apresenta o 2009 ing webcast.finalx -...
TRANSCRIPT
We outpaced the crisis– and added R$ 1.8 billion in assets
Brazil’s Best Electricity .
2009RESULTS
Disclaimer
Some statements in this presentation are “forward-looking statements” by the concept of the
US Securities Law and are subject to risks and uncertainties. “Forward-looking statements” are
forecasts that may differ from the final figures and are not under our control. For a discussionforecasts that may differ from the final figures and are not under our control. For a discussion
of the risks and uncertainties as they relate to us, please see our 20F form for 2008 and, in
particular, item 3, under “Basic information – Risk factors”.
All figures are in BRGAAP(in millions of Reais, except where otherwise indicated).
2
Execution of the strategy takes Cemig to a new level
Cemig’s Long-term Strategic Plan calls for sustainable growth, toensure long-term addition of value for shareholders
�Outright leadership in consolidation of the sector
�Significant growth in the transmission segment
3
�Significant growth in the transmission segment
�Creation of a structure for expansion that is unprecedented in Brazilian electricity
�Stragetic partnerships are part of the growth model
�Cemig’s financial solidity puts it in the leading position for growth opportunities
�Credit quality wins access to funding
3
1.887 1.755
1.861 2.020
4.099 4.0904.039 4.280
We outpaced the crisis
Net IncomeNet revenue EBITDA
10.890 10.76411.705 11.975
Reported Adjusted2008 2009
Reported Adjusted
2008 2009
� 2009: a landmark year in Cemig’s history�Cemig’s portfolio of businesses ensured growing results in spite of the adverse
economic scenario
�Strong fundamentals and profitability of operations are evidenced by margins
�Acquisitions are the result of Cemig’s solidity, and financial innovation
4
Reported Adjusted2008 2009
(*) Adjusted by non recurring items, detailed in the Annex
(*) (*) (*)
4
The Cemig group – corporation with agile management
� Cemig is now Brazil’s largest integrated utility company:
� Present in 20 States of Brazil, and in Chile
� The Cemig Group comprises 59 companies and 10 consortia
• Centralized administration ensures efficiency in management
�Activities concentrated in core businesses:
• Power generation, transmission and distribution• Power generation, transmission and distribution
• Electricity trading
• Natural gas exploration and distribution
• Energy efficiency
• Telecommunications
� We give clients energy solutions:
�We serve Brazil’s largest corporate groups
�25% share of Brazil’s electricity Free Market
�Mission: “To operate in electricity with profitability, quality and
social responsibility”.5
Generation
� Today Cemig is Brazil’s third largest generation group:
� Installed capacity:6,754 MW
� Power plants: 67
� Leadership in renewable energy sources:
�98% of generation comes from hydro plants and wind farms
� Innumerable partnerships in co-generation and Small Hydro Plants
� Total generation sales (Free and Regulated Markets) 35,175 GWh*
- up 2% from 2008 to 2009
6
26.89231.607
34.839 34.565 35.175
2005 2006 2007 2008 2009
*Excludes Trading Chamber(CCEE), spot market (“PLD”)and RME mechanism.
Total generation sales (GWh)
Generation: Expansion
� Acquisitions:
� 3 wind farms – from Energimp S.A.: R$ 219 million (49%).
� New projects
Plant Installed
capacity (MW)
Cemig stake
(%)
Start up date
Cachoeirão Small Hydro Plant 27 49% 2009
Baguari Hydro Plant 140 34% 2009
7
Baguari Hydro Plant 140 34% 2009
Wind farms 100 49% 2009/2010
Small Hydro Plants 107 49% 2010/2011
Santo Antônio 3,150 10% 2012
Itaocara Hydro Plant* 194 49% 2013
6,113
6,692 6,678 6,691 6,754
2005 2006 2007 2008 2009
Installed capacity
(MW)
*In partnership with Light
Transmission: Present all over Brazil
� Cemig is now Brazil’s third largest transmission group:
� Total lines: 7,506 Km
� Consolidated
Permitted Annual
MAMA
PEPE
RNRN
NOVATRANS
GTESA
PATESA
PAPA
EATE and ENTE
ETEP and ERTE
Permitted Annual
Revenue (RAP): R$ 859
million, including
Transchile
� Present in 13 States of
Brazil and in Chile
8
MTMT
SCSC
MGMG
RSRS
BABA
GOGO
TOTO
PEPE
PB PB
SPSP
MUNIRAH
TSN
ETEO
ETAU
BRASNORTE
MTMT
ESDE
ECTE and LUMITRANS
STC
EBTE
TRANSUDESTE
TRANSLESTE and
TRANSIRAPE
CENTROESTE
TAESA
TBE
Transmineiras
Transchile
Centroeste
Cemig GT: various lines
Cemig
GT
Transmission: Expansion
� Acquisitions in 2009:
� Taesa (formerly Terna): R$ 2.03 billion (R$ 957 million in 2010, with 100% acceptance of the minority shareholders)
� Increased stake in TBE: R$ 605 million
ASSETS RAP (Permitted Annual
Revenue) - R$ million
Cemig stake (%) Start up date
EBTE (775km)1 27.3 68%3 06/2010 (partial)
Transm. Centro Oeste 10.5 51% 03/2010
9
Transmission capacity (km)
Transm. Centro Oeste 10.5 51% 03/2010
Santos Dumont substation2 8.3 40%3 05/2011
¹ EBTE: indirect holding through EATE. ² Indirect holding through ETEP. 3Includes direct and indirect holding.
Start up in Chile: First international step
Charrúa–Nueva Temuco Transmission Line
•Voltage: 2x 220kV
•Length: 205 km
•Concession period: 20 years
•Stake: 49%
ChileChile
•Stake: 49%
•Total investment: US$88 million
•Annual Revenue: US$65 million
•Financing: 63% of the investment
•Capital from Cemig : U$20.3 million
•Start of works: April 2007
•Start of operation: January 2010
TranschileTranschile
10
Distribution� The Cemig Group is market leader in Distribution
� Total length of lines: 467,275 km
�Concession area *: 578,448 km2
� Number of consumers*: 10.7 million
�Cities served: 805, in states of Minas Gerais and Rio de Janeiro
� Record volume distributed in 2009: 43,903 GWh
� Scale of final consumer markets stable in 2008-9
� Highlight growth is in residential and commercial categories
11* Includes 100% of Light.
Sales to final consumers (GWh)
Distribution: Expansion
� Acquisitions in 2009:
� Increase of stake in Light, jointly with an FIP: 26.06%*
• R$ 785 million for each block of 13.03% in Light
• Payment to AG Concessões after necessary approvals
• Payment to PCP after approvals and stockholding reorganization ofEquatorial
12
Equatorial
� Light announces new Executive Board
� Leadership of Gerson Kelman ensures stability in transition
� Three new Chief Officers, coming from Cemig
• More than 25 years activity in electricity sector
• Will operate in strategic areas: distribution, generation, finances
� Challenges are: improvement of operational indicators; and
capture of synergies with Cemig
*Payment planned for first half 2010.
Investment program Activity 2009 2010 2011 2012
Basic program (1) 768.4 800.8 953.2 1,062.0
Generation 55.8 132.8 61.4 84.0
Transmission 114.5 52.9 18.6 30.2
Distribution 598.1 614.4 873.0 945.5
Holding - 0.7 0.2 2.3
Luz Para Todos (“Light for All”) – Cemig 164.0 536.9 (160.2) -
Luz Para Todos – Total 164.0 827.7 - -
CDE - (215.8) (32.0) -
Minas Gerais State - (75.0) (128.2) -
(1) Amounts estimated as from 2010, in accordance with corporate planning, at June 2010 prices. Includes basic
investments for upkeep of the routine work of distribution, generation, transmission and the Holding Company.
(2) Based on 100% acceptance of the Public Offering
Minas Gerais State - (75.0) (128.2) -
Acquisitions 1,797.5 1,791.5 8.1 10.8
Terna Participações 1,069.9 956.8(2) - -
TBE (Acquisition - Brascan) 505.0 - - -
TBE (Acquisition - MDU) - 117.3 - -
TBE (Share buyback) 3.7 6,4 8.1 10.8
Wind Farms 218.9 - - -
Light (49% of AGC+EQTL) - 711.0 - -
Overall total 2,729.9 3,129.1 801.1 1,072.8
13
Sustainability
� In 2009 Cemig joined the Global Compact and published its “Corporate SocialResponsibility” handbook.
� Environmental education - Launch of the Terra da Gente (“Our Land”) programfor two regions: Campo das Vertentes, and Sul de Minas
14
• To involve an estimated 247,000 pupils
� Recognition
• Leader of the Super Utilities sector, worldwide,in the Dow Jones Sustainability Index
• 10th year running in the Index – since its creation
Financial management
� Cemig is very well positioned to continue growing in a sustainable manner,ensuring addition of value for our shareholders
� Quality of our balance sheet; credit quality
• Low debt indices
• Robust cash position: R$ 4.4 billion
• 1.8 billion committed with acquisitions
15
• Debt profile appropriate to our businesses
� Solidity of our results
• Large operational cash flow
• Balanced portfolio of businesses
� New models for growth
• Structuring with FIPs frees cash for other investments
“Even with acquisitions and new growth projects, dividend policyis kept unchanged.”
Lengthened debt profile with reduction of costs
Principal indexors
Average tenor: 3 years
Maturities timetable
1%2%
72%
1%
5%3%12%4%
Umbnds
Dólar
CDI
Outros
Ipca
Igpm
Urtj
RGR/Finel
4,2801,317 1,566 1,366 1,123 586 309 746
2010 2011 2012 2013 2014 2015 2016 2017 to
2031
16
Consolidated debt
(1) Net debt = Total debt – Cash and cash equivalents
� Reduction in basic interest rate captured
CEMIG
consolidatedCEMIG GT CEMIG D
Dívida Total 11,293 6,819 2,617
Dívida em Moeda Estrangeira 252 2% 13 0,2% 170 6%
Dívida Líquida 6,868 3,775 2,371
LAJIDA/Juros 5.05 6.71 4.48
Dívida Líquida/ LAJIDA 1.70 1.57 2.20
Dívida Líq. / (PL + Dívida Líq.) 40% 51% 47%
Total debt
Debt in foreign currency
Net debt
EBITDA/Interest
Net debt/EBITDA
Net debt/(stockholders’ eq.+ Debt)
Credit quality: Ensures funds for expansion � Cemig GT raised funding of R$2.7 billion through Cemig GT with Promissory Notes, that have
already been paid with the issuance of Commercial Papers (debêntures)
� Funds used for acquisitions and other
investments
� Debt indicators remain within limits of
the Bylaws for acquisition situations
1.5801.317
3.132
1.7441.501
964
309746
Adjusted Maturities Timetable
17
� Cemig’s ratings:
A+.bra Cemig H, Cemig GT and Cemig D Brazilian scale
Aa1.br Cemig GT and Cemig D Brazilian scale
Aa2.br Cemig H Brazilian scale
Baa3 Cemig GT and Cemig D Global scale
Ba1 Cemig H Global scale
brAA- Cemig GT and Cemig H Brazilian scale
brAA Cemig D Brazilian scale
BB Cemig H, Cemig GT and Cemig D Global scale
Investment Grade
2010 2011 2012 2013 2014 2015 2016 2017 a
2031
Solidity of our results
� EBITDA over recent years has ensured availability of funds for growth
� Continuous growth of EBITDA over the period
� Highest cash flow in the electricity sector
� EBITDA in line with the market’s estimates
Cemig: consolidated EBITDA, 2005-9
18
Cemig: consolidated EBITDA, 2005-9
3.058 3.222
4.062 4.099 4.039
1500
1700
1900
2100
2300
2500
2700
2900
3100
3300
3500
3700
3900
4100
4300
4500
2005 2006 2007 2008 2009
Aquisitions leverage results
Assets 2004 2005 2006 2007 2008 2009 TotalValue invested in acquisitions TotalRosal 136,7 136,7 TBE 349,3 3,6 3,6 356,6 Light 174,6 174,6 Total 136,7 - 523,9 3,6 3,6 667,8
Contribution to net incomeRosal (5,6) 18,9 18,7 18,9 120,5 23,4 TBE 24,7 28,9 36,4 79,1Light (19,6) 147,1 128,5 78,8 Total (5,6) 18,9 23,8 194,9 184,4 181,3
19
70%
18%
2% 10%
Net profit 2009
Cemig GT Cemig D Gasmig Participações
Total (5,6) 18,9 23,8 194,9 184,4 181,3
Dividends received Total Rosal 13,3 17,7 17,4 58,9 107,3 TBE 10,4 33,9 32,8 29,4 106,4Light 67,7 107,1 92,9 267,7 Total - - 23,7 119,3 157,3 181,2 481,5
� R$ 181 million of 2009 consolidated Net income came from acquisitions made in 2004–2008
� 2009 P/E of these acquisitions is 3.7
�Dividends and other proceeds received from these
companies to date equal represent 72% of the amount
invested. Holdings
Holdings acquired in 2009 add immediate income
TBE(1)
+R$ 46 MM
TAESA(1)
+R$ 178 MM
(1) 2009 numbers are pro-forma; they include the increased stake sin Light (from 13% to 26%) and TBE
(from 17% to 39%), and assume 100% subscription to the public offer to buy the free float of Taesa.
+ R380million/year
of Net Income
LIGHT(1)
+R$ 157 MM
20
Cemig model for growth
� Structuring of partnerships with Equity Investment Funds (FIPs) produces a
growth strategy that optimizes capital
� Strategic positioning with minority interests guarantees Cemig greater access
to funding
• Attractive to investors due to low risk• Attractive to investors due to low risk
• Investors enter as financial partners and Cemig as operating partner
• Possibility of increasing stake in the future
� Innovative acquisition structure enables Cemig to use it in other
expansion opportunities, aligned with its Long-Term Strategic Plan.
21
� On November 4th, 2009, Cemig GT, jointly with FIP Coliseu, acquired 65.85% of Terna Participações
S.A., through Transmissora do Atlântico de Energia Elétrica S.A.
� Atlântico was split, creating Transmissora Alterosa, which will be responsible for the public offer to
acquire the free float from minority stockholders.
� Terna absorbed Atlântico, and its name was changed to Transmissora Aliança de Energia Elétrica S.A. –
“Taesa”.
FIP Coliseu: Efficient vehicle for growth in Transmission
Taesa: Present structure
� After the public offer to buy shares, assuming
100% acceptance, the shares bought will be:
• common shares: 49% Cemig GT and 51% FIP
• preferred shares: 100% Cemig GT
Taesa: Present structure
22
COMMON COMMON
(32,26% KT) (33,59% KT)
Stockholding restructuring in Light: accounting effects
Nov. 09: At this point
Cemig has direct
SOCLUCE
AGCCEMIG
Light S.A.
100%100%
Equatorial
RME
13,03% 13,03%13,03% 13,03%
LUCE
BNDESPAR
23,46 % 23,41%
Results for 1Q 2010 will
reflect absorption of RME
by Light
13%
25%
1Q09 2Q09 3Q09 4Q09 1Q10
Consolidation of the results of Light
Net Income Revenue Ebitda
Cemig has direct
holding of 13.03% in
Light
Light S.A.
23
Stockholding restructuring in Light: final structure
* Maximum stake
24
Shareholders’ agreement
� As well as operators, we have become managers of assets, in all
segments of electricity:
� Generation (MWh)
Cemig Group grows through management of assets
6,754 1,752Capacidade Instalada
8,506
Installed capacity
� Distribution (MWh)
� Transmission (Km)
� Cemig
consolidated
�Management
for partners
43.826
12.458
Electricity distributed
Total length of lines
25
51%31%
5%
Balanced portfolio of operations sustains growing EBITDA
EBITDA by business – 2009
EBITDA 2009 2008
Cemig GT 2,402 1,924
Cemig D 945 1,606
EBITDA by company
51%
13%
Generation Transmission
Distribution Gas and Others
Cemig D 945 1,606
Light 301 329
Gasmig 50 50
TBE 123 74
TAESA 30 -
Others 188 116
Total 4,039 4,099
26
Gener
Economic income (R$ million)
90,4
527,7
395,0
502,4
NOPAT 1,683 2,168 2,234 2.180
Capital invested 13,646 15,559 16,321 18.186
ROIC 12.33% 13.93% 13.69% 11,99%
WACC* 11.67% 10.54% 11.27% 9,22%
ROIC – WACC 0.66% 3.39% 2.42% 2,76%
Economic income 90.4 527.7 395.0 502,4
*Measured as opportunity cost of the period (not as a reference for valuation of investments).
2006 2007 2008 2009
27
Shareholders’ Equity and Dividends
� Proposal for 2009 Net Income:
• Dividends of R$ 931 million
• Dividends per share: R$1.50
• Dividend Yield*:
• Preferred Shares: 5.1%
Shareholders’ Equity 2009 2008
Capital 3.102 2.482
Capital Reserves 3.969 3.983
Income Reserves 3.177 2.860
Funds Earmarked for Capital Increase
27 27
Total Shareholders’ Equity 10.275 9.352
• Common Shares: 6.5%
• Shareholders’ Equity grew 10%
� Proposal of Capital Increase in R$310 million
� Stock Dividend of 10%
� Use of remaining cash flow to make acquisitions, according Long Term
Strategic Plan* Closing Price of March 23, 2009
28
Fourth quarter 2009Results
Brazil’s Best Electricity .
15.215
16.209
207
- 1.147
105 - 63
1.504
324 64
Consolidated sales volume – 4Q09
Electricity sold – GWh: Changes in 4Q09, by consumer category
+6.5%
4Q08 Residential Industrial Commercial Rural Wholesale CCEE Others 4Q09
� We closed 4Q09 with robust growth in volume of electricity sold
� Our rapid and efficient response to the world economic crisis improved margins
and expanded our sales
�Wholesale growth: mainly sales to distributors in Adjustment Auction
�Cemig successfully re-sold excess energy not used by Free Clients
� Fall in industrial sales was due to the economic recession
30
Cemig GT: sales volume - 4Q09Electricity sold, by market, GWhElectricity sold, GWh: Changes by consumer type, 4Q09
8.380 9.010
- 894 123
1.140 261
5.1594.138 4.009 4.019 4.258
3.036
3.0124.337 4.165 4.278
378
773
255 549474
7.51%
�Commercial strategy gives Cemig GT a year of record sales: 9,010 GWh
� Cemig turned the crisis into an opportunity to increase market share, and
improve trading relationships with clients
31
4T08 Free Clients Free Market
Wholesale
Regulated CCEE (Spot) 4Q094T08 1T09 2T09 3T09 4T09
Free Clients Regulated CCEE
Volume sold, GWh: Lower in 4Q
Final consumer 4Q09 4Q08 Change, %
Residential 1,961 1.822 7,6
Industrial 1,246 1,504 (17.2)
Commercial 1,227 1,158 6,0
Rural 563 626 (10.1)
Others 743 714 4,1
Sales by category - GWh
Cemig D Sales - 4Q09
-1.4%
5.8245.740
Others 743 714 4,1
Total 5,740 5,824 (1.4)
Percentages by category, 4Q09� Significant growth in residential and
commercial categories kept size of total
market stable
� Fall in industrial consumption, adjusted for
migration to free market, was 4.7%
� Overall growth continues: 1.31% in 4Q09 (from
previous quarter, 3Q09).
32
4Q08 4Q09
2.755 3.370
349 - 18 381
71 - 22 - 5 - 141
Consolidated net revenue, 4Q09
Changes in consolidated net revenue – from 4Q08 to 4Q09, R$ million
+22%
� Sales to final consumer reflect consolidation of economic recovery
� Increase in wholesale arises from long-term contracts and sales of 2 contracts
in the Adjustment Auction
33
9481.150
163-14 -16 8 18 29 14
EBITDA by company
Changes in EBITDA by company: 4Q08-4Q09
21%
4Q08 Cemig GT Cemig D Light Gasmig TBE TAESA Others 4Q09
� Portfolio of businesses ensured exceptional EBITIDA growth in the 4Q09
34
54%27%
8%1% 4% 3% 3%
EBITDA by company - 4Q09
Cemig D Cemig GT Light Gasmig TBE TAESA Others
EBITDA margin %
Consolidated EBITDA and EBITIDA margin
Cemig: Quarterly consolidated EBITDA
948 1.035 1.072 1.150 1.065
34 33 35 36 34 35
-4000,00%
-2000,00%
0,00%
2000,00%
4000,00%
600
800
1000
1200
1400
�Cash flow improved every quarter in the year
� Final result exceeded market forecast
35
948780
1.035 1.072 1.150 1.065
-10000,00%
-8000,00%
-6000,00%
0
200
400
4Q08 1Q09 2Q09 3Q09 4Q09 Market
forecast(*)
(*) Refers to the expectations of analysts regarding the results of Cemig
246
434
97
16 -8 -1 13 1258
Net income by company
76%
Changes in Net income by company, 4Q08-4Q09
4Q08 Cemig GT Cemig D Light Gasmig TBE TAESA Others 4Q09
� Growth in Cemig D’s Net income reflects lower expense on profit sharing with employees
� Increase in Cemig GT’s contribution reflects trading strategy
� Transmission sector, immune to the economic crisis, shows stable results
36
13%
69%
6% 3% 6% 3%
Net income by company, 4Q09
Cemig D Cemig GT Light Gasmig TBE TAESA
Net margin, %
Consolidated Net income
Quarterly consolidated net income, R$ mn
524 567434 452
9 10 14 18 13 15
-4000,00%
-2000,00%
0,00%
2000,00%
300
400
500
600
� Net income in line with market forecast
37
246336
434 452
-10000,00%
-8000,00%
-6000,00%
0
100
200
4T08 1T09 2T09 3T09 4T09 Market
forecast(*)
(*) Refers to the expectations of analysts regarding the results of Cemig
2009 results
Brazil’s Best Electricity .
59.76260.909
733
- 4.043
311 - 87
2.823
1.330 80
Consolidated sales volume – 2009
Electricity sold, GWh: Changes, by type, IN 2009
1.9%
2008 Residential Industrial Commercial Rural wholesale CCEE (spot) Others 2009
� We continued to expand total sales volume in spite of the economic crisis
� Industrial consumption was hit strongly by recession
� - but commercial strategy enabled us to overcome the fall in industrial sales by
redirecting to the Regulated Market: >> better prices
� Wholesale figure reflects long-term contracts (“Botox” electricity) and sales in the
Adjustment Auction (Regulated Market)
39
Cemig GT: Sales volume
Electricity sold, by market, GWhElectricity sold, GWh: Changes by category, 2009
4.4%
32,817 34,268
- 3.131
- 997
4.728
851
17.859 18.263 19.55416.425
11.70813.550 12.082 15.812
1.400 1.294 1.174 2.031
�New sales volume record for Cemig GT
� Sales in Adjustment Auction mitigated reduction of demand from free clients
� Excess available was sold to distributors in short-term contracts for better prices: R$145/MWh
� Lower proportion of free clients as percentage of total sales is temporary,and it will
begin to return to normal levels in 2010
40
2008 Flee Clients Free market
wholesales
Regulated CCEE (spot) 2009
2006 2007 2008 2009
Free Clients Regulated CCEE
Electricity sold, GWh: Growth in 2009
Final consumers 2009 2008 Change, %
Residential7,774 7,164 8,5
Industrial4,826 5,563 -13.2
Commercial4,642 4,391 5.7
Rural2,208 2,296 -3.8
Sales by category, GWh
Cemig D: sales by category in 2009
0.33%
22.332 22.259
2,208 2,296 -3.8
Others 2,283 2,845 1.3
Total 22,332 22,259 0.3
Percentage by category – 2009
� Market stable from 2008 to 2009
� Growth in residential and commercial consumption softened fall in industrial sector
� Fall in industrial consumption was due to reduction of demand, and migration of load to Free Market
� Adjusted by migration, growth is 1.9%
41
36%
22%
21%
10%11%
RESIDENTIAL
INDUSTRIAL
COMMERCIAL
RURAL
OTHER
2008 2009
2009 2008 Change, %Net revenue (a) 6,384 6,146 3.88%
Non-controllable expenses (b) 3,599 2,875 25.18%
Purchase of energy 3,068 2,416 26.99%
Use of network 531 459 15.69%
Impact of Tariff Review on Cemig D
Net revenue of “Portion B” (a-b) 2,785 3,271 -14.86%.
In spite of growth in net revenue, “Portion B revenue” fell R$ 486 million
42
10.890
11.705351
- 201 613
- 296 78 44 - 71
- 139
Consolidated net revenue
Consolidated net revenue, 2008-2009: R$ million
+7.5%
� Solid increase in net revenue from 2008 to 2009
� Wholesale/CCEE sales compensated fall in end user consumers
� In spite of undergoing a tariff review, and the recession, the portfolio of businesses sustained the level of the Cemig Group’s revenues.
(*) Compensation of the tariff review adjustment that was accounted in the first quarter 200943
192
(115)
2
(66)
146
746
21 23
(100)
107
(62)
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Changes in consolidated expenses –breakdown, 2009 vs. 2008+12%
8.403
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� Increase in operational expenses due to non-controllable costs
• Higher purchase of electricity, due to increase in average tariff of electricity bought for resale
• Voluntary Retirement Plan impacted personnel expenses
• Increase in expenses on outsourced services, in particular the call center, and maintenance of electricity
systems and equipment – due to strong rains in the concession area
44
7.5068.403
2008 2009
Ebitda by company
EBITDA by company, 2008- 2009
-1.5%
4.099 4.039
478 -660
-33 0 49 29 77
� Portfolio of businesses ensures stability
� Profit of Cemig GT arises from trading strategy
� Profit of Cemig D mainly hit by Tariff Review
45
2008 Cemig GT Cemig D Light Gasmig TBE TAESA Others 2009
4.099 4.039
34%
52%
4%1% 3% 6%
EBITDA by company, 2009
Cemig D Cemig GT RME Gasmig TBE Others
EBITDA margin, %
Consolidated EBITDA and EBITDA margin
Consolidated EBITDA
40 38 35 36
-5000,00%
0,00%
4
4
4
�EBITDA stable from pre-crisis period
� EBITDA in line with market forecast
46
4,062 4,099 4,0393,945
-30000,00%
-25000,00%
-20000,00%
-15000,00%
-10000,00%
3
3
3
4
2007 2008 2009 Market Forecast(*)
(*) Refers to the expectations of analysts regarding the results of Cemig
1.887 1.861
323 - 371 - 51 - 5 43 12 23
Net income by company
Net income by company, 2008-2009
-1.4%
2008 Cemig GT Cemig D Light Gasmig TBE TAESA Others 2009
� Net income impacted by Tariff Review of Cemig D
� Result of Cemig GT arises from our commercial strategy
� Transmission sector immune to market oscillations
47
18%
71%
4% 2% 4% 1%
Net income by company, 2009
Cemig D Cemig GT Light Gasmig TBE TAESA
Net margin, %
Consolidated Net income
Consolidated Net income
1.7431.887 1.861 1.879
17 17 18 18
-4000,00%
-2000,00%
0,00%
2000,00%
1400
1500
1600
1700
1800
1900
2000
� Result boosted by growth in all operations
� Commercial strategy and balanced portfolio of businesses return
net margin of 18%
� Net income in line with market expectations48
1.743
-10000,00%
-8000,00%
-6000,00%
1000
1100
1200
1300
2007 2008 2009 Market forecast(*)
(*) Refers to the expectations of analysts regarding the results of Cemig
Strong cash position sustains investments
Cash Flow Statement (Consolidated)
2009 2008
Cash at start of period 2.284 2.066
Cash from operations 3.505 2.967
Net income 1.861 1.887
Depreciation and amortization 736 715
Suppliers 5 -68
Deferred Tariff Adjustment 133 412
49
Deferred Tariff Adjustment 133 412
Regulatory Asset - Transmission Tariff Review -119 -
Other adjustments 889 21
Financing activity 2.248 -1.396
Financing obtained and capital increases 4.311 361
Payment of loans and financing -1.015 -893
Interest on Own Capital and Dividends -937 -864
Reduction on minority shareholders’ participation -111 -
Investment activity -3.611 -1.353
Investments -529 -90
Property, Plant and Equipment /Intangible -3.082 -1.263
Cash at start of period 4.426 2.284
Position in february, 5, 2010
Companies and Consortia OF Cemig Group CIA. ENERGÉTICA
DE MINAS GERAIS
Usina TérmicaIpatinga S.A.
100%
CEMIG PCH S.A.100%
Horizontes Energia S.A.
100%
Sá Carvalho S.A.100%
Rosal Energia S.A.100%
Usina TermelétricaBarreiro S.A.
100%
Cia. Translestede Transmissão
25%
Empresa Catarinensede Transmissãode Energia S.A.
13,37%
Empresa Regional
Cia. Transirapéde Transmissão
24,50%
Cia. de TransmissãoCentroeste de Minas
51%
Cia. Transudestede Transmissão
24%
Transchile CharrúaTransmisión S.A.
49%
CEMIG Geração e Transmissão S.A.
100%
HidrelétricaCachoeirão S.A
49%
ConsórcioAHE Funil
49%
Consórcio daUsina Hidrelétrica
de Igarapava14,50%
Consórcio AHE Porto Estrela
33,33%
ConsórcioAHE Queimado
82,50%
Consórcio daUsina Hidrelétrica de
Aimorés 49%
Guanhães Energia S.A.
49%
Light S.A.
13,03%
CEMIGDistribuição S.A .
100%
Madeira Energia S.A.
10%
Light Energia S.A.
100%
Instituto Light
Light EscoPrest. Serviços
Ltda.100%
Lightger Ltda.
100%
ItaocaraEnergia Ltda.
100%
Lighthidro Ltda.
100%
Cia. de Gás deMinas Gerais
55,20%
Centro de GestãoEstratégica de
Tecnologia100%
CEMIG TelecomunicaçõesS.A.
99,99%
Efficientia S.A.100%
CEMIG Trading S.A.100%
Axxiom Soluções Tecnológicas S.A.
49%
Hidrelétrica Pipoca S.A.49%
Santo AntônioEnergia S.A.
100%
EBL Companhia de Eficiência
Energética S.A.33%
ConsórcioUHE ItaocaraCEMIG GT:49%
Itaocara Energia: 51%
ConsórcioPCH Paracambi
CEMIG GT:49% Lightger: 51%
ConsórcioPCH LajesCEMIG GT:49%
Light Energia: 51%
Central Termelétrica
Empresa Brasileirade Transmissãode Energia S.A. 49%
CV = Voting Shares CT= Total Capital
59 Companies
10 Consortia
ConsórcioCapim Branco
Energia21,05%
CEMIG Capim BrancoEnergia S.A.
100%
Empresa Regionalde Transmissãode Energia S.A.
36,69%
Empresa Paraensede Transmissãode Energia S.A.
CV: 49,98% CT: 40,62%
Empresa Nortede Transmissãode Energia S.A.
36,69%
Empresa Amazonensede Transmissãode Energia S.A.
CV: 49,98% CT: 36,35%
Baguari Energia S.A.69,39%
Consórcio UHE Baguari
49%
Light Serviçosde Eletricidade
S.A.100%
Instituto Lightde Desenvolvim.Social e Urbano
100%
CEMIG Serviços S.A.
100%
CEMIG Baguari Energia S.A.
100%
STC - Sistema de Transmissão
Catarinense S.A.80%
LUMITRANS Companhia Transmissora de Energia Elétrica
80%
Central Termelétrica de Cogeração S.A.
100%
Central HidrelétricaPai Joaquim S.A.
100%
Empresa Santos Dumontde Energia S.A.
100%
Transmissora Aliança de Energia Elétrica S.A.
CV: 41,78% CT: 32,27%
ETAU - Empresa de Transmissão do
Alto Uruguai S.A. 52,58%
TSN - Transmissora Sudeste Nordeste S.A.
100%
Novatrans Energia S.A.100%
Brasnorte Trasmissorade Energia S.A.
38,67%
ETEO - Empresa deTransmissão de Energia
do Oeste Ltda 100%
Central Eólica Praiasdo Parajuru S.A.
49%
Central Eólica Praiado Morgado S.A.
49%
Central Eólica Volta do Rio S.A.
49%
Transmission
Distribution
Power Generation
Wind Farms
Generation Consortia
Financial Operation
Non - Profit
Gas Distribution
Telecomunication
Comercialization
Holding
Services
Legenda
Terna Serviços Ltda100%
50
Cemig : a global investment option....
� Total assets: R$ 29 billion
� Shareholders’ equity: R$ 10 billion
� Total sales: R$ 17 billion
� Consolidated net sales : R$ 12 billion
� Market value: R$ 17 billion
� Operation in the greater part of Brazil
� Initial investments outside Brazil are a reality
51
Brunei
China
Singapore
South Korea
Japan
Malaysia
Asia North America
Canada
United States
Central America
Bermudas
Bahamas
Europe
Luxemburg
UK
Spain
Switzerland
Ireland
Guernsey
Jersey
Romania
Holland
France
Norway
Denmark
Italy
Sweden
Germany
Belgium
Austria
Portugal
Poland
...With stockholders in more than 40 countries
Australia
Oceania
South America
Argentina
Bolivia
Brazil
Chile
Uruguay
Bahamas
Cayman Islands
Turks and Caicos Islands
Virgin Islands
Middle East
Saudi Arabia
UAE
Kuwait
Lebanon
Oman
Syria
Average daily trading in 2009
Bovespa: R$ 48 million
NYSE: US$ 27 million
• Shares traded on 3 stock exchanges
• >117,000 Shareholders
52
Capital markets and Investor relations
� Stock performance
0%
50%
100%
150%
200%
250%
300%
350%
400%
450%
� Investor relations in 2009
� More than 600 one-on-one meetings
� 8 roadshows
� 5 congresses
� 43 seminars, conferences and special events
-100%
-50%
dez-
03
jun-
04
dez-
04
jun-
05
dez-
05
jun-
06
dez-
06
jun-
07
dez-
07
jun-
08
dez-
08
jun-
09
dez-
09
CMIG3 CMIG4 IBOV
53
Next important events
IBRI / Abrasca Brazilian Conference:
ICGN Annual
Conference,
Toronto
Conference, South
Beach-Miami
IBGC Technical
Tour: London
and Paris
05
Conference:
London, NY, Boston
IBRI / Abrasca Brazilian
National IR Meeting,
São Paulo
Conference,
Tokyo
Road Show:
Tokyo, Beijing,
Singapore
Conference, São Paulo
Conference, São Paulo
New York
15th Annual
Cemig-Apimec Conference,
Belo Horizonte, Brazil
NIRI Annual
Conference,
San Diego, USA
Conference:
London
Conference,
London
54
PB
AM PA MA
RRAP
PI
CE RN
PE
Long-term target is 20% market share in the
various segments of the electricity market
We expand our national leadership
ACRO
PIPE
AL
SEBA
TO
MT
GODF
MS
SP
PR
SC
RS
ES
RJ
MG
Transmission
Cemig Free Client
Generation
Generation under construction
Purchase of electricity
Gas distribution
Transmission under construction
Wind power generation under construction
Distribution
55
Vision: To be, in 2020, one of Brazil’s
two largest energy groups by market
value, with a significant presence in the
Cemig in the future
value, with a significant presence in the
Americas and world leader of the sector
in sustainability.
56
2009 results
�2009: a milestone in Cemig’s history
�Better results in spite of world economic crisis
�Crisis was an opportunity to add more value for Shareholders:
� Acquisitions� Acquisitions
• Largest acquisition ever made in Brazil’s electricity sector
• Total invested in acquisitions: more than R$ 3.6 billion
� Increase in market share through re-allocation of electricity sales
• Commercial strategy and speed of decision making were essential
elements in this success
57
Investor Relations
Tel: (55-31) 3506-5024Tel: (55-31) 3506-5024
Fax: (55-31) 3506-5025
Attachments
59
Adjustments for non-recurring items
IMPACT OF NON-RECURRING ITEMS 2009 2008
EBITDA 4,039 4,099
Non-recurring adjustments ( * )+ Employee retirement program 206 50- Tariff review of Cemig D – Net revenue 214 -63+ Tariff review of Cemig D – operational expenses -21 4
+ Revenue of Transmission – Technical Note 214/2009 -158 -+ Revenue of Transmission – Technical Note 214/2009 -158 -Adjusted EBITDA 4,280 4,090
Net income 1,861 1,887
Non-recurring adjustments ( * )RME Financial Compensation - -55RME PIS COFINS Provision Reversion - -71+ Employee retirement program 136 33- Tariff review of Cemig D – Net revenue 141 -42+ Tariff review of Cemig D – operational expenses -14 3+ Revenue of Transmission – Technical Note 214/2009 -104 -
Adjusted Net income 2,020 1,755
( * ) The non-recurring adjustments correspond to the compan y’s interpretation on events which it deems to be extraordin ary, not related to current operations. 60
Recognition by the market
� Sustainability
� Chosen as Leader in the worldwide Utilities sector by the Dow Jones Sustainability Index
o Included in the Index 10 years running – since its creation
� Classification as leader in sustainability by OEKOM
o OECOM is one of the world’s leading sustainability ratings agencies
o Institutions that use OECOM criteria currently represent €90 billion
� Cemig Telecom (new name of Infovias)� Cemig Telecom (new name of Infovias)
� Two 2009 Telecom Annual awards:
o 2008 Company of the Year awards: best network infrastructure company.
o One of Brazil’s 10 most profitable Telecom companies IN 2008
� 36th Apimec Awards
� Best Listed Company: 2 categories: Efficiency in relationship with investors; speed in sending information
� Best Investor Relations Professional
� ABRACONEE Award
� Listed company with best financial statements in the electricity sector
61
Aneel : The Brazilian electricity sector regulator. An independent federal regulatory agency.
BRGAAP: Accounting Principles Generally Accepted in Brazil.
CCC: The Fossil Fuel Consumption Account: The CCC was created to generate financial reserves to cover the increase in costs associated with greater use of thermal generating plants, in the event of drought – since the marginal operational costs of the thermal plants are higher than those of hydroelectric plants. Each energy company is obliged to make an annual contribution to the CCC. The annual contributions are calculated based on the estimates of the cost of fuel consumption by the thermal plants necessary in the subsequent year.
CCEE: Electricity Trading Chamber: Facility for trading of electricity in the national grid system.
CDE: Energy Development Account: This is a source of subsidy created to make alternative sources of energy (e.g. wind energy, biomass) competitive, and to promote the “universalization” of electricity services – their extension to every citizen and location. It is funded from annual payments made by the concession holders for the use of public assets, and penalty payments imposed by Aneel. The CDE willremain in effect for a period of 25 years and will be administered by Eletrobrás.
Glossary
Dividend payout: Percentage of Net incomedistributed as dividends.
Dividend Yield: Stockholder’s annual return from dividends and Interest on Equity as a percentage of the share price.
Ebitda or EBITDA: Net incomeBefore Interest, Tax, Depreciation and Amortization. An expression of operational cash flow, and provides a view of how much a company is generating in cash from its principal business.
Ebitda Margin: Ebitda / Net operational revenue. A measure of Operational cash flow as a percentage of Operational revenue. Shows the percentage of revenue that is transformed into cash after the operation, giving an idea of the basic profitability of the business.
FIDC: (Receivables Fund) – Investment fund consisting of realizable credit rights.
Free Market (“ACL” – Ambiente de Contratação Livre, or “Free Contracting Environment”): Where sales and purchases are made between Free Consumers, Traders and Generators, through freely negotiated bilateral contracts.
GSF: Generating Scaling Factor: Factor used to determine Allocated Energy of each generator participating in the National Grid. Calculated on parameters including the availability of generation and the size of the existing market.
Hedge: A mechanism by which holders of asset or liability positions protect themselves from market price fluctuations, e.g., commodities or FX.
Market value (Market capitalization): Product of multiplying number of shares by share price.
P/E: Price/ earnings: Ratio of stock price to annual profit.
PLD: (Differences Settlement Price) Spot price.
Regulated market (“ACR – Ambiente de Contratação Regulado”): Where purchase and sale contracts are made involving the Distributors, through public auctions.
62
GlossárioRTD: The “Deferred Tariff Adjustment”: Aneel decided the results of the periodic Tariff Review of Cemig D which covers the repositioning of
electricity retail supply tariffs at a level compatible with the preservation of the economic-financial equilibrium of the concession contract, providing sufficient revenue to cover efficient operational costs and adequately remunerate investments. The average adjustment applied to Cemig’s tariffs on April 8, 2003, provisionally, was 31.53%, but the final tariff repositioning for Cemig was 44.41%. The percentage difference of 12.88% was compensated through an increase in each of the tariff adjustments planned to occur in 2004 and 2007, cumulatively. The difference between the tariff repositioning to which Cemig D was entitled and the tariff actually charged to consumers was recognized as a Regulatory Asset.
RTE: The “Extraordinary Tariff Recomposition”: This is a tariff adjustment granted in December 2001 to the distributors and generators of the regions that were under rationing. It is settled in the General Agreement for the Electricity Sector, and resulted in an increase of 2.9% in the tariffs of residential consumers (with the exception of low-income consumers) and rural consumers, and 7.9% for the other consumers. The objective of the adjustment was to restore the losses that distributors and generators of electricity had suffered from the reduction of consumption imposed by the government. The duration of the adjustment varies in accordance with the time necessary for the recovery of the losses of each concession holder.
RGR: Global Reversion Reserve: This is an annual quota paid by concession holders, to generate funds for expansion and improvement of public electricity services. The amounts are paid monthly to Eletrobrás, which is responsible for administration of the funds, and will be employed, among other uses, in the Procel program.
SAIDI: System Average Interruption Duration Index: The average time of outage of the Distribution system, over a given period, suffered by each consumer unit in a given group.
SAIFI: System Average Interruption Frequency Index: The average number of outages in Distribution per consumption unit in a given group in the period referred to.
Total return to the stockholder: Sum of dividends (incl. Interest on Equity) and appreciation in the share price, as a percentage of share price.
TUSD: Tariff for Use of the Distribution Systems: This is paid by generation companies and by Free Consumers for the use of the distribution system of the distribution concession holder to which the respective generator or consumer is connected, and is revised annually in accordance with the inflation index and the investments made by the distributors in the previous year to maintain and expand the network. The amount to be paid by the user who is linked to the distribution system is calculated by multiplication of the amount of energy contracted with the distribution concession holder for each connection point, in kW, on the basis of the tariff in R$/kW which is set by Aneel.
UHE: Hydroelectric power plant: (“Usina Hidrelétrica”) – Plant using mechanical energy of water to turn rotors and generate electricity.
UTE: Thermal generation plant: (“Usina Térm(o)Elétrica”) – Plant in which chemical energy in fossil fuels is converted into electricity.
WACC: Weighted average cost of capital.
63