Slide 1: Company Presentation 2Q 2013
COMPANY PRESENTATION 2Q 2013
Slide 2: Agenda
Agenda Company Overview Business Strategy Financial Profile Chilean Electricity Sector Overview 2
Slide 3: Colbún at a glance
Company Overview Colbún at a glance Business Power Generation & Trade Market Share (as a % of Installed Capacity) - SIC Size 2nd largest generator in Chile’s Central Grid (SIC), with over 20% market share (MW). Others Colbún 24% 20% The SIC covers 90% of the population Capacity 2,962 MW AES Gener En
Slide 4: A diversified asset base
Company Overview A diversified asset base ACONCAGUA BASIN: 213 MW NEHUENCO COMPLEX: 874 MW Chacabuquito Blanco 15 HYDRO POWER PLANTS 7 THERMAL POWER PLANTS DIESEL/GAS Capacity: 29 MW Capacity: 60 MW Nehuenco I Juncal Los Quilos Capacity: 368 MW Capacity: 39 MW Capacity: 29 MW Nehuenco II Hornitos Ju
Slide 5: A diversified customer base
Company Overview A diversified customer base UN-REGULATED CUSTOMERS REGULATED CUSTOMERS CHILECTRA CODELCO (2011- 2021/23/25) Salvador CONAFE CODELCO (Until 2015) Ventanas CGE-Río Maipo ANGLOAMERICAN (2010- 2021) Los Bronces Santiago CGE-Distribución CODELCO (2010- 2024) Andina METRO SAESA AGUAS ANDI
Slide 6: Colbún has grown steadily over the past decade
Company Overview Colbún has grown steadily over the past decade Capacity (MW) Total Operating Revenues (MMUSD) 3.500 2,962 1.600 USD 1,409 MW million 3.000 1.400 1.200 2.500 1.000 2.000 800 1.500 600 1.000 USD 214 400 1,260 CAGR: 9% million CAGR: 21% 500 MW 200 0 0 2002 2003 2004 2005 2006 2007 2008
Slide 7: Solid and reliable controlling group with a strategic and long term vision
Company Overview Solid and reliable controlling group with a strategic and long term vision CONTROL Ownership Structure Controlled by the Matte Group (49%), one of the leading economic groups in Chile, with Angelini stakes in various sectors (forestry, financial, Group telecommunications, among othe
Slide 8: Agenda
Agenda Company Overview Business Strategy Financial Profile Chilean Electricity Sector Overview 8
Slide 9: Corporate strategy
Business Strategy Corporate strategy Who are we? We are a Chilean company, leader in the generation of reliable, competitive and sustainable energy. What do we do? We seek to generate long-term value by developing projects and managing power infrastructure, integrating with excellence the economical
Slide 10: Strategic pillars
Business Strategy Strategic pillars Strengthen our organization and people 1. Strengthening Strengthen our operations Strengthen our financial position Narrow our exposure to exogenous variables: diversified asset base 2. Diversification (technology, fuel and location) and clients and Risk M
Slide 11: Colbún: a sustainable partner
Business Strategy Colbún: a sustainable partner EMPLOYEES INVESTORS ENVIRONMENT CLIENTS AND COMMUNITY AND SUPPLIERS SOCIETY CONTRACTORS AND PROVIDERS 11
Slide 12: Commercial policy
Business Strategy Commercial policy COMMERCIAL GOALS Supply secure and competitive energy to our customers Maximize returns from our current and future assets Manage volatility given large renewable component 1. CONTRACT LEVEL 2. SALE PRICE INDEXATION 3. HEDGE PROGRAM Define optimal Incorporate inde
Slide 13: Commercial balance evolution
Business Strategy Commercial balance evolution Contractual Sales vs. Generation (GWh) 14.000 12.000 983 2.240 10.000 1.901 3.118 8.000 2.563 2.242 GWh 2.418 6.000 1.273 1.853 2.658 10.687 95 10.436 9.834 8.829 4.000 5.566 5.462 5.233 4.861 2.000 0 2010 2011 2012 LTM June 2013 Hidro Coal Gas Diesel C
Slide 14: Our expansion plan
Business Strategy Our expansion plan FINAL STAGES LONG-TERM LNG SUPPLY (expected to begin operations by the end of 2013) Existing CCGT (766 MW) and existing open-cycles (270 MW) that could be optimized, subject to securing a long-term competitive and flexible natural gas supply. OTHER GROWTH OPPORTU
Slide 15: Our projects under development
Business Strategy Our projects under development LA MINA HYDRO POWER PLANT: 34 MW Maule River, Maule Region SANTA MARÍA II COAL POWER PLANT: 342 MW LA MINA Coronel, Biobío Region ANGOSTURA SANTA MARÍA II ANGOSTURA HYDRO POWER PLANT: 316 MW Santa Barbara and Quilaco, Biobío Region SAN PEDRO SAN PEDRO
Slide 16: Agenda
Agenda Company Overview Business Strategy Financial Profile Chilean Electricity Sector Overview 16
Slide 17: Income statement and FCF
Financial Profile Income statement and FCF EBITDA (MMUSD) Selected Sources & Uses of Funds (MMUSD) 500 451 600 WK Capex EBITDA 400 500 331 284 400 300 205 300 200 200 100 100 0 0 2010 2011 2012 June 2013 LTM 2010 2011 2012 June 2013 LTM EBITDA margin (%) Debt (MMUSD) 2.000 50% 40% 1.500 32% 28% 30%
Slide 18: Conservative financial strategy
Financial Profile Conservative financial strategy Amortization Schedule of LT Debt (MMUSD) Balance Sheet as of June 2013 (MMUSD) Current Assets 760 Cash and equivalents 223 Accounts receivable 184 Recoverable taxes 230 Other current assets 123 Non-Current Assets 5,259 Property, Plant and Equipment 4
Slide 19: A quarterly look at Colbún's results
Financial Profile A quarterly look at Colbún’s results Sales vs. Generation - quarterly (GWh) Revenues - quarterly (MMUSD) 3.200 2.800 518 2.400 402 2.000 361 367 332 315 1.600 1.200 800 400 0 2Q12 3Q12 4Q12 1Q13 2Q13 1Q 2Q 3Q 4Q Contractual Sales(*) Hydro Coal Natural gas (LNG) Diesel Revenues 2012
Slide 20: Agenda
Agenda Company Overview Business Strategy Financial Profile Chilean Electricity Sector Overview 20
Slide 21: Sector segmentation
Chilean Electricity Sector Overview Sector segmentation 3 SUB-SECTORS 4 SEPARATE GRIDS SING Arica 4,146 MW - 24% 16,751 GWh - 25% GENERATION Antofagasta SIC Tal-Tal 13,332 MW - 76% 48,796 GWh - 74% TRANSMISSION Santiago Regulated sectors (concessions) DISTRIBUTION Castro Chaitén SEA 52 MW - 0% 166 G
Slide 22: Market structure
Chilean Electricity Sector Overview Market structure Electricity Market Structure Main Players in the Generation Sector-SIC GENERATORS 39% >15 players REGULATED UNREGULATED SPOT 24% CUSTOMERS CUSTOMERS MARKET 20% 17% DISTRIBUTION “FREE” CDEC COMPANIES CUSTOMERS Unregulated Spot Price Regulated Tarif
Slide 23: Evolution of power generation and demand in the SIC
Chilean Electricity Sector Overview Evolution of power generation and demand in the SIC Annual Power Generation – SIC (TWh) Annual Electricity Demand – SIC (TWh) 50 Others 50 Diesel-Fuel Unregulated Demand Regulated Demand 45 LNG 45 Coal /Petcoke Diesel 7% Gas 40 40 Hydro LNG 21% Unregulated: ~30% 3
Slide 24: Dispatch and pricing model: a technical guide
Chilean Electricity Sector Overview Dispatch and pricing model: a technical guide Dispatch Model Dispatch Scheme OBJECTIVE Meet demand at the lowest cost possible Demand Curve Variable Cost of the Plants (USD/MWh) INSTITUTION Independent load dispatch center (CDEC) coordinates the efficient dispatch
Slide 25: Evolution of electricity prices
Chilean Electricity Sector Overview Evolution of electricity prices Electricity Prices-SIC (USD/MWh) 350 1) Energy Node Price Alto Jahuel (USD/MWh) 300 2) Average Auction price (USD/MWh) 3) Average Market price (USD/MWh)* 250 4) Energy Spot Market Price Alto Jahuel (USD/MWh) 200 150 100 50 0 2001 20
Slide 26: Demand and supply: what to expect in the coming years
Chilean Electricity Sector Overview Demand and supply: what to expect in the coming years Electricity Demand - SIC (TWh) Available Power by type - SIC (MW) TWh MW Hydro (1) Wind Coal Gas (2) Diesel 70 12.000 60 10.000 50 8.000 40 6.000 30 4.000 20 10 2.000 0 0 2013 2014 2015 2016 2017 2018 2013 2014
Slide 27: Colbún
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