Slide 1: Reported EBITDA: +14% YoY based on organic growth
0 Reported EBITDA: +14% YoY based on organic growth Liberalized Gen.&Sup.: good performance in a tough market; EBITDA +37% YoY Renewables: wind capacity increased 132%; Delivering growth targets with top quality assets Regulated Networks and LT contracted generation: 82% of EBITDA, 75% of Capex Effi
Slide 2: In an adverse environment, EDP achieved strong EBITDA growth
Wind: Acquisition of Horizon in USA and + 582 MW built in Europe Successful integrated hedging strategy generation/supply in Iberia Achievement of key milestones for new hydro and CCGT capacity in Iberia Efficiency improvement: Anticipation of cost cutting targets 2 In an adverse environment, EDP ac
Slide 3: EDP EBITDA and EBITDA Breakdown
!"#$%& EDP EBITDA (€ million) 2006 2007 ∆ % Chg. Reported EBITDA (€m) 2,305 2,628 323 14% Tariff Deviations & Prior years tariff (5) 75 80 deviations recovery in Portugal (1) Brazil's Regulatory Deviation (2) (95) (216) (121) Enersul's Provision 0 69 69 HR Restructuring Costs 66 193 127 EBITDA Adjus
Slide 4: OMEL Weighted Avg. Baseload Price Performance in 2007
Reported EBITDA: +14% YoY based on organic growth Liberalized Gen.&Sup.: good performance in a tough market; EBITDA +37% YoY Renewables: wind capacity increased 132%; Delivering growth targets with top quality assets Regulated Networks and LT contracted generation: 82% of EBITDA, 75% of Capex Effici
Slide 5: Liberalised Generation Output and Production Costs
+ , ) # Production Output and Costs 2.9% Liberalised Generation Output 19.7 20.2 1.2 1.0 Iberian Market: +1.8% 1.2 1.2 • EDP: +2.9% 7.4 7.8 Coal Plants Load Factor: Hydro • Iberian Market: 78% Nuclear • EDP: 76%* CCGT 9.9 10.1 Coal CCGT Plants Load Factor • Iberian Market: 47% 2006 2007 • EDP: 57% V
Slide 6: Hedging strategy and liberalized generation & supply EBITDA
, ) # # + ' !% - .- Volume Sold / Generation Output (%) 2006 68% 2007 64% 53% 54% 35% 22% 16% 17% 18% 13% EDP Peer1 Peer2 Peer3 Peer4 In 2006 EDP had the highest level of GWh coverage liberalized retail clients/generation Fuel needs to satisfy electricity sales contracted with clients hedged in the
Slide 7: Fuel costs, regulatory environment and low hydro reserves
- Fuel Cost Performance Regulatory Framework: 25 150 130 20 • Downward revision of the Capacity Charge remuneration 110 15 • CO2 Clawback: €7/MWh extra cost 90 70 10 05-Out-07 02-Nov-07 30-Nov-07 28-Dez-07 25-Jan-08 22-Fev-08 …adverse regulatory environment… Coal API #2 ($/ton) Brent ($/bbl) CO2 (€/
Slide 8: 2008 coverage of CO2 emissions and generation mix evolution
12 2008 coverage of CO2 emissions (%) 24% 51% CO2 costs to be 76% internalized in electricity wholesale price biding 11% 14% 24% 8% Expected RD 11/07 Free CO2 Purchased Purchased Exposure Potencial to Emissions Impact Allowances CER EUA buy additional CER Excluding CO2 Clawback in Spain (RD11/07), E
Slide 9: Liberalized supply volumes and margins support EBITDA growth
/ + 4 , ) , Volumes and margins growth support EBITDA growth Liberalized Supply - Volumes & Selling Margin EBITDA (€ million) Supplied GWh Avg. Gross Margin (€/MWh) 43.8 2,51 1,98 2,45 1,80 2,63 1,26 0,46 -2,82 4.550 4.611 5.028 20.9 3.691 3.059 3.417 3.588 4.014 1Q2006 2Q2006 3Q2006 4Q2006 1Q2007 2
Slide 10: Wind gross installed capacity increased 132% YoY to 3,639 MW
* - ( # 1 ) Neo Installed Capacity Year 2007 Horizon Installed Capacity Year 2007 Gross MW Gross MW +37% 2.150 +167% 1.490 1.568 1.556 2.200 559 2006 2007 Target 2007 YE 2006 2007 Target 2007 YE (Jan-07) (Jan-07) Wind gross installed capacity increased 132% YoY to 3,639 MW in 2007 Reliability in the
Slide 11: Wind: higher load factors and capacity offset lower pool prices
* Wind Power Output Gross Profit EBITDA GWh € million € million 98% 38% 46% 3,773 279 202 214 1,902 147 YE06 YE07 YE06 YE07 YE06 YE07 Increase of load factors and capacity more than compensated lower pool prices in Spain First time consolidation of Horizon in 2H07 – Contribution of €24m at EBITDA le
Slide 12: EDP's Investment Plans in Hydro
!%- 3 ) ) ): 7 :; # ' EDP’s Investment Plans in Hydro (MW) Hydro Start 18% MW Capex Type Status Plants Date 883 Picote II 241 135 2012 Repowering Under construction 5,005 Construction to start in Bemposta II 191 130 2012 Repowering 1Q08 Ribeiradio Construction to start in 41 154 2013 New Plant (@55%
Slide 13: Reported EBITDA: +14% YoY based on organic growth
Reported EBITDA: +14% YoY based on organic growth Liberalized Gen.&Sup.: good performance in a tough market; EBITDA +37% YoY Renewables: wind capacity increased 132%; Delivering growth targets with top quality assets Regulated Networks and LT contracted generation: 82% of EBITDA, 75% of Capex Effici
Slide 14: Iberian distribution EBITDA increased 9% adjusted to one-offs
! )% - , EBITDA increased 9% adjusted to one-offs Iberian Distribution EBITDA: 2007 vs. 2006 % Chg. 2006 2007 (€ million) Reported EBITDA 572 441 -23% Tariff Deviations Portugal (1) 118 58 -51% Prior years tariff deviations recovery Portugal (1) (123) 16 -113% One-off HR Restructuring Costs Portugal
Slide 15: Regulatory receivables in regulated supply and CMECs
) Regulatory receivables in Regulated Electricity Supply and CMECs system (€ million) +23% 642 753 Portugal CMECs 613 • To start recovery in Jul-08 (over 12 months) 583 592 102 49 145 66 • Rationing losses almost fully recovered 157 Brazil 246 196 222 • 2006 tariff deficit of €154m (1) 188 203 Spain
Slide 16: EDP operating costs
2 1 EDP operating costs • Decline of supplies & (€ million) YE06 YE07 % Chg. services and personnel costs – Efficiency Controllable Operating Costs * 1,423 1,358 -4.6% improvement, staff reduction and disposal of Oni; Supplies & Services 741 684 -8% • Higher restructuring costs Personnel Costs & Soc
Slide 17: Continuous efficiency improvement effort
! )% / - 1 ! ) Total Early Retirement agreements signed (Referent to 2007 HR Rest. Costs) Maintenance Own Employees : 2005-2008E * 26% 2,066 1,945 Electricity Spain 1,776 Distribution 1,656 Portugal 13% Generation 61% Portugal 2005 2006 2007 2008E CAGR Workforce EDP Distribution Employees : Dec-2007
Slide 18: 75% of capex allocated to regulated activities and long term contracted generation
1 1 3 75% of capex allocated to regulated activities and long term contracted generation EDP Capex: YE06 vs. YE07 Iberian (€ million) YE06 YE07 % Chg. Distribution Wind Europe 10% Expansion 680 1,936 185% & USA 3% Iberian Gas Maintenance 777 764 -2% 50% 8% Brazil Total EDP 1,457 2,700 85% 1% Other G
Slide 19: Financing of Horizon acquisition and debt maturity profile
1 )% Financing of Horizon Acquisition closed under favourable market conditions: Jul-07: US$1.5bn Revolving Credit Facility (7-Year term) Oct-07: US$2bn fixed rate bond issue (US$1bn 5-Year term + US$1bn 10-Year term) 3.000 Other 2.700 EDP SA & EDP Finance BV 19% 2.400 Commercial Paper 2.100 € milli
Slide 20: EPS: -4% YoY: high level of positive non recurrent items in 2006
- EDP Net Profit (€ million) 2006 2007 % Chg. EBIT (€m) 1,253.0 1,560.3 25% • 2007 capital gains include Capital Gains/(Losses) 4.8 262.6 5349% €259m related to the sale of a 25% stake in REN; Financial Income/(Expense) (207.4) (545.8) 163% • 2006 income from Income/(Losses) Associated Companies 245
Slide 21: Continue to deliver growth based on a sound capital structure
2 ' High generation costs: Increase of electricity wholesale prices and tariff deficits in Iberia Target for EDP wind power by 2008YE: 5,200MW gross installed capacity IPO of EDP Renováveis in 2Q08: dependent on market conditions Cost Efficiency: Anticipation of 2010 target Continue to deliver growt
Slide 22: edp - feel our energy
edp feel our energy