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INSTITUTIONAL PRESENTATION 3 Q 1 8 | R E S U L T S
ISA CTEEP and the Transmission Sector
Sustainable Value
Financial Highlights
ISA CTEEP
WHY TO INVEST AT
ISA CTEEP?
No demand risk and no default risk
Strong Cash Generation
Minimum payout of 75% (regulatory net
income)
Dividends
Reference Company for quality and O&M
Benchmark
Valuation Attractive valuation
Fitch: AAA(bra)
Investment Grade
Sustainable value
Profitability
Opportunities in brownfield projects, greenfield and M&A
Growth
51% IE Madeira
Revenue: BRL 497 million³
100% IENNE
Revenue: BRL 44 million
ISA CTEEP
Revenue: BRL 2.421 million
IE Serra do Japi 100%
Revenue: BRL 60 million
100% IE Pinheiros
Revenue: BRL 54 million
100% Evrecy
Revenue: BRL 7 million
100% IE Sul
Revenue: BRL 18 million
51% IE Garanhuns
Revenue: BRL 87 million³
100% IEMG
Revenue: BRL 18 million
Largest listed transmission utility in Brazil
Transmission of 24% of Brazil’s power generation
Transmission of 90% of the power load in the State of São Paulo
Benchmark player in cost and quality
18,600 km of transmission lines
126 substations
65,500 MVA of transformation capacity
IENS¹: 2.26 x 10-6
Availability Discount/Revenue: 0.68%
Regulatory Net Revenue²: BRL 2.8 billion
Regulatory EBITDA²: BRL 2.3 billion (margin of 84%)
Nota: ¹ Index of Non-Supplied Energy on 09/30/2018 ² Last 12 months ended on 09/30/2018 ³ Total revenue of the asset
100% IE Itaúnas
Revenue: BRL 47 million
100%² IE Biguaçú
Revenue: BRL 38 million
50% IE Paraguaçu
Revenue: BRL 107 million³
Largest listed transmission utility in Brazil
Sustainable growth
Nota: ¹ Average of last 5 revenue cycles ² ISA CTEEP’s investments in 10 projects acquired in 2016, 2017 and 2018 auctions ³ Total revenue of the project
Organic growth: capex of around
BRL 200 million/year and revenue
(RAP) of BRL 40 million/year¹
Greenfield Projects²: CapEx of BRL
2.9 billion and revenue (RAP) of
BRL 448 million/year
+2,000 km of transmission lines
+8,000 MVA of transformation
capacity
50% IE Aimorés
Revenue: BRL 71 million³
50% ERB I
Revenue: BRL 267 million³
100% IE Tibagi
Revenue: BRL 18 million
100% IE Itapura Lorena
Revenue: BRL 10 million
100% IE Itapura Bauru
100% IE Aguapeí
Revenue: BRL 11 million
100% IE Itaquerê
Revenue: BRL 46 million
Revenue: BRL 54 million
A successful story of growth, resilience and performance
1999 2013 2001 2012 2006 2007 2017 2016
‘000 km of transmission lines
Consolidated regulatory
EBITDA in BRL billion
0.1 0.7 1.4 1.6 0.2 0.7 1.4
11.5 12.3 15.4 17.7 18.6
Transmissão Paulista merger with EPTE
Origin from CESP spin off and creation of Transmissão Paulista
Set up of RBSE compensation
(Ordinance 120 Ministry of Mining
and Energy)
Winner bid for 3 lots in October
auction
Expansion to 17 Brazilian states through greenfield projects and acquisitions
ISA acquires CTEEP and
becomes the controlling
shareholder
Winner bid for 5 lots in April auction
Extension of Main Concession
Contract (059/2001) for 30 years
Winner bid for 2 lots in June auction
2018¹
18.6
2.3
Note: ¹ Last twelve months ending on September 30, 2018
Tickers: TRPL3¹ and TRPL4²
Corporate Governance: Level 1 at B3
Average daily volume in 3Q18: BRL 24 million
Market cap³: BRL 10.8 billion
Free Float: 77% of Brazilian investors 23% of foreign investors
ADR: “CTPTY” and “CTPZY”
Coverage of 15 institutions: 60% Buy 40% Hold
Common shares: 89.5% Preferred shares: 1.3%
ISA 35.8%
Common shares: 10.5% Preferred shares: 98.7%
Free Float 64.2%
Common shares: 9.8% Preferred shares: 51.9%
Eletrobras 35.4%
Common shares: 0.7% Preferred shares: 46.8%
Others 28.8%
Common shares: 64,484,433 Preferred shares: 100,236,393 Total: 164,720,826
CONTROLLED BY ISA FREE FLOAT OF 64%
ISA CTEEP
Notes: ¹ Common share l ² Preferred share l ³On 11/1/2018
Shareholder Structure on 09/30/2018
Notes: ¹ Considers 2017 IFRS Results adjusted by participation l ² On 11/01/2018 | ³ ALAS20 - Sustainability Leaders Agenda 2020
Central America
Transmission Telecom
Brazil 34% of net income Transmission Telecom
Bolivia Transmission Argentina
Telecom
Peru 21% of net income
Transmission Telecom
Ecuador Telecom
Colombia 25% of net income Transmission Telecom Highway concessions Real Time Systems
Chile 18% of net income
Transmission Telecom
Highway concessions
Transmission: 77.2%
The largest energy transmission company in Colombia and Peru, with 70% of capacity in each market
2nd largest player in Chile with 18% of market share
2nd largest player in Brazil with investments in ISA CTEEP and TAESA
Highway concessions: 22.0%
Real Time Systems: 0.7%
Telecom: 0.1%
ISA CTEEP represents 31% of ISA’s¹ net income
2017 Net Income Breakdown:
Benchmark player in the sector
44,200 km of transmission lines
87,100 MVA of transformation capacity
907 km of highways
Controlled by the Colombian government (51.4% of shares)
Market Cap: USD 4.3 billion²
Alas20 Award³ - Recognition in Corporate Governance
ISA INTERCONEXIÓN ELÉTRICA, S.A.E.S.P.
A multilatina company focused in transmission, telecom, highway concession and real time systems with growth opportunities in Brazil
Solid Presence in Latin America: 8 countries, 4 sectors, 40 companies
CORPORATE STRUCTURE
ISA CTEEP and its subsidiaries Assured Annual Revenue (RAP) 2018/2019 Cycle BRL 3.4 billion
Notes: ¹ RAP considers 100% of the project value. For projects under construction RAP of the bid | ² Auction ANEEL 02/2018
RAP ISA CTEEP
Cycle 2018/2019
(BRL million)
ISA CTEEP Operational São Paulo 2.421 2.421 ISA CTEEP 100% Fully consolidated
IE Madeira Operational Rondônia / SP 280 143 ISA CTEEP 51% / Furnas 24.5% / Chesf 24.5% Equity method
ERBI Under construction Paraná 267 134 ISA CTEEP 50% / TAESA 50% Equity method
Paraguaçu Under construction Bahia / MG 107 53 ISA CTEEP 50% / TAESA 50% Equity method
IE Garanhuns Operational Pernambuco 602 307 ISA CTEEP 51% / Chesf 49% Equity method
Aimorés Under construction Minas Gerais 71 36 ISA CTEEP 50% / TAESA 50% Equity method
IE Pinheiros Operational São Paulo 54 54 ISA CTEEP 100% Fully consolidated
IE Serra do Japi Operational São Paulo 60 60 ISA CTEEP 100% Fully consolidated
IE Aguapeí Under construction São Paulo 54 54 ISA CTEEP 100% Fully consolidated
Itaúnas Under construction Espírito Santo 47 47 ISA CTEEP 100% Fully consolidated
IE Itaquerê Under construction São Paulo 46 46 ISA CTEEP 100% Fully consolidated
IENNE Operational Tocantins 44 44 ISA CTEEP 100% Fully consolidated
IE Biguaçu² Operational Santa Catarina 38 38 ISA CTEEP 100% Fully consolidated
IE Tibagi Under construction SP / Paraná 18 18 ISA CTEEP 100% Fully consolidated
IE Sul Operational Rio Grande do Sul 315 158 ISA CTEEP 100% Fully consolidated
IEMG Operational Minas Gerais 18 18 ISA CTEEP 100% Fully consolidated
Evrecy Operational Espírito Santo 7 7 ISA CTEEP 100% Fully consolidated
IE Itapura - Bauru Under construction São Paulo 11 11 ISA CTEEP 100% Fully consolidated
IE Itapura - Lorena² Under construction São Paulo 10 10 ISA CTEEP 100% Fully consolidated
Total 4,471 3,659
Operational Status¹ Location
RAP Cycle
2018/2019¹
(BRL million)
Participation (%) Consolidation
Corporate Governance Structure
Remuneration Committee
Audit Committee
CFO and IRO COO
Institutional Relations Department
Rinaldo Pecchio Carlos Ribeiro Rafael Noda
Project Director
Weberson Abreu
Board of Auditors 8 effective members, of which 2 are independent and one is elected by the
employees
5 effective members
and 5 substitute members
Board of Directors
Reynaldo Passanezi Filho
CEO
Ethics and Transparency recognized at ISA and at ISA CTEEP levels 2018 Transparency Trophy from ANEFAC
CONNECTIONS THAT CREATE VALUE THROUGH
Forest projects that reduce the impact of greenhouse gases
Climate change mitigation
Conservation of biodiversity in jaguar’s habitat
JAGUAR CONNECTION: Carbon neutral until 2030
Barretos Cancer Hospital
GRAACC – Support group of teenagers and children with cancer
33rd Bienal of Art in São Paulo
SOCIAL RESPONSIBILITY:
ACTIONS
CONEXIONS THAT INSPIRE
C O N N E C T I O N S T O G E N E R A T E S U S T A I N A B L E V A L U E
Digitalization Real Estate Opportunities Energy Storage Distributed Energy Resources
Sustainable Value
Financial Highlights
ISA CTEEP and the Transmission Sector
ISA CTEEP
6
7
11
18
63
State Grid
Alupar
TAESA
ISA CTEEP
Eletrobras
2017 M a rk e t S h a re ( t hou s and km o f l i n e s )
T ra n s m is s io n R e v e n u e s ¹ ( 2017 /2018 c y c l e )
Total: BRL 37 billion
IS THE PURE TRANSMISSION COMPANY IN THE SECTOR IN BRAZIL
Transmission companies are remunerated by the availability of its assets
Notes: ¹ Considers auctions held until June of 2018 | ² Interconnected National System| ³ National Electric Energy Agency | 4 National Operator of the Electric System
SIN² is composed of 135 thousand km of transmission lines and serves 98% of the market
The transmission sector is regulated and monitored by ANEEL³ and coordinated and controlled by ONS4
Transmission companies are remunerated by the availability of its assets. There is no demand risk and no default risk.
38%
10% 8% 9%
31%
4%
Alupar Others Eletrobras ISA CTEEP State Grid TAESA
Source: ANEEL
Concessions prior to 1998
Concessions between 1999 and 2006
Concessions after 2008
Note: ¹ Regulatory Asset Base
THE COMPANY’S MAIN IS IN
Revenue (RAP) annually adjusted by IPCA
Contracts renewed in 2013 (Provisional Measure 579/2012)
Tariff Reset every 5 years (O&M, WACC and RAB¹)
RAP annually adjusted by IGP-M
RAP reduction in 50% on the 16th year of operation
No tariff reset
Reset of reinforcements and improvements, starting in July 2019 every 5 years
RAP annually adjusted by IPCA
30 year contract, with 3 tariff reset (cost of debt applied at WACC)
Reset of reinforcements and improvements every 5 years
RAP in operation: 72%
RAP in operation: 1%
RAP in operation: 13%
RAP under construction: 13%
DEMAND DOES NOT IMPACT TRANSCO’S REVENUE
Annual Costs of
Electric Assets
(CAAE)
O&M Revenue
(AOM)
Gross Investment x
%O&M
+ Gross Investment x
Depreciation Rate
Net Investment x
Regulatory WACC
Annual Allowed Revenue (RAP) Breakdown
PV
RBSE
(CAEE)
O&M
(AOM)
NI
(CAAE & AOM)
PA
PV
OTHERS¹
Note: ¹Other revenue considers bilateral and sharing contracts
Revenue (RAP) approved by ANEEL with periodic tariff reset (“PTR”)
RBSE receivables related to the non depreciated assets in operation in May/2000
O&M revenues related to the operation and maintenance services
New Investments (NI) organic growth with execution of authorized reinforcement and improvements
Variable Parcel (PV) revenue reduction due to unavailability
Adjustment Parcel (PA) compensates excess or deficit of revenues in the previews tariff cycle
ISA CTEEP
ISA CTEEP and the Transmission Sector
Financial Highlights
Sustainable Value
ISA CTEEP
STRATEGY BASED ON
Regulation
RBSE Receivables of ~BRL 9,200 million
Legal
Pension Fund Lawsuit receivables ~BRL 2,000 million
Growth
10 projects in execution with capex of ~BRL 2,900 million
Affiliates
EBITDA: BRL 400 million (87%margin)
Brownfield Projects
EBITDA: BRL 150 million (85% margin)
Operation and Maintenance
EBITDA: BRL 350 million (40% margin)
P E S S O A S
Regulação
Valor Justo
Jurídico
Gestão de Litígios
Crescimento
Disciplina de Capital
Integração
Subsidiárias
Projetos
Crescimento Orgânico
Operação e Manutenção
Eficiência, Qualidade, Segurança
SOLID & SUSTAINABLE RESULTS
Note: ¹ Regulatory results of the last 12 months ending on 09/30/2018
O&M Brownfield Projects
RBSE Receivables
100% JV
Adjusted Net Revenue
799 179 1,619 176 258 3,031
Adjusted EBITDA
347 156 1,619 151 228 2,501
LAST 12 MONTHS¹
(BRL million)
OPERATIONAL HOLDING SUBSIDIARIES Total
Focus in cost efficiency, service quality and operational safety to maximize results
0.0206%
0.0034%
0.0033%
0.0020%
0.0010%
0.0006%
88.51
14.05
12.64
6.7
3.83
1.86
1.44
0.4
0.26
0.11
0.1
0.093 ISA CTEEP
South
Southeast/ Midwest
SIN
Northeast
North
FREQ (times) Equivalent Frequency of Interruption
DREQ (minutes) Equivalent Duration of Interruption
ISA CTEEP
Southeast/ Midwest
South
SIN
Northeast
North
IENS (%) Index of Non Supplied Energy
ISA CTEEP
Southeast/ Midwest
South
SIN
Northeast
North
Focus in efficiency results in reduction of 41% of OPEX, excluding contingencies, going from BRL 915 million in 2006 to BRL 542 million in 20171
1
DREQ/FREQ indicators, in September/18, suggest that for every 23 years and 3 months, there would be 1 total shutdown of ISA CTEEP’s system of approximately 17 minutes
2
In the city of São Paulo, ISA CTEEP is
responsible for 3 minutes of every 16
hours of interruption
3
Note: ¹ Considers controlled and affiliates weighted by the Company’s share
2017 Numbers
Reinforcements and Improvements CapEx (BRL million)
Average: BRL 190 million/year
ORGANIC
FROM REINFORCEMENTS & IMPROVEMENTS
Opportunity for organic growth (transmission capacity increase)
Execution and project selection to guarantee proper profitability
Reinforcements and Improvements Revenue (BRL million)
220 198
214
147
210
150
2013 2014 2015 2016 2017 2018e
Average: BRL 40 million/year
26 31
47 41
61
2014/2015 2015/2016 2016/2017 2017/2018 2018/2019
IENNE (100%) TL: 710 km (500 kV) Substation: none RAP: BRL 44 million
IE Garanhuns (51%) TL: 842 km (230/500 kV) Substation: 2,100 MVA RAP: BRL 44 million
IE SUL2 (100%) TL: 175 km (230kV) Substation: 750 MVA RAP: BRL 9 million
IE Madeira (51%) TL: 2,375 km (±600 kVCC) Substation: 6,100 MVA RAP: BRL 253 million
IE Pinheiros (100%) TL: 1.8 km (345 kV) Substation: 4,200 MVA RAP: BRL 54 million
IE Serra do Japi (100%) TL: 137 km (230 kV) Substation: 2,000 MVA RAP: BRL 60 million
IEMG (100%) TL: 172 km (500 kV) Substation: none RAP: BRL 18 million
Evrecy (100%) TL: 154 km (230 kV) Substation: 450 MVA RAP: BRL 7 million
MANAGEMENT OF SUBSIDIARIES WITH GOVERNANCE AND INTEGRATION
8 subsidiaries fully in operation
14 concession contracts
4,500 km of transmission lines
17 substations
16,000 MVA of power transformation capacity
Revenue (RAP) of ~BRL 490 million¹
Notes: ¹ RAP Cycle 2018/2019 weighted by ISA CTEEP’s participation | ² Celebration of Purchase Agreement to acquirë 50% of Share Capital in April/18. The closing of the deal is subject to approvals.
Substation
Line Entrance
Transmission Line (TL)
In operation
RBSE (BASIC NETWORK OF EXISTING SERVICE) CASH FLOW BOOSTS CASH GENERATION FOR THE NEXT YEARS
RBSE: receivables related to the non depreciated assets in operation in May/2000
BRL 12 billion to be received, of which approximately BRL 1.6 billion were paid in the 2017/2018 cycle
April of 2017 injunction determined temporary exclusion of Ke
ANEEL recalculated the RAP for 2018/2019 cycle, excluding Ke¹ and considering the linearization of the Economic Component so that payments will be flat until 2022/2023 cycle (REH 2,408/18)
Bill for the restructuring of the electric sector proposes change from Ke to WACC from financial component
Notes: ¹ Technical Note 170/17 | ² Net of PIS/COFINS
RBSE Receivables Schedule² (BRL million)
Economic Component Financial Component ex-Ke Ke
Assumptions pursuant to RES ANEEL
762/2017
IPCA (Dec/12-Jun/17): 34.45%
WACC: 6.64% p.a.
Cost of Equity (Ke): 10.74% p.a. (1H13) and 10.44% p.a. (from Jul/13 to Jun/17)
Estimated amounts. WACC will be defined in tariff reset and asset base is subject to write-offs.
837 711 711 711 711 711
332
750
729 750 750 750 750 750
750
253
246 253 253 253 253 253
253
2021/2022 2017/2018
1,714
2020/2021 2018/2019
1,714 1,714
2019/2020
1,335
2024/2025 2022/2023 2023/2024
1,812 1,714 1,714
1,003
TO GUARANTEE
FAIR TARIFF RESET
ANEEL still has not disclosed the results of the analysis of the contributions
Postponement of RTP from 2018 to 2019, with retroactive effects
Transmission concession contracts renewed in 2013 are subject to periodic tariff reset (“RTP”) every five years
ANEEL opened public hearing 41/2017 to discuss and improve 2018 RTP rules
Regulatory Operational Costs (O&M)
Cost of Capital (WACC)
Regulatory Asset Base & Regulatory Price Reference
EVOLUTION OF MAIN DISPUTES WITH FAVORABLE DECISIONS REINFORCES FOCUS IN CONTINGENCIES REDUCTION
Supplemental Retirement Case Law 4,819/58
Collective Action
Starting in 2004, the Treasury Office (SEFAZ) began to pass through 70%¹ of the amount that retirees would receive
ISA CTEEP, by provisory judicial decision, has to pay the remaining amount (30%), which is equivalent to an estimated cash disbursement of BRL 180 million/year
Unanimous favorable decision in 2nd instance reinforces the merit of the case. In 2017, the payment was suspended for 4 months, but resumed by decision of the Federal Supreme Court injunction
Debt Collection
Debt collection action against the State of São Paulo (SEFAZ) with unanimous favorable decision in the 2nd instance
Amount on September of 2018: BRL 2 billion²
In August 2018, São Paulo state Court decision obliges Sefaz to transfer the amount in full for retiree benefits payment. No gloss up can be done before the administrative process is concluded.
Note: ¹ The main exclusions are (i) payments above the ceiling which is the Governor’s salary (~R$ 22 thousand), and (ii) contributions to State retirement; ² Does not consider monetary adjustment and interest since the filing of the case
10 PROJECTS UNDER CONSTRUCTION WILL ADD BRL 448 MILLION OF RAP
CapEx ISA CTEEP: BRL 2.9 billion¹
Extension of lines: +2,000 km
Capacity: +8,000 MVA
Note: ¹ Total CapEx ANEEL of BRL 5.2 billion | ² Auction ANEEL 02/2018
IE Itaquerê (100%) 3 Synchronous Components (Araraquara Substation) CAPEX ANEEL: BRL 398 million Revenue: BRL 46 million Deadline ANEEL: Aug/21
IE Aguapeí (100%) TL: 111 km (440 kV) Substation: 1,400 MVA CAPEX ANEEL: BRL 602 million Revenue: BRL 54 million Deadline ANEEL: Aug/21
IE Paraguaçu (50%) TL: 338 km (500 kV) Substation: none CAPEX ANEEL: BRL 510 million Revenue: BRL 107 million Deadline ANEEL: Feb/22
IE Itaúnas (100%) TL: 79 km (345 kV) Substation: 1,197 MVA 1 Static Component CAPEX ANEEL: BRL 298 million Revenue: BRL 47 million Deadline ANEEL: Feb/22
IE Aimorés (50%) TL: 208 km (500 kV) Substation: none CAPEX ANEEL: BRL 341 million Revenue: BRL 71 million Deadline ANEEL: Feb/22
IE Itapura – Bauru (100%) 1 Static Component (Bauru Substation) CAPEX ANEEL: BRL 126 million Revenue: BRL 11 million Deadline ANEEL : Feb/21
IE Tibagi (100%) TL: 36 km (230 kV) Substation: 1000 MVA CAPEX ANEEL: BRL 135 million Revenue: BRL 18 million Deadline ANEEL: Aug/21
ERB I (50%) TL: 1,200 km (230/500 kV) Substation: 2,988 MVA CAPEX ANEEL: BRL 1,937 million Revenue: BRL 267 million Deadline ANEEL: Aug/22
Substation
Line Entrance
Transmission Lines (TL)
Under construction
IE Itapura - Lorena (100%)² TL: 6 km (230/500 kV) Substation : 1,200 MVA CAPEX ANEEL: BRL 238 million Revenue: BRL 10 million Deadline ANEEL : Sep/22
IE Biguaçú (100%)² TL: 57 km (230 kV) Substation: 300 MVA CAPEX ANEEL: BRL 641 million Revenue: BRL 38 million Deadline ANEEL : Sep/23
GROWTH OPPORTUNITIES
TO CREATE VALUE
Note: ¹ RAP based on RAP / Investment of 17.1% observed in the Auction 002/2018 l ² Source: PET/PELP, MME Study consolidating the expansion constructions
AUCTIONS ACQUISITIONS Always studying market opportunities
Recent acquisitions
IE Sul
Acquisition of 50% of shares from CYMI for BRL 20 million
ISA CTEEP holds 100% of IESUL as of 3Q18
IENNE
Acquisition of 50% of shares from ISOLUX and 25% of shares from CYMI for BRL 101 million
ISA CTEEP holds 100% of IENNE as of 3Q17
New auctions expected until 2022 amount to BRL 30 billion of capex and RAP² of BRL 5 billion
Outlook for Auction estimated for 4Q18 (Preliminary)
20 lots with estimated capex of BRL 15 billion
RAP¹ of ~BRL 2.5 billion
Construction of 4,900 km of transmission lines and sectioning and installation of 13,800 MVA
ISA CTEEP and the Transmission Sector
Sustainable Value
Financial Highlights
ISA CTEEP
46.2% 51.3% 76.0% EBITDA Margin
85.3% REGULATORY RESULTS HIGHLIGHTS
STRONG CASH GENERATION BOOSTED BY RBSE
Note: ¹ Last twelve months ended on 09/30/2018
² Costs do not consider depreciation and contingencies
Net Revenue and EBITDA include only 100% owned subsidiaries. Shared control companies are accounted as equity shareholder.
NET REVENUE (BRL MILLION) O&M COSTS² (BRL MILLION)
EBITDA (BRL MILLION) NET INCOME (BRL MILLION)
143 181 82 129 220
747 675 671
694
689
2015
21 20
1,778
23 112 135
2016
172 22
2017
1,660
LTM¹
890 955
2,773
212%
180 195 20 120 157 197
747
191 199
244
246
75
2015
23
411
125 24
2016 LTM¹
148 21
2017
1,660
488
1,351
2,322
465%
404 439 472 472
15 7 19
430
2015
22 9 19
2016 2017
23 26
LTM¹
467 509 521
21%
247 246
635
2015 2016
1,075
2017 LTM¹
335%
O&M
Others
RBSE
New Investments
Subsidiaries
SOLID DEBT PROFILE WITH
Debt Amortization Schedule (BRL million) Debt Breakdown
55% 19%
26%
Local bonds - CDI/IPCA BNDES - TJLP Others - CDI
Debt Profile on 9/30/2018
Gross Debt: BRL 3.0 billion
Average cost: 8.3% p.a
Average term: 3.3 years
Net Debt / Adjusted EBITDA: 0.6x
Investment Grade by Fitch: AAA(bra)
74
243 232
74 70
369
894
2025 + 2022 4Q18 2019 2020 2023 2021 2024
1,035
230 226
335
247
2016
585
2014 2018+ 2015 2017 2013
Note: ¹ The Company registered net loss due to the provision for losses related to Law 4,819/58
Strong cash generation allows higher dividends
(BRL million)
Regulatory Payout
N.A.¹ 91% 123% 108% 95%
Minimum payout of 75% of regulatory net income limited to the financial covenant of 3.0x Net Debt/EBITDA
Proceeds via interest on capital and dividends payments
BRL 760 million dividend payment in June of 2018 (BRL 4.62/share)
68
70
72
74
76
78
80
82
84
86
UBS
Brasil Plural
Eleven Financial
Goldman Sachs
BTG Pactual
HSBC
Santander
DOES NOT REFLECT ISA CTEEP’S CASH GENERATION
Bradesco
Itaú BBA
Credit Suisse
Merrill Lynch
Safra
JP Morgan
COVERAGE TARGET PRICE
RATING DATE OF UPDATE
Itaú BBA BRL 83.00 Buy Nov/18
Bradesco BRL 82.00 Hold Jul/18
Goldman Sachs BRL 78.00 Buy Aug/18
JP Morgan BRL 78.00 Buy Aug/18
Brasil Plural BRL 77.60 Hold Dec/18
Merrill Lynch BRL 75.00 Hold Aug/18
HBSC BRL 75.00 Buy Aug/18
XP Investimentos BRL 75.00 Hold Aug/18
Banco do Brasil BRL 73.00 Hold Aug/18
Santander BRL 72.17 Buy Aug/18
BTG Pactual BRL 70.00 Buy Aug/18
UBS BRL 70.00 Buy Aug/18
Citi BRL 70.00 Hold Nov/18
Safra BRL 69.40 Hold Aug/18
Average Target Price BRL 74.87
TRPL4 3Q18 Average
BRL 58.79
Citi
TARGET PRICE (BRL)
63
65
67
69
71
73
75
77
79
81
83
85
Hold Buy Sell
UBS
Goldman Sachs
BTG Pactual
HSBC
Santander
Bradesco
Merrill Lynch
Safra Citi
Itaú BBA
Banco do Brasil
JP Morgan
XP
Brasil Plural