[PPT] - C OMPANY P RESENTATION 2Q 2013 Agenda Company Overview Business PowerPoint Presentation

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COMPANY PRESENTATION

2Q 2013

SLIDE 2

Company Overview

Agenda

Business Strategy Financial Profile Chilean Electricity Sector Overview

2

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Market Share (as a % of Installed Capacity) - SIC Generation (GWh) and Installed Capacity (MW)

Source: Colbún – December 2012 Source: Colbún 2012 Generation and Capacity

Thermal 55% Hydro 45%

57 % 43 %

Generation

Capacity

Business Power Generation & Trade Size 2nd largest generator in Chile’s Central Grid (SIC), with over 20% market share (MW). The SIC covers 90% of the population Capacity 2,962 MW 43% hydro and 57% thermal Generation 11,568 GWh in 2012 45% hydro and 55% thermal Power plants 15 hydro plants in 4 different basins 7 thermal plants in 4 different regions People 976 employees as of March’13 Results EBITDA of USD 284 million in 2012 EBITDA of USD 451 million LTM Revenues of USD 1.4 billion in 2012 Revenues of USD 1.6 billion LTM

Colbún at a glance

Company Overview

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Colbún 20%

Endesa 39% AES Gener 17% Others 24%

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Nehuenco III

Capacity: 108 MW

Nehuenco I

Capacity: 368 MW

Nehuenco II

Capacity: 398 MW

NEHUENCO COMPLEX: 874 MW

DIESEL/GAS Candelaria

Capacity Unit I : 133 MW Capacity Unit II : 137 MW

CANDELARIA POWER PLANT: 270 MW

DIESEL/GAS Los Pinos

Capacity: 100 MW

LOS PINOS POWER PLANT: 100 MW

DIESEL Antilhue

Capacity Unit I : 51 MW Capacity Unit II : 52 MW

ANTILHUE POWER PLANT: 103 MW

DIESEL Chacabuquito

Capacity: 29 MW

ACONCAGUA BASIN: 213 MW

Los Quilos

Capacity: 39 MW

Hornitos

Capacity: 55 MW

Blanco

Capacity: 60 MW

Juncal

Capacity: 29 MW

Juncalito

Capacity: 1 MW

7 THERMAL POWER PLANTS

Carena

Capacity: 9 MW

CARENA POWER PLANT: 9 MW

Colbún

Capacity: 474 MW

MAULE BASIN: 630 MW

San Ignacio

Capacity: 37 MW

San Clemente

Capacity: 5 MW

Machicura

Capacity: 95 MW

Chiburgo

Capacity: 19 MW

Rucúe

Capacity: 178 MW

LAJA BASIN: 249 MW

Quilleco

Capacity: 71 MW

Canutillar

Capacity: 172 MW

CHAPO LAKE: 172 MW

15 HYDRO POWER PLANTS

A diversified asset base

Company Overview

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Santa María I

Capacity: 342 MW

SANTA MARIA I POWER PLANT: 342 MW

COAL

523 KM Additional Transmission System 68 KM Sub Transmission System

TRANSMISSION LINES

261 KM Trunk Transmission System Combined Cycle Open Cycle Run of the River Reservoir Coal-fired

Angostura Capacity: 316 MW

BIOBIO BASIN: 316 MW

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CHILECTRA (2011- 2021/23/25) SAESA (2010- 2019) CGE-Río Maipo (2010- 2021) CONAFE (Until 2015) CGE-Distribución (2010- 2024) CODELCO Andina ANGLOAMERICAN Los Bronces CMPC Puente Alto CODELCO Ventanas CODELCO Salvador CODELCO Teniente CMPC Procart METRO AGUAS ANDINAS La Farfana

UN-REGULATED CUSTOMERS REGULATED CUSTOMERS

Company Overview

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A diversified customer base

Santiago

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Colbún has grown steadily over the past decade

Company Overview

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Capacity (MW) Total Operating Revenues (MMUSD) Market Cap (MMUSD) 3-year Moving Average EBITDA (MMUSD)

500 1.000 1.500 2.000 2.500 3.000 3.500

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

2,962 MW 1,260 MW

CAGR: 9%

200 400 600 800 1.000 1.200 1.400 1.600

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

USD 1,409 million USD 214 million

CAGR: 21%

50 100 150 200 250 300 350

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

USD 107 million USD 273 million

CAGR: 10%

1.000 2.000 3.000 4.000 5.000 6.000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

USD 4,830 million USD 618 million

CAGR: 23%

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Angelini Group 10% Pension Funds 18% Others 23%

Matte Group 49%

CONTROL

Controlled by the Matte Group (49%), one of the leading economic groups in Chile, with stakes in various sectors (forestry, financial, telecommunications, among others).

LARGE STAKEHOLDER

The second important stakeholder, the Angelini Group, is also a leading Chilean economic group and owns 9.6% of Colbún.

FLOAT

41% free float, with relevant local institutional investor presence.

GOVERNANCE

4 out of 9 are independent directors.

ACCOUNTING STANDARDS

Disclosure under IFRS standards Functional currency: US dollar

Solid and reliable controlling group with a strategic and long term vision

Company Overview

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Ownership Structure

Source: Colbún, June 2013

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Agenda

8

Company Overview Business Strategy Financial Profile Chilean Electricity Sector Overview

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Corporate strategy

Business Strategy

We are a Chilean company, leader in the generation of reliable, competitive and sustainable energy.

Who are we? What do we do?

We seek to generate long-term value by developing projects and managing power infrastructure, integrating with excellence the economical, technical, environmental and social dimensions.

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10

Strategic pillars

Business Strategy

Strengthen our organization and people
Strengthen our operations
Strengthen our financial position
1. Strengthening
2. Diversification

and Risk Management

3. Growth
Narrow our exposure to exogenous variables: diversified asset base

(technology, fuel and location) and clients

Risk-sharing mechanisms with our strategic clients and suppliers
Active risk-management policy
Identify and develop growth options to strengthen our competitive position

based on efficient capacity

Commercial strategy that generates long-term returns consistent with our

asset base

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EMPLOYEES COMMUNITY AND SOCIETY ENVIRONMENT CONTRACTORS AND PROVIDERS Business Strategy

11

Colbún: a sustainable partner

INVESTORS CLIENTS AND SUPPLIERS

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COMMERCIAL GOALS

Supply secure and competitive energy to our customers Maximize returns from our current and future assets Manage volatility given large renewable component

1. CONTRACT LEVEL

Define optimal Contract Level Hydro capacity (Output of a medium-dry year)

+

Efficient thermal capacity

(Output of coal-fueled plant)

2. SALE PRICE INDEXATION

Incorporate indexation formulas of sale prices that reflect

ur cost structure

Structure tailor-made hedge programs to protect from more adverse 1) Hydrologic conditions 2) Fuel prices

3. HEDGE PROGRAM

Business Strategy

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Commercial policy

Hydro CPI Efficient thermal Fossil Fuels Transitional periods Flexible Price

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Business Strategy

13

Commercial balance evolution

8.829 5.566 10.687 5.462 9.834 5.233 10.436 4.861

95 1.853 2.658

1.273 2.418 2.242 3.118 2.563 1.901 2.240 983

2.000 4.000 6.000 8.000 10.000 12.000 14.000 2010 2011 2012 LTM June 2013

GWh

Hidro Coal Gas Diesel Contractual Sales Volume Contractual Sales vs. Generation (GWh)

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Business Strategy

Our expansion plan

OTHER GROWTH OPPORTUNITIES FINAL STAGES

(expected to begin

perations by the end
f 2013)

43% 53%

Angostura 316 MW

Hydro capacity (*NCRE)

San Pedro 150 MW La Mina* 34 MW Santa María II 342 MW

~ 4,300 MW 2,962 MW

Coal-fired capacity Combined-cycle capacity Open-cycle capacity (natural gas and/or diesel) LONG-TERM LNG SUPPLY Existing CCGT (766 MW) and existing open-cycles (270 MW) that could be

ptimized, subject to securing a long-term competitive and flexible natural

gas supply.

Hydro potential ~500 MW

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ANGOSTURA HYDRO POWER PLANT: 316 MW

Santa Barbara and Quilaco, Biobío Region

INVESTMENT POWER PLANT:

675 MMUSD

INVESTMENT TX LINE:

45 MMUSD

SPENT AS OF JUN. 2013:

630 MMUSD

ADVANCE JUN. 2013:

93%

ESTIMATE START OF OPERATION: 4Q2013 SAN PEDRO HYDRO POWER PLANT: 150 MW

Riñihue Lake, Los Ríos Region

INVESTMENT AND SCHEDULE:

Under revision

SPENT AS OF SEP 2012:

112 MMUSD

ANGOSTURA SAN PEDRO

Business Strategy

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Our projects under development

LA MINA

LA MINA HYDRO POWER PLANT: 34 MW

Maule River, Maule Region

SANTA MARÍA II COAL POWER PLANT: 342 MW

Coronel, Biobío Region

SANTA MARÍA II

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Agenda

16

Company Overview Business Strategy Financial Profile Chilean Electricity Sector Overview

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Income statement and FCF

32% 15% 20% 28% 0% 10% 20% 30% 40% 50% 2010 2011 2012 June 2013 LTM

EBITDA (MMUSD) Selected Sources & Uses of Funds (MMUSD) Debt (MMUSD) EBITDA margin (%)

100 200 300 400 500 600 2010 2011 2012 June 2013 LTM WK Capex EBITDA 331 205 284 451 100 200 300 400 500 2010 2011 2012 June 2013 LTM 500 1.000 1.500 2.000 2010 2011 2012 June 2013 Net Debt Cash

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Financial Profile

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Current Assets 760 Cash and equivalents 223 Accounts receivable 184 Recoverable taxes 230 Other current assets 123 Non-Current Assets 5,259 Property, Plant and Equipment 4,955 Other non-current assets 305 Total Assets 6,020 Current Liabilities 536 Long-Term Liabilities 1,904 Shareholders' Equity 3,580 Total Liabilities and Shareholders' Equity 6,020 Cash USD 223 million of cash and cash equivalents as of June 2013. Committed lines Committed back-up facility of UF 4 million (~USD 200 million), unused, signed with local counterparties. Other sources of liquidity Access to additional USD 150 million in credit lines facilities and a registered commercial paper program, which we use from time to time for working capital optimization purposes Amortization Schedule of LT Debt (MMUSD) Balance Sheet as of June 2013 (MMUSD)

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Conservative financial strategy

Liquidity Position

Financial Profile

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27 25 116 115 89 130 1Q 2Q 3Q 4Q EBITDA 2012 EBITDA 2013 361 332 315 402 367 518 1Q 2Q 3Q 4Q Revenues 2012 Revenues 2013 8% 37% 29% 24% 25% 0% 10% 20% 30% 40% 50%

2Q12 3Q12 4Q12 1Q13 2Q13

400 800 1.200 1.600 2.000 2.400 2.800 3.200

2Q12 3Q12 4Q12 1Q13 2Q13

Sales vs. Generation - quarterly (GWh) Revenues - quarterly (MMUSD) EBITDA - quarterly (MMUSD) EBITDA margin - quarterly (%)

A quarterly look at Colbún’s results

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Contractual Sales

(*)

(*) Lighter areas are Codelco supplies

Hydro Natural gas (LNG) Diesel Coal

Financial Profile

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Agenda

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Company Overview Business Strategy Financial Profile Chilean Electricity Sector Overview

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GENERATION

Regulated sectors (concessions)

RELEVANT INSTITUTIONS

Ministry of Energy Regulator: CNE Supervisor: SEC Coordinator: CDEC

3 SUB-SECTORS Chilean Electricity Sector Overview

TRANSMISSION DISTRIBUTION

Sector segmentation

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Tal-Tal

Arica Antofagasta

Santiago

Castro Chaitén Cochrane

Pto. Natales

Pto. Williams

SING SIC SEA SAM

4,146 MW - 24% 16,751 GWh - 25% 13,332 MW - 76% 48,796 GWh - 74% 52 MW - 0% 166 GWh - 0% 103 MW - 0% 287 GWh - 0%

4 SEPARATE GRIDS

Source: CNE, December 2012

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GENERATORS

REGULATED

CUSTOMERS

DISTRIBUTION COMPANIES Regulated Tender Tariffs

Auctioned under the supervision of the National Energy Commission.

UNREGULATED

CUSTOMERS

“FREE” CUSTOMERS Unregulated Tariffs

Market Price: settled by both parties, generator and free customer.

SPOT

MARKET

CDEC Spot Price /Marginal Cost

The variable cost

f the most

expensive dispatched plant at each moment.

39%

20%

17% 24%

Endesa Colbún Gener Others

>15 players

Market structure

Electricity Market Structure Main Players in the Generation Sector-SIC

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Source: Colbún, December 2012

Chilean Electricity Sector Overview

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5 10 15 20 25 30 35 40 45 50 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Others Diesel-Fuel LNG Coal /Petcoke Gas Hydro Diesel 7% Coal 27% Gas 0% Hydro 40% LNG 21% 5 10 15 20 25 30 35 40 45 50 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Unregulated Demand Regulated Demand Unregulated: ~30% Regulated: ~70%

Evolution of power generation and demand in the SIC

Annual Power Generation – SIC (TWh) Annual Electricity Demand – SIC (TWh)

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Source: “Producción Real por Sistema”, CNE/Colbún, 2013. Anuarios CDEC-SIC Source: “Generación Bruta en el SIC”, CNE 2012.

Chilean Electricity Sector Overview

33% 30% 23% 9% 5%

Jan-Jun 2013

0% 5% 10%

J F M A M J J A S O N D

2013 YoY monthly growth

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OBJECTIVE Meet demand at the lowest cost possible INSTITUTION Independent load dispatch center (CDEC) coordinates the efficient dispatch of electricity producers MODEL CDEC dispatches plants in ascending order of variable production cost Prices vary according to the type of customer: REGULATED CUSTOMERS 1) Node Price: calculated by the CNE every 6 months 2) Auction Price: auctioned under the supervision of the Regulator for bilateral LT contracts UNREGULATED CUSTOMERS 3) Market Price: free price settled by both parties for bilateral contracts OTHER GENERATORS 4) Spot Market Price: the variable cost of the most expensive dispatched plant at each moment of the day All facilities are also paid a capacity charge for being available Hydro OC-Diesel Coal Thermo-Diesel Output from available plants (MWh) Variable Cost of the Plants (USD/MWh) CC-Diesel

Dispatched Plants Back Up Plants

*Margin = [Spot Price - Var. Cost]

Plants receive revenues from Capacity charge Plants earn a Margin*

CC-LNG SPOT PRICE

Marginal Cost of the System

Demand Curve

Dispatch and pricing model: a technical guide

Dispatch Model Dispatch Scheme Pricing Model

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Chilean Electricity Sector Overview

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Source: “Costos reales marginales mensuales Alto Jahuel”, CDEC/ Colbún; “Historia precios nudos”, CNE; “Informes Mensuales Systep”, www.systep.cl Note (*): The market Price is calculated by the Regulator upon information provided by all generation companies. This average price does not includes the capacity charge component.

Evolution of electricity prices

Electricity Prices-SIC (USD/MWh)

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50 100 150 200 250 300 350 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 1) Energy Node Price Alto Jahuel (USD/MWh) 2) Average Auction price (USD/MWh) 3) Average Market price (USD/MWh)* 4) Energy Spot Market Price Alto Jahuel (USD/MWh)

Chilean Electricity Sector Overview

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10 20 30 40 50 60 70 2013 2014 2015 2016 2017 2018 TWh

Source: “Informe Técnico Definitivo Fijación Precio Nudo SIC” ,CNE/Colbún, April 2013

Demand and supply: what to expect in the coming years

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Source: “Informe Técnico Definitivo Fijación Precio Nudo SIC” ,CNE, April 2013 (1) Considering normal hydro conditions (2) Real gas output depends on fuel availability

2.000 4.000 6.000 8.000 10.000 12.000 2013 2014 2015 2016 2017 2018 MW

Hydro (1) Wind Coal Gas (2) Diesel

Chilean Electricity Sector Overview

Electricity Demand - SIC (TWh) Available Power by type - SIC (MW)

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