Apresenta??o Corporativa - Bank of America Merrill Lynch*

8/9/2019 Apresenta??o Corporativa - Bank of America Merrill Lynch*

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Corporate Presentation

Bank of America Merrill Lynch

March 2015


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Light HoldingsDiversified structure which is comprised of the distribution, generation

and commercialization segments.

2


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4

56

7

Light in numbers

Amazônia Energia

Renova

Guanhães Energia

Generation

Complexo de Lajes

Distribution RJ StateConcession

Area%

Population¹ 16 mn 11 mn 68%

Area¹ 44,000 Km² 11,000 Km² 25%

GDP¹ R$ 407 bn R$ 207 bn 51%

# Consumers 7 mn 4 mn 57%

# Municipalities 92 31 34%

5

HPP Ilha dos Pombos

SHP Paracambi

HPP Santa Branca

1

2

3

1 IBGE (2010)

4

6

7

3


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Rankings Among the largest players in Brazi l

INTEGRATED¹Net Revenues 2013* – R$ Billion

POWER GENERATION PRIVATE-OWNED COMPANIES¹

Installed Hydro-generation Capacity (MW) – 2013

37,767

25,77722,926

21,783 20,39115,634

15.6

10.69.2

7.47.1

5,560

2,652 2,241 2,2191,799

896

ELECTRICITY DISTRIBUTION²Energy Consumption in Concession Area** (GWh) - 2013

1 – Source: Companies reports

2 – Source: Relatório do Sistema de Apoio

a ANEEL

* Construction Revenue Included

** Captive Market

*** Considers the 9 MW of Renova’s SHPs

and 19 MW of Brasil PCH

***4

14.6


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Shareholder StructureEff ic ient comb inat ion of so l id indu stry and f inancia l players

11 Board members: 8 from the controlling

group, 2 independents e 1 employees

nominated

A qualifying quorum of 7 members to

approve relevant proposals such as: M&A

and dividend policy

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Corporate GovernanceDecision process assures transparency and value creation

General Assembly

Fiscal Council

Board of Directors

Auditors

Committee

Governance andSustainability

Committee

HumanResourcesCommittee

Finances

Committee

Management

Committee

Chief ExecutiveOfficer

João B. Zolini Carneiro Ricardo Cesar C. Rocha Luis Fernando Guimarães Andreia Ribeiro Junqueira

Fernando Antônio F.Reis *Ailton Fernando Dias *Cláudio Bernardo Moraes

Paulo Roberto R. Pinto

ChiefCommunications

Officer

*Luiz Antonio R. Elias

LGSXY ADR-OTC

6

Chief Financial and

Investor RelationsOfficer

Chief Legal Officer

Chief HR Officer

Chief Distribution

Officer Chief Energy Officer

Chief BusinessOfficer

CorporateManagement Officer

Waiting to take office.*


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Energy Consumption Distribution – 9M14

7

1Note: To preserve comparability in the market approved by Aneel in the tariff adjustment process.the billed energy of the free customer CSN has been considered back.

TOTAL MARKET (GWh) ¹

Industrial

captive5.7%

Free

19.8%

Otherscaptives

14.6%

Commercialcaptive28.4%

Residentialcaptive31.5%

+3.2%

+3.8% p.a.

19,186

17,4197,259

19,800

23.9ºC

24.4ºC

9M12

M11

24.3ºC

24.0ºC

9M13 9M14


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Market Breakdown

8

ELECTRICITY CONSUMPTION (GWh)

TOTAL MARKET – ACCUMULATED

FREECAPTIVE

RESIDENTIAL INDUSTRIALCOMMERCIAL OTHERS TOTAL

+3.2%

9M13 9M14

15,209

16,048

19,186

3,978

3,752

19,800

+2.5%

2,686

2,747

2,837

151

161

2,908

+4.5%

5,909

637

663

6,175

1,039 1,042

4,229

3,190

2,928

3,970

+8.6%

6,212

6,747

9M13 9M14

9M13 9M14

9M13 9M14 9M13 9M14

-6.1%

5,271

5,512


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Losses and Collection

9

LOSSES (12 MONTHS)

% Non-technical

losses/ LV Market

Non-technical losses GWh

Technical losses GWh

PBD/GROSS REVENUE

(BILLED SALES) - QUARTER

COLLECTION RATE

12 MONTHS

97.9%

102.0%

Sep-13 Sep-14

Sep/14

ep/13 Mar/14

Jun/14

ec/13

43.7%

5,738

2,614

8,552

41.3%

5,972

2,843

8,352

41.9%

5,906

2,851

8,815

5,905

2,647

8,757

- 2.4 p.p.

42.2%

42.4%

5,955

2,793

8,748

3Q12

3Q1 4

Q13

1.9%

2.0%

1.6%

-0.4 p.p.


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Loss Reduction StrategyEfficient combination between technology and effective management

Outisde of Communities

Communities

CUSTOMERS ENERGY AND STATUS

Retail and residential clients(Low Voltage)

4,100,000

Low Voltage

Largest Clients22,000

LargeClients

(hight andmed voltage)

7,600

11,500 GWh (48%)

100% Concluded

2,700 GWh (11%)

1/3 as of today until 2015

10,000 GWh (41%)

APZ

10

2010

2011 2013012

115

Sep/14

351

30

79

102

227

432

272

330

7

122

197

131

570

439


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Mechanical

MeterDisplay

11

Technology: Centralized MeasuringUse of new technologies in areas with a high level of losses


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Focused in areas with 10,000 to 20,000 clients with high level of losses and

delinquency;

Fully-dedicated teams of technicians and commercial agents;

Results constantly and accurately monitored by Light;

Result-linked remuneration for services provided;

29 units implemented with 511 thousand

clients (12% of total); 200 thousands additional clients per year .

Zero Losses AreaProject: “Light Legal”

12

ELECTRONICMETERS

WORKFORCEMANAGEMENT

PARTNERSHIP WITH THE STATEGOVERNMENT


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APZ COLLECTIONAPZ LOSSES

Evolution of APZs ResultsSigni f icant los s reduc t ion and increasing col lect ion rate

Before

50.0 %

19.2%

89.2%

95.5%

Before

100.2%

98.4%

00.3%

93.9%

20.3%

22.3%

22.0%

13

M

a

1

J

1

S

1

J

1

S

1

M

a

1

S

1

J

1

S

1

-29.7%

+9.2%

D

1

91.2%

D

1

22.2%

J

1

16.4%


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Generation


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855 MW Installed CapacityConcessions Expiring Only in 2026

16

HPP Santa Branca

56 MW

HPP Ilha dos Pombos187 MW

HPP Fontes Nova

132 MWUnderground HPP

Nilo Peçanha - 380 MWHPP Pereira Passos

100 MW

SP

RJ

HPP Santa Branca

Paraiba do Sul River

HPP Ilha dos

Pombos

100%

100%

100%100%100%

ISO 9001 – Quality Management

14001 – Environmental ManagementOHSAS 18001 - Occupational health and Safety Management


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Contracted Energy (Free)

Hedge

vailable Energy

17

2015 2016 2017 2018 2019 2020 2021

28 28 28 28 28 28

549 549

549

549

549 549 549

486 456 480 438

337

247 232

35

66

41

83

184

274 289

Average selling price in 2015-2021: R$ 169/MWh (base date: January, 2015)

Assured Energy: 549 MWaverage

Energy commercialization focused on the free market

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Power Generation ExpansionRenewable energy generat ion projects, mainly through partnership s

Project

Installed Capacity

(MW)

Assured Energy

(MWaverage)

Operational Start Stake

Paracambi

25 20 2012 51%

Renova

652.3 (in operation)

1,853.8 (contracted)

296 (in operation)

914 (contracted)

2008 - 2014

2015 2019

15.87%

Belo Monte

11,223 4,571 2016 2.49%

Guanhães

44 25 2015 51%

Lajes

17 15 2016 100%

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82 128 173

219

265 280

13

2217

855

13

255

22

1H17 1H19

1,552

855

13

365

22

104

1H14

945

855

1377

2H13

921

855

1353

17

2H18

1,520

855

13

365

22

1H18

1,421

855

68.5%

13

312

22

2H17

13

200

22 9

1H15

1,011

855

13

143

2H14

971

855

1H16

1,147

1,319

13

204

2236

2H15

1,099

855

1,273

855

13

255

22

2H16

1,208

855

13

236

855

Light Energia

SHPP Paracambi¹

Renova²

Guanhães¹

Belo Monte³

SHPP Lajes¹ 51% Light

² 15.87% Light3 2.49% Light

Power Generation ExpansionInstalled Capacity (MW)

Light's proportional Participation

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RESULTS


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Net Revenue

Industrial (Captive)

6.3%

NET REVENUE (R$MN) Generation 7.4%

Distribution

79.4%**

NET REVENUE BY SEGMENT (3Q14)*

Commercialization

13.2%

* Eliminations not considered

** Construction revenue not considered

NET REVENUE FROM DISTRIBUTION (3Q14)

Commercial

(Captive)

40.9%

Others (Captive)

12.6%

Network Use (TUSD)

(Free + Concessionaires)

8.3%

Residential (Captive)

31.9%

Construction Revenue

Revenue w/out construction

revenue

3Q14 9M13Q13 9M14

+9.4%

1,557

1,581

634

455

1,679

5,356

4,901

5,301

25722

1,838

5,936

+10.8%1,360

128

227

21

+1.5%

+8.2%


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Operating Costs and Expenses

Manageable

(distribution)

(20.4%)

Generation and

Commercialization

(19.6%)

Non manageable

(distribution

**

)

(60.0%)

* Eliminations not considered** Construction revenue not considered

DISTRIBUTION PMSO COSTS (R$MN)COSTS (R$MN)*3Q14

COSTS (R$MN)*9M14

Non manageable

(distribution

**

)

(64.3%)

Generation and

Commercialization

(16.2%)

Manageable

(distribution)

(19.5%)

R$ MN 3Q13 3Q14 Var. 9M13 9M14 Var.

PMSO (311.5) (326.6) 4.8% (987.0) (979.4) -0.8%

Provisions (19.6) (37.9) 93.3% (97.2) (99.3) 2.2%

PCLD (3.9) (20.3) 419.8% (38.3) (38.3) 0.1%

Contingencies (15.7) (17.6) 12.2% (58.9) (61.0) 3.5%

Depreciation (37.1) (29.8) -19.6% (114.6) (91.2) -20.4%

Other operational/revenues expenses

(86.0) (91.4) 6.3% (250.5) (263.0) 5.0%

Total 58.2 105.6 81.4% 246.1 296.6 20.5%

327

321

988

3,305

979

827

312

327

+4.8%

3T14T13 9M14M13

987 979

-0.8%

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EBITDA by segment

(R$ MN)

23

Generation and Commercialization

1

Electricity Distribution

56.0%

Consolidated EBITDA (R$ MN) 3Q14 3Q13 Var. 9M14 9M13 Var.

Distribution 137.1 608.9 -77.5% 524.3 1,011.5 -48.2%

EBITDA Margin (%) 10.1% 43.8% -33.7 p.p. 11.5% 23.1% -11.6 p.p.

Generation 24.5 104.9 -76.7% 295.3 324.4 -9.0%

EBITDA Margin (%) 19.2% 79.0% -59.8 p.p. 62.5% 79.1% -16.6 p.p.

Commercialization 23.6 9.3 155.0% 88.8 23.5 277.0%

EBITDA Margin (%) 10.4% 6.0% 4.5 p.p. 13.1% 5.1% 8.0 p.p.

Others and eliminations (1.7) (1.1) 58.4% (32.5) (4.3) 649.1%

Total 183.6 722.0 -74.6% 875.8 1,355.1 -35.4%

EBITDA Margins (%) 11.6% 46.4% -34.8 p.p. 16.5% 27.6% -11.1 p.p.

185

-74.4%

723

26.0%

74.0%

15.8%

84.2%

3Q13 3Q14 9M13 9M14

74.4%

57.7%

25.6%

42.3%

-33.2%

908

1,359

1Percentages do not consider eliminations


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EBITDA

EBITDA

9M13

EBITDA

9M14

Net

Revenue

Non-

Manageable

Costs

Manageable

Costs

(PMSO)

Provisions

egulatory

Assets and

Liabilities

Regulatory

Assets and

Liabilities

Adjusted

EBITDA

9M13

Adjusted

EBITDA

9M14

Adjusted EBITDA – 9M13 / 9M14 (R$ MN)

Other

operacional

revenues

Equity

Pikup

- 16.2%

- 35.4%

1,246

(109)

1,355

400

(896)

0,2 (2) 23 (5)

876

169

1,044

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Net Income

9M13

9M14

BITDA Financial

Result

Taxes Depreciation

Adjusted Net Income 9M13 / 9M14 (R$ MN)

Regulatory

Assets and

Liabilities

Regulatory

Assets and

Liabilities

Adjusted Net

Income

9M13

Adjusted Net

Income

9M14

(3)

- 68.9%

- 34.3%

387

(72)

458 (479)

8

169

(14)

143

111

254

25


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Indebtedness

Average Term: 3.7 years

AMORTIZATION SCHEDULE* (R$ MN)

27*ConsideringHedge

* Principal only

Nominal Cost Real Cost

COST OF DEBT

2012

011

3T14

2.24%

8.21%

4.47%

11.27%

4.25%

11.03%

2013

9.68%

3.55%

261

791

1,055

866

1,210

721

733

479

581

TJLP

12.0%

CDI

73.3%

IPCA

10.8%

Others

3.5%

U /Euro *

0.3%

4,151.6

5,229.65,543.6

NET DEBT

Net Debt / EBITDA

Sep/13 Sep/14un/14

2.99

3.39

2.68


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Investments

CAPEX (R MN)

CAPEX BREAKDOWN

(R MN)

9M14

Generation

18.1

Administration

27.8

Others

7.7

Develop. of

Distribution

System

339.7

Losses

Combat

227.9

Investments in Electric Assets (Distribution)

Commerc./

Energy

Eficiency

8.3

519

2010

701

2011

2012

797

694

103

519

182

775

154

713

132

845

+30.5%

2013

482

9M13

9M14

88

54

394

575

630

929

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Why invest in Light?

29

Rio as a host of major events Communities pacification Pro-business environment Investment projects hubEnergy Market growth

EconomicTransformation

in theConcession Area

Progress in the TechnologyProgram (Smart Grid)

New network and electronic metersin the pacified areas

“Zero Losses Area” Program

EnergyLosses

Reduction

Projects under construction withpartnerships: Renova, Belo Monte andGuanhães (total of 588 MW) SHPP Lajes under construction(17MW).

Growth in theGenerationBusiness

Expiration of RegulatedContracts (Dec/2013)New contracts in 2014Energy available forcommercialization

EnergyCommercialization

focused on thefree market

Listed in “Novo Mercado” ofBovespa

Board Commitees with strongparticipation in the decision makingprocess Included in the Sustainability

Index (ISE) for the 7th year

Best CorporateGovernance

Practices

Dividend Policy: minimum 50%of net income;

Average payout since 2009:86%

Dividend trackRecord


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Apresenta??o Corporativa - Bank of America Merrill Lynch*

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