The AES Corporation · NYSE:AES
The AES — Investor Day (May 2009)
94 slides from The AES's investor day presentation, May 27, 2009
Slide 1: 2009 Investor Day
2009 Investor Day May 27, 2009 1
Slide 2: Safe Harbor Disclosure
Contains Forward Looking Statements Safe Harbor Disclosure Certain statements in the following presentation regarding AES’s business operations may constitute “forward-looking statements.” Such forward-looking statements include, but are not limited to, those related to future earnings growth and fi
Slide 3: Presenters & Agenda
Contains Forward Looking Statements Presenters & Agenda Philip Odeen Paul Hanrahan Andrés Gluski Victoria Harker Ned Hall Chairman of President & Executive Vice Executive Vice Executive Vice the Board Chief Executive President & President & President & President, Officer Chief Operating Officer Chie
Slide 4: Opening Remarks - Philip Odeen
Contains Forward Looking Statements Opening Remarks Philip Odeen Chairman of the Board 4
Slide 5: Board of Directors
Contains Forward Looking Statements Board of Directors Philip Odeen Samuel Bodman Paul Hanrahan Tarun Khanna John Koskinen Chairman of Director Director, Director Director the Board President & CEO Philip Lader Sandra Moose Jay Morse Charles Rossotti Sven Sandstrom Director Director Director Directo
Slide 6: Overview - Paul Hanrahan
Contains Forward Looking Statements Overview Paul Hanrahan President & Chief Executive Officer 6
Slide 7: Today's Agenda
Contains Forward Looking Statements Today’s Agenda Sound Built-in Liquidity Organic Position Growth Diverse Option Portfolio Value of Generates Growth FCF1 1 Pipeline Value Proposition 1. Free Cash Flow (FCF), a non-GAAP financial measure. 7
Slide 8: AES is Not Trading In Line With its Underlying Businesses
Contains Forward Looking Statements AES is Not Trading In Line With its Underlying Businesses May 21, 2008 – May 22, 2009 ($ US) 1.6 1.4 12-month 1.2 Return 1 Tiete 6% Gener -5% 0.8 EP -20% 0.6 AES -56% 0.4 MIR -65% 0.2 5/21/2008 7/3/2008 8/19/2008 10/2/2008 11/13/2008 1/2/2009 2/13/2009 3/31/2009 5
Slide 9: Stock Trades at a Discount Based on Existing Portfolio
Contains Forward Looking Statements Stock Trades at a Discount Based on Existing Portfolio & Reflects No Value for Development Pipeline1 Based on 2011 P/E Multiples2 Based on Sum of the Parts3 $15.25 $16.77 $10.78 $13.21 $8.62 $8.62 12.2x 8.2x 8.6x 7.0x 6.9x 5.5x Current Price Current Market Histori
Slide 10: Stock Trades at a Discount Based on Existing Portfolio
Contains Forward Looking Statements Stock Trades at a Discount Based on Existing Portfolio & Reflects No Value for Development Pipeline Based on 2011 Proportional Free Cash Flow Yield1 $15-$182 $8.62 10%-12% 21% Current Price 5/22/09 Target Yield 1. Proportional free cash flow and proportional free
Slide 11: AES Overview
Contains Forward Looking Statements AES Overview AES Holdco Carbon Generation Utilities Renewables Offsets Coal Hydro Wind Gas Solar Grid Other Efficiency 11
Slide 12: Global Operations
Contains Forward Looking Statements Global Operations Ukraine Czech Republic Bulgaria Kazakhstan Netherlands Turkey U.K. France Hungary U.S. Spain Mexico China Dominican El Salvador Republic Philippines Panama Nigeria Colombia Cameroon India Sri Lanka Brazil Pakistan Oman Chile Jordan Qatar Argentin
Slide 13: Global Construction
Contains Forward Looking Statements Global Construction Bulgaria Turkey U.K. France U.S. China Panama Cameroon Chile Jordan Key AES Headquarters Facilities Under Construction 13
Slide 14: Global Development
Contains Forward Looking Statements Global Development Hungary U.S. El Salvador Cameroon India Vietnam Chile Key AES Headquarters Projects Under Development 14
Slide 15: AES Overview
Contains Forward Looking Statements AES Overview 2008 Proportional Gross Margin1 Expected 2009 Subsidiary by Line of Business Distributions2 by Geography Utilities Asia Europe 7% 16% 35% Latin America 28% 65% 49% Generation North America & Others Note: 38,820 MW excludes Ekibastuz (4,000 MW), a busi
Slide 16: Diverse Portfolio: Businesses in Multiple Markets
Contains Forward Looking Statements Diverse Portfolio: Businesses in Multiple Markets 2008 Proportional Gross Margin1 ($2.3 Billion) Asia Others 2008 Proportional Gross Margin1 Generation Latin America ($2.3 Billion) Europe 3% 6% Generation Generation 11% 32% Utilities 35% ($0.8 Billion) North Ameri
Slide 17: Diverse Portfolio: Businesses Utilize Multiple Fuel Types
Contains Forward Looking Statements Diverse Portfolio: Businesses Utilize Multiple Fuel Types Current Portfolio by Fuel Type (MW1) Coal 35% Oil – 3% Diesel – 1% Pet Coke – 2% 23% Renewables2 36% Gas 59% of Our Capacity Is in Natural Gas & Renewables 1. 38,820 MW in operation under generation and uti
Slide 18: Profile of Generation Businesses
Contains Forward Looking Statements Profile of Generation Businesses z 70% of our generation capacity is contracted under long-term agreements with more than 100 offtakers z Merchant businesses seek to hedge their margins in the medium to short-term e.g., AES Eastern Energy (US) Contract Status1,2
Slide 19: Profile of Utility Businesses
Contains Forward Looking Statements Profile of Utility Businesses z Regulated businesses 2008 Proportional Gross Margin1 from Utility Segment primarily with long-term ($0.8 Billion) concessions 14 utilities, including 4,419 Others MW generation capacity IPALCO 9% 32% z Three largest utilities repr
Slide 20: Global Trends
Contains Forward Looking Statements Global Trends Global Electricity z Set to increase in long-term – particularly in Demand developing countries where AES has expertise Lack of Infrastructure z Aging capacity needs replacement Investment Environmental z Driving shift to low carbon sources, renewabl
Slide 21: Global Demand for Electricity Is Expected to Grow
Contains Forward Looking Statements Global Demand for Electricity Is Expected to Grow, Mostly in Non-OECD Countries Electricity Demand Growth (2006-2030) 8% 2006–2015 7% 2006–2030 6% 5% 4% 3% 2% 1% 0% OECD Russia Brazil Africa Middle East China Indonesia India z Global capacity additions are predict
Slide 22: Renewables Will Take on a Greater Role
Contains Forward Looking Statements Renewables Will Take on a Greater Role, But Fossil Fuels Remain an Important Part of the Fuel Mix 16,000 Coal 14,000 Oil Gas 12,000 Nuclear 10,000 Hydro TWh Biomass 8,000 Wind 6,000 Rest of Renewables 4,000 2,000 0 2006 2030 z Coal remains an important part of the
Slide 23: Key Summary Points About AES
Contains Forward Looking Statements Key Summary Points About AES z Diversified mix of businesses results in stable cash flow to the Parent z Asset base diversified across Generation and Utility operations Multiple markets Various fuel types and technologies z Significant opportunities in globa
Slide 24: Operations & Construction Overview - Andrés Gluski
Contains Forward Looking Statements Operations & Construction Overview Andrés Gluski Chief Operating Officer 24
Slide 25: Improvement in Key Performance Indicators
Contains Forward Looking Statements Improvement in Key Performance Indicators Equivalent Forced Outages1 % Utility Losses1 % (non-US) 12.28% 11.78% 5.57% 3.76% 2005 2008 2005 2008 In 2007, AES Latin America Won the Edison Electric Institute Global Operational Improvement Award 1. See Appendix for de
Slide 26: Experience in Improving Operations of Acquired Assets
Contains Forward Looking Statements Experience in Improving Operations of Acquired Assets TEG-TEP, Mexico Masinloc, Philippines z Since acquisition in 2007: z Since acquisition in 2008: Increased capacity by Improved plant capacity 5% to 484 MW by 40% to 630 MW Improved availability Improved
Slide 27: Improving Operating Performance Translating to Improved Financial Results
Contains Forward Looking Statements Improving Operating Performance Translating to Improved Financial Results Adjusted Earnings Per Share1 $1.12 $0.94 $0.98 2006 2007 2008 1. A non-GAAP financial measure. See Appendix for definition and reconciliation. 27
Slide 28: Our Approach to Risk Management
Contains Forward Looking Statements Our Approach to Risk Management We Mitigate Key Risks Important Risk Project Finance Prior to Financing Mitigation Tools Model: Including: Include: z Non-recourse financing; z Currency risk z Long-term power sales standalone contracts (generally project structure
Slide 29: Risk Management: Currency Risk
Contains Forward Looking Statements Risk Management: Currency Risk Debt Currency v. Revenue Currency $18.1 Billion (as of 12/31/2008) Matched Currency $16.9 Billion 94% 6% Cross Currency $1.2 Billion z Many Power Purchase Agreements (PPAs) denominated or paid in US Dollars z 10% move in key currenci
Slide 30: Risk Management: Limited Commodity Price Risk
Contains Forward Looking Statements Risk Management: Limited Commodity Price Risk 2009-2011 Proportional Gross Margin1 34% 30% 27% 41% 47% 51% 66% 70% 73% 25% 23% 22% 2009 2010 2011 Utilities Long-Term Contracts 2 Other 2 z 70% of gross margin is attributable to long-term contracts and utilities (le
Slide 31: Risk Management: Political Risk
Contains Forward Looking Statements Risk Management: Political Risk Masinloc (Philippines) Gener (Chile) Maritza East (Bulgaria) z Multilateral partners – z Shares listed on Chilean z Long-term contract with IFC1 & ADB2 stock exchange with state-owned utility z Local advisory board 30% float z Multi
Slide 32: Construction Program: More than 3,500 MW Under Construction
Contains Forward Looking Statements Construction Program: More than 3,500 MW Under Construction, 96% of Which is Under Long-Term Contracts Construction Program Additional MW On-Line by Year by Geography (MW) 3,504 North Asia America & the 2,493 1,011 Middle East Latin 3% America 16% 1,354 49% 2,493
Slide 33: Market is Still Open for Well-Structured AES Projects
Contains Forward Looking Statements Market is Still Open for Well-Structured AES Projects Recent Non-Recourse Project Finance Transactions Long-Term Financing Type Date Amount Off-Take Angamos, Chile Coal Oct ‘08 $1 billion 9 North Rhins, Scotland Wind Dec ‘08 $54 million 9 St. Nikola at Kavarna, Wi
Slide 34: Funding to Complete Construction Program Is in Place
Contains Forward Looking Statements Funding to Complete Construction Program Is in Place Construction Program – $2,750 Million Total Capex to Be Incurred Through 2011 Source Amount ($ in Millions) Non-Recourse Financing Already Secured $2,000 Cash at Gener $350 AES Corp. $300 Minority Partners $100
Slide 35: Construction Program 2009–2010: Nueva Ventanas, Guacolda
Contains Forward Looking Statements Construction Program 2009–2010: Nueva Ventanas, Guacolda 3 Nueva Ventanas (Gener), Chile Guacolda 3 (Gener), Chile 270 MW 304 MW 100% Owned by Gener 50% Owned by Gener (AES’ Net Interest 71%) (AES’ Net Interest 35%) COD1: 2010 COD1: 2009 1. Commercial Operations D
Slide 36: Construction Program 2010: Maritza East, Bulgaria
Contains Forward Looking Statements Construction Program 2010: Maritza East, 670 MW, Bulgaria z Ownership: 100% Owned by AES z COD1: Second Half 2010 z Fuel Type: Coal z Total Project cost: $1.6 billion – 70% financed through long-term debt z Output sold under long-term contract (PPA) z PPA: NEK, st
Slide 37: Construction Program 2011: Angamos, Chile
Contains Forward Looking Statements Construction Program 2011: Angamos, 518 MW, Chile z 100% Owned by Gener (AES’ net interest 71%) z COD1: Second Half 2011 z Total Project cost $1.3 billion – 72% financed through long-term debt z Output sold under long-term contract (PPA) z PPA: BHP Billiton subsid
Slide 38: Summary of AES Operations & Approach to Risk Management
Contains Forward Looking Statements Summary of AES Operations & Approach to Risk Management z Leveraging our operational experience to improve profitability z Risk management to minimize currency, commodity and political risks z Construction program is progressing well Debt financing is already in
Slide 39: Solid Liquidity & Manageable Debt Profile - Victoria Harker
Contains Forward Looking Statements Solid Liquidity & Manageable Debt Profile Victoria Harker Chief Financial Officer 39
Slide 40: Solid Liquidity: Parent Company
Contains Forward Looking Statements Solid Liquidity: Parent Company z Total Parent Liquidity1 of $1.5 billion as of May 15, 2009 $695 million in cash $766 million availability under Revolver z Recent transactions have contributed to our strong liquidity position Increased the size of the Revol
Slide 41: Historical Debt Profile, Significant Near-Term Parent Debt Maturities
Contains Forward Looking Statements Historical Debt Profile, Significant Near-Term Parent Debt Maturities Parent Debt Maturities as of 12/31/02 ($ in Millions) $1,801 Total Debt: $7,109 $1,059 $893 $850 $750 $754 $517 $231 $129 $125 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19
Slide 42: Current Debt Profile, Reduced Overall & Near-Term Parent Debt
Contains Forward Looking Statements Current Debt Profile, Reduced Overall & Near-Term Parent Debt Parent Debt Maturities as of May 2009 ($ in Millions) $1,801 Total Debt: $5,686 $1,500 $1,059 $893 $850 $750 $754 $690 $625 $517 $500 $500 $535 $517 $451 $231 $214 $129 $154 $125 '03 '04 '05 '06 '07 '08
Slide 43: Solid Liquidity & Manageable Debt Profile: Subsidiaries
Contains Forward Looking Statements Solid Liquidity & Manageable Debt Profile: Subsidiaries $ in Millions z Total Subsidiary Liquidity1 of $2.4 billion as of March 31, 2009 z Brazilian businesses and IPALCO have credit, liquidity and refinancing track record z $500-$700 million of the remaining annu
Slide 44: Reduced Non-Recourse Debt on Existing Businesses by $1.6 Billion
Contains Forward Looking Statements From 2005, Reduced Non-Recourse Debt on Existing Businesses by $1.6 Billion $ in Billions Debt at Generation Businesses Debt at Utilities Businesses $10 $10 $8 $8 19% $6 $6 $4 $8.1 $4 $6.6 $2 $2 $3.6 $3.5 $0 $0 Dec 31, 2005 Dec 31, 2008 Dec 31, 2005 Dec 31, 2008 N
Slide 45: Summary of AES Liquidity & Debt Profile
Contains Forward Looking Statements Summary of AES Liquidity & Debt Profile z We have solid liquidity and a manageable debt profile Operating cash flow is more than sufficient to cover our debt maturities Non-recourse debt structure provides additional protection z Demonstrated access to capital
Slide 46: Development Pipeline - Ned Hall
Contains Forward Looking Statements Development Pipeline Ned Hall Executive Vice President & President, North America 46
Slide 47: Global Energy Trends: 4,528 GW Capacity Expected by 2030
Contains Forward Looking Statements Global Energy Trends: 4,528 GW Capacity Is Expected to Be Added by 2030 37% of Which Is Expected by 2015 GW Additions by 2030 4,528 GW Latin America Africa US 3% 6% Middle East 15% 5% Rest of Asia 15% 20% Rest of OECD 29% 7% China Eastern Europe Source: Internatio
Slide 48: Low Cost Development Options: Core Power Examples
Contains Forward Looking Statements Low Cost Development Options: Core Power Examples z Greenfield opportunities: OPGC II, India (1,200 MW coal) – platform expansion Borsod CFB, Hungary (330 MW coal) – platform expansion Chhattisgarh, India (1,200 MW coal) Mong Duong, Vietnam (1,200 MW coal)
Slide 49: Push for Renewables
Contains Forward Looking Statements Push for Renewables Positive Market z Increased government incentives Fundamentals z Ability to secure project financing z Opportunities in countries with AES presence Leveraging AES’ z Core competencies in development, construction Expertise management and operat
Slide 50: Hydro Generation
Contains Forward Looking Statements Hydro Generation z AES operates 7,460 MW of hydro generation and has 285 MW under construction z We have an additional 850 MW in development z We are reviewing new developments in China, Brazil, Chile, Panama, Colombia, Turkey and US Under Construction: Existing A
Slide 51: Government Support Provides Opportunities for Wind Growth
Contains Forward Looking Statements Government Support Provides Opportunities for Wind Growth Across Multiple AES Markets US Europe China Brazil z Renewable Portfolio z 20% by 2020 z 10% by 2010 z Government Standards (RPS) in z RPS/feed-in tariffs z 15% by 2020 sponsored program 28 states & DC z Re
Slide 52: US Legislation Promotes Renewables by Expanding Financing Options
Contains Forward Looking Statements US Legislation Promotes Renewables by Expanding Financing Options American Recovery & Reinvestment Act of 2009 z Production Tax Credit (PTC) z Investment Tax Credit (ITC) z Loan guarantee programs through Department of Energy OR M N NY WY CT IA PA NJ IN MD CA OK T
Slide 53: Global Energy Trends: 567 GW of Wind Capacity Expected by 2020
Contains Forward Looking Statements Global Energy Trends: 567 GW of Wind Capacity Expected to Be Added by 2020 GW Additions by 2020 567 GW Rest of World 3% Europe 27% Asia Pacific 42% 28% North America Source: Emerging Energy Research (EER): Global Wind Energy Market Forecast 2009. 53
Slide 54: AES Wind Generation: 1,274 MW in Operation
Contains Forward Looking Statements AES Wind Generation: 1,274 MW in Operation in China, France & US Established in 2005 z Strategy Buffalo Gap, USA-TX M&A and Greenfield development 524 MW Start with OECD markets with attractive incentives Non-recourse financing Expand globally with focus o
Slide 55: AES Wind Generation: ~6,000 MW Pipeline
Contains Forward Looking Statements AES Wind Generation: ~6,000 MW Pipeline in Various Stages of Development Total Development Pipeline Advanced Development Pipeline 6,406 MW 1,427 MW Brazil Brazil 685 210 China 746 MW China MW 99 MW MW 600 3,504 MW US 1,471 MW US Europe MW 518 Europe MW Huanghua, C
Slide 56: Solar PV: Government Support Provides Opportunities for Growth
Contains Forward Looking Statements Solar PV: Government Support Provides Opportunities for Solar PV Growth France Greece Spain Italy z Current Tariff: z Current Tariff: z Current Tariff: z Current Tariff: €0.32/kWh indexed €0.40/kWh €0.31/kWh indexed €0.35/kWh + market price z Term: 20 years z Term
Slide 57: AES Solar: 32 MW Operating in Spain & 500 MW in Development
Contains Forward Looking Statements AES Solar: 32 MW Operating in Spain & 500 MW in Development Darro, Spain z Strategy 6 MW Partner with credible infrastructure fund – $1 Billion JV with Riverstone Europe first Non-recourse financing Expand to rest of the world as equipment prices decline a
Slide 58: Preserving Low Cost Options: Climate Solutions
Contains Forward Looking Statements Preserving Low Cost Options: Climate Solutions z Currently own and operate landfill gas and animal waste based projects 92 projects registered with the UN Annual capacity of 1,800,000 Certified Emission Reductions (CER) z Joint Venture with GE Energy Financial
Slide 59: Greenhouse Gas Services: An AES-GE-MP Venture
Contains Forward Looking Statements Greenhouse Gas Services: An AES-GE-MP Venture Develop Carbon Offsets for Future US Compliance Market What Does GHGS Do? Progress to Date z Invest in methane to power z 5 Projects yielding a combined 1.5 million Offsets z Develop next generation Offset technologies
Slide 60: AES Grid Stability & Efficiency
Contains Forward Looking Statements AES Grid Stability & Efficiency What Does GSE Do? Progress to Date z Improve Grid Services – Install z Working with PJM,NYISO, CAISO, ISO- “batteries” across the electric distribution NE, MISO and ERCOT to demonstrate system to provide higher quality technology an
Slide 61: Summary of Development Priorities
Contains Forward Looking Statements Summary of Development Priorities z Projected global power demand drives future growth opportunities for AES z We are continuing to progress low cost options in core power, renewables and climate solutions z We are well positioned for varying legislative, regulato
Slide 62: 2009-2011 Guidance - Paul Hanrahan
Contains Forward Looking Statements 2009-2011 Guidance Paul Hanrahan President & Chief Executive Officer 62
Slide 63: Key Drivers of 2009-2011 Earnings & Cash Flow Projections
Contains Forward Looking Statements Key Drivers of 2009-2011 Earnings & Cash Flow Projections z Completion of over 3,500 MW construction program Adds $0.25 to Adjusted EPS1 and $300-$400 million proportional free cash flow1 in 2011 z Assumes $800 million Corporate debt paydown Resulting in lower
Slide 64: Portfolio Generates Growing Proportional Free Cash Flow
Contains Forward Looking Statements Portfolio Generates Growing Proportional Free Cash Flow1: 26% CAGR2 $ in Millions Proportional Free Cash Flow1 $1,100-$1,300 $900-$1,100 $650-$850 2009 2010 2011 z AES has a proportional FCF Yield1 of 11%-15% at current stock price3 of $8.62 per share z This incre
Slide 65: Proportional Free Cash Flow Bridge
Contains Forward Looking Statements Proportional Free Cash Flow1 Bridge $ in Millions $130 $50 $350 ($80) $1,200 $750 2009 Mid-Point Kazakhstan Contributions Lower Parent Organic Growth, 2011 Mid-Point of Guidance Incentive Bonus from Projects Interest Operational of Guidance Range Under Improvement
Slide 66: Earnings Projected to Grow at 11% CAGR
Contains Forward Looking Statements Earnings Projected to Grow at 11% CAGR1 $ Per Share Adjusted EPS2 $1.20-$1.30 $0.97-$1.07 $1.05-$1.15 2009 2010 2011 z AES is trading at 8.5x multiple of 2009 Adjusted Earnings Per Share2 z Based on 2011 Earnings potential, AES is trading at 6.9x multiple3 1. Base
Slide 67: Adjusted Earnings Per Share Bridge
Contains Forward Looking Statements Adjusted Earnings Per Share1 Bridge $ in Millions $0.07 $0.05 $0.25 ($0.02) ($0.12) $1.25 $1.02 2009 Mid-Point Kazakhstan Contributions Lower Parent Organic Change in 2011 Mid-Point of Guidance Incentive Bonus from Projects Interest Growth & Share Count2 of Guidan
Slide 68: Sum of the Parts Also Implies Substantial Undervaluation
Contains Forward Looking Statements Sum of the Parts Also Implies Substantial Undervaluation1 $ in Millions, Except Earnings Per Share Unlisted Subs at Unlisted Subs at Unlisted Subs at 5.5x 2009 7x 2009 8.2x 2009 Proportional Proportional Proportional Basis EBITDA2 EBITDA2 EBITDA2 Remarks Equity Ma
Slide 69: Stock Trades at a Discount Based on Existing Portfolio
Contains Forward Looking Statements Stock Trades at a Discount Based on Existing Portfolio & Reflects No Value for Development Pipeline1 Based on 2011 P/E Multiples2 Based on Sum of the Parts3 $15.25 $16.77 $10.78 $13.21 $8.62 $8.62 12.2x 8.2x 8.6x 7.0x 6.9x 5.5x Current Price Current Market Histori
Slide 70: Stock Trades at a Discount Based on Existing Portfolio
Contains Forward Looking Statements Stock Trades at a Discount Based on Existing Portfolio & Reflects No Value for Development Pipeline Based on 2011 Proportional Free Cash Flow Yield1 $15-$182 $8.62 10%-12% 21% Current Price 5/22/09 Target Yield 1. Proportional free cash flow and proportional free
Slide 71: Currency & Commodity Sensitivities and Assumptions
Contains Forward Looking Statements Currency & Commodity Sensitivities and Assumptions Interest Rates z 100 bps move in interest rates is equal to change in EPS of approximately $0.01-$0.02 z 10% appreciation in USD against the following key currencies1 is equal to the following negative EPS impacts
Slide 72: Conclusion
Contains Forward Looking Statements Conclusion Sound Built-in Liquidity Organic Position Growth Diverse Option Portfolio Value of Generates Growth FCF11 Pipeline Value Proposition Compelling Valuation Compared to Current Stock Price 1. Free Cash Flow (FCF), a non-GAAP financial measure. 72
Slide 73: Q&A
Contains Forward Looking Statements Q&A 73
Slide 74: Appendix
Contains Forward Looking Statements Appendix z 2009-2011 Guidance Slide 75 z Construction Program Details Slide 76 z Non-Recourse Debt Maturities 2009-2011 Slide 77-79 z Recourse Debt Maturities 2009-2011 Slide 80 z Top 10 Subsidiary Distributions Slide 81 z Reconciliations Slide 82-91 z Definitions
Slide 75: 2009-2011 Guidance
Contains Forward Looking Statements 2009-2011 Guidance $ in Millions, Except Earnings Per Share 2009 2010 2011 Consolidated Proportional1,2 Consolidated Proportional1,2 Consolidated Proportional1,2 Operating Cash Flow $2,000-$2,200 $1,200-$1,350 $2,300-$2,600 $1,450-$1,650 $2,600-$3,000 $1,600-$1,90
Slide 76: Built-in Growth from More than 3,500 MW Under Construction
Contains Forward Looking Statements Built-in Growth from More than 3,500 MW Under Construction Generation (Thermal) Generation (Renewables) Utility Jordan Chile UK Chile Chile Bulgaria Chile Chile Chile US – PA France Scotland China Turkey Bulgaria Panama Cameroon Guohua I.C. Amman Guacolda Kilroot
Slide 77: Non-Recourse Debt Maturities Summary by Segment
Contains Forward Looking Statements Non-Recourse Debt Maturities Summary by Segment as of March 31, 2009 US$ in Millions Line of Business Country/State Q2–Q4 ’09 2010 2011 2012 2013 Thereafter Total North America Merida III Generation Mexico 6 13 14 14 17 14 78 TEG Generation Mexico 6 7 7 8 8 183 21
Slide 78: Non-Recourse Debt Maturities Summary by Segment
Contains Forward Looking Statements Non-Recourse Debt Maturities Summary by Segment as of March 31, 2009 US$ in Millions Line of Business Country/State Q2–Q4 ’09 2010 2011 2012 2013 Thereafter Total Latin America Alicura II (Inc. Parana) Generation Argentina 4 11 11 12 12 135 185 Edelap Utilities Ar
Slide 79: Non-Recourse Debt Maturities Summary by Segment
Contains Forward Looking Statements Non-Recourse Debt Maturities Summary by Segment as of March 31, 2009 US$ in Millions Line of Business Country/State Q2–Q4 ’09 2010 2011 2012 2013 Thereafter Total Europe & Africa Kavarna Generation Bulgaria – – 2 3 3 53 61 Maritza East I Generation Bulgaria – 22 4
Slide 80: Recourse Debt & Trust Preferred Scheduled Maturities Summary
Contains Forward Looking Statements Recourse Debt & Trust Preferred Scheduled Maturities Summary1 as of March 31, 2009 US$ in Millions 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2029 Senior Secured Term Loan Facility due 2011 - - 200 - - - - - - - - - - Senior Secured Credit Facilit
Slide 81: Top 10 Subsidiary Distributions, 2005-2008
Contains Forward Looking Statements Top 10 Subsidiary Distributions, 2005-2008 2005 2006 2007 2008 IPALCO $208 Eastern Energy $162 IPALCO $170 Eastern Energy $153 EDC1 $107 IPALCO $142 Eastern Energy $122 IPALCO $124 Eastern Energy $85 EDC1 $100 EDC1 $97 Kilroot $105 Shady Point $57 Gener $81 Brasil
Slide 82: Adjusted Earnings Per Share, 2005-2008
Contains Forward Looking Statements Adjusted Earnings Per Share1, 2005-2008 2005 2006 2007 2008 Diluted EPS from Continuing Operations $0.53 $0.25 $0.72 $1.80 FAS 133 Mark to Market (Gains)/Losses $0.05 ($0.05) $0.03 $0.05 Currency Transaction (Gains)/Losses $0.02 $0.02 ($0.03) $0.16 Disposition/Acq
Slide 83: Reconciliation of 2009 Guidance
Contains Forward Looking Statements Reconciliation of 2009 Guidance $ in Millions, Except Earnings Per Share 2009 Consolidated Adjustment Factors1 Proportional1,2 Operating Cash Flow $2,000-$2,200 $800-$850 $1,200-$1,350 Operational Capex (a) $575-$675 $150-$175 $425-$500 Environmental Capex (b) $50
Slide 84: Reconciliation of 2010 Guidance
Contains Forward Looking Statements Reconciliation of 2010 Guidance $ in Millions, Except Earnings Per Share 2010 Consolidated Adjustment Factors1 Proportional1,2 Operating Cash Flow $2,300-$2,600 $850-$950 $1,450-$1,650 Operational Capex (a) $575-$675 $125-$175 $450-$500 Environmental Capex (b) $50
Slide 85: Reconciliation of 2011 Guidance
Contains Forward Looking Statements Reconciliation of 2011 Guidance $ in Millions, Except Earnings Per Share 2011 Consolidated Adjustment Factors1 Proportional1,2 Operating Cash Flow $2,600-$3,000 $1,000-$1,100 $1,600-$1,900 Operational Capex (a) $575-$675 $125-$175 $450-$500 Environmental Capex (b)
Slide 86: Reconciliation of Proportional Free Cash Flow Yield
Contains Forward Looking Statements Reconciliation of Proportional Free Cash Flow Yield1 $ in Millions 2009 2010 2011 Proportional Free Cash Flow1,2 (a) $750 $1,000 $1,200 Current Market Value of Equity3 (b) $5,750 $5,750 $5,750 Proportional Free Cash Flow Yield2,4 (a)/(b) 13% 17% 21% 1. A non-GAAP
Slide 87: Reconciliation of 2008 Proportional Gross Margin
Contains Forward Looking Statements Reconciliation of 2008 Proportional Gross Margin1 $ in Millions Adjustment Consolidated Factor2 Proportional1,2 Generation Segment Gross Margin $1,528 $25 $1,503 Utility Segment Gross Margin $2,179 $1,368 $811 Total Gross Margin $3,707 $1,393 $2,314 1. A non-GAAP
Slide 88: Reconciliation of 2011 Proportional Free Cash Flow from Projects Under Construction
Contains Forward Looking Statements Reconciliation of 2011 Proportional Free Cash Flow1 from Projects Under Construction $ in Millions Adjustment Consolidated Factor2 Proportional1,2 Free Cash Flow1 from Projects $350-$450 $50 $300-$400 Under Construction 1. A non-GAAP financial measure. See “defini
Slide 89: Non-Recourse Debt Reconciliation
Contains Forward Looking Statements Non-Recourse Debt Reconciliation $ in Billions Non-Recourse Debt Balance As of 12/31/05 As of 12/31/08 Businesses Owned as of 12/31/2005 $11.7 $10.1 Generation $8.1 $6.6 Utilities $3.6 $3.5 Net Adjustment for New/(Sold) Businesses $1.1 $2.8 As Reported $12.8 $12.9
Slide 90: Reconciliation of Parent & Subsidiary Liquidity
Contains Forward Looking Statements Reconciliation of Parent & Subsidiary Liquidity In Millions, as of March 31, 2009 Parent Company Subsidiaries Total Cash & Cash Equivalents $168 $1,099 $1,267 Bank Lines of Credit $1,182 $1,305 $2,487 Total Liquidity $1,3501 $2,4042 $3,754 Restricted Cash – $435 $
Slide 91: Reconciliation of Proportional EBITDA
Contains Forward Looking Statements Reconciliation of Proportional EBITDA1 Adjustment Consolidated Factor2 Proportional1,2 Gross Margin $3,200-$3,400 $1,150-$1,250 $2,050-$2,150 Add Depreciation & Amortization $950-$1,050 $175 $775-$875 Less General & Administrative $300 - $300 EBITDA $3,850-$4,150
Slide 92: Assumptions
Contains Forward Looking Statements Assumptions Forecasted financial information is based on certain material assumptions. Such assumptions include, but are not limited to: (a) no unforeseen external events such as wars, depressions, or economic or political disruptions occur; (b) businesses continu
Slide 93: Definitions
Contains Forward Looking Statements Definitions Non-GAAP Financial Measures z Adjusted earnings per share (a non-GAAP financial measure) is defined as diluted earnings per share from continuing operations excluding gains or losses of the consolidated entity due to (a) mark-to-market amounts related
Slide 94: Definitions (cont'd)
Contains Forward Looking Statements Definitions (cont’d) Non-GAAP Financial Measures z Subsidiary Distributions should not be construed as an alternative to Net Cash Provided by Operating Activities which are determined in accordance with GAAP. Subsidiary Distributions are important to the Parent Co