1Q13 Results

May, 2013

1Q13 Highlights

Decrease of 13% in SAIDI and 10% in SAIFI compared to 1Q12

10 1% t t l l i th l t 12 th d 0 3% d t th i d l tOperationalOperational

10.1% total losses in the last 12 months, down 0.3% compared to the same period last year

2.2% increase in energy consumption, totaling 11,401 GWh

Gross revenues of R$ 3,283 million, a 14% decrease compared to 1Q12FinancialFinancial Manageable PMSO down 3.4% compared to 1Q12, versus IGP-M 8.0% in the same period

Adjusted EBITDA of R$ 209 million, 35% higher than in 1Q12

Reported EBITDA totaled R$ 128 million, 60% lower than 1Q12

FinancialFinancial

Cash generation of R$ 385 million in 1Q13, 27% higher than in 1Q12

Completion of the renegotiation process of debt covenants to amend its limits for the 1Q13 and 2Q13 to 5.5xand 3.75x, respectively

S iS i 87 times reduction in the frequency rate of accidents involving contractors

Promoting safe access to the use of electricity, guiding more than 14,000 families to avoid accidents with thepower grid, seeking development and enhancement of communities

Efficient use of energy resources: through reduction of 4 668 MWh in energy demand from our customers

Socio-environmentalSocio-environmental

Efficient use of energy resources: through reduction of 4,668 MWh in energy demand from our customers

2

Regulatory events

20% average tariff reduction of AES Eletropaulo from January 24, 2013, due to the Energy Cost Reduction

ProgramLaw No. 12,783Law No. 12,783

Involuntary exposure to spot market of 4%, generated by the non-allocation of energy quotas due to non-renewal

of the concessions of some generators

CDE transfer of funds to distributors from January 2013 to neutralize exposure at the spot market, Decree No 7 945Decree No 7 945 y p p ,

hydrological risk and additional cost of thermal power plants

R$ 317 million was recorded in income as a reversal of expenses with Parcel A, with a receipt of R$ 134

million in April and R$ 148 million in May

Decree No. 7,945Decree No. 7,945

In 2012 the financial impact due to the thermal dispatch for thermal security system totaled R $ 118 million,

which will be credited to the Company in the tariff adjustment in July

Results should be released by the end of June and applied in the tariff adjustment in JulyAdministrative Administrative

.

Results should be released by the end of June and applied in the tariff adjustment in July

Shielded RAB: claim for reversal of the exclusion of R$ 728 million related to the amount of cables and R$ 533million related to accounts reclassification and adjustments in the number of equipments

Incremental Regulatory Asset Base: claim for inclusion of R$ 442 million related to smaller components and

appealsappeals

3

workforce capitalization

.

Consumption growth due to better performance at residential and total commercial class¹

Consumption evolution² (GWh)

11,156 11,401 +3.8% -2.7% -2.0% +0.3% +0.7% +9.7% +2.2%

4,106

1 3953,043

9,250

1 906

4,262

1 3572,981

9,309

2,0921,395 707 1,906 1,357 709

2,092

Residential Industrial Commercial Public Sector and Others

Captive Market Free Clientes Total Market

Consumption evolution with the free market allocated in the respective consumer classes (GWh)2

11,156 11,401

+3.8% -3.1% +5.2% -0.3% +2.2%

Consumption evolution with the free market allocated in the respective consumer classes (GWh)2

4,106 2,654 3,353

1 043

4,262 2,571

3,528

1 040

41 - Captive and free commercial clients 2 – Own consumption not considered

1,043 1,040

Residential Industrial Commercial Public Sectorand Others

Total Market

1Q12 1Q13

Best SAIDI since 2006 and better performance than the regulatory limits

SAIDI1 (YTD)SAIDI¹ (last 12 months)

than the regulatory limits

9%

-13%

8 67 8 49 -9%

10.60 10.36 9.57 8.29

9.32 8.68

8.67

8.67 8.49

3.36 3.06

8.35 9.57 8.29

Jan-Apr 12 Jan-Apr 13

SAIDI (hours) SAIDI Aneel Reference

2010 2011 2012 1Q12 1Q13

51 - System Average Interruption Duration IndexSources: ANEEL and AES Eletropaulo

SAIFI better than regulatory limits

SAIFI1 (YTD)SAIFI¹ (last 12 months)

7.39 6.93 6.87 6.87 6.64

10%-10%-5%

5.46 5.45 4.65 5.09 4.60

1.76 1.68

2010 2011 2012 1Q12 1Q13

SAIFI Aneel ReferenceSAIFI (times)

Jan-Apr 12 Jan-Apr 13

61 - System Average Interruption Frequency IndexSources: ANEEL and AES Eletropaulo

Losses level within the regulatory reference for the 3rd Cycle of Tariff Reset

Losses (last 12 months) Regulatory Reference² - Total Losses (last 12 months)

10.9 10.5 10.4 10.4 10.1

6.5 6.5 6.1 6.4 6.1

10.6 10 3 9 8

4.4 4.0 4.1 4.0 4.0

10.6 10.3 9.8 9.4

2010 2011 2012 1Q12 1Q13

Non Technical Losses Technical Losses¹

2011/2012 2012/2013 2013/2014 2014/2015

71 – In January 2012, the Company improved the assessment of the technical losses, making it more precise. 2 – Values estimated by the Company to make them comparable with the reference for non-technical losses of the low voltage market determined by the Aneel .

Investments focused on system expansion, maintenance and quality of client services

1Q13

R$ 145 million

Investments (R$ million) Investments (R$ million)

22

35

26

739

831

647 36

5

29

717 796

26

-21%53

311

9621

177 134

7 11

184 145

53

Client Service134

2011 2012 2013(e) 1Q12 1Q13

Own Resources Paid by the clients

Client ServiceSystem ExpansionLosses RecoveryOperational Reliability¹

81 – Maintenance capex is the investment s made for the grid modernizationand improvement in quality of service

ITPaid by the ClientsOthers

Gross revenues reflects the tariff reductionimpact due to the Law No. 12,783/2013

Gross Revenues (R$ million)

p

186

145

3,835

3,283

-14%

1,362 993

145 -27%

2,286 2,146 -6%

1Q12 1Q13

Net revenue ex-construction revenue

9

Deduction to Gross RevenueConstruction revenues

Recognition of a provision for the CDE transfer of funds represented a decrease of 17%

1,858

in Parcel AEnergy balance – expected to 2013 (GWh) Parcel A (R$ million)

-17%

217

11

11

,

1,541 BILAT. AES TIETÊ 25%

ITAIPU 22%

319Provision for the CDE

100 103 11

AUCTION (hydro) 31%

PROINFA 2%

AUCTION (th l) 15%

transfer of funds

1,428 Exposure 4%

AUCTION (thermal) 15%1.523

1Q13 excluding transfer funds from CDE

1Q13

R$ 317 million on the provision of transfer of funds fromCDE, being:

- R$ 100 million – exposure in the short term (R$ 29illi ) d h d l i l i k i i f th

Energy Supply Transmission Charges CFURH

10

million) and hydrological risks arising from theallocation of quotas (R$ 71 million)- R$ 217 million – thermal plants dispatch

Parcel A on the same level because of lower costs due to Law 12,783/2013 and the transfer of

Operating Costs and Expenses ¹ (R$ million) funds from CDE

+1%

1,957 1,986

421 444

1,535 1,541

1Q12 1Q13

Energy Supply and Transmission Charges

111 - Depreciation and other operating income and expenses are not included 2 - Personnel, Material and Services

PMS² and Others Expenses

PMSO manageable by the Company below the inflation over the period

PMS and other expenses (R$ million)

-3.4%(65) 88

421 444

( )

(60) (3) 1 (8) 69

356297 297 294 287 287 287

356

1Q12 FCesp Contingencies, ADA and

Write-Offs

1Q12Manageable

Personal Materials and

Third Party Services

Others 1Q13Manageable

Contingencies, ADA and

Write-Offs

FCesp 1Q13

12

EBITDA decrease primarily reflects the resetand adjustment of tariff on Parcel B

Ebitda (R$ million)

j

(194)

298 41 (23) 6298

104 122 122 128

6

1Q12 Market, review and adjustment in

Parcel B

Other revenues and expenses

PMSO¹ Parcel A 1Q13

131 – PMSO: Personnel, Materials, Third Part Services and Others.

Net income variation reflects tariff reset

Net Income (R$ million)

97

283

(121) (132)137(228)

69918

11

283

18(121) (132) (228)

(121)

(30)11

-1

(65)

1Q12 1Q13

14

Adjusted Net Income Tracking Account for the Parcel A itemsTariff review postponement effect

Higher cash generation due to reduced expenses in Parcel A and PMSO

Cash flow (R$ million)

expenses in Parcel A and PMSO

CASH FLOW - R$ Million 1Q12 1Q13CASH FLOW - R$ Million 1Q12 1Q13

INITIAL CASH 1,390 814

Operational Cash Generation 304 385

Investments (191) (213)

Net Financial Expenses (22) (5)

N A i i 591 (8) Net Amortization 591 (8)

Pension Fund Expenses (56) (55)

Income Tax (62) (7)

Di l f t 8 Disposal of assets - 8

FREE CASH 564 105 Dividends (9) (0)

15

FINAL CASH 1,946 919

Covenants: improvement in the indicators will be noticed from 2Q13

CovenantsDívida Líquida

Amendment of the covenants limits:5.5x Amendment of the covenants limits:

Net Debt / Adjusted EBITDA:

- 5.5x in 1Q13;

3 75 in 2Q13

1.1x

4.4x3.5x

- 3.75x in 2Q13;

- 3.5 x from 3Q13 onwards

- Adjusted Ebitda/Financial Expense >1.75x2.4

3.0

Improvement of indicators will be noticed from

2Q13 d h d f h i ff f

1Q12 1Q13

Net Debt (R$ billion)

Net Debt/Ebitda Adjusted¹

C t N t D bt/Ebitd Adj t d¹

1Q12 1Q13

Arerage cost (% CDI)2 112% 110%

Cost of debtCost of debt

2Q13 due to the end of the negative effect of

the provision of the negative effects of the

postponement of tariff reset in the adjusted

Covenants Net Debt/Ebitda Adjusted¹

16

Avarege term (years) 6.4 6.7

Effective rate 12.0% 11.7%

EBITDA in 1H12

The statements contained in this document with regard to theb i t j t d ti d fi i l lt

1Q13 Results

business prospects, projected operating and financial results,and growth potential are merely forecasts based on theexpectations of the Company’s Management in relation to itsfuture performance.Such estimates are highly dependent on market behavior andSuch estimates are highly dependent on market behavior andon the conditions affecting Brazil’s macroeconomicperformance as well as the electric sector and internationalmarket, and they are therefore subject to changes.