Enel Generacin Chile Investor Relations Presentation FY 2016 - - PowerPoint PPT Presentation

Enel Generación Chile

Investor Relations Presentation FY 2016

Organization structure

2

Enel Generación Chile (after Spin Off)

 PEHUENCHE, 93%  GASATACAMA, 97%

61% 60% ITALY CHILE  Transquillota ,48%  Electrogas, 43%  GNL Chile, 33% CHILE1

Committed Shareholders

Average daily volume traded (MMUS$) 2015 2016 Chilean Stock Exchanges 6.0 3.9 NYSE 4.4 3.9 Total 10.4 7.8

ENEL SpA ENEL CHILE ENEL GENERACIÓN CHILE

1 Recognized as equity method investments.

60% 16% 3% 3% 18% Enel Chile S.A. Chilean Pension Funds ADRs (Citibank N.A.) Retail Institutional Investors

Key investment considerations

Best investment grade in the region. Stable ratings by Credit Rating Agencies (BBB+)

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Attractive business in Chile

Well diversified portfolio of generation assets, including all types of technologies.

Hydroelectric assets prevailing in the Chilean Central Interconnected System SIC. Competitive thermal assets to reduce hydrological risks.

One of the largest electricity generation companies in Chile.

Proven track record with more than 70 years of experience

Conservative commercial policy to cope with hydrological risks. Stable regulatory framework to develop reliable long term business.

Well diversified generation assets

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Most relevant player in hydro generation

Energy sales 2016 : 23,689 GWh Energy sales 2015 : 23,558 GWh Market Share 1 : 35%

55% 10% 34% 1%

HYDRO COAL OIL-GAS NCRE

55% of Enel Generación Chile’s installed capacity corresponds to hydro resources Installed Capacity 6,351 MW

Hydro : 3,456 MW Oil-gas : 2,173 MW Coal : 636 MW NCRE 2 : 87 MW

• D. Almagro–

Taltal Bocamina Laja Maule Bio Bío Tarapaca Huasco San Isidro Los Molles Cachapoal Santiago

1:Calculated based on total sales of the country. 2: Non Conventional Renewable Energy.

Balanced commercial policy

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Leading to revenue stability

Physical sales: 23,689 GWh

Spot Unregulated Customers Regulated Customers Spot Free Customers

Energy sales by type of customer (Million Ch$) Chile – Contracted energy with Regulated and Free Customers (GWh) Physical Sales 2016 GWh Change1 REGULATED 18,516 5% UNREGULATED 4,321 0% SPOT 852

• 47%

TOTAL 23,689 1%

Regulated Customers

1 Compared with 2015

2 4 6 8 10 12 14 16 18 20 22 2017 2018 2019 2020 2021 2022 2023 2024 2025

Regulated Costumers Free Costumers

78% 18% 4%

1,081,142 1,180,043 243,597 234,642 150,079 102,003 2015 2016

1,474,818 1,516,688

Financial Highlights

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Improving results in Chile

Consolidated Income Statement1 2016 2015 Change %2 MM US$3 2016

Revenues 1,659,727 1,543,810 8% 2,453 Costs (895,060) (880,891) 2% (1,323) Contribution Margin 764,667 662,919 15% 1,130 EBITDA 594,772 516,861 15% 879 EBITDA Margin 35.8% 33.5% 2.4% 33.5% EBIT 431,386 401,819 7% 638 Net Financial Expenses (35,678) (114,252) (69%) (53) Related Company Results 7,878 8,905 (12%) 12 Net Income from other Investments 121,457 4,309 2719% 179 Taxes (83,217) (76,656) 9% (123) Net Income 521,432 635,021 (18%) 771 Attributable to shareholders of Enel Generación Chile 472,558 392,868 20% 698

1 Under IFRS, Endesa Chile has adopted the Chilean Peso as functional currency, comparisons between periods have been only made using Ch$. 2 When comparing 2016 with 2015 3 Referential average exchange rate was 676,67 Ch$/US$ as of December 30, 2016.

Healthy debt maturity profile

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Solid financial ratios and Investment grade rating (BBB+)

Debt by Currency

1

Debt by Type1

Total Debt: US$ 1,273 MM Financial Debt Maturity1 as of December 2016

• Cash:

US$ 171 MM

• Committed Credit Lines:

US$ 512 MM

• Average life of debt:

11 years

• International Credit Rating:

BBB+

1 Includes arrangements and other consolidation adjustments.

2% 98%

Others Bonds

92% 8%

US$ UF + CLP

8 8 80 44 44 1,062 3 3 3 3 4 11

500 1,000 1,500 < 1 year 1-2 years 2-3 years 3-4 years 4-5 years 5 years and beyond Bonds Banks and Other

Consolidated Cash Flow Generation (US$ million)1

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Including discontinued operations

• 1. Referential average exchange rate was 676.67 Ch$/US$ as of Dec, 2016.
• 2. Dividend payment considers cash outflows to Enel Chile and all minorities’ shareholders.

90 603 188 828 222 169

200 400 600 800 1,000 1,200

Cash and equivalents Dec-15 Funds from operations Capex Financing activities & Exchange rate effects Dividend payment ² Cash and equivalents Dec-16

Markets with high potential for growth

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Annual growth of 3.4% in electricity demand in Chile*

Direct relation between GDP and electricity demand

ARGENTINA AUSTRALIA AUSTRIA BOLIVIA BRAZIL CANADA CHILE CHINA COLOMBIA FINLAND FRANCE GERMANY GREECE INDIA IRELAND ITALY JAPAN MEXICO PERU RUSSIA SPAIN UNITED KINGDOM UNITED STATES 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 10,000 20,000 30,000 40,000 50,000 60,000 Electricity consumption, per capita (Kwh per year) GDP per capita (current PPP, US$)

Data source: The World Bank.

• Chile aims to be in the group of developed countries
• There is no development without energy.

* Average for 2005-2015 period.

Evolution of Enel Generación Chile’s total installed capacity

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Enel Generación Chile has more than doubled its capacity in the last 20 years

87% 72% 76% 62% 55% 55% 13% 28% 24% 37% 44% 44%

1% 1% 1%

1995 2000 2005 2010 2016 Under construction 2,513 4,035 4,477 5,611 6,351 6,501

GasAtacama 781 MW* Los Cóndores 150 MW

• A well diversified generation matrix incorporating different types of generation technologies (Coal, LNG and NCRE), providing a better

position to cope with hydrological risks.

• 2% increase in installed capacity through projects under construction.

* Capacity added in 2014.

Projects under construction

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To support growth of the country

• Run-of-the-river, hydroelectric power plant.
• Located in San Clemente, in Maule region, Chile.
• 150 MW of installed capacity.
• Estimated generation of 600 GWh/year.
• Estimated load factor: 46%.
• Total CAPEX of US$ 662 million.
• 45% progress.
• Total investment of US$ 258 million as of December 2016.

Los Cóndores

Credit Rating Agencies’ Recognition

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Attractive ratings since 2010

BBB+ Baa2 BBB+

Since: Affirmed:

• Jan. 2010
• Apr. 2011
• Feb. 2010
• Feb. 2017
• Dec. 2016
• Feb. 2016

AA AA

• Jan. 2010
• Apr. 2010
• Feb. 2017
• Jul. 2016

International market Chilean market

RATINGS BASED ON:

• Well diversified and efficient assets
• Leading market share in Chile
• Transparent and stable regulatory framework in Chile
• Solid financials, good cash flow generation and prudent financial

management

• Conservative commercial policy

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Strategic Plan 2017 - 2019

EBITDA Evolution

898 1.108 2016E 2019 23%

Hydrology Normalization of hydrology since 2018, favor an increase in hydro production, improving margin Sale price Contractual position allows to defend margins when spot prices fall down Assets Mix Diversified generation mix mitigates hydrology risk Drivers Additional capacity Commercial operations of Los Cóndores starting by the end of 2018, increasing our production in 600 GWh/year approx. Accumulated EBITDA 2017 – 2019: MM US$ 3,095 1,108

Total 2017-2019

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Total investment for the period 2017 – 2019: MM US$ 687:

• New Capacity: Los Cóndores.
• Higher environmental standards.
• Maintain higher standard of operational efficiency.

Operational excellence in the generation capacity

248 439

Mantenimiento BD

Capex Maintenance and Business Development

85 61 101 264 158 18

349 219 119

2017 2018 2019 Mantenimiento BD

Strategic Plan 2017 - 2019

Maintenance Maintenance

15 50% 55% 60% 65% 70%

2016 2017 2018 2019 2020

• Enel Generación Chile paid on May 24th a dividend of Ch$ 11.02 per share1.
• Enel Generación Chile proforma dividend 2015 was Ch$ 23.95 per share.

1. Note: As of March 1, 2016, Enel Generación Chile Spin-Off became effective.

Pay-out ratio increasing to 70% in 2020

Dividend policy

Susana Rey Head of IR Enel Chile +56 2 2630 9606 susana.rey@enel.com

Contact us

ir.enelgeneracionchile@enel.com

For further information, visit our IR site at:

www.enelgeneracion.cl

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Catalina González Head of IR Enel Generación Chile +56 2 2630 9603 catalina.gonzalez@enel.com Guillermo Berguecio Analyst of IR Enel Generación Chile +56 2 2630 9506 guillermo.berguecio@enel.com Francisco Basauri Analyst of IR Enel Generación Chile +56 2 2630 9585 francisco.basauri@enel.com

Enel Generación Chile

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Exhibits

Highlights 2016

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• Chilean EBITDA amounted to 879 million dollars in 2016, increasing 15%.
• Net income attributable to shareholders rose by 20% to 698 million dollars.
• Total energy sales rose by 1% in 2016.
• Greater thermal generation (+2,065 GWh), compensating poor hydrology.
• On October 4, 2016, it was agreed to change the Company’s name to "Enel Generación

Chile S.A.”. The new name became effective legally on October 18, 2016.

• Enel Generación Chile S.A. sold all its shareholding in GNL Quintero S.A. for Ch$ 132,821

million on September 14, 2016.

Installed capacity and energy generation

19 1 : Compared with 2016 2: Non Conventional Renewable Energy

Los Molles: 18 MW Rapel-Sauzal: 466 MW Maule: 875 MW Laja: 940 MW Ralco-Pangue: 1,157 MW

54% Hydro 3,456 MW 44% Thermal 2,808 MW

GasAtacama 780 MW Tarapaca 182 MW

• D. Almagro–Taltal:

268 MW Huasco: 64 MW San Isidro 1 and 2: 778 MW Bocamina 1 and 2: 478 MW TG Quintero: 257 MW

2% NCRE2 87 MW

Canela: 18 MW Canela II: 60 MW Ojos de Agua: 9 MW

Installed Capacity: 6,351 MW Market Share*: 29% Total Generation: 17,564 GWh

Net Generation 2016 GWh Change1

HYDRO

9,033 (4%)

COAL

3,061 97%

OIL-GAS

5,318 17%

NCRE

152 (18%)

Total

17,564 (4%) Historical energy generation by type of technology

* Based on total installed capacity of the country 1000 2000 3000 4000 5000 6000 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 2012 2013 2014 2015 2016 Hydro Coal Oil-Gas CHP / Renewables

Strong financial position

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1Amounts translated into US$ using the exchange rate as of December (Ch$ 669.47 per US$).

*Financial ratio as of Dec 2016 compared with Dec 2015.

(Million Ch$) Dec 2016 Dec 2015 Chg. Chg % MM US$ 20161 Gross Debt 879,713 945,119 (65,406) (6.9%) 1,314 Cash 114,486 37,425 77,061 205.9% 171 Net Debt 765,226 907,694 (142,468) (15.7%) 1,143 Leverage 0.97 1.05 (0.08) 8%

• Financial Expenses

Coverage 14.22 11.23 2.99 27%

• ROE (%)*

29.8% 14.7% 15.1% 103%

• ROA (%)*

15.4% 8.7% 6.6% 76%

DISCLAIMER This presentation does not constitute an offer to sell any securities and is not soliciting an offer to buy any securities in any jurisdiction. This presentation contains certain “forward-looking statements” regarding anticipated financial and operating results and statistics and other future events relating to Enel Generación Chile S.A. (Enel Generación) These statements are not guarantees of future performance and are subject to material risks, uncertainties, changes and other factors which may be beyond Enel Generación’ control or may be difficult to predict. These statements may constitute forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. The inclusion of these forward-looking statements should not be regarded as an indication that Enel Generación or any other person considers such projections to be material or to be a reliable prediction of actual future results. These forward-looking statements are subjective in many respects and there can be no assurance that they will be realized or that actual results will not be significantly higher or lower than described. As a result, the inclusion of any forward-looking statements in this presentation should not be relied on as necessarily predictive of actual future events. The projections and other forward-looking statements were based on numerous variables and assumptions that are inherently uncertain. Actual results may differ materially from those projected as a result of such risks and uncertainties. In addition, the financial projections do not necessarily reflect revised prospects, changes in general business or economic conditions, or any other transaction or event that has occurred or that may occur and that was not anticipated at the time the projections were prepared. Forward looking statements include, but are not limited to, information regarding: Enel Generación' business plans, Enel Generación' cost reduction plans, trends affecting Enel Generación ' financial condition or results of operations including market trends in the electricity sector in Chile or elsewhere, supervision and regulation of the electricity sector in Chile or elsewhere, and the future effect of any changes in the laws and regulations applicable to Enel Generación' or its affiliates. The principal assumptions underlying these forecasts and targets relate to: Economic and Industry Conditions, Commercial Factors, Political/Governmental Factors, Operating Factors, and Competitive Factors. The following important factors, in addition to those discussed elsewhere in this presentation, could cause actual financial and operating results and statistics to differ materially from those expressed in our forward-looking statements, including but not limited to: changes or developments regarding the applicable regulations (which may affect the investment plan of Enel Generación regarding the regulated activities), legal restrictions applicable to the implementation of the dividends policy, environmental regulations and other legal issues; price of electricity; price and supply of raw materials; interest rates or exchange rates; availability of fuel; ability to maintain relationship with suppliers, customers and consumer and user protection groups; changes in climate conditions; widespread adoption energy efficiency measures; inherent risks in the construction of new power generation and distribution facilities; changes in general economic, political, administrative and business conditions; operating hazards and risks; tax risks; loss of senior management and key personnel; insufficiency of insurance coverage or increase of insurance costs; failure of systems and information technology and processing; inability to access the capital markets to refinance its debt and finance its capital expenditures; and other factors that could adversely affect the business and financial results of the Company. No assurance can be given that the forward-looking statements in this document will be realized. Readers are cautioned not to place undue reliance on those forward-looking statements, which speak only as of the date of this presentation. Our independent registered public accounting firm has not audited, examined or compiled the forward-looking statements and, accordingly, does not provide any assurance with respect to such statements. Neither Enel Generación nor any of its affiliates intends, nor undertakes any obligation, to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.