the last 12 months, the percentage of technical losses is 6.3% of the 2Q12. 2 – Regulatory reference is estimated by the Company in order to translate the reference given by Aneel for non-technical losses in the market for low voltage to total 7 energy injected into the system
- 8. Investments of R$ 170 million in 2Q12 Investments (R$ million) 2Q12 Investments (R$ million) 45 841 739 46 800 7 682 22 700 28 42 8 600 8 500 16 400 794 717 44 654 +7.1% 300 159 170 200 5 8 Maintenance¹ 100 154 162 Client Service 0 2010 2011 2012(e) 1Q11 1Q12 System Expansion Losses Recovery Capex Paid by Customers IT Paid by the Clients Others 8 1 – Maintenance Capex is the investment s made for the grid modernization and improvement in quality of service
- 9. Revenues increased by 3% due to residential and commercial classes expansion Gross Revenues (R$ million) +2.8% 7,466 7,672 2,651 2,748 +2.8% 324 352 3,732 3,838 1,342 1,386 4,490 4,572 160 166 2,231 2,286 1H11 1H12 2Q11 2Q12 Net revenue ex-construction revenue Construction revenues Deduction to Gross Revenue 9
- 10. Cost of energy purchased impacted by growth of the market and average price Operating Costs and Expenses ¹ (R$ million) +16.3% 3,962 3,407 775 +9.6% 707 +19.1% 2,025 +18.0% 1,700 +4.1% 374 3,187 359 2,700 +23.1% 1,651 1,341 1H11 1H12 1Q11 1Q12 Energy Supply and Transmission Charges PMS² and Others Expenses 10 1 - Depreciation and other operating income and expenses are not included 2 - Personnel, Material and Services
- 11. Growth of 4% in operational expenses, below the inflation increase of 5% PMS and other expenses (R$ million) 21 5 (22) 12 4 (21) 16 391 412 395 375 387 374 374 359 359 2Q11 Personnel and Fcesp Material and Action Plan Client Default Agreements Others¹ 2Q12 Payroll Third part 2011-2012/ (ADA) and reversals DEC & FEC in legal labor project and civil disputes 11 1 – Others: Other contingencies provision, losses and agreements (excluding civil and labor) , reduction in call center expenses and other operational expenses
- 12. Reduction in Ebitda due to higher cost of energy purchased Ebitda (R$ million) 61 (310) (15) (17) 525 525 275 261 243 243 2Q11 Net Revenue Parcel A costs PMSO Others revenues 2Q12 and expenses 12
- 13. Financial results negatively impacted by exchange rate and lower capitalized interests Financial Results (R$ million) 1H11 1H12 2Q11 2Q12 (11) (10) (30) (58) 13
- 14. Net income variation impacted by an increase in energy purchased Net Income (R$ million) 537 162 -69% 167 255 70 376 -78% 247 57 185 69 (12) (80) ¹ ¹ 1H11 1H12 2Q11 2Q12 Net Income - with regulatory assets and liabilities Regulatory assets and liabilities 1 - The amount of regulatory assets and liabilities of 2Q12 does not consider the adjustment in the provision regarding the possible impacts of tariff review related to the 3Q11 and 1Q12 (R$ 69,7 million). As, the amount related to the 1H12 does not consider the adjustment related to the 2H11 of R$ 102.7 million. 14
- 15. Lower cash generation due to higher cost of energy purchased and charges Operational Cash Generation (R$ million) Final Cash Balance (R$ million) -60% +4% 654 1,043 1,083 259 2Q11 2Q12 2Q11 2Q12 13
- 16. Debt kept at comfortable level Net Debt Average Cost and Average Term (Principal) 1.7x 1.4x 6.8 6.1 1.3x 1.3x 116.2% 2.9 3.1 108.9% 2Q11 2Q12 2Q11 2Q12 13.6% Effective rate 11.3% Net Debt (R$ billion) Gross Debt/Ebitda Adjusted with Fcesp¹ Average Time - years Net Debt/Ebitda Adjusted with Fcesp ¹ % of CDI 14 1 - Adjusted Ebitda for the expenses related to liabilities with pension plan in the last 12 months
- 17. Efficiency program and costs management Efficiency Program Implementation of “Creating Value” project in 2010, that provided gains with cost control and increase in efficiency and revenue Program initiatives: • review in the operational process and support areas • increase in productivity of the teams in field • optimization in orders to emergency teams • improvement in the management of material and service suppliers contracts • efficient use of operational fleet • rationalization and modernization of customer services stores and on site billing Disposal of Property Centralization of activities in the new corporate headquarters and demobilization of Cambuci operational unit will allow the sale of real estate in value estimated up to R$ 239 million 17
- 18. 2Q12 Results 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.