COMPANY PRESENTATION Feb ebruary 20 2016 16 DISCLAIMER This - - PowerPoint PPT Presentation

COMPANY PRESENTATION

Feb ebruary 20 2016 16

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.

DISCLAIMER

CONTENTS

Snapshot of the last 12 Months

9

Company Introduction

7 15

Executive Summary Key Takeaways

37

Equipment Reliability & Resiliency

17

Preserving the Revenue Base

27

US$ Debt Management & FX Exposure

31

10 Strategic Focus, 11 Business Model, 12 Contract Tenor, 13 Volatile Earnings, 14 Risk Factors & Initiatives 28 Weak Commodity Prices, 29 GCGI Contract Re-pricing 18 Profile of Geothermal Plants, 19 Total CAPEX, 20 FY2015 Outages, 21 Retrofitting of CTUs, 22 Tongonan Rehab, 23 Bacman Plants’ Gross Generation, 24 Geothermal Infrastructure, 25 Power Plant Structures 32 Financial Ratios, 33 Loans Profile, 35 Debt Maturity Profile, 36 US$ Exposure

EXECUTIVE SUMMARY

8 Executive Summary

HIGHLIGHTS OF THE PRESENTATION

 Volatile earnings reported even as business model possesses stable and predictable cash flows  Formulated initiatives being implemented to reduce/eliminate volatility

Company Introduction

 Nasulo Project operates for its first full year; greater than 90% capacity utilization reported for the Bacman Plants; FiT allowance now being collected for the Burgos Wind and Solar Projects  Revenue loss reported with plants going on forced outage, sales agreements being re-priced and higher OPEX expenditures for typhoon proofing, O&M of new projects and reported FX losses with the PHP depreciating

Snapshot of the last 12 Months

 Significant CAPEX required to uprate reliability of aging power plants and resiliency of company infrastructures’ to harsh weather conditions  Typhoon proofing of critical power plant components in Leyte and Bacman substantially completed together with the implementation of a proactive landslide mitigation strategy

Equipment Reliability & Resiliency

 Weak commodity prices expose company's uncontracted capacity to lower margins prompting EDC to secure the "Base Case" thru re-negotiation of expiring supply contracts and to selectively postpone growth initiatives until targeted project returns are achieved

Preserving the Revenue Base

 Deliberately managed financial risk with the successful refinancing of legacy US$ denominated debt into Php and the refinancing of previously incurred fixed interest notes into amortizing debt  EDC comfortably maintains covenanted financial ratios

US$ Debt Management & FX Exposure

Focus Area 1: Focus Area 2: Focus Area 3:

COMPANY INTRODUCTION

10 Company Introduction

TODAY EDC IS A DIVERSIFIED RENEWABLE ENERGY COMPANY – 100% OF ITS INVESTMENTS ARE IN THE PHILIPPINES

150.0 MW Burgos 4.16 MW Burgos 120.0 MW Pantabangan 12.0 MW Masiway 120.0 MW Bacman I 20.0 MW Bacman II 112.5 MW Tongonan 112.5 MW Palinpinon I 60.0 MW Palinpinon II* 125.0 MW Upper Mahiao 232.5 MW Malitbog 180.0 MW Mahanagdong 50.9 MW Optimization 49.4 MW Nasulo 52.0 MW Mindanao I 54.0 MW Mindanao II

Note: *20 MW Nasuji Power Plant placed on preservation

1 1 1 2 3 1 3 2

Wind Hydro Solar Geothermal (EDC Subsidiary) Geothermal (Integrated)

1

1 1 1 2 3 3 2 1 1

STRATEGIC FOCUS BEFORE 2007 TODAY

TECHNOLOGY 1,149 MW Geothermal*

1,169 MW 132 MW 150 MW 4.16 MW Geothermal** Hydro Wind Solar

CUSTOMERS NPC

NPC Electric Cooperatives Distribution Utilities Large Industrial Clients NGCP

BUSINESS MODEL

Power Purchase Agreements Power Purchase Agreements Wholesale Electricity Spot Market Ancillary Services Provider Feed-in Tariff

DOMICILE

Philippines Philippines Indonesia Chile Peru

* Steam field only ** Steam field & Power Plant NPC – National Power Corporation NGCP – National Grid Corporation of the Philippines

EDC IS THE LARGEST VERTICALLY INTEGRATED GEOTHERMAL COMPANY GLOBALLY

11 Company Introduction

EDC’S BUSINESS MODEL POSSESSES STABLE AND PREDICTABLE CASH FLOWS

Transco Electric Cooperatives/ Third party customers

Subsidiaries

• f EDC

National Power Corporation

Power Supply Agreements (PSAs) Power Purchase Agreements

Steam Sales Agreements (SSA)

Bac-Man Geothermal

Geothermal Resources Sales Contracts (GRSC)

Green Core Geothermal FG Hydro

Electricity Cashflow Electricity Cashflow

Electricity & Ancillary Svcs.

Cashflow Steam

Cashflow or Dividends

Steam

Cashflow or Dividends

Dividends

Burgos Wind

Electricity Cashflow Dividends

Power Supply Agreements Power Purchase Agreements (PPAs)

Electricity Cashflow

Solar

Electricity Cashflow

Geothermal

% of Consolidated Revenues (1) USD Linkage

Electricity 37% 73%

Sovereign off-take

Electricity 58% 0%

Commercial off-take

Electricity 5% 60%

Feed-in-Tariff

(1) As of Sept 30, 2015

Customers

Cashflow Energy Flow

12 Company Introduction

EDC’S EXPOSURE TO THE SPOT MARKET PRICES IS ONLY 12%

WESM, 2,967 NGCP, 539 DU, 4,089 NPC, 9,239 DU, 4,035 Transco, 1,302 DU, 3,152 SPOT 12% 1-2 YRS 14% 3-5 YRS 5% 6-10 YRS 47% 11-20 YRS 10% >21 YRS 12%

25,323

(1) Consolidated revenues as of September 30, 2015

TERM STRUCTURE OF CONTRACTS(1) In PHP Millions

SPOT 1-2 YRS 3-5 YRS 6-10 YRS 11-20 YRS >21 YRS WESM

12%

• NGCP
• 2%
• DU
• 12%

5% 11% 5% 12%

NPC

• 36%
• TRANSCO
• 5%
• 88%

revenue from long-term contracts

69%

revenue from contract tenors

• f >6 yrs

45%

expanded revenue base from commercial clients

13 Company Introduction

HOWEVER, REPORTED EARNINGS HAVE BEEN VOLATILE

2007-2014 (CAGR)

Revenues 7.2% EBITDA 8.2% NI 4.5%

REVENUES EBITDA NI

1 Recorded foreign exchange losses (Php9.4B) and higher interest expense (Php552.4M) on foreign loans brought about by the peso depreciation and yen appreciation

against the US dollars

2 Recorded a non-cash impairment of Php5.0B on NNGP and Php1.2B of foregone steam revenues resulting from EDC’s acquisition of the Bacman power plants 3 Lower revenues (Php2.7B) mainly from ancillary services and impairment of PPE due to typhoon Yolanda (Php0.6B) 4 Twelve trailing months

TTM4 TTM4 TTM4

Bacman failure

(2012-2013)

Typhoon damage3

(2013-2014)

Tongonan/ Upper Mahiao Outages

(2015)

NNGP impairment2

(2009-2011)

JPY overhang1

(2009-2011)

14 Company Introduction

WE HAVE CLEAR ACTION PLANS TO REDUCE/ELIMINATE VOLATILITY

Power plants: “Midlife” stage brings about reliability issues Geography: Project sites are situated along the “typhoon” belt Market: Margin squeeze due to low commodity prices Geothermal Resource: Natural decline of reservoir pressure Geothermal Growth CAPEX: Significant amounts required upfront FCRS: Mountainous location exposes infrastructure to potential landslide risk Retrofit aging plants to enhance

• verall reliability

Typhoon proof critical power plant components Re-negotiate expiring contracts to preserve revenue base Advanced technologies drive company’s replacement well drilling strategy Expand to FiT-supported technologies and access multi-lateral financing to mitigate exploration risk Institute a proactive landslide mitigation strategy

RISK FACTORS INITIATIVES

 Power plant rehab CAPEX  Typhoon proofing CAPEX/OPEX  Mitigate margin squeeze  Maintenance CAPEX  Domestic growth  Typhoon proofing CAPEX/OPEX

IMPACT

SNAPSHOT OF THE LAST 12 MONTHS

16 Snapshot of the last 12 Months

SIGNIFICANT FACTORS THAT AFFECTED OUR 2015 OPERATIONAL AND FINANCIAL PERFORMANCE

 150 MW Burgos Wind Project started collecting FIT allowance May 2015  49.4 MW Nasulo Project achieved its first full year of operations in 2015  4.16 MW Burgos Solar Project commissioned last March 2015  Php8.5Bn EDC retail bond refinanced through GCGI (3.3% lower interest rate)  Bacman Plants attained greater than 90% capacity utilization with the completion of its retrofit program  Typhoon resistant cooling tower components installed at Leyte [Mahanagdong and Malitbog] and Bacman [Units 1 & 2]  Output of 150 MW Burgos Wind Project grid constrained from January to September; San Esteban line completed last Oct 1  Php0.8Bn reduction in revenues after the GCGI contracts were re-priced from Php5.20 to Php4.80/kWh  Php0.6Bn and Php0.3Bn reduction in revenues following the unplanned outages registered for 37.5 MW Tongonan Unit 2

and 20.0 MW Bacman Unit 3, respectively

 Drilling campaign in Mariposa, Chile postponed with near term project economics challenged by low commodity prices  Php1.2Bn in higher OPEX related expenses, mainly typhoon proofing and O&M new projects  FX losses reported with the PHP depreciating vis-a-vis the US$

Highlights Lowlights

150 MW BURGOS 49.4 MW NASULO 4.16 MW BURGOS TYPHOON PROOFING COOLING TOWER

EQUIPMENT RELIABILITY & RESILIENCY

18 Equipment Reliability & Resiliency

PLANT AGE, in years

END OF DESIGN LIFE (HIGH) END OF DESIGN LIFE (LOW) END OF DESIGN LIFE (BASELINE)

OUR POWER PLANTS ARE AT MIDLIFE STAGE AND REQUIRE SUBSTANTIAL CAPEX FOR IMPROVED RELIABILITY

OUTAGE RATE

*As of December 31, 2015

Leyte Southern Negros Bacman Mindanao

19 Equipment Reliability & Resiliency

INVESTMENTS SHIFTED TOWARDS PROTECTING THE CORE BUSINESS

in PHP millions

2016 2017 2018 2019 2020 2021 Growth 226 1,761 3,539 14,074 23,934

• Local Geo Growth1
• 1,308

3,050 906

• Wind Growth2
• 7,544

20,342

• Solar Growth2

33

• International4

223 453 489 5,624 3,592

• Existing

13,744 6,114 4,721 6,262 3,525 4,588

Steam field 7,1685 5,498 4,224 5,205 2,962 3,993 Power Plant 6,5766 616 497 1,057 563 595

Total Capex 13,9707 7,875 8,260 20,336 27,459 4,588

1 31MW Bacman 3 2 Implementing of additional Wind and Solar growth projects depend on the new government’s policy for Feed-in-tariff (FIT) 3 2.6MW Burgos Solar 4 International Projects on hold pending improvements in project economics 5 Drilling of 9 wells in Leyte 6 Tongonan 1 Rehab 7 Excludes Php1,181Mn budget provision for Bacman 3 & 4

20 Equipment Reliability & Resiliency

UNPLANNED OUTAGES ARE THE BIGGEST CONTRIBUTORS OF OPPORTUNITY LOSS FOR 2015 Facility

OUTAGE Duration Nature Action Plan

Tongonan Unit 2 Mar 7 - Jul 7 Turbine Rotor Problem Retrofit kits on order and for installation 2016 - 2017 Malitbog OEC7 Jan 1 – Mar 24 Jul 18 – Sept 28 PMS Generator Problem For rotor replacement Bacman Unit 3 Mar 5 – Apr 8 Lube Oil Leak Re-design of lubrication system completed Mindanao I Jul 12 – Aug 11 Aug 17 Generator Problem Replacement generator stator/rotor on order and for installation mid-2016

808.4MW <5% Outage 360.4MW >5% Outage

288.4MW Leyte 20MW Bacman 52MW Mindanao

MW vs. Outage Rate Facility Net Capacity Revenues for 1% Δ in outage rate p.a.

Tongonan 107.1 MW  Php46.7Mn Upper Mahiao 120.3 MW  Php33.8Mn Bacman 2 18.5 MW  Php8.4Mn Mindanao I 49.7 MW  Php13.4Mn

A CONDITION BASED MONITORING REVIEW PROGRAM HAS BEEN INSTITUTED TO ANITICIPATE EQUIPMENT END OF DESIGN LIFE (OBSOLESCENCE) AND END OF SERVICE LIFE (RELIABILITY) ISSUES

21 Equipment Reliability & Resiliency

INSTALLATION OF TYPHOON RESISTANT COOLING TOWER COMPONENTS AT LEYTE & BACMAN SUBSTANTIALLY COMPLETED BY END 2015

2015 2016 JUL AUG SEPT OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEPT OCT NOV

TONGONAN

UNIT 1 UNIT 2 UNIT 3

BACMAN

UNIT 1 UNIT 2 UNIT 3

MAHANAGDONG

UNIT 1 UNIT 2 UNIT 3

MALITBOG

UNIT 1 UNIT 2 UNIT 3

MODIFIED AND REINFORCED DESIGN*

* ~300 kph winds

22 Equipment Reliability & Resiliency

Costs Benefits TONGONAN REHAB PHASE II: Php4.3Bn

ATTAINING GENERATION TARGETS REQUIRE SUCCESSFUL IMPLEMENTATION OF BOTH TYPHOON RESILIENCY AND EQUIPMENT RELIABILITY UPRATING INITIATIVES RETROFIT

Php968Mn

UPRATE

Php789Mn

RELIABILITY

Php2,581Mn

Mitsubishi for Turbine Retrofit* Transformer, Busbar, Cooling Tower (Php196Mn) Mitsubishi for Generator Rehabilitation* (Php593Mn) Control System Integration – Tongonan* (Php258Mn) Balance-of-Plant Reliability Enhancements (Php2,323M) *Projects with Notice to Proceed

CAPACITY (MW) FORCED OUTAGE RATES REVENUES (EST.) BASE CASE 1% Δ

3 x 37.5 24.2% Php 46.8 Mn Php 1,085.8 Mn 3 x 3.5*

• 433.0 Mn

*incremental capacity from improved engineering design

2.8 Years

Payback Period (est.)

TONGONAN

32 YEARS OLD

(STATUS QUO)

70.6%

UTILIZED

74.4%

AVAILABLE

75.8%

RELIABLE PALINPINON I TURBINE RETROFIT ALREADY PROGRAMMED FOR 2017 AS UNITS ARE DEEMED AT THE END- OF-DESIGN LIFE EVEN AS ITS REPORTED RELIABILITY IS CURRENTLY HIGH

19.0 %

Internal Rate of Return

23 Equipment Reliability & Resiliency

WITH THE COMPLETION OF THE BACMAN RETROFIT PROGRAM IN 2015, GROSS GENERATION HAS IMPROVED

Gross Generation (GWh) Ave.

gWh

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 22.67 30.63 45.03 13.98 43.08 66.04 39.17 87.38 72.20 99.69 96.47 94.07

9.9 58.1 0.0 27.0 14.3 50.6 48.9 56.9 29.2 14.7 13.8 13.4 20.9 51.4 57.0 46.9 59.6 91.6 40.5 17.0 60.1 94.3 93.2 74.7 55.2 71.3 90.1 96.8 102.8 99.5 99.1 92.3 98.0 100.0 95.4 86.8

0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 100.0 110.0 120.0 130.0 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15

2013 2014 2015 Gross Generation (Installed Capacity), GWh 1138 1143 1226 Gross Generation (Actual), GWh 337 707 1087

24 Equipment Reliability & Resiliency

EDC CONTINUALLY INSTITUTES MEASURES TO ENSURE ITS GEOTHERMAL INFRASTRUCTURE REMAIN RESILIENT AGAINST EXTREME WEATHER EVENTS

PLAN VIEW

PAD 409 PAD 403 OLD ROAD NEW ROAD LANDSLIDE

• Pipeline re-routing

(P246.9M)

• Hazard: Landslide
• Impact/Value at Risk:

~11.5MW Gen Loss

BEFORE Old road to Pad 403 New re-routed road to Pad 403 AFTER DURING IMPLEMENTATION AFTER BEFORE

• Construction of Masonry

Wall (P10.7M)

• Hazard: Road Slip
• Impact/Value at Risk:

~125MW Gen Loss

Marshalling Marshalling Landslide Diversion

PLAN VIEW

Old drainage outlet

New drainage outlet (opposite old)

AFTER BEFORE

• Drainage Re-routing &

Construction of Slope Canal

• Hazard: Landslide
• Impact/Value at Risk:

425MW

403 ROAD Near Pad UM-C MARSHALLING STATION

25 Equipment Reliability & Resiliency

VARIOUS POWER PLANT STRUCTURES HAVE BEEN REINFORCED TO WITHSTAND 300 KPH WIND SPEED

BM1 PALAYAN CONTROL ROOM BM1 PALAYAN POWER HOUSE

CONVERSION OF CONTROL ROOM TO BUNKER-TYPE DESIGN INSTALLATION OF INTERMEDIATE SHORING ON ROLLUP DOORS INSTALLATION OF ADDITIONAL PURLINS

TGPP POWERHOUSE BLDG. MBPP POWERHOUSE BLDG.

CONTROL CENTER ENHANCEMENT

TONGONAN TOPPING CYCLE PLANT MALITBOG BOTTOMING POWER PLANT

PRESERVING THE REVENUE BASE

28 Preserving the Revenue Base

WEAK COMMODITY PRICES EXPOSE OUR UNCONTRACTED CAPACITY TO LOWER MARGINS WHICH PROMPTS EDC TO SELECTIVELY POSTPONE GROWTH UNTIL TARGET RETURNS ARE ACHIEVED

CONTRACTED VS. WESM/EXPIRING CONTRACT EDC WACC

Source: Bloomberg

128.08 71.34 98.97 121.55 96.53 84.38 70.88 59.38 62.44 70.26 64.64 59.81 59.34 59.76 60.55 59.17 57.93 53.65 52.41 52.58 93.56 63.28 78.04 106.19 109.08 105.30 96.24 50.91 45.57 55.44 54.66 58.55 63.56 61.79 56.17 47.69 45.38 45.84 41.69 34.59 20 40 60 80 100 120 140 160 2008 2009 2010 2011 2012 2013 2014 2015 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sept-15 Oct-15 Nov-15 Dec-15

Coal, $/MT Oil, S/bbl

HISTORICAL COAL AND OIL PRICES

(2008-2015, in US$)

29 Preserving the Revenue Base

GCGI’S CONTRACT REPRICING IS IMPERATIVE GIVEN ADVERSE MARKET CONDITIONS

1 As of November 30, 2014 2 As of January 31, 2015

CONTRACT REPRICING SUCCESSFULLY PRESERVED GCGI REVENUES OVER THE NEXT 5 TO 10 YEARS, INSPITE OF PHP800M IN FOREGONE REVENUES AT THE ONSET

3.6x increase

weighted ave. contract life

4.27 yrs

vs.

15.36 yrs

MW MW

GCGI CONTRACT REPRICING

US$ DEBT MANAGEMENT & FX EXPOSURE

32 US$ Debt Management & FX Exposure

COMFORTABLY OPERATING WITHIN COVENANTED FINANCIAL RATIOS

3Q 2015 3Q 2014 Dec-14 Dec-13 Dec-12 Dec-11 Dec-10 6.1 2.2 5.4 2.1 3.2 2.1 2.5 3Q 2015 3Q 2014 Dec-14 Dec-13 Dec-12 Dec-11 Dec-10 2.1 3.2 2.7 3.3 3.2 3.0 2.3 3Q 2015 3Q 2014 Dec-14 Dec-13 Dec-12 Dec-11 Dec-10 1.0 1.4 1.3 1.6 1.3 1.5 1.0 3Q 2015 3Q 2014 Dec-14 Dec-13 Dec-12 Dec-11 Dec-10 2.6 3.5 3.5 3.9 2.5 2.4 3.0

CURRENT RATIO DEBT TO EQUITY NET DEBT TO EBITDA(1) DEBT SERVICE COVERAGE RATIO(2)

Notes: Ratios are computed based on Parent Company financial statements (1) EBITDA = Earnings Before Interest, Taxes, Depreciation, and Amortization (2) Debt Service Coverage Ratio = Net Cash flow from Operating Activities / (Short Term Debt + Long Term Debt + Projected Interest Service for the next 12 months)

3.6 times 1.0 times 2.3 times High liquidity to meet short-term obligations Well within our targeted 3.6 times Allows headroom for additional debt financing Strong ability to produce cash to cover debt payments 1.2 times

33 US$ Debt Management & FX Exposure

DELIBERATELY MANAGING FINANCIAL RISKS

89% 100% 79% 84% 90% 86% 81% 79% 90%

0.0% 25.0% 50.0% 75.0% 100.0% Dec- 08 Dec- 09 Dec- 10 Dec- 11 Dec- 12 Dec- 13 Dec- 14 Sep- 14 Sep- 15 Fixed Floating

7.9 6.9 4.5 5.1 5.8 5.4 5.2 5.4 5.2 7.4% 7.2% 4.9% 8.9% 7.2% 7.1% 5.6% 6.0% 5.1%

0.0% 2.0% 4.0% 6.0% 8.0% 10.0% Dec- 08 Dec- 09 Dec- 10 Dec- 11 Dec- 12 Dec- 13 Dec- 14 Sep- 14 Sep- 15 Average Loan Life (in years) Average Interest Rate (%)

PROJECT FINANCE NEW PROJECTS

45% 52% 68% 47% 46% 41% 51% 38% 64%

0.0% 25.0% 50.0% 75.0% 100.0% Dec- 08 Dec- 09 Dec- 10 Dec- 11 Dec- 12 Dec- 13 Dec- 14 Sep- 14 Sep- 15 Amortizing Bullet

LOANS BY REPAYMENT SCHEDULE 87% LOANS BY INTEREST RATE LOANS BY INTEREST RATE Predominantly fixed debt matches the nature of energy projects Shift to amortizing loans smoothens lumpy principal payments 50% Series of refinancing initiatives lowers average borrowing cost Will project finance new ventures starting with

EBWPC •

GCGI • BGI •

Allows projects to be appraised on a stand-alone basis

Php 8.5B

2015

Php 5.0B

2015

USD 315.0M

2014

34 US$ Debt Management & FX Exposure

Fixed 1,307 90% Floating 147 10%

ONLY 10% OF EDC LOANS ARE EXPOSED TO INTEREST RATE FLUCTUATIONS

USD 597 41% PHP 857 59% USD Linked Revenues 195 28% PHP Revenues 857 72%

LOANS BY CURRENCY US$ indexed revenues provide natural hedge LOANS BY STRUCTURE Predominantly fixed debt matches nature of energy projects

USD1,454 USD1,454

35 US$ Debt Management & FX Exposure

2015 2016 2017 2018 2019 2020 2021 2022 2023

50 100 150 200 250 300 350 400 USD Debt PHP Debt

WE WILL REFINANCE THE MATURING PHP3.5 BILLION BONDS IN 4Q 2016

DEBT MATURITY PROFILE

Average Loan Life (Years)

5.2 yrs

Average Interest Cost

5.1%

Type Currency Outstanding (MM) Repayment Interest Tenor (Years) Maturity 175MM Club1 USD 114.0 Amortizing LIBOR+1.75% 6 2017 80MM Club USD 77.0 Amortizing LIBOR+1.80% 5.25 2018 Reg S Bonds USD 300.0 Bullet 6.50% 10 2021 PF – ECA USD 150.0 Amortizing LIBOR+0.90% 15 2029 PF – USD Com USD 38.0 Amortizing LIBOR+0.90% 15 2029 IFC Loan 1 PHP 2,732.0 Amortizing 6.07%2 15 2023 IFC Loan 2 PHP 2,634.0 Amortizing 6.66% 15 2025 PHP FXCN PHP 6,790.0 Amortizing 5.25%4 10 2022 PHP Bonds PHP 3,500.0 Bullet 9.33% 7.0 2016 PHP Bonds PHP 7,000.0 Bullet 4.16%, 4.73% 7.0, 10.0 2020, 2023 GCGI Loan PHP 7,990.0 Amortizing 5.25% 7 2022 PF - PHP Com PHP 5,610.0 Amortizing PDST – R1 +Margin3 15 2029

(1) USD65 MM converted to PHP via Cross Currency Swap (3} Margin: 200 bps + (PDST-F minus RDST-R1). Re-pricing on the 10th year (2) Subject to re-pricing (4) Amended interest rate

US$300Mn Bonds PHP3.5Bn Bonds

36 US$ Debt Management & FX Exposure 100 200 300 400 500 600 700 Cover Debt

VARIOUS INITIATIVES HAVE BEEN UNDERTAKEN TO INSULATE EDC FROM SWINGS IN NET INCOME

LOANS BY CURRENCY Eliminated JPY exposure starting 2011 USD EXPOSURE Significant portion of USD obligation remain exposed to currency fluctuations Cash flow exposure is evident in years 2018 & 2021 CASH FLOW EXPOSURE

142.61 150.35 150.35 150.35 150.35 150.35 150.35 98.01 146.22 128.18 182.96 93.32 87.64 345.61 100 200 300 400 2015 2016 2017 2018 2019 2020 2021 USD Capex, Opex, Debt Service USD Linked Revenues 12 66 56 63 62 60 59 59 11 21 44 37 38 40 41 41 77 13 0% 20% 40% 60% 80% 100% 2009 2010 2011 2012 2013 2014 3Q 2014 3Q 2015 PESO USD JPY Dollar Bonds 300 CCS 63 $ Linked Revenues 150 Uncovered Portion 465

*As of December 31, 2015

175mn Club loan 88 80mn Club loan 73 Burgos PF 175 OPEX 9 Debt Service 53 USD Cash 25 New Capex Dep’n 6

*As of September 30, 2015

KEY TAKEAWAYS

38 Key Takeaways

KEY TAKEAWAYS

 EDC faces challenges in the different facets of our operations and this has resulted to volatile

financial performance

 EDC proactively addresses underlying risk factors that fuel earnings volatility …

• Invest in both typhoon resiliency and equipment reliability uprating initiatives to deter
• perational upsets
• Deliberately manage financial risks by entering into project financing for new investments,

hedging of US Dollar debt, and refinancing bullet maturities to amortizing type loan

 EDC remains comfortably within debt covenant ratios despite the increase in leverage  EDC will defer some CAPEX-intensive growth projects and focus investments on its existing asset

base to boost output and improve reliability and cash generation

 EDC remains committed to grow its geothermal business overseas  EDC will continue to pay cash dividends to its shareholders

OVERSEAS DRILLING TURBINE RETROFIT REINFORCED COOLING TOWER

END OF PRESENTATION

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