CORPORATE PRESENTATION Larrain Vial 14 th Annual Andean Conference August 31 - September 4, 2020
LEADING GENERATION COMPANY IN LATIN AMERICA AES GENER AT A GLANCE 5,295MW 2.3GW 221MW Of installed capacity (1) Of green capacity Added since launch of Greentegra to be added by 2024 (2) Leading Energy Producer in Chile Baa3/BBB-/BBB- $827mm 4.1x (3) Stable Outlook LTM 2Q-20 EBITDA Net Debt/LTM 2Q-20 EBITDA (Moody’s/S&P/Fitch) 66.7% ~10 years Controlled by Average life of PPAs (4) The AES Corporation Providing Stable Cash Flows Member of Chile and MILA Indices Launched Greentegra Strategy to incorporate Renewables leveraging on existing commercial relationships 2 (1) Includes 5,233MW of Power plants (including 764MW of Guacolda, which is not consolidated in EBITDA) and 62MW of Battery Energy Storage System as of 19/8/2020. (2)Includes Operational assets, projects under construction, and projects under development. (3) Consolidated metric, including equity credit (4)Average remaining life on PPAs in Chile as of 30/06/2020.
LEADING GENERATION COMPANY IN LATIN AMERICA AES GENER EXECUTIVE SUMMARY 2018 2019 2020-YTD Colombian Auctions 1 C&I Customers RECONTRACTING 2.7TWh 3.8TWh 1.8TWh Agreement Signed for DECARBONIZATION Ventanas 1 & 2 21MW Solar 70MW Solar RENEWABLE GROWTH 110MW Wind 10MW Energy Storage 3.1km EPC Contract Restucturing ALTO MAIPO To begin operations Hybrid Bond Capital Increase Approved FINANCING ESSA & CTNG Assets Sale Green Hybrid Bond PLAN Coal Monetization Cochrane PF Restructuring LEVERAGE 3.0x 4.0x 4.2x RATIOS 3
LEADING GENERATION COMPANY IN LATIN AMERICA AES GENER KEY INVESTMENT CONSIDERATIONS 1 RESILIENT BUSINESS 2 MARKET LEADER POSITION 3 DIVERSIFIED PORTFOLIO 4 HIGH QUALITY LONG TERM PPAs 5 GREENTEGRA TRANSFORMATIONAL STRATEGY 6 ROBUST CAPITAL STRUCTURE & STRONG FINANCIALS 4
BHP SETTLEMENT UPDATE
BHP SETTLEMENT UPDATE ANGAMOS BACKGROUND 558 MW Coal Plant (2 Units) PPAs 2020 2021 2026 2029 2037 80 MW - TECK 90 MW - Spence 340 MW - Escondida FULLY CONTRACTED FIXED CHARGE VARIABLE CHARGE ASSET UNDER (paid under any (no margin for TOLLING AGREEMENTS circunstancies) Angamos) In Operation since 2011 6
BHP SETTLEMENT UPDATE ANGAMOS GREENTEGRA ON-TRACK 558 MW Coal Plant (2 Units) PPAs 2020 2021 2026 2029 2037 2042 80 MW - TECK COAL to GREEN → Fixed Charges + Renewable PPA 90 MW - Spence BHP Early Termination FULL PPA VALUE recognition 340 MW - Escondida FULL FLEXIBILITY TO PRESERVED VALUE RENEWABLE ACCELERATE OF LEGACY PPAs TRANSFORMATION DECARBONIZATION In Operation since 2011 7
BHP SETTLEMENT UPDATE ANGAMOS KEY FOR SYSTEM RELIABILITY LOW COST 14% OF CRITICAL SYSTEM COAL OF LOCATION ON THE GRID GENERATION OPERATION 250 Daily Average Capacity (MW) 200 June 30 th Gross Demand 150 100 50 0 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 8
BHP SETTLEMENT UPDATE BHP AGREEMENT TERMINATION PAYMENT ACCELERATED $ 720 mn PPA’s RESOLUTION OF ALL LEGAL DISP DISPUTES UTES PAYMENT REMAIN IN PLACE UNTIL ACCELERATED AUGUST 2021 TO 2020 9
BHP SETTLEMENT UPDATE USE OF PROCEEDS FURTHERING GREENTEGRA OBJECTIVES $153mn $367mn TAX PAYMENT DEBT REDUCTION $720mn ON TOP OF THE $29mn SCHEDULED AMORTIZATION $200mn GROWTH FUNDING 10
BHP SETTLEMENT UPDATE USE OF PROCEEDS GREEN GROWTH FUNDING $153 TAX PAYMENT GREENTEGRA GROWTH FUNDING TO GO $720 mn $486 $750 $200 THIRD PARTY AVAILABLE CAPITAL CASH GROWTH FUNDING $2.2 bn $367 DEBT REDUCTION $392 $500 STRABAG CAPITAL INCREASE 1Q-2021 ALTO MAIPO $72
BHP SETTLEMENT UPDATE STRENGTHENING INVESTMENT GRADE ACCELERATING DEBT REDUCTION 4.1x 3.7x $367mn $ 4.2 bn Debt Prepayment $ 3.8 bn June 2020 After Debt Prepayment 12
BHP SETTLEMENT UPDATE ESTIMATED FINANCIAL IMPACT EBITDA & NET INCOME (US$mn) 2020 2020 2021 2021 TOTAL AL 380 460 840 EBITDA After MONETIZATION 260 460 720 PRE-TAX INCOME 189 336 526 NET INCOME
BHP SETTLEMENT UPDATE ASSET RECOVERABILITY ASSESSMENT TO BE CONDUCTED IN 3Q-2020 (US$mn) EARLY TERMINATION TRIGGERS EVALUATION OF ASSET RECOVERABILITY $ 747 mn ANGAMOS PP&E BOOK VALUE SUBJECT TO IMPAIRMENT TEST 14
COVID-19 UPDATE
COVID-19 UPDATE AES GENER GUIDING PRINCIPLES WORK ALL SAFETY RELIABLE OF OUR PEOPLE ENERGY SUPPLY TOGETHER + HEALTH & LEADING power Accelerating WELLNESS programs producer in Chile SUSTAINABLE RECOVERY 16
COVID-19 UPDATE OUR OPERATIONS CONTINUE PROVIDING RELIABLE ENERGY ESSENTIAL 100% +30 days of Our Plants of Fuel Supply Personnel WORKING ON SITE OPERATING NORMALLY ASSURED 17
COVID-19 UPDATE OUR PROJECTS LIMITED IMPACTS ALTO MAIPO SOLAR & WIND ENERGY HYDRO PROJECTS STORAGE Progress continuing on all fronts Virtual Reservoir completed Andes Solar II 70MW already operational Los Olmos and Mesamávida COD expected in 2H-2021 18
COVID-19 UPDATE OUR COLLECTIONS NO MATERIAL DISRUPTIONS IN WORKING CAPITAL Accounts Receivables ($mn) 91 86 58 58 20 13 12 10 9 8 8 5 Days Sales Outstanding (days) 57 53 51 36 14 14 14 12 11 9 9 8 31-Dec-2019 31-Mar-2020 30-Jun-2020 31-Jul-2020 19
COVID-19 UPDATE OUR LIQUIDITY STRONG POSITION TO OVERCOME POTENTIAL DISRUPTIONS $299mn $250mn $ 549 CASH & UNDRAWN COMMITTED CASH EQUIVALENT CREDIT FACILITIES mn 54% 46% 20 As of 30/06/2020
COVID-19 UPDATE OUR MARKETS COUNTRY AND COUNTERPARTY RISK 76% EBITDA IMPACT A+/A1 Regulatory Changes 2Q-2020 REVENUE Chile 20% NO IMPACT BY MARKET BBB-/Baa2 Vulnerable Household Relief Argentina -$0.7mn 4% Local CPI Indexation SD/Ca Investment grade profile customers 96% INVESTMENT GRADE Markets 89% 42% CHILE COLOMBIA 21 Based on 2019 Revenues
COVID-19 UPDATE OUR CONTRACTS DEMAND RISK DEMAND AES Gener Contracts with Exposure Contract Level NO volumetric risk 89% REVENUE Chile 100 % 65% CONTRACTED BY SOURCE Colombia 80 % 90% Argentina 23 % 0% Regulated Unregulated Total EBITDA 2Q-2020 System System System Impact ($mn) -1.5 % -$ 4 -9.5% 4.3% HIGHLY CONTRACTED business with Robust Take or Pay -7.9 % -$ 0.4 -1.8% -17.2% PPAs & Limited Volume Risk -5.7 % -$ 1.6 10.4% -17.3% 22 Based on 2019 Revenues
COVID-19 UPDATE OUR CURRENCIES FX RISK CASH FLOW FX Variation FX Δ QoQ CF Impact 79% REVENUE Chile -0.2 % $ 0 mn DOLLAR BY CURRENCY denominated Colombia -9 % +$ 3 mn Argentina -10 % -$ 0.3 mn FULLY DOLLARIZED FIXED COSTS Revenues in Chile Local currencies help to offset devaluation ACTIVE HEDGE STRATEGY in Colombia 23 Based on 2019 Revenues
COVID-19 UPDATE OUR DISCRETIONARY COSTS HELPING MITIGATE POTENTIAL COVID-19 IMPACTS Non-Essential COST MANAGEMENT $11 mn $5 mn ACHIEVED so far 24
CHILE – COLOMBIA - ARGENTINA SYSTEM DEMAND EVOLUTION 2020 vs 2019 10.0% 8.7% 4.9% 5.1% 2.2% 2.5% 1.2% 1.5% 0.9% Total -0.2% System -2.6% -1.5% -0.5% -5.4% -7.5% -7.6% -10.8% -11.0% 25.1% 17.8% 6.6% 10.4% 2.8% 5.8% 2.3% 4.9% 6.8% Regulated Customers -1.3% -1.0% -2.9% -3.0% -3.2% -4.6% -8.2% -8.3% -11.9% 4.6% 11.1% 6.9% 5.2% 1.3% 6.6% 5.4% 9.8% 0.2% 0.4% -0.3% Unregulated --12.9%% -3.7% -18.1% Customers -17.4% -10.8% -20.8% -23.5% Jan Feb Mar Apr May Jun Jan Feb Mar Apr May Jun Jun (*) Jan Feb Mar Apr May (*) Preliminary data 25 Source: Coordinador Eléctrico Nacional, XM, CAMMESA. In Argentina Discos considers Residential Demand and Free Customers considers Commercial and Industrial Demand
STRATEGY EXECUTION UPDATE
STRATEGY EXECUTION UPDATE GREENTEGRA ULTIMATE OBJECTIVES Transform AES Gener into a LEADING RENEWABLE BUSINESS in South America REDUCE CARBON STRENGTHEN GREEN OUR INVESTMENT GRADE CUSTOMERS INTENSITY 27
STRATEGY EXECUTION UPDATE GREENTEGRA 2024 PROFORMA BASED ON CURRENT ACHIEVEMENTS STRENGTHEN GREEN OUR REDUCE CARBON INVESTMENT GRADE INTENSITY CUSTOMERS 66% 52% 69% $1.0 BN 7.1 GW 3.4 X EBITDA Installed Net Debt/ Capacity EBITDA RENEWABLES RENEWABLES NON-RECOURSE DEBT NON-RENEWABLES NON-RENEWABLES RECOURSE DEBT 28
STRATEGY EXECUTION UPDATE REDUCING CARBON INTENSITY SUSTAINABLE PORTFOLIO 52% 24% +169% Renewable 5.8 GW 7.1 GW Capacity -27% 2017 2024 CO 2 Intensity RENEWABLES NON RENEWABLES 29
STRATEGY EXECUTION UPDATE GREENING OUR CUSTOMERS SUSTAINABLE EBITDA GROWTH 33% +$ 0.4 bn 66% +Wind, Solar & Batteries +Alto Maipo 0.8 bn 1.0 bn +Greentegra PPAs - $ 120mn BHP termination 2017 2024 - PPA roll-off - Asset Sales ($ 0.2 bn) ENSURING SUSTAINABLE EARNINGS & DIVIDENDS RENEWABLES NON RENEWABLES 30
STRATEGY EXECUTION UPDATE STRENGTHEN INVESTMENT GRADE SUSTAINABLE LEVERAGE Net Debt¹ / EBITDA 36% 64% 31% 69% Renewable 4.1 X 3.4 X EBITDA Debt 2017 2024 Amortization NON-RECOURSE DEBT RECOURSE DEBT 31 (1) Includes Hybrid Debt Equity Credit
STRATEGY EXECUTION UPDATE RENEWABLE TRANSFORMATION ENABLED BY OUR BUSINESS SOLUTIONS ENABLE ALLOW FOR EARLIER PROTECT GREEN GROWTH COAL PHASE OUT EXISTING VALUE Delink existing PPAs from New long-term renewable PPAs to Coal plants merchant providing coal physical assets support green capacity expansion reliability to the system 32
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