Slide 1: 2005 Financial Review and 2006 Outlook
AES Corporation 2005 Financial Review and 2006 Outlook April 6, 2006 9:00am EDT The Global Power Company
Slide 2: Safe Harbor Disclosure
AS Safe Harbor Disclosure ‘The Global Power Company 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 earings, growth and financial
Slide 3: 2005 Record Year and 2006 Targets
Contin Foard Looking Siotente 2005 was a record year for: y Revenues ¥ Net cash from operating activities ¥ Free cash flow!) Revenues exceed $11 billion for the first time Fourth quarter and full-year earnings benefit from good operating results, favorable currencies and lower tax rate 2008 financia
Slide 4: 2006 Guidance Elements: 2005-2006 EPS Bridge
AS 2006 Guidance Elements: The Goba Power Coary 2005-2006 EPS Bridge Contains Formard Looking Statements $1.28 $0.95 2005 Higher Higher Debt Increased Diluted 2006 Adjusted Diluted EPS Operating «Tax Rate Retirement Development EPS From EPS Adjusted From Results & &Minonty and Business Expense and C
Slide 5: 2006 Guidance Elements
Contains Forward Looking Statements Guidance Element 2006 Guidance Revenue Growth (% change) 4 to 5% Gross Margin $3.2 to $3.3 billion Business Segment Income Before Tax & Minority Interest $2.3 billion (Excludes Corporate Costs of $625 Million) Allocated by Segment as % of Total + Regulated Utiltie
Slide 6: 2006 Guidance Elements
Contains Forward Looking Statements Guidance Element 2006 Guidance Net Cash From Operating Activities $2.2 to $2.3 billion Maintenance Capital Expenditures $800 to $900 million Free Cash Flow) $1.3 to $1.5 billion Subsidiary Distributions”) $1.0 billion Parent Investments and Capital Expenditures $2
Slide 7: 2006 Guidance Elements: Subsidiary Distributions
AS 2006 Guidance Elements: The Gel Power Conny Subsidiary Distributions ($ Millions) Contains Forward Looking Statements Expected 2006 Subsidiary Distributions” ametien | america | Europe Made | Asia | yop Rong $143 $134 $28 & $300 Conrad $160 $60 $148 $32 $400 ae $224 $49 - $27 $300 Total $627 $243
Slide 8: Fourth Quarter and 2005 Financial Results
{S Millions Except Earnings Per Share and Percent) Revenues Gross Margin a5 % of Revenues Income Before Income Taxes and Minority Interest (IBT&MI) Diluted EPS from Continuing Operations Adusted EPS® Return on Invested Capital (ROIC)® () Restated Fourth Quarter 2008 $2973 $929 31.2% sant $0.27 $0.28
Slide 9: Adjusted EPS Reconciliation
(SPer Share) 2005 2004 2005 20040 Diluted Earnings Per Share From Continuing $0.27 $0.03 $095 = $0.41 Operations FAS 133 Mark-to-Market (Gains)/Losses® - - = 0.06 Currency Transaction (Gains)/Losses oot oot (0.04) 0.06 Net Asset (Gains)/Losses and Impairments - 0.05 - 0.05 Debt Retirement (Gains)/Lo
Slide 10: Fourth Quarter 2005 Cash Flow
(S Millions) 40 Fourth Quarter 2005 ‘Subsidiary-Only_ ‘Subsidiary Net Cash from Operating Activities” $840 Consolidated Net Cash from Operating Activities $699 Free Cash Flow? ‘$577 Parent-On! ‘Subsidiary Distributions» $354 Return of Capital from Subsidiaries” $8 Recourse Debt Repayment (Net)” $2 (
Slide 11: Fourth Quarter and 2005 Subsidiary Distributions
AS Fourth Quarter and 2005 The Gel Power Conny Subsidiary Distributions ($ Millions) Fourth Quarter/ 2005 Subsidiary Distributions North Latin | Europe, Middle |, america | america | Easts Africa Total Regulated $54/208- $7123 $27128 Sh $162369 Utites Contract Gereration: $54/234, $25/36- $38/158 $2
Slide 12: Regulated Utilities Segment Results
{S Millions Except As Noted) Fourth Fourth Quarter Quarter % 2005 = 2004 Change | Segment Highlights Revenues $1,537 $1,355 13% | + Revenues grew as a result of favorable currency effects in Brazil and higher tariffs in Brazil and Gross Margin $416 $275 51% ‘Argentina, as % of Sales 271% 203% 680bp.
Slide 13: Contract Generation Segment Results
{S Millions Except As Noted) Fourth Fourth Quarter Quarter % 2005 2004 Change Revenues $1,118 $904 24% Gross Margin $405 $374 8% as % of Sales 362% 414% (620bp) IeTEM $236 $140 69% Revenue Comparison (Q0Q) —_% Change Volume/Price/Mix 23% ‘Currency (Net) 1% Total 24%. 13 2005 Financial Review and 200
Slide 14: Competitive Supply Segment Results
6 14 Millions Except As Noted) Fourth Fourth Quarter Quarter 2005 © 2004 Revenues $318 $264 Gross Margin $108 $57 as % of Sales 34.0% 21.6% IBT&MI $80 $13 Revenue Comparison (Q0@) _% Change Volume/Price/Mix 23% ‘Currency (Net) O% Total 20%. + Revenues grew as a result of higher prices in New York, A
Slide 15: Appendix
15 Appendix 2005 Financial Review and 2006 Outlook www.aes.com
Slide 16: Parent Sources and Uses of Liquidity
{SMillions) Sources Total Subsidiary Distributions Proceeds from Asset Sales, Net Refinancing Proceeds, Net Increased Revolver Commitments Issuance of Common Stock, Net Total Returns of Capital Distributions and Project Financing Proceeds Beginning Liquidity” Total Sources Uses Repayments of Debt® I
Slide 17: Parent Debt Reconciliation
{SMillions) Debt Reconciliation Parent Debt (Including Letters of Credit) at 12/31/04 $5,250 ( ‘Scheduled Debt Maturities: (142) Discretionary Debt Repayments: Prepayment of Debt «gy Other 180% Parent Debt (including Letters of Credit) at 12/31/05 $5,176 Less: Letters of Credit Outstanding at 12/31/
Slide 18: Consolidated Cash Flow Summary
($ Millions) Net Cash from Operating Activities Maintenance Capital Expenditures Growth Capital Expenditures Investment n Subsidiaries Returns of Capital from Subsidiaries ‘Net Proceeds ftom Asset Sales Proceeds from the Sale of Emission Allowances ‘Sale of Short Term Investments, Net of Purchases.
Slide 19: Consolidated Cash Flow Summary
($ Millions) Net Cash from Operating Activities Maintenance Capital Expenditures Growth Capital Expenditures Investment n Subsidiaries Returns of Capital from Subsidiaries ‘Net Proceeds ftom Asset Sales Proceeds from the Sale of Emission Allowances ‘Sale of Short Term Investments, Net of Purchases.
Slide 20: Subsidiary Distributions and Liquidity by Quarter
(S Millions) ‘Total subsidiary distibutions. & tetuins of capital to parent ‘Sbsiary aston to pret Net aston totion) HC Total stbsidny dette Retuns of capt ebb opaert Net eturs tap tiers to! (romance ‘Total retums fcaptal ditions Liquidity ‘cosh at per val nde reoher Ending tity ‘ee fotonng page for
Slide 21: Assumptions
AS Assumptions ‘The Global Power Company 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 continue to op
Slide 22: Definitions of Non-GAAP Measures
AS Definitions of Non-GAAP Measures ‘The Global Power Company + Adjusted earnings per share (a non-GAAP financial measure), is defined as diluted earnings per share from continuing operations excluding gains or losses associated with (a) mark-to-market amounts. related to FAS 133 derivative transact
Slide 23: Net Cash from Operating Activities and Free Cash Flow Reconciliation
Net Cash from Operating Activities - Fourth Quarter and Full Year 2005 ($ Millions) AES Subsidiaries Corp Eliminations _ Consolidated Fourth Quarter 2005, $840 $213 $(354) $699 2005 $2,737 $421 $(993) $2,165, Reconciliation of Free Cash Flow ($ Millions) Fourth — Fourth 2006 Quarter Quarter Guidance
Slide 24: Searchable text section of graphics shown above
Searchable text section of graphics shown above AES Corporation 2005 Financial Review and 2006 Outlook April 6, 2006 9:00am EDT [LOGO] The Global Power Company Safe Harbor Disclosure Certain statements in the following presentation regarding AES’s business operations may constitute “forward looking