Axia Energia Sa · BMFBOVESPA:AXIA3
Axia Energia Sa — Brazilian Electric Power — FY2017 Earnings Presentation
30 slides from Axia Energia Sa's earnings presentation, Apr 13, 2018
Slide 1: Presentation Results of 2017
Slide 2: Forward-looking statements
This presentation may contain forward-looking statements. Such statements are not statements of historical facts but reflect the beliefs and expectations of our management and may constitute forward-looking statements within the meaning of rm a Comissao de Valores Mobilgrios and Section 27A of the S
Slide 3: Highlights
a: - . ~ - Highlights +s
Slide 4: 2017 Highlights
2017 Highlights Results R$ 37,876 million R$ 6,744 million R$ 1,726 million R$ 5,214 million Net Operating Revenue Ebitda Net Loss Investments in 2017 (ROL) | | | 66%F 149%% 58% 37% Regarding 2016, Regarding the Of R$ 8,953 billion Regarding 2016, Due to RBSE in 2016 R$ 3.513 billion profit budget d
Slide 5: 2017 Highlights
2017 Highlights Business Plan Eletrobras obtained the = G Indicat t Bylaws Reform 7 — overnance Indicator fo meet the requirements REEL Gli Certification -IGISEST of Law 13,303/2016 = Net ie 2016 2017 evel 1 (Excellence) | lanagerial Ebitda i w Getting closer to the indebtedness IGOSEST Estate aaa C
Slide 6: Financial
a: - = _ Financial +s
Slide 7: Economic Financial Performance
Economic Financial Performance (R$ Million) EMENT ‘CONSOLIDs INCOME Rol, Ebitda and Profit: Effect of accounting for RBSE's assets in 2016. Gross Operating Revenue Deductic PMSO: reduction of third-party c 1 services, reduction of research { (31,002) (20,202) -35% Operational Expenses (14,201) (10,3
Slide 8: Result by Segment
Result by Segment (R$ million IFRS 4Q17 GENERATION TRANSMISSION DISTRIBUTION ; Generation: ‘i Exploration oam Exploration 0am - Rol: 23% Regime Ebtida: 151% ROL (Net Operating Revenue) 5,016 508 367| 2,240 3,354 Net Income:134% poonnnennnestnon () PMso (1,443 (361) (275) (1,483| | (643} ) (©) Operat
Slide 9: Gross Revenue 4Q17
Gross Revenue 4Q17 (R$ million) -24% R$ 4,195 million 444% $3,536 million 17,537 1,291 8,241 bn 1,192 609 13,342 2,535 11,541 — v 349 ’ 1,310 100 17 || — — 5088 43 Gross RBSE CELGDand Managerial Generation - Generation - Transmission Transmission Distribution Other Managerial == RBSE_-—-—CELGDand _—
Slide 10: Personnel, Material, Service and Others
Personnel, Material, Service and Others (R$ million) Consolidated IFRS % — CELG DRS 350 mi n in 2016 (12 in 2017. Personnel Material Services Others PMSO PAE Investigtion Findings TOTAL PMSO 5 months) and R$ 37 mi i] Exclusion of CELG D as of February 2017 and the reduction of contracting expenses f
Slide 11: Operational Provision
Operational Provision (R$ million) 4Q16 4Q17 (%) 1373472017 513 Provision for Contingencies inipiaininink | of R$ 3,621 mi n, highlighting compulsory loan provision of R$ PCLD - Consumers and resellers “21 321 -1,661% 1,689 2,337 million. PCLD - Loans and Finacings 4 5 21% 269 \ Onerous Contracts 1,
Slide 12: Result Without Main Provisions
Result Without Main Provisions (R$ million) Accumulated Loss of December 2017 1.726 Balance} CTEEP Reversal 615 (e) Provision for Impairment SPE (617) (2,132) Provision Impairment Angra 3 (990) (11,288) Provision Impairment CGTEE (363) (363) Bresser Plan Provision (345) (356) Provision RGR (309) (2,
Slide 13: Ebitda 2017
Ebitda 2017 (R$ million) 17,799 13,954 44% R$ 1,710 million 5,338 784 2,194 6,744 477 171 4,108 a 5,554 — 3,845 EBITDA CVM Non Recurrent EBITDA Managerial Shareholdings Operating PMSO Managerial Non Recurrent EBITDA CVM 4Q16 items Managerial ROL costs EBITDa 4Q17 items 4Q17 4716 Highlights: Recurren
Slide 14: Financial Result
Financial Result (R$ million) Variation is mainly due to the lower availability of resources for application. Financial Result 2016 2017 Yo Frat (i) reduction of the rates of the main indexes (inflation and SELIC) incident on credits as receivables from the updated nterest income and financial inves
Slide 15: PMSO IFRS
PMSO IFRS PMSO / ROL 4Q16 X 4Q17 -17% 4,410 3,639 4716 4717 lEPAE HPMSO = @mPMSO without PAE/ Rol without RBSE + Improvement in Economic and Financial Performance (R$ million) PMSO IFRS PMSO / ROL 2016 X 2017 -5% PAE RS 853 | million in 2017 2016 2017 lm PAE mmm PMSO ‘== PMSO Managerial/ ROL Manager
Slide 16: Improvement in Economic and Financial Performance
Improvement in Economic and Financial Performance (R$ million) Managerial Ebitda and Managerial Ebitda Margin +44% 5,554 18.0% 15.0% 2016 2017 mmm EBITDA Gerencial ‘= EBITDA Managerial Margin
Slide 17: Eletrobras' Financial Performance
|_| 68.069 -2.963 -14.954 Eletrobras’ Financial Performance (R$ million) Shareholder’s Equity -3.2% 61.577 Tn 56.849 2014 2015 2016 2017 2012 The company reversed its 3-year loss in 2016 and it had R$ 1.7 billion loss in 2017 due to the operating provisions. 2013 2014 2015 2016 2017 Shareholders’ Eq
Slide 18: Operational Growth
‘ . Ne . Operational Growth w
Slide 19: Eletrobras' installed capacity
48,134 MW Eletrobras’ installed capacity 233 31% plants of Brazil's installed capacity + 1,278 MW Physical aggregation in 2017, highlighting HPP Belo Monte and Maua 3 + 8,000MW Already under construction, will be added to the Brazilian energy matrix with contribution from Eletrobras and partners by
Slide 20: Interconnection
Country Interconnection The largest tansmission company of Latin America sistent Lis Empresas Eletrobras Lis Empresas Eletrobrae com pareeris Us Outras Empresas Strategic role in the National Interconnected System, the company accounts for almost half of the transmission lines existing in Brazil TL
Slide 21: Business and Management Master Plan
= WS ~ Business and Management Master Plan 5
Slide 22: PDNG 2018-2022
PDNG 2018-2022 Challenge 22: Sustainable Excellence To maximize the potential of competitive advantages in Generation, Transmission and Trading energy, achieving the corporate sustainability recognized by all stakeholders. (2017 2018 Financial Discipline Net Debt/Ebitda < 3 Sustainable Performance 3
Slide 23: Operational Excellence Financial Discipline
Operational Excellence Financial Discipline Net Debt / Adjusted EBITDA PMSO/PMSO Regulatory (*) 155 154 154 139 1,35 449 HEEEEs Challenge 2021/22: main results Gover ce and Compliance Amount of Material Weaknesses(*) co 4 Bem e© © ©» © o 2015 2016 1717 2717 317 Meta Meta 2017 2018 Reduction of 758 g
Slide 24: Net Debt
Net Debt —_——eEGunrmns ss Adjusted EBITDA . R$ 45,593 Net Debt/Ebitda Gross Debt million 23.4 a3 23.4 22.7 Financing payable without RGR 42,982 (-) (Cash + Securities) 8,048 (-) Financing Receivable without RGR 12,848 (-) Net balance of Itaipu Financial Asset 1,788 dez-16 mar-17 jun-17 set-17 dez-17
Slide 25: Sale of SPEs Ownerships
Sale of 70 SPEs Ownerships Generation (wind farms) 59 | 967 MW. | ene Book value RS 2.5 billion 17 Auction lots: » 8 generation|lots - 9 transmission lots Date; June 29) 2018) ‘rounesia 21 “s99Sef01d 2 sennewnse saqu0> aped opSequaraide €353
Slide 26: Investment plan 2018-2022 (R$ million)
R$ million 2018 2019 2020 2021 2022 2018 - 2022) Corporate 4,382 3,094 2,490 2,205 2,068 14,239 Enterprises Generation 1,321 968 1,055 938 874 5,157 Transmission 2,367 1,858 1,184 994 896 7,300 Infrastructure and Others 434 268 251 273 297 1,523 Distribution 260 0 0 0 0 260 Generation 1,490 389 639
Slide 27: Future Structure
Future Structure 4 Eletrobras Expected Strength the focus in A Generation and 49.9 GW of installed Hon 2 . Transmission Eletrobras R&D Stockholding Eletrobras capacity by 2918 Cepel Eletropar Generation and Transmission Maintenance of 48 1 a cee ct = c =, i Eletrobras letrobras letrobras letrobras e
Slide 28: Eletrobras' Privatization
Eletrobras’ Privatization Opportunity to create a large corporation The largest Energy Companies in the G-20 countries are \" structured as "Corporation". — 4 © 15 plants and 14 GW for dequotization in future capital primary emission y
Slide 29: Eletrobras Privatization timeline
August - 2017 + The Ministry of Mines and Energy proposed to the Council of the Investment and Partnership Program of the Presidency - PPI, the privatization of Eletrobras. The proposal was approved on August 23, 2017 by the Council of the Investment Partnership Program (CPPI). Disclaimer January -
Slide 30: Signature
SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Date: April 12, 2018 CENTRAIS ELÉTRICAS BRASILEIRAS S.A. - ELETROBRÁS By: / S / Armando Casado de Araujo
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