AES Gener March 2016 Gener... · 2016-06-07 · Disco Bid 2015-2 Award Proponent Parent Company Energy (GW/year) Price per Energy block Existing Energy (GWh/year) Energy from Projects

AES GenerMarch 2016

AES GenerKey investment considerations

Coal Hydro Natural Gas Diesel Biomass

Leading position: Largest energy producer in Chile, and major producer in Colombia, with one of the most efficient plants in Argentina

Diversification: One of the most diversified LatAm generator player in terms of geographical footprint and technology

Reliable Growth: Secured future growth through fully-financed pipeline and world-class contractors

Stable cash flows: Largely contracted US dollar-denominated revenue streams with built in fuel and inflation protection

Strong capital structure: A successful financing history committed to investment grade rating

Highlights Asset map

1

2

3

4

5

Bogota

Antofagasta

Santiago

3 countries

22 operating plants

4 plants under construction

5 technologies

1 international transmission line

1

5,243 MW of installed capacity(1) US$3.8bn market capitalization(2)

1,083 MW of fully funded capacity under construction(3) US$1.3bn remaining capex of the U$4bln 2nd

expansion phase fully funded1)

100% of baseload energy in Chile sold under long-term PPAs US$691mm 2015 EBITDA

12.2 years of average remaining PPA life BBB-/Baa3 credit ratings (S&P, Fitch, Moody’s)

IntroductionKey statistics

Data as of December 31, 2015, unless otherwise note d

(1)(2)(3)

Includes Guacolda.As of February 24, 2016.152 MW Gucaolda V and 21 MW Andes Solar recently completed

2

21% 21%19%

10%

6%4% 4%

14%

EPM Emgesa Isagen Gecelca Celsia EPSA Others

Note: In GWh, data as of December 31, 2015.

Leading position

#1 generation player in Chile

Major player in Colombia

27% 26%

18%14% 15%

Endesa Colbun E-CL Others

3

1

Ratings System DataExpected Energy Sales

Growth (CAGR 2015-2025)Energy Sales

(GWh) Generation by

Fuel Type

S&P AA-

Moody’s Aa3

Fitch A+

Installed capacity 4,175 MW

Generation18,800 GWh


Generation52,899 GWh

45%50%

5%

HydroThermalOther

3%

97%

Renewable

Thermal

70%

30%

Regulated

Unregulated

Attractive markets with stableregulatory frameworks

SING

SIC

4.8%

4.1%

12%

88%

Regulated

Unregulated

Chile

Source:Note:

CNE, data as of December 2015.Excludes TermoAndes which today exclusively sells to Argentina. 4

1

Ratings System DataExpected Energy Sales

Growth (CAGR 2015-2025)Energy Sales

(GWh) Generation by

Fuel Type

S&P BBB

Moody’s Baa2

Fitch BBB


Generation 66,173 GWh

S&P B-

Moody’s Caa1

Fitch CCC


Generation 118,507 GWh

Attractive markets with stableregulatory frameworks (cont’d)

3.2%

3.5%

67%

33%

Regulated

Unregulated

47%

40%

13%

Large CustomersResidentialCommercial

30%

64%

6%

HydroThermalOther

68%

31%1%

HydroThermalOther

Colombia and Argentina

Colombia

Argentina

Source: XM, data as of December 2015 for Colombia and Private Consultants for Argentina.

5

1

SIC39%

SING22%

SIN36%

SADI3%

Contracted43%

Spot57%

Regulated34%

Unregulated60%

Spot6%

Diversified generation platform

EBITDA 2015 - By electric system Revenues 2015 - By customers

Installed capacity - By fuel type

Note: As of December 31, 2015.SIC: Sistema Interconectado Central.SING: Sistema Interconectado del Norte Grande.

Total Chile61%

US$ 691mm

Coal47%

Hydro24%

Natural gas20%

Diesel8%

Solar0.4%

Biomass0.2%

5,243 MW

Contracted78%

Spot22%

US$1.4bn

US$0.5bn

US$0.1bn

6

2

Reliable growthHistory of world-class development

(GW)

� US$3bn capital expenditure

� 1,664 MW of generation plus 32 MW of BESS

� Projects successfully completed

� US$4bn capital expenditure

� 1,256 MW

� Construction on time and budget

� Guacolda V completed

� Andes Solar in commissioning tests

� New business line: Desalinization

� Angamos completed

� Ventanas under development

2nd Phase Fully Funded

2007 – 2013 Phase I Expansion 2012 – 2018 Phase II Expansion (1)

2

3

4

5

6

7

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

7

Since 2007, we have constructed 1,664 MW of new cap acity in Chile…

Phase I: Successful and disciplined strategy

3,393

5,057

2007 2015

Installed Capacity (MW)

BESS Angamos IBESS Norgener2 2

� 12 MW

� Battery

� 20 MW

� Battery

Guacolda III Guacolda IV4 4

� 152 MW

� Coal

� 152 MW

� Coal

Angamos I & II1

� 545 MW (2 units)

� Coal

Los Vientos3

� 132 MW

� Diesel

Nuevas Ventanas Ventanas IV6 7Santa Lidia5

� 139 MW

� Diesel

� 272 MW

� Coal

� 272 MW

� Coal

1 2

4

36

7

5

Antofagasta

Santiago

Expansionary Projects Executed (~US$3bn)

...accounting for ~21% of the Chilean growth

21%

10% 10%7%

AES Gener Colbun EC-L Endesa

8

3

5,0725,224

5,797

152

573

531

Angamos Desal

2015 2016 2018/2019

Guacolda V (152 MW)Completed

Angamos Desalinization Completed

Fully funded plan

Environmental approvals and social awareness

Platform expansion with competitive advantage

Experienced team

Strong partners

Secure profitability

Investment grade rating

��

High growthPhase II: Secured fully-funded pipeline

Alto Maipo (531 MW)Progress: 24%

��

��

��

��

��

Development checklist US$4bn of fully funded projects under construction (1)

Solar-Andes (21 MW)In commissioning tests

Tunjita (20 MW)Progress: 98%

Cochrane (532 MW)Progress: 94%

��

9

3

Stable cash flowsLong term , proven and strong commercial strategy

660 624 671 691

2012 2013 2014 2015

EBITDA (US$mm)

28% 28% 29%32%

2012 2013 2014 2015

EBITDA Margin (%)

AES Gener strategy Predictable cash flows

Efficient GenerationLong Term Contracts

(up to 20 years)

Back-up Generation Spot Sales

Firm CapacityCapacity

Charge Revenue

~75% ofExpected Generation

Medium Term Contracts(1-4 years)

Remaining GenerationSpot and Frequency

Regulation Sales

Firm Energy(~3,000 GWh)

Reliability Charge Revenue

Contract EnergyEnergía Plus Contracts

(306MW)(1)

Sales to Spot Resolution 482

Note:(1)

Data as of December 31, 2015.Currently contracted 220MW.

� Exports to Argentina through 100% owned exclusive transmission line

10

4

-

5,000

10,000

15,000

20,000

25,000

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

GW

h-y

ea

r

AES Gener Contract level

� Long term contracted position with an average life of 12 years with a high qualityand diversified customer base

� No significant maturities until 2024

� Efficient portfolio fully aligned with our contracted capacity

Distribution33%

Mining59%

Industrial8%

AES Gener Contracts by Sector

ContractContractContractContractavg. life: avg. life: avg. life: avg. life: 12 years

Contract Strategy Chile

Long term, dollarized, indexed contracts

11

4

$167$225 $242

$317

$210

$230 $235$49 $66

$130

100% 100% 94%

2012 2013 2014 2015

Capex DividendsDebt Paydown Dividend Payout Ratio

$286 $449

$703 $860

$55

$33

$58

$98

2012 2013 2014.00 2015

Construction Maintenance Environmental

$355 $355 $377 $426

$245 $209 $263

$246

28% 28% 29%

32%

9%

14%

19%

24%

29%

34%

2012 2013 2014 2015

Title

$1,126 $1,298$1,520 $1,669

$1,156$1,487

$1,214

$1,706

2.8x3.3x 3.7x

4.5x

2012 2013 2014PF / Non Recourse Debt Corporate Debt Net Debt/EBITDA

Adjusted EBITDA & EBITDA margin

Strong financial performance and value creation

ArgentinaColombiaChile

(US$ mm)

$660 $624 $671 $691

Total debt and net debt / EBITDA

Total capex Capital allocation

$366

$477

$585

$443

2015

(US$ mm) (US$ mm)

(US$ mm)

$419

$1,002

$830

$532

(1)

(1) Capex net of project financing.

$2,282

$2,785 $2,734

$3,375

12

4

xxx

2016 2017 2018 2019 2020 2021 2022 2023 2024 25-73

69

139176

154

559

162172 173

1,768

136

2025+

97.9% denominated in US$ 88.5% at fixed interest rate

US$ Million

Recourse Debt

49%51%

Non Recourse

Debt

Total Outstanding as of December 31, 2015 US$3,507 M illion

Average Cost 5.3%

Average Life 14.5 years

Net Debt/EBITDA 4.5x (2.4x excluding non recourse debt)

Strong capital structurePrudent debt profile

13

4

� COMPANY 2015 EBITDA HIGHER THAN IN 2014� $20 million higher than last year

� Better results in Chile partially offset by lower energy margin in Colombia and Argentina

� LEADER IN GENERATION IN CHILE� Company contributed with 27% of country generation

� Operational excellence proven by high availability

� DIVERSIFIED AND LONG TERM CONTRACTED ASSET PORTFOLIO� Geographical, technological, customers base and fuel sources

� Dollarized Long Term PPAs aligned with efficient generation

� MOVING FORWARD WITH SECOND EXPANSION PHASE� Guacolda V and desalinization plant successfully completed in 2015

� Generator with more projects under construction in Chile

� Expansion plan fully funded

� World class partners: GIP, Mitsubishi, Antofagasta Minerals

� STRONG AND ENHANCED CAPITAL STRUCTURE� Investment grade rating

� Strong liquidity

� Extended debt maturity profile

Key TakeawaysGrowth under AES Corp control

14

Annex I: Next Bid with distribution companies

Source: Systep

-

2000.0

4000.0

6000.0

8000.0

10000.0

12000.0

14000.0

16000.0

18000.0

20000.0

0

20

40

60

80

100

120

140

EN

DE

SA

CO

LBU

N

AE

S G

EN

ER

GU

AC

OLD

A

CA

MP

AN

AR

IO

MO

NT

E R

ED

ON

DO

DIE

GO

DE

ALM

AG

RO

PU

YE

HU

E

PA

NG

UIP

ULL

I

PU

NT

ILLA

E-C

L SI

NG

Vo

lum

e (

GW

h)

Vo

lum

e (

GW

h)

Vo

lum

e (

GW

h)

Vo

lum

e (

GW

h)

Pri

ce (

US$

/MW

h)

Pri

ce (

US$

/MW

h)

Pri

ce (

US$

/MW

h)

Pri

ce (

US$

/MW

h)

Distros prices & VolumeDistros prices & VolumeDistros prices & VolumeDistros prices & Volume

Price (US$/MWh) Energy (GWh-year)

Disco Bid 2015-2 Award

Contracts with Distribution Companies

16

Distribution Company Bids

Disco Bid 2015-2 Award

ProponentParent Company

Energy (GW/year)

Price per Energy block

Existing Energy

(GWh/year)

Energy from Projects

(GWh/year)In Operation Projects

Aela Generación S.A.Andes

Mainstream768 79.32 87 681

Cuel Eolic Park (33 MW)

Sarco (238 MW) and Alena (108 MW) eolic parks

Abengoa Abengoa 39 97.00 - 39Thermosolar CSP + PV (110 CSP + 100 PV)

Ibereólica Cabo Los Leones

Ibereolica 195 89.31 - 195Cabo Los Leones Wind Park I (170 MW)

SCB II SpA First Solar 88 67.64 88 -Luz del Norte Unit 1 (36 MW) and Unit 2 (38 MW)

Luz del Norte Units 3 & 4 (67 MW)

Amuche Solar Solar Pack 110 64.85 - 110

Los Libertadores Solar Park (16 MW)La Constitución Solar Park (48 MW)

1,200 79.34 175 1,025

17

Upcoming Bid

Schedule 2015-01

Tender Call May 29, 2015

Question & Answers December 30, 2015

Date of proposals April 20, 2016

Award May 10, 2016

Supply January 1, 2021 to December 31, 2041

Disco Bid Energy [GWh] 2021 2022 2023 2024 2025 2026 2027 2028 +

2015-01 (2021+20 years) BS1+BS2 6,600 6,600 6,600 6,600 6,600 6,600 6,600 6,600

2015-01 (2022+20 years) BS3 - 7,150 7,150 7,150 7,150 7,150 7,150 7,150

Total 6,600 13,750 13,750 13,750 13,750 13,750 13,750 13,750

Awarding Mechanism

• Levelized price of energy

• Fuel indexes: Annual Energy Outlook 2015 from EIA

• Indexed price present value @10%

Change of law

• Future: 2% variation of capital or operation cost of contract execution

Next Disco Bids

• The following Disco Bids are expected according to CNE projections:

• 3,000 since 2023+20 years (Tender call 2016)

• 8,000 since 2024+20 years (Tender call 2017) 18

Annex II: Angamos & Guacolda

Angamos

Revenues(US$ millions)

$38

$198 $225 $214 $238 $137

$133 $81 $83 $44

$174

$332 $308 $298 $284

2011 2012 2013 2014 2015

Contracted Spot Other

EBITDA and EBITDA Margin(US$ millions)

$ 72

$ 127$ 119

$ 112 $ 111

41.5% 38.4% 38.8% 39.9% 38.9%

0%

20%

40%

60%

80%

100%

0

50

100

150

2011 2012 2013 2014 2015

EBITDA EBITDA Margin

Credit MetricsCapital Expenditures

(US$ millions)

1%

12% 12%

7%

8%

11.0x

6.5x 6.4x

7.0x

7.1x

4.1x

3.0x 3.1x 3.0x2.5x

0

2

4

6

8

10

12

0%

2%

4%

6%

8%

10%

12%

14%

2011 2012 2013 2014 2015

CFO/Debt Debt/EBITDA EBITDA/Finance Expense

$112

$26

$5 $11 $11

2011 2012 2013 2014 2015

Summary of Historical Financials

20

4.6x

2.9x

5.1x

6.2x

3.7x

7.0x7.2x

3.9x

0

1

2

3

4

5

6

7

8

-

1.0

2.0

3.0

4.0

5.0

6.0

7.0

2012 2013 2014 2015

Net Debt / EBITDA EBITDA / Finance Expenses

$117

$165

$129 $122

19%

30%25%

28%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

-

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

180.0

2012 2013 2014 2015

EBITDA EBITDA margin

Guacolda

Summary of Historical Financials

Revenues(US$ millions)

EBITDA and EBITDA Margin(US$ millions)

Capital Expenditures(US$ millions)

Credit Metrics

$613 $554

$515

$438

2012 2013 2014 2015

$98 $125

$342

$115

2012 2013 2014 201521

Annex III: Major Assets

Diversified Asset Portfolio

� Guacolda Complex

− 5 Units

− 760 MW - Coal

− Located in Huasco (Northern part of the SIC)

− Start of operations: 1995/1996/2009/2010/2015

� Alfalfal I

− 178 MW – Hydro Run-of-River

− Located 50 km from Santiago

− Start of operations: 1991

� Other plants: 106 MW

− 93 MW – Other Hydro Run-of-River

− 13 MW - Biomass

� Ventanas Complex

− 4 Units

− 884 MW - Coal

− Located in Valparaíso Region

− Start of operations: 1964/1977/2010/2013

� Nueva Renca

− 379 MW – LNG / Diesel

− Located in Santiago


� Other plants: 437 MW

SIC coal – fired plants: 1,644 MW Back – up plants: 816 MW

Hydro run-of-river plants and renewables: 284 MW

23

� TermoAndes

− Combined Cycle (2 Gas Turbines and 1 Steam Turbine)

− 643 MW – Natural Gas

− Located in Salta, Argentina


Argentina: 643 MW

Battery storage (BESS) & Solar: 53 MW

� AES Chivor

− 8 Units

− 1,000 MW - Hydro

− Located in Boyacá, Colombia

− Start of operations: 1977/1981

Colombia: 1,000 MW

� Norgener

− 2 units

− 277 MW – Coal

− Located in Tocopilla


SING coal plants: 822 MW

Diversified Asset Portfolio

� Angamos

− 2 units

− 545 MW – Coal

− Located in Mejillones


24

� Battery Storage: 32 MW

− Norgener and Angamos


� Solar: 21 MW

− Adjacent to Andes Substation


Annex IV: Other Financialinformation

Wide access to capitalSuccessful financing for US$7bn growth

Confirmation of investment grade rating by 3 agenci es through a diversified financing strategy

Sources of Financing for the Expansions (1) Amount (US$ million)

Equity

Cash from Operations 710

Capital Increases 668

Partners 682

DebtBonds

International 300

Local 415

Banks Project Finance 4,225

(1) First and Second Phases: From 2007 – 2018.

26

27

Solid PerformanceSignificant value creation for shareholders

The largest total return to shareholders since 2010 (1)…

5.9%

4.5%5.2%

6.3%

2012 2013 2014 2015

AES Gener +93%

Colbún +40%

Endesa +27%

E-CL +40%

98%

50%41%

30%

Endesa Colbun EC-L

… and the highest payout ratio among peers (3)… with an attractive dividend yield (2)…

Source:(1)(2)(3)

Bloomberg as of February 24, 2015.In Chilean pesos, including dividends.LTM dividends paid / market capitalization end of period.Last 3 years average.

IPSA +2%

0

50

100

150

200

250

2010 2011 2012 2013 2014 2015 2016

Documents

AES Gener March 2016 Gener... · 2016-06-07 · Disco Bid 2015-2 Award Proponent Parent Company Energy (GW/year) Price per Energy block Existing Energy (GWh/year) Energy from Projects