1Q19 Results

Economic-Financial Office and Investor Relations Office

DISCLAIMER

This presentation may contain forward-looking statements referring to SABESP’s

business outlook, operating and financial results estimates, and growth prospects. These

are only forecasts, and as such, they are exclusively based on SABESP’s management

expectation in relation to the future of business and its continuous access to capital to

finance the Company’s business plan. These forward-looking statements largely depend

on changes in market conditions, governmental rules, industry performance and the

Brazilian economy, among other factors, in addition to risks exhibited in disclosure

documents filed by SABESP. Therefore, they are subject to changes without prior notice.

AGENDA

1 COMPANY OVERVIEW

2 OUR OPERATIONS

3 OUR FINANCIAL PERFORMANCE

4 SPMR – WATER SITUATION

...ONE OF THE LARGEST WATER AND SEWAGE PROVIDERS IN THE WORLD

COMPANY OVERVIEW MAIN OPERATIONAL INDICATORS(1)

Water Sewage

Connections (million)(2) 9.5 7.9

Coverage(3) (%) 97 89

Service(4) (%) 94 83

Treatment(5)(%) --- 76

Billed Volume (m³ million) 532.6 439.8

(1) As of March 31, 2019

(2) Active and Inacttive water connections. It includes Guarulhos

(3) Services Available. It includes Guarulhos

(4) Connected households. It includes Guarulhos

(5) Consumer units connected to the sewage treatment – It does not include Guarulhos

*Source: Depth Water Yearbook 2014-2015

**Operation in Guarulhos started in Jan/2019

**The Metropolitan Region we consider for this estimate, includes 8 municipalities outside the

legal boundaries of the São Paulo Metropolitan Region and represents the municipalities served

by the Company’s Metropolitan Division

Sabesp is one of the largest water and sewage service

providers in the world based on the number of

Customers*

Provides water to 26.2 million people and sewage

services to 22.8 million people

Also sells wholesale treated water to 4** municipalities

(1.7 million people)

Natural monopoly, low operating risk

Serves the City of São Paulo and 369 out of 645

municipalities in the State

Covers around 65.5% of State's urban population,

including the wholesale

Operations in the São Paulo Metropolitan Region***

represent 69.8% of our total revenues

4

São Paulo

Sistemas Regionais

RMSP

...WITH STRONG CORPORATE GOVERNANCE

OWNERSHIP STRUCTURE % (1)

We are a mixed capital company, majority-owned by the State of São Paulo, with significant private ownership

State law requires the State of São Paulo to own at least 50% + 1 voting shares at all times (State Law 11,454/2003)

Currently the Government of São Paulo has 50.3% share

100% common shares

Market Cap: R$ 28.7 billion (as of March, 2019)

Law nº 13.303/16 – Government-Controlled Companies Law

5(1) March/2019

AGENDA

1 THE COMPANY

2 OUR OPERATIONS

3 OUR FINANCIAL PERFORMANCE

4 SPMR – WATER SITUATION

80% of water volume and revenue come from residential,

commercial and industrial customer

90% of sewage volume and revenue come from residential,

commercial and industrial customer

DIVERSIFIED CONSUMER BASE

WATER BILLED VOLUME BY TYPE OF CUSTOMER SEWAGE BILLED VOLUME BY TYPE OF CUSTOMER

WATER REVENUES BY TYPE OF CUSTOMER* SEWAGE REVENUES BY TYPE OF CUSTOMER*

7*Managerial information

30-year-service agreement between Sabesp, Municipality of São

Paulo and State Government (expires in 2040)

Minimum investment of 13% of the Gross Revenue, net of

Cofins and Pasep

Transfer of 7.5% of the Gross Revenue, net of Cofins and Pasep,

to the Municipal Environmental Sanitation and Infrastructure

Fund

Since May/18 – Pass-through of 4%

BROAD COVERAGE OF MUNICIPALITIES

CONTRACTS

CONTRACT WITH THE MUNICIPALITY OF SÃO PAULO TOP 10 CONTRACTS

8

Municipalities% of Total Revenue

(1Q19)

Remaining Period(Years)

São Paulo 46.3 21

São Bernardo do Campo 3.8 15

Santos 2.1 26

Osasco 2.1 11

Praia Grande 2.0 29

São José dos Campos 1.8 20

Barueri 1.7 26

Diadema 1.3 25

Itaquaquecetuba 1.2 28

Suzano 1.1 23

Total 10+ / Avg. 63.4 22

* Program and Service Contract from 2007 to Mar/2019

Nº CONTRACTS % OF REVENUE

Renewed/Secured* 307 83.6%

Expired Contracts / Under negotiation 35 7.7%

To be expired (2019 - 2030) 31 7.8%

Total Retail 373 99.1%

Wholesale 4 0.9%

Total Sabesp 377 100.0%

Guarulhos: Operation started in January 2019. Participation of total revenue accounted for 2.4%

CONTRACT WITH GUARULHOS

CONTRACT

9

TERM OF DEBT ADJUSTMENT

40-year service contract Water Supply Service

Sewage collection, removal and treatment services*

Contract signing parties: State, Municipality and Sabesp

Planning shared among State and Municipality (SPMR)

Regulator: ARSESP Tariff, control and monitoring

Tariff: the same as SPMR (adjustment – catch-up period of approximately 2 years)

Expected investment of R$ 2 billion over 40 years

Transfers to the Municipal Fund for Environmental Sanitation and Infrastructure R$ 150 million in 5 years (R$ 30 million per year) 4% of net revenue

The municipality withdraws pending appeals of Sabesp’s collections legal procedings

Sabesp: Court orders debt payments (“Precatórios”) Sabesp suspends the judicial collection of debt

The payments remains suspended during the contract term

The amounts are used as guarantees in the service contract

If the service contract is interrupted, the court orders will be reactivated

Transfer R$ 50 million to the municipality in order to end SAAE’s activities

SAAEs employees ceded to Sabesp: During 6 months - All SAAE’s employees will be ceded to Sabesp

From month 7 up to a maximum of 4 years up to 400 employees will continue to be ceded

* Part of the removal and treatment services will be remaine under the municipality’s direct and indirect responsibility

REGULATORY FRAMEWORK

Legal proceeding related to this matter under Supreme Court (STF) appraisal was ruled in March 2013

The decision was released in September 2013

Sanitation services in metro regions are subject to shared responsibility between State and Municipality

State Legislative has to create an entity and mechanisms to implement the ruling to adjust to the legislation

FEDERAL LAW 11.445/07 / FEDERAL DECREES: 7.217/10, 8.211/14, 8.629/15, 9.254/17

CONCESSION POWER IN METROPOLITAN REGIONS

PROPOSED AMENDMENT TO THE REGULATORY FRAMEWORK FOR SANITATION

Obligatory creation of a Regulatory Agency → Municipal or State level

Clarifies the payment conditions of non-amorSzed investments → up to 4 years

Disbursement of federal funds conditioned to the existence of a sanitation plan

10

The Provisional Measure Nº 868 of December 28, 2018 expired on June 3, 2019;

The Provisional Measure was replaced by a Bill of Law, which was approved on na emercency basis

on June 6 in the Senate;

The Bill of Law is being appraised by the House of Representatives and, if approved without

changes, will continue on to the President of Brazil to be sanctioned, otherwise it will return to the

Senate for approval of the amendments and then to the presidencial sanction.

Productivity Factor

(0.6920%)

Productivity Factor

(0.6920%)New Average

Tariff

New Average

Tariff= 1

Inflation

(IPCA)

Inflation

(IPCA)

100x Previous

Average TariffPrevious

Average Tariff

QualityFactor*QualityFactor*

-

+

TARIFF REVIEW

*Not defined yet

METHODOLOGY OF TARIFF REVIEW (PRICE CAP)

ANNUAL TARIFF ADJUSTMENT FORMULA

11

-

TaxesRequired Revenue

Average

Tariff (P0)

PRICECAP

Output ofthe Model

= + +

Reduced by X Factor X defined by Arsesp

(after year1)

Income Taxes

RevenueTaxes

OPEX +

PersonnelEnergy

MaterialsOthers

WaterSewageOthers

RABt – RAB0

AmortizationRate

AssetUseful Life

WACC

Cost of EquityCost of Debt

ArsespTechnical

Note

Sabesp 4 year Business Plan+

Arsesp Review

CAPEX

Billed

Volume

Initial Phase - Oct/2017 Final Phase- May/2018

RAB(1) (R$ Billion) 40.3 39.0

WACC (%) 8.11 8.11

Current Average Tariff (R$/m³) 3.37255 3.6425

X Factor(%) - 0.6920

P0 (R$/m³) 3.63861 3.7702

TRI(2) (%) 7.8888 3.507

TARIFF READJUSTMENTS AND REVISIONS

ORDINARY TARIFF REVISION (OTR) - 2º CYCLE FROM 2017 TO 2020

READJUSTMENTS AND REVISIONS INDEXES

12

(1) Regulatory Asset Base (2) Tariff Repositioning Index

ARSESP’s responds to the requests filed by Sabesp: Reconsideration request Not accepted Clarification and revision request Partially accepted (Adjustment of 0.8408% in May 2019)

ARSESP’s Resolutions nº 865 and nº 866 → Tariff Structure Revision (to be defined by June 2020)

OTR- Ordinary Tariff Revision

ETR- Extraordinary Tariff Revision

2015 - Readjustment + Residual + ETR = 15.24%

IPCA Index – Between the readjustement/revision periods

Add 954 thousand new connections by 2023

Add 1.2 million new connections by 2023

Coverage: 93% in 2023

Treatment: 84% in 2023

WATER AND SEWAGE OPERATIONS

WATER CONNECTION EVOLUTION (million) WATER COVERAGE (Connection in 000’s)

SEWAGE CONNECTION EVOLUTION (million) SEWAGE COVERAGE (´000s)

13

Metropolitan Water Program

Tietê Project

Corporate Program for Water Loss Reduction

Clean Stream Program

Clean Wave Program

CAPEX AND FINANCING

CAPEX PLAN OF R$ 18.7 BILLION FROM 2019 TO 2023

FINANCING MAIN PROGRAMS

(*) Book Value – Includes non-cash items

(**) Book Value – Items that affected cash

Additional information is presented in

Note 31 of the 1Q19 Financial Information

14

Financial Values (in R$ million)

788*

228**

AGENDA

1 COMPANY OVERVIEW

2 OUR OPERATIONS

3 OUR FINANCIAL PERFORMANCE

4 SPMR – WATER SITUATION

LONG TERM AND LOW COST FUNDING

TOTAL DEBT BREAKDOWN TOTAL DEBT BY CURRENCY

DEBT AMORTIZATION PROFILE (R$ million)

16

Total debt: R$ 12.2 Billion

2013 2014 2015 2016 2017 2018

Dividends declared (R$) 0.8 0.4 0.2 1.2 1.0 1.2

Pay Out % 27.9 27.9 27.9 27.9 27.9 27.9

Outstanding Shares

(million)

683.5 683.5 683.5 683.5 683.5 683.5

CONSISTENT PERFORMANCES

NET REVENUE (R$ million) NET INCOME (R$ million)

ADJUSTED EBITDA (R$ million) DIVIDENDS / PAY OUT

Adjusted EBITDA – Last 12 months Adjusted EBTIDA Margin – Last 12 months Adjusted EBITDA Margin Without Construction – Last 12 months 17

HISTORICAL LEVERAGE (R$ million)

GROSS DEBT VS. ADJUSTED EBITDA* ADJUSTED EBITDA* VS. FINANCIAL EXPENSES**

NET DEBT VS. ADJUSTED EBITDA* NET DEBT VS. EQUITY

* Adjusted EBITDA – LTM ** Financial Explosures paid - LTM Calculated in accordance with CPCs/IFRS 18

19

COVENANT – ADJUSTED NET DEBT vs. EBITDA

COVENANT – ADJUSTED TOTAL DEBT vs. EBITDA

20

2002 2003 2004 2005 2006 2007 2008* 2009* 2010* 2011* 2012* 2013* 2014* 2015* 2016* 2017* 2018* 1Q19

Gross Revenues w/ construction 3.962 4.308 4.642 5.356 5.984 6.448 6.839 9.085 9.787 10.530 11.391 11.985 11.823 12.284 14.855 15.375 17.056 4.140

Net Revenues 3.767 4.131 4.397 4.953 5.527 5.971 7.809 8.580 9.231 9.927 10.738 11.316 11.213 11.712 14.098 14.608 16.085 3.879

Adjusted EBITDA 1.860 2.076 1.927 2.286 2.446 2.699 2.865 2.727 3.222 3.371 3.605 4.007 2.919 3.974 4.572 5.269 6.541 1.545

Adjusted EBITDA Margin 49,4 50,3 43,8 46,1 44,3 45,2 36,7 31,8 34,9 34,0 33,6 35,4 26,0 33,9 32,4 36,1 40,7 39,8

Adj. EBITDA without Construction Margin 46,3 41,2 44,7 43,2 43,0 44,6 34,4 46,6 43,3 45,4 48,8 46,8

Net Income (651) 833 513 866 789 1.055 863 1.508 1.630 1.381 1.912 1.924 903 536 2.947 2.519 2.835 647

Net Margin (%) 20,2 11,7 17,5 14,3 17,7 11,0 17,6 17,7 13,9 17,8 17,0 8,1 4,6 20,9 17,2 17,6 16,7

2002 2003 2004 2005 2006 2007 2008* 2009* 2010* 2011* 2012* 2013* 2014* 2015* 2016* 2017* 2018* 1Q19

Total Assets 16.332 16.590 16.784 17.431 18.000 18.660 17.206 20.243 23.293 25.019 26.476 28.274 30.355 33.707 36.745 39.546 43.565 43.313

Total Debt 7.878 7.264 7.051 6.664 6.327 5.685 6.865 6.560 8.209 8.423 8.875 9.450 10.786 13.122 11.964 12.101 13.153 12.181

Short-term Debt 1.132 997 1.497 759 853 742 1.449 1.010 1.240 1.629 1.343 641 1.207 1.526 1.247 1.747 2.104 1.488

Long-Term Debt 6.593 6.267 5.554 5.905 5.474 4.943 5.416 5.548 6.970 6.794 7.533 8.809 9.579 11.595 10.718 10.354 11.049 10.693

Foreign Currency Debt 3.708 3.013 2.681 1.576 1.472 1.242 2.281 1.746 2.249 3.053 3.216 3.699 4.346 6.618 5.660 5.673 6.669 6.609

Shareholders' Equity 4.217 7.577 7.952 8.483 9.019 9.781 6.758 8.439 9.682 10.546 11.257 12.931 13.304 13.717 15.419 17.513 19.552 20.199

Total Debt/Total Cap. (%) 65,1 48,9 47,0 44,0 41,2 36,8 50,4 43,7 45,9 44,4 44 42 45 48,9 43,7 40,9 40,2 37,6

Investments 619 594 601 678 905 921 1.734 2.059 2.194 2.440 2.536 2.716 3.211 3.482 3.878 3.388 4.177 788

2002 2003 2004 2005 2006 2007 2008* 2009* 2010* 2011* 2012* 2013* 2014* 2015* 2016* 2017* 2018* 1Q19

Dividend Declared (R$/ share) - 17.7** 5.4** 12.2** 9.5** 1,3 1,3 1,7 2,0 2,5 2,3 0,8 0,4 0,2 1,2 1,0 1,2 -

Pay Out (%) - 60,5 29,8 40,2 34,7 28,5 34,3 26,1 28,0 47,3 27,9 27,9 27,9 27,9 27,9 27,9 27,9 -

Dividend Yield (%) - 10,8 3,4 7,8 3,2 3,2 4,7 5,0 4,7 4,9 2,7 3,0 2,2 1,2 4,2 3,0 3,8 -

Outstanding shares (million) 28,5 28,5 28,5 28,5 28,5 227,8 227,8 227,8 227,8 227,8 227,8 683,5 683,5 683,5 683,5 683,5 683,5 683,5

FINANCIAL HIGHLIGHTS (R$ million)

21

* In accordance with CPCs / IFRS, which includes Construction Costs.** R$ / 000 shares

AGENDA

1 COMPANY OVERVIEW

2 OUR OPERATIONS

3 OUR FINANCIAL PERFORMANCE

4 SPMR – WATER SITUATION

Guarapiranga Alto Tietê

SPMR – WATER SITUATION

Cantareira

Long Term Average – Sep/17 to Oct/18

RAINFALL IN THE MAIN WATER PRODUCTION SYSTEMS (mm)

23

AVERAGE PRODUCTION (m³/s)VOLUME STORAGE (%)

Until June 13, 2019Until June 13, 2019

SPMR – WATER SITUATION

WATER SUPPLY SYSTEM STRONGER THAN BEFORE THE WATER CRISIS OF 2014/2015

RESERVOIRS 2013 2019 Var. %

Reservoirs (water right) (m³/s) 70.4 80.3 14%

Maximum storage capacity (hm³)

(without the technical reserve)1,816 2,106 16%

Transfers between reservoirs (m³/s) 13.2 35.4 168%

PRODUCTION AND DISTRIBUTION 2013 2019 Var. %

Urban population in the area served (source: SEADE)

(million inhabitants)20.1 20.9

3.6%

730,000 inhab.

Total water treatment capacity (m³/s) 73.4 82.3 12%

Water production systems 8 9 -

Average monthly production (m³/s) 69.1 63.3 (9%)

Average residential consumption (m³/month) 13.0 10.8 (17%)

Treated water transfers between the systems (m³/s) Up to 3 Up to 12 300%

IPDT (water loss per connection per day) in the SPMR 434 322 (26%)

24

WATER PLAN FOR SPMR – FROM 2015 TO 2019 (MAIN ACTIONS)

25

DESCRIPTION FLOW (m³/s)

PURPOSEAVAILABILITY/ SECURITY

INITIATIVES ACCOMPLISHED IN 2015Reversal increase from Guaratuba River to the Ponte Nova reservoir by 0.5

m³/s0.5

Recover the storage volume and ensure Alto Tietê's water source

Reversal from the Guaió River to the Taiaçupeba reservoir: 1 m³/s 1

Increase of the ABV Water Treatment Station production from 15 to 16 m³/s Transfer water from Guarapiranga to the Cantareira area via the

aqueduct system

Interconnection between: Pequeno River → Grande River (Billings) →

Taiaçupeba (Alto Tietê) 4 m³/s 4

Recover the storage volume and ensure the Alto Tietê reservoir

Transfer water to Cantareira’s area

1 m³/s transfer increase from Taquacetuba to Guarapiranga (from 4 to 5

m³/s)1

Ensure Guarapiranga's water source

Transfer water to Cantareira’s area

TOTAL 2015 6.5

INITIATIVES ACCOMPLISHED IN 2018Jaguari → Atibainha Interconnection: 5.13 m³/s to the Cantareira system

(security increase)5.13

Recover storage volume and ensure the Cantareira System's water

source

São Lourenço Production System: 6.4 m³/s 6.4 Produce 6.4 m³/s for the Greater São Paulo's western region

TOTAL 2018 11.53

INITIATIVE PLANNED FOR 2019

Reversal from Itapanhaú River (Ribeirão Sertãozinho) to the Biritiba reservoir 2 Recover the storage volume and assure Alto Tietê's water source

TOTAL 2019 2

TOTAL 2015 – 2019 20.03

SPMR – WATER SITUATION

www.sabesp.com.br

IR Contacts

Mario Azevedo de Arruda Sampaio Angela Beatriz AiroldiHead of Capital Markets and IR Investor Relations Managermaasampaio@sabesp.com.br abairoldi@sabesp.com.br+55 (11) 3388-8664 +55 (11) 3388-8793