Maybank Invest ASEAN Philippines 2015 Makati Shangri-La Hotel, Manila August 25, 2015
DISCLAIMER This presentation contains certain “forward looking statements. ” These forward looking statements include words or phrases such as EDC or its management “believes”, “expects”, “anticipates”, “intends”, “plans”, “foresees”, or other words or phrases of similar import. Similarly, statements that describe EDC’s objectives, plans or goals also are forward-looking statements. All such forward looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statement. Such forward looking statements are made based on management’s current expectations or beliefs as well as assumptions made by, and information currently available to, management. EDC does not make expressed or implied representations or warranties as to the accuracy and completeness of the information contained herein and shall not accept any responsibility or liability (including any third party liability) for any loss or damage, whether or not arising from any error or omission in compiling such information or as a result of any party’s reliance or use of such information. The information and opinions in this presentation are subject to change without notice. This presentation does not constitute a prospectus or other offering memorandum in whole or in part. Information contained in this presentation is a summary only and is prepared for discussion purposes and is not a complete record of the discussions. This presentation shall not constitute an offer to sell or the solicitation of an offer to buy any security. There shall be no sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to qualification under securities laws of such state or jurisdiction. By receiving this presentation, each investor is deemed to represent that it is a sophisticated investor and possesses sufficient investment expertise to understand the risks involved. Prospective investors should undertake their own assessment with regard to their investment and they should obtain independent advice on any such investment’s suitability, inherent risks and merits and any tax, legal and accounting implications which it may have for them.
CONTENTS Key Investment Highlights 8 Investment Summary, 9 Domaine Expertise, 10 Cornerstone Investors, 11 EDC’s Business Model, 12 Contract-based Cash Flows, 13 Track Record for Growth, 14 Favorable Industry Dynamics, 15 Managing Financial Risks, 16 Dividend Policy Review 1H 2015 Financial Results 18 1H 2015 Significant Events, 19 Revenues, 20 Operating Expenses, 21 Recurring Net Income, 22 Financial Ratios, Company Updates 24 Tongonan Retrofit, 25 EDC’s Growth Agenda, 26 Bacman 3 NTP, 27 Burgos Project Update, 29 Latin America Expansion Update 112.5 MW TONGONAN Mexico: 2,500 MW 32 YEARS OLD Online: 950 MW Costa Rica: 200 MW El Salvador: 150 MW Guatemala: 200 MW Nicaragua: 300 MW Online: 475 MW Peru: 3,000 MW 70.6 % 74.4 % 75.8% Chile: 1,400 MW Online: 0 MW CAPACITY FACTOR AVAILABILITY RELIABILITY Geothermal Potential Tongonan Retrofit Project Burgos Project Update International Expansion Started in January 2014, the Tongonan retrofit EDC still guides for a 4Q 2015 completion, even as EDC is targeting 400 to 500 MW over the next 10 project is expected to improve plant’s overall on-going developments for the Laoag-San Esteban years in the resource rich Latin America, with its reliability, output and efficiency. TL Project is encouraging. portfolio of early stage geothermal assets. Key Takeaways
KEY INVESTMENT HIGHLIGHTS
TOP REASONS FOR INVESTING IN EDC -- A GLOBAL DIVERSIFIED RENEWABLE POWER COMPANY 1 of 11 light bulbs 5 Concessions 1H 15 Highlights 88% acquired in EDC accounts for 9% Revenues Chile & Peru of the Philippine’s Php16.8 billon Geothermal is electricity production RNIA Revenue derived Wind 10 11% Php4.7 billion Into geothermal, hydro concessions from long-term EBITDA & wind and now acquired with contract of Installed diversifying into solar ~543 MW Php9.7 billion agreements capacity capacity energy Favorable Strong Credit & Domaine Contract-based Track Record of Robust Industry Investment Expertise Cash Flows Growth Growth Dynamics Profile Managing 100% Feed-in-Tariff (FIT) 69% Revenue Financial Risks derived Php0.0406/kWh Interest rate on Successfully promulgated from contract tenors 90% of loans acquired power Registered RE project of greater than Domestic Expansion are fixed developers now being plants inside its 6 years 5.3 yrs. loan life paid at FIT rate Install 137MW of geothermal 5.4% Interest geothermal capacity concessions YEAR Geothermal provides Overseas Expansion cost 2031 Drill wells in 13% 30% of Largest vertically Mariposa, Chile by revenues are integrated geothermal 2015 Concession agreements of electricity production company globally US$ indexed start expiring in the Philippines 8 Key Investment Highlights
EDC IS THE LARGEST VERTICALLY INTEGRATED GEOTHERMAL COMPANY GLOBALLY TOP 5 GEOTHERMAL COMPANIES 1 1 Plant Type Manufacturer CAPACITY (in MW) 1 150.0 MW Burgos Wind Vestas COMPANY STEAM PLANT 1 4.16 MW Burgos Solar Juwi 1 EDC 1,169 1,169 1 120.0 MW Pantabangan Hydro Andritz 12.0 MW Masiway Hydro Toshiba 2 Comision Federal de Electricidad 958 958 1 1 120.0 MW Bacman I Geothermal Toshiba/Alstom 3 Enel Green Power 915 915 20.0 MW Bacman II Geothermal Mitsubishi 1 2 112.5 MW Tongonan Geothermal Mitsubishi 4 Chevron 1,329 887 * 3 112.5 MW Palinpinon I Geothermal Fuji 5 60.0 MW Palinpinon II* Geothermal Fuji Ormat 689 749 1 1 125.0 MW Upper Mahiao Geothermal GE/Ormat/Kato 2 Source: Bertani, Ruggero, 2010: Geothermal Power Generation in 232.5 MW Malitbog Geothermal Fuji the World 2005-2010 Update Report 180.0 MW Mahanagdong Geothermal Toshiba Note: * Not included is the 442 MW operated by the Indonesian 3 2 Government through PLN 50.9 MW Optimization Geothermal Various 2 49.4 MW Nasulo Geothermal Fuji 3 52.0 MW Mindanao I Geothermal Mitsubishi Wind Geothermal (EDC Subsidiary) 3 54.0 MW Mindanao II Geothermal Mitsubishi Hydro Geothermal (Integrated) Solar Note: *20 MW Nasuji Power Plant placed on preservation 1,455 MW % share Offices EDC 1,169MW Geothermal 7% of Installed Capacity Philippines Chile AT A 150MW Wind 9% of Electricity Produced Indonesia Peru GLANCE 132MW Hydro 4.16MW Solar 9 Key Investment Highlights
EDC GENERATES STRONG AND ROBUST CASHFLOWS AT BOTH PARENT AND SUBSIDIARY LEVELS Revenues (2) as of June 2015 IFC GIC Public Lopez Group E: 1.69 % V: 1.12 % E: 4.99 % V: 3.33 % E: 42.76 % V: 44.71 % E: 50.56 % V: 50.84% 16,775 • 747.96 MW Power Plants 588.4 MW Unified Leyte Power Project 106.0 MW Mindanao Power EBITDA (2) as of June 2015 Project 49.4 MW Nasulo Power Project 4.16 MW Burgos Solar Project 100% 9,692 60% 100% 100% EDC Hong Kong EDC Geothermal (1) First Gen Hydro Power EDC Wind Energy Corporation (EGC) Corporation (FGHPC) Holdings Inc. Limited 120.0 MW Pantabangan Net Income (2) as of June 2015 12.0 MW Masiway 100% 95/100% 100% 100% EDC Burgos Wind Power International Green Core Geothermal Bac-Man Geothermal 4,801 Corp. (EBWPC) Inc. (GCGI) Inc. (BGI) Expansion • Chile 150.0 MW Burgos 172.5 MW Palinpinon (2) 115.0 MW Bac-Man I • Peru 112.5 MW Tongonan 20.0 MW Bac-Man II • Indonesia (2) All figures in PHP millions as of June 30, 2015. EBWPC’s net loss of P35 million is As of June 30, 2015 included as part of EDC Parent (3) EDC Parent figures include UL, Mindanao, Burgos Solar and the Company’s other (1) Formerly First Luzon Geothermal Energy Corporation (FLGEC) subsidiaries (2) 20 MW Nasuji Power Plant to be placed in preservation 10 Key Investment Highlights
POSSESSES STABLE AND PREDICTABLE CASH FLOWS Percentage of Consolidated USD Linkage Revenues (1) National Cashflow 35% Electricity 73% Geothermal Power Electricity Corporation Power Purchase Agreements Sovereign off-take Power Purchase Agreements (PPAs) Cashflow or Cashflow Bac-Man Dividends Steam Geothermal Electricity Steam Sales Agreements (SSA) 59% Electricity 0% Cashflow or Electric Cooperatives/ Green Core Cashflow Dividends Third party customers Geothermal Steam Electricity Commercial off-take Geothermal Resources Sales Contracts (GRSC) Cashflow FG Hydro Dividends Electricity & Ancillary Svcs. Power Supply Agreements Power Supply Agreements (PSAs) Cashflow 6% Electricity 60% Burgos Wind Dividends Electricity Feed-in-Tariff Transco Cashflow Solar Electricity (1) As of June 30, 2015 Subsidiaries of EDC 11 Key Investment Highlights
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