INSTITUTIONAL PRESENTATION 3 Q 1 9 | R E S U L T S
ISA CTEEP ISA CTEEP in the Transmission Sector Sustainable Value Financial Highlights
WHY INVEST IN ISA CTEEP? Strong Cash Growth Generation Opportunities in retrofitting, No demand greenfield projects risk and low and M&A default risk Profitability Dividends Sustainable value creation Minimum payout of 75% (regulatory net income) Investment Grade Fitch: AAA(bra) Benchmark Reference Company in quality and O&M Valuation Attractive valuation
ISA CTEEP IE Garanhuns 51% Revenue² : BRL 2,579 million Revenue² : BRL 46 million IE Pinheiros 100% IENNE 100% Largest publicly traded pure transmission Revenue² : BRL 57 million utility in Brazil Revenue² : BRL 46 million IE Serra do Japi 100% ▪ Transmission of ~ 25% of Brazil’s power Revenue² : BRL 58 million IE Madeira IEMG generation 51% 100% IE Itapura Bauru 100% Revenue²: BRL 260 million Revenue²: BRL 19 million ▪ Transmission of ~ 100% of the power Revenue² : BRL 12 million generated in the State of São Paulo ▪ Benchmark player in costs and quality 18.6 thousand km of transmission lines Evrecy 100% 126 substations Revenue² : BRL 10 million 65.9 thousand MVA of transformation capacity ▪ RAP ISA CTEEP 2019/2020 cycle : BRL 3.1 billion¹ IE Sul 100% Revenue² : BRL 18 million Notes: ¹ Operational assetsL ² 2019/2020 Revenue Cycle proportional to ISA CTEEP’s participation
IE Itaquerê 100% IE Paraguaçu 50% Revenue²: BRL 51 million Revenue²: BRL 59 million IE Itapura Lorena 100% Revenue²: BRL 11 million Largest publicly traded pure transmission IE Ivaí utility in Brazil IE Aguapeí 50% 100% Revenue²: BRL 147 million Revenue²: BRL 59 million ▪ Sustainable growth IE Tibagi 100% Organic growth: CapEx of around BRL 180 million/year Revenue²: BRL 20 million Greenfield Projects¹: Revenue (RAP) cycle 2019/2020: BRL 479 million/year IE Aimorés 50% Revenue² : BRL 40 million IE Itaúnas 100% Revenue²: BRL 52 million IE Biguaçú 100% Revenue²: BRL 40 million Notes: ¹ ISA CTEEP’s investments in 10 projects acquired in 2016, 2017 and 2018 auctions. CAPEX and 2019/2020 Revenue adjusted to ISA CTEEP’s participation ² Considers 2019/2020 Revenue Cycle adjusted to ISA CTEEP’s participation
A successful story of growth, resilience and performance Winner bid for 5 lots in April auction ISA acquires CTEEP and Extension of Main becomes the Concession Winner bid for controlling CESP spin off creates Contract (059/2001) 2 lots in June shareholder Transmissão Paulista for 30 years auction Transmissão Set up of RBSE Paulista merger compensation Expansion to 17 with EPTE ( Ordinance 120 Brazilian states through Ministry of Mining greenfield projects and IE Itapura and Energy ) acquisitions (Bauru) startup Winner bid for 3 lots in October auction 1999 2001 2006 2007 2012 2013 2016 2017 2018 2019² ‘000 km¹ of 18.6 18.6 17.7 15.4 12.3 18.6 11.5 transmission lines Consolidated regulatory EBITDA 2.2 ICVM 527 in 2.5 1.6 BRL billion 0.1 0.7 1.1 1.6 0.2 0.7 Note: ¹ Information considers 100% of the projects ² Last 12 months ending on 09/30/2019
Shareholder Structure on 09/30/2019 ▪ Tickers: TRPL3¹ and TRPL4² ▪ Corporate Governance: Level 1 at B3 Common shares: 257,937,732 Preferred shares: 400,945,572 ▪ Average daily volume in 9M19: Total: 658,883,304 BRL 33 million ISA CTEEP ▪ Market cap³: BRL 17 billion 35.8% 64.2% ISA Free Float ▪ Distribution of capital: 53% of foreign investors CONTROLLED BY ISA Common shares: 10.5% Common shares: 89.5% 47% of Brazilian investors Preferred shares: 98.7% Preferred shares: 1.3% FREE FLOAT OF 64% ▪ ADRs: “CTPTY” and “CTPZY” ▪ Coverage of 12 institutions : 67% Hold 35.4% 28.8% 33% Sell Eletrobras Others Common shares: 9.8% Common shares: 0.7% Preferred shares: 51.9% Preferred shares: 46.8% Notes: ¹ Common share l ² Preferred share l ³On 09/30/2019
ISA A multilatina company focused in INTERCONEXIÓN ELÉCTRICA, transmission with growth ▪ Largest high-tension electric S.A.E.S.P . opportunities in Brazil transmission network in Latin America Operational: ▪ 46,280 km of transmission lines Colombia Central ▪ 91,880 MVA in power capacity 70% of participation in the America Transmission market in 2018 Under construction: ▪ 5,869 km of transmission lines ▪ 13,232 MVA in power capacity ▪ Businesses in: Peru 70% of participation in ▪ Energy transmission the Transmission market in 2018 ▪ Highway concessions ▪ Information Technology/Telecom Brazil 20% of participation in the Transmission market in ▪ Controlled by the Colombian 2018 Chile government (51% of shares) 5% of participation in the Transmission ▪ Market cap: USD 5 billion¹ market in 2018 Bolivia Argentina Solid Presence in Latin America: 7 countries , 3 sectors , Notes: ¹ On 09/30/2019 43 companies
ISA CTEEP and its subsidiaries Assured CORPORATE Annual Revenue (RAP) 2019/2020 Cycle of STRUCTURE BRL 4.1 billion RAP Cycle RAP ISA CTEEP Location Profit Regime² Share (%) Consolidation Cycle 2019/2020 2019/2020¹ (BRL million) (BRL million) ISA CTEEP Operational São Paulo 2,579 2,579 Real Profit ISA CTEEP 100% Fully consolidated IE Madeira Operational Rondônia / SP 511 260 Real Profit ISA CTEEP 51% / Furnas 24,5% / Chesf 24,5% Equity method IE Ivaí Under construction Paraná 294 147 Real Profit ISA CTEEP 50% / TAESA 50% Equity method IE Paraguaçu Under construction Bahia / MG 118 59 Real Profit ISA CTEEP 50% / TAESA 50% Equity method IE Garanhuns Operational Pernambuco 91 46 Real Profit ISA CTEEP 51% / Chesf 49% Equity method IE Aimorés Under construction Minas Gerais 79 40 Real Profit ISA CTEEP 50% / TAESA 50% Equity method IE Pinheiros Operational São Paulo 57 57 Presumed Profit ISA CTEEP 100% Fully consolidated IE Serra do Japi Operational São Paulo 58 58 Presumed Profit ISA CTEEP 100% Fully consolidated IE Aguapeí Under construction São Paulo 59 59 Presumed Profit ISA CTEEP 100% Fully consolidated IE Itaúnas Under construction Espírito Santo 52 52 Presumed Profit ISA CTEEP 100% Fully consolidated IE Itaquerê Under construction São Paulo 51 51 Presumed Profit ISA CTEEP 100% Fully consolidated IENNE Operational Tocantins 46 46 Presumed Profit ISA CTEEP 100% Fully consolidated IE Biguaçu Under construction Santa Catarina 40 40 Presumed Profit ISA CTEEP 100% Fully consolidated IE Tibagi Under construction SP / Paraná 20 20 Presumed Profit ISA CTEEP 100% Fully consolidated IE Sul Operational Rio Grande do Sul 18 18 Real Profit ISA CTEEP 100% Fully consolidated IEMG Operational Minas Gerais 19 19 Presumed Profit ISA CTEEP 100% Fully consolidated Evrecy Operational Espírito Santo 10 10 Presumed Profit ISA CTEEP 100% Fully consolidated IE Itapura - Bauru Operational São Paulo 12 12 Presumed Profit ISA CTEEP 100% Fully consolidated IE Itapura - Lorena Under construction São Paulo 11 11 Presumed Profit ISA CTEEP 100% Fully consolidated Total 4,127 3,587 ¹ 2019/2020 cycle RAP with PA, net of PIS and COFINS ² Presumed profit: a presumed profit of 8% of operational revenue is calculated, with a retainment of 25% of income tax rate on the presumed amount. For the Social Contribution of Net Profit (CSLL), 12% of operational revenue is calculated, with a retainment of 9% of CSLL on presumed profit. Real Profit: 34% of income tax + CSLL on real taxable profit
Corporate Governance Structure Shareholders Ethics and Transparency recognized at ISA Board of Directors Board of Auditors and at ISA CTEEP 8 effective members, of 5 effective members levels which 2 are independent and 5 substitute and one is elected by the members employees Experienced Human Resources Audit Management Committee Committee team focused on value creation CEO César Ramirez 2019 Transparency Trophy from Institutional Relations CFO and IRO Project Director COO Department ANEFAC Alessandro Gregori Filho Carlos Ribeiro Weberson Abreu Rafael Noda
CONNECTIONS THAT CREATE VALUE THROUGH ACTIONS JAGUAR CONNECTION: ▪ Forest projects that reduce the impact of greenhouse gases ▪ Climate change mitigation ▪ Conservation of biodiversity in jaguar’s habitat SOCIAL RESPONSIBILITY: Sponsorship with tax benefit ▪ ~BRL 15 million in investments in 2018 ▪ Projects related to Youth Leadership, Local Development, and the Environment ▪ Educational Focus CONEXIONS THAT INSPIRE
C O N N E C T I O N S T O G E N E R A T E S U S T A I N A B L E V A L U E Ancillary Services Energy Storage Real Estate Opportunities Digitalization Operational safety optimization with cost reduction through substation teleassistance and retrofitting EFFICIENCY NEW BUSINESSES
ISA CTEEP ISA CTEEP in the Transmission Sector Sustainable Value Financial Highlights
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