corporate presentation dec

7/29/2019 Corporate Presentation Dec

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December, 2013


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Investment Thesis

1


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Investment Thesis

One of the largest private sector power generators in Brazil

ENEVA currently operates 2.3 GW (2.9 GW in 2014) in coal and gas-fired power pla

Integrated energy platform, with privileged access to natural resources

Only private power generator in Brazil with access to onshore gas

Short-term value triggers

- Reorganization of the companys structure and tackling of short-term debt challen

- Stronger role of E.ON, bringing technical expertise and cost discipline to ENEVA

Competitive greenfield portfolio

Licensed coal, gas and wind power generation projects


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A Brazilian thermal generator with asset exposure to energy fossil fuels (natural gas

ENEVA at a Glance

2.9 GW with inflation-protected, long-term PPAs

o 2.3 GW in operation

o 580 MW under construction

Long-term PPAs guarantee R$1.7 billion in annual inflation-adjusted

capacity payments

PPAs provide hedge against commodity price exposure

Integrated gas E&P assets supply up to 8.4 M m/day to ENEVAspower

plants

Competitive portfolio of licensed greenfield wind, coal and gas fired

capacity

Company Description

ENEVA ownership structure

Geographic Footp

Amapari EnergiaENEVA 51% / Eletronorte 49%

Diesel - 23 MW

ItaqENEVCoal

Natural GasExploratory

blocksContracted production

of 8.4 M m3/day

Free Float (38.2%)

37.9%23.9%

Other

MPX / E.ONPartipaes

Joint Venture

50%

50%

BNDES

10.3%

EikeBatista

Controlling Block

27.9%


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Company Overview

2


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2.9 GW with inflation-protected long-term PPAs developed since 2007

Company History

2007 2008 2009 ...

IPO raising US$1.1 bn

Contracts 1,080 MW inthe A-5 Auction

Acquisition of interest in 7onshore exploratoryblocks in the ParnabaBasin

Operational capacity rethe beginning of commItaqui, Parnaba I, PecIII TPPs

E.ON increased its stakof R$1.4 bn and joins c

Company name change

Contracts 365 MWin the A-5 Auction

Partnership with E.ON,including a R$1.0 bninvestment and thecreation of a JV

Acquisition ofgreenfield windprojects (Ventos)

Beginning ofcommercial operationsat Pecm I TPP ENEVAs first largescale power plant

20132012


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2.3 GW of coal and gas-fired power plants in operation

Operational Assets (1)

Pecm I

Energy Source: Coal

ENEVA Stake: 50%

Installed Capacity: 720 MW

Sold Energy: 615 MW

Fixed Revenue: R$600.3 Mp.a.

Start-up: May, 13

Energy Source: Coal

ENEVA Stake: 100%


Sold Energy: 315 MW


Start-up: Feb, 13

Itaqui

Note: 1) Fixed revenues are indexed to inf lation index IPCA (Database: Nov, 2013)

Energy

ENEVA

Instal

Sold E

Fixed

Start-


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2.3 GW of coal and gas-fired power plants in operation

Operational Assets (2)

Parnaba I (OCGT)

Energy Source: Natural Gas

ENEVA Stake: 70%


Sold Energy: 450 MW


Start-up: Apr, 13

Note: 1) Fixed revenues are indexed to inf lation index IPCA (Database: Nov, 2013)


ENEVA Stake: 70%


Sold Energy: 98 MW


Start-up: Oct, 13

Parnaba III (OCGT)


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Additional 580 MW under construction

Power Plants with COD in the next months

Note: 1) Fixed revenues are indexed to inflation index IPCA (Database: Nov, 2013)


ENEVA Stake: 70%


Sold Energy: 46 MW (Free

Market)


Start-up: 4Q13

Parnaba IV


ENEVA Stake: 100%


Sold Energy: 450 MW


Start-up: 1H14

Parnaba II (CCGT)


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All Parnaba gas-fired power plants are supplied by Parnaba Gs Natural

(Parnaba GN), owner and operator of 8 onshore exploration blocks

ENEVA has an interest of 33.3% in Parnaba Gs Natural

Declaration of commerciality with Development Plan for 3 gas fields: Gavio

Real, Gavio Branco and Gavio Azul

Gas supply agreements secured for 8.4 MM m/day

Highlights

Integrated Natural Gas E&P

Parnaba GN Ownership Structure

33.3%

Parnaba Gs Natural

66.6%

Blocks 1-7 Block 8

50%30%50%70%

Imetame, DELP,Orteng

PN-T-48 PN-T-49

PN-T-67

PN-T-84

PN-T-85

Geographic Fo

Strong competitive position in gas-fired generation


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35 wells drilled, of which 24 have gas indications

o 17 wells with discoveries

o 7 wells with gas indications

Declaration of commerciality with Development Plan for 3 gas fields:

o Gavio Real

o Gavio Azul

o Gavio Branco

Gavio Real field is producing since Jan, 2013:

o 13 producing wells out of 3 clusters

o Daily Production: 5.7MM m/day of natural gas

o Connected to a 6.6MM m/day GTU Gas Treatment Unit (as of

today)

o All gas dedicated to ENEVAsParnaba TPPs

Exploration Campaign

Integrated Natural Gas E&P

2014 / 2015:

o Connection of 3 additional production

8.4MMm/day

o Gavio Branco production developmen

assessment plan for new discoveries (Ma

Upcoming Events

Current capacity allows connection

generating unit of Parnaba II

Power PlantParnaba I and

Parnaba IIIParnaba IV

Parnaba II

Wells 13 16

Production Ramp-up (MM m/day)

5,76,6

Current 4Q13 (L


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Cambuhy/E.ON Investment in Parnaba Gs NaturalSecuring ENEVAs power plants gas supply

On October 30, ENEVA entered into a subscription agreement with Cambuhy Investimentos, E.ON and OGX, pursuant

o Parnaba Gs Naturalsshareholders envisaged a capital increase in the total amount of R$250MM

o Cambuhy and E.ON have agreed to subscribe for R$200MM and for R$50MM, respectively

Capital Increase will guarantee funds to cover Parnaba Gs Natural capex needs in 2014

E.ON E&P team will provide technical and operational expertise

Cambuhy also entered into share purchase agreements with the purpose to either:

o OGX: Buy for R$200MM the remaining stake of OGX; or

o ENEVA: Buy for R$200MM the eventually foreclosed shares of OGX by Parnaba Gs Naturalslending banks

All steps of the transaction are subject to approval by CADE, ANP and OGXsbankruptcy protection judge

18.2%

Parnaba Gs Natural

36.3%9.1% 36.4%

Controlling Block (63.7%)

After the capital increase After execution of the sale and purch

18.2%

Parnaba Gs Natural

9.1% 7

Controlling Block (100%)


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Short-Term Value Triggers

3


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Operational Performance (Itaqui)

-95,3

-31,3

-5,9

1Q13 2Q13 3Q13

Itaqui EBITDA (R$MM)

38%

65% 71%

1Q13 2Q13 3Q13

Itaqui Availability

Operations are gradually stabilizing with increased availability and reduced operating

EBITDA amounted -R$5.9MM, impacte

mostly attributable to:

o Unavailability charges (R$21.7MM)

o High fuel costs: Coal (R$55.6MM), dies

(R$3.9MM)

1Q13 2Q

Fuel Costs per Gross EnergyGenerated (R$/MWh)

166.5 124


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Operational Performance (Parnaba I)

-5,9

28,2

58,8

1Q13 2Q13 3Q13

Parnaba I EBITDA (R$MM)

96% 91% 96%

1Q13 2Q13 3Q13

Parnaba I Availability

Full capacity and stable operations reflect on strong EBITDA

EBITDA amounted to R$58.8MM (E

reflecting full operations of all four gene


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Significant improvement throughout 2013

-143,4

-63,8

40,1

1Q13 2Q13 3Q13

Operational Performance (Pecm I)

Pecm I EBITDA (R$MM)

Pecm I Availability

NOTE: 1) Figures consider 100% of Pecm I

1st quarter with positive EBITDA since

operations

Operating costs impacted by:

o Unavailability charges (R$27MM)

o High fuel costs: Coal (R$86.4MM), dies

(R$2.2MM)

1Q13 2Q

Fuel Costs per Gross EnergyGenerated (R$/MWh)

119.3 106

71%

40%

64%

1Q13 2Q13 3Q13


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Operational Performance of New Plants

Pecm II (MWavg) Parnaba III (MWavg)

COD granted on October 22COD granted on October 18

Pecm II

o Synchronized to the system on Oct 15 and was granted authorization for commercial operation on Oct 18

o Stable operations since then, resulting from actions carried out within the recovery plan designed for the coal plan

o Availability to mid-November >90%

Parnaba III

o Reached full capacity on the same day it synchronized to the system (Oct 14) and has been stable since then

364 365

294

Oct, 19

Oct, 25

Oct, 26

Nov, 1

Nov, 2

Nov, 9

166 164

Oct, 19

Oct, 25

Oct, 26

Nov, 1


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5,584

5,195

150

357

5,733

5,551

2Q13 3Q13

Net Debt Cash and Cash Equivalents

Refinancing of Holding DebtOngoing efforts for debt maturity lengthening

Consolidated Debt (R$MM)

Total Gross DebtR$5,551MM

Consolidated Gross Debt Profile (R$MM)

After positive first round discussions w

past months, now ENEVA initialized th

of HoldCo debt

2,52846%3,023

54%

Short Term Long Term

-7.0%(net debt)

November

S M T W T F S S

1 2 1

3 4 5 6 7 8 9 8

10 11 12 13 14 15 16 15

17 18 19 20 21 22 23 22

24 25 26 27 28 29 30 29

Banks approval process+ Documentation

Dm

ENEVAs Bankers Day

1,44257%

1,08643%

Hold Co. Project Related


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Regulatory IssuesMain ongoing discussions with Aneel

Ongoing

Solved

Variable Cost ICB & ICB ICB Online

Change in pass-through criteria for power purchased to fulfill contractual obligations. The reimbuthe current/online cost to the system (ICB Online).

Postponement of PPAs start datesInitial Date Modified Date

Itaqui Jan, 2012 Dec 21, 2012

Pecm I Jan, 2012 Jul 23, 2012

Pecm II Jan, 2012 Jun 1, 2013

Parnaba I Jan, 2013 Apr 1, 2013

ADOMP

ADOMP Criteria: Plant unavailability is measured on an hourly basis

ENEVA is challenging the ADOMP criteria on the basis that it goes against PPA conditions

Pecm II fixed revenue and Pecm II ICB reimbursement

Fixed revenue reimbursement request for Pecm II from the moment it was ready to operate

granted COD. Additionally ICB reimbursement request is still pending (R$15MM)


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Cost Reduction Program

ENEVA is currently working on a Medium Term Plan 2014-2016, to be approved by

Directors in the end of October, aimed at achieving significant cost reduction at holdin

level through:

Leaner organizational structure

Headcount reduction

Decrease in third-party services

Reduction of fixed costs at project level


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Brazilian Power Market and Greenfield Por

4

B ili E M t i


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Southeast Reservo

~70% of total storage ca

Source: ANEEL

Brazils Generation Capacity: 131 GW

Breakdown by source 2012

68.7%

9.9%

2.2%

1.6%1.6%

16.0%

Hydro Gas Coal Nuclear Wind Others

Brazil is highly dependent on hydro generation with increasingly faster depletion of re

Brazilian Energy Matrix

67%

76%

38%

46%

54%

62% 63% 64% 61%

5

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Jan Feb Mar Apr May Jun Jul A

Average 2007-2011 20

Dry Seas

El t i S t R li bilit


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Source: ONS

Autonomy = Storage Capacity / (Load Thermal Generation)

Economic growth will boost

leading to a supply defi

Water storage capacity has stagnated,

leading to decreased system autonomy

65.2

64.7

60

65

70

75

80

85

90

2013 2014 2015 2016 201

GWavg

2016-on: New generatio~8 GWavg required un

Electric System ReliabilityNew thermal plants are necessary to guarantee reliable power supply

0

5

10

15

20

25

30

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

ReservoirsAutonomy(Months)

2013

Current reservoirautonomy ~6 months

ENEVA G fi ld P tf li


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ParnabaComplex

Integrated to natural gas resources

Located in a tax-advantaged region

Ventos WindComplex

Located in one Brazilsbest wind resource areas

Attractive load factor

Just 30km from grid connection

Land ownership assured

Au(Coal + Gas)

Located at a port with a regasification terminal buildlicense

150km from Campos Basin natural gas accumulations

Environmental licensed to both coal and gas operations

Sul & Seival Integrated to the Seival Mine (proven reserves: 152 M ton)

Low operation costs

Power

supply-demand

unbalanced

Hydropower

concentrated

matrix

Spot prices at

historical highs

Demand for base-

load generation2 3 4 51

Sul727 MW

ParnabaComplex

2,166 MW

Se600

Solar 1 MW

ENEVAs Greenfield PortfolioAttractive licensed greenfield projects in various development stages


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Appendix | Images

5

Pecm I & II


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Pecm I & II

Itaqui


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Itaqui

Parnaba Complex


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Parnaba Complex

Natural Gas: Parnaba E&P


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Natural Gas: Parnaba E&P


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Disclaimer

The material that follows is a presentation of general background information about ENEVA S.A. and its subsidiaries (collectively, ENE

the date of the presentation. It is information in summary form and does not purport to be complete. No representation or warranty,

concerning, and no reliance should be placed on, the accuracy, fairness, or completeness of this information.

This presentation may contain certain forward-looking statements and information relating to ENEVA that reflect the current view

Company and its management with respect to its performance, business and future events. Forward looking statements include, with

that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words like may, p

expect, envisages, will likely result, or any other words or phrases of similar meaning. Such statements are subject to a numb

assumptions. We caution you that a number of important factors could cause actual results to differ materially from the plans, object

and intentions expressed in this presentation. In no event, neither the Company, any of its affiliates, directors, officers, agents o

placement agents shall be liable before any third party (including investors) for any investment or business decision made or ac

information and statements contained in this presentation or for any consequential, special or similar damages.

This presentation does not constitute an offer, or invitation, or solicitation of an offer, to subscribe for or purchase any securities.

Neither this presentation nor anything contained herein shall form the basis of any contract or commitment whatsoever.

Recipients of this presentation are not to construe the contents of this summary as legal, tax or investment advice and recipients shou

in this regard.

The market and competitive position data, including market forecasts, used throughout this presentation were obtained from intern

publicly available information and industry publications. Although we have no reason to believe that any of this information or these

material respect, we have not independently verified the competitive position, market share, market size, market growth or other dat

by industry or other publications. ENEVA, the placement agents and the underwriters do not make any representation as to the accurac

This presentation and its contents are proprietary information and may not be reproduced or otherwise disseminated in whole or i

written consent.


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Thank you.www.eneva.com.br

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