ENGIE Energia Per Corporate Presentation September 2018 AGENDA - - PowerPoint PPT Presentation

SLIDE 1

ENGIE Energia Perú

Corporate Presentation

September 2018

SLIDE 2

AGENDA

2 ENGIE Energía Perú - Corporate Presentation / September 2018

ENGIE Energia Peru overview Capital structure Energy Market update Appendix

SLIDE 3

ENGIE ENERGIA PERU OVERVIEW

ENGIE Energía Perú - Corporate Presentation / September 2018 3

ENGIE 61.8% AFP´s (Peruvian pension funds) 32.7% Others 5.5%

Shareholders %

Largest private electricity generation company in Peru 2,497 MW of installed capacity & ~7,600 GWh of annual

generation

Diversified & decentralized portfolio of generation

sources

21 years operating in the country & listed since 2005 502 employees Diversified and solid client portfolio

Strong financials to support ambitions, AAA local rating

Sponsored by a global leader, ENGIE S.A.*

* www.engie.com

SLIDE 4

SPONSORED BY A GLOBAL PLAYER: ENGIE S.A.

4 ENGIE Energía Perú - Corporate Presentation / September 2018

World leading independent power producer 103 GW(1) installed ~90% low CO2 26% renewables(2) European leader in gas infrastructures €27bn(3) regulated asset base in France 12bn m3 storage capacity Expertise in power transmission & distribution

LOW CO2 POWER GENERATION CUSTOMER SOLUTIONS

Capacity breakdown EBITDA gas infrastructures EBITDA by type of business

GLOBAL NETWORKS

24m customers in Europe Global leader in energy solutions for cities 23m individual and professional contracts +250 distribution heating & cooling networks worldwide

B2B: Business to Business B2T: Business to Territories B2C: Business to Customers (1) At 31/12/2017, at 100% (3) Incl. Storengy in France, regulated as from 01/01/2018 (2) Incl. pumped storage for hydro (3%) (4) 2017 EBITDA

89% low CO2

Natural gas Renewables(2) Nuclear Coal Other

5% 7% 6% 26% 56%

103 GW(1)

France Other EU & International

0.4 3.4

€3.8bn(4)

0.7 0.5 1.1

€2.3bn(4)

B2B B2T B2C

SLIDE 5

KEY MESSAGES

ENGIE Energía Perú - Corporate Presentation / September 2018 5

Solid results in a volatile context Value proposition for our clients and portfolio optimization Solid financial discipline and capital structure Dynamic commercial strategy in a changing environment

SLIDE 6

HIGHLIGHTS 2017 – H1 2018

ENGIE Energía Perú - Corporate Presentation / September 2018 6

• At the end of 2017, total debt reached

837MUSD, decreasing 17% with respect to

• 2016. At the end of H1 2018 total debt

decreased to 787MUSD

• Bond issuance in local capital market for

~70MUSD @ 10 years at an attractive rate below 4.9%

• 5.5 year Corporate Loan with Scotiabank

for up to 150MUSD @3.3%

• Net debt / EBITDA (12m): 2.5x @

Dec/2017; 2.9x @ Jun/2018

Awards/ Recognition

• ENGIE’s outstanding environmental,

social and governance practices were

• nce more recognized. EEP was

appointed by Capital Finance International as The Best ESG Power Producer in Peru in 2017 for a 2nd year in a row

• In July, because of its recognized

standards of transparency and corporate governance, ENGIE entered the BVL Good Corporate Governance Index

Industry & regulation

• FY 2017 EBITDA reached 325.0MUSD

while Net Result totalized 129.7MUSD, growing 5% and decreasing 1% compared to FY 2016

• H1 2018 EBITDA reached 142.7MUSD,

increasing 29% compared to H2 2017 while Net result totalized 60.3MUSD increasing significantly compared to H2 2017

• On March 31st EEP announced the

commercial operation of Intipampa solar project (41 MW)

Our business

• Total energy generation (SEIN) grew

1.4% compared to 2016 and 2.9% in H1 2018 compared to H1 2017. As of June 2018, EEP maintained a leading position in the sector as the first private player, accounting for 20% of the total capacity

• Natural gas price declaration norm was

modified

Financial discipline SOLID RESULTS IN A VOLATILE CONTEXT

SLIDE 7

2017 – H1 2018 FINANCIAL RESULTS

7

• Q2 2018 EBITDA stable vs Q1 2018 consolidating the commercial efforts taken during H2 2017
• Q2 2018 EBITDA decreased -33% compared to Q2 2017 to 71MUSD, mainly explained by the end of SPCC PPA (April 2017)

which was partially offset by new PPAs. Q2 2018 Net result was affected by lower EBITDA and higher D&A compared to Q2 2017

• However EBITDA H1 2018 presents a pick up of 29% vs H2 2017 mainly explained by commercial efforts / clients demand
• Total debt decreased by 1.5% from March 2018, following the expected amortization schedule, and totalized 787MUSD

ENGIE Energía Perú - Corporate Presentation / September 2018

* Restatement by application of IFRS ** Does not include commercial penalty fees and impairment of assets

(MUSD) Q2 2018 Q1 2018 Q2 2017 ∆ Q2 2018 vs Q2 2017 H1 2018 H2 2017 H1 2017 ∆ H1 2018 vs H1 2017 FY 2017 FY 2016 ∆ FY Revenues* 127 132 147

• 13%

259 253 319

• 19%

576 641

• 10%

EBITDA 71 71 106

• 33%

143 111 214

• 33%

325 309 5% Net Result 30 30 55

• 45%

60 20 110

• 45%

130 132

• 1%

Recurrent EBITDA** 71 71 106

• 33%

143 113 186

• 23%

298 330

• 10%

Net Recurrent Result** 30 30 55

• 45%

60 22 90

• 33%

111 169

• 35%

Total Debt 787 799 951

• 17%

787 837 951

• 17%

837 1,009

• 17%

Net Debt 729 763 872

• 16%

729 800 872

• 16%

800 981

• 18%

Net Generation GWh 847 740 1,699

• 50%

1,588 4,087 3,536

• 55%

7,624 7,914

• 4%

Clients Demand GWh 2,155 2,116 2,196

• 2%

4,271 3,822 4,536

• 6%

8,358 8,976

• 7%

Net Debt / EBITDA 12m 2.9 2.6 2.6 12% 2.9 2.5 2.6 12% 2.5 3.2

• 22%

SLIDE 8

8

EBITDA BREAKDOWN

ENGIE Energía Perú - Corporate Presentation / September 2018

48 81 41 43 69 68 33 38 192 148 37 62 28 2016 2017 H2 2017 H1 2018

+69%

• 1%
• 23%

Market risk - Market risk +

Investment agreements with Government Capacity income Market margin

50% 50%

HIGHER PROPORTION OF INCOME WITH LOWER RISK BUT MANTAINING UPSIDES

309 325

5%

EBITDA In US$ millions

Market risk - Market risk +

43% 57%

111 143

26% +5% +13% +68%

SLIDE 9

ENGIE Energía Perú - Corporate Presentation / September 2018 9

Low Co2 generation base Largest private electricity company Diversified & decentralized asset base across 4 regions

#1

282 km of transmission lines + 1 substation

Natural Gas; 963; 39% Hydro; 248; 10% Dual fuel; 1110; 44% Coal; 135; 5% Solar; 41; 2%

2,497MW

Chilca Complex

• ChilcaUno - 852MW - Natural Gas
• ChilcaDos - 111MW- Natural Gas

Ilo Complex

 Nodo - 610MW - Dual Fuel  Ilo31 (Cold Reserve) -

500MW - Dual Fuel

 Ilo21 - 135MW - Coal

Intipampa

 Solar 41MW

Yuncan

 Hydro 136MW

Quitaracsa

 Hydro 112MW

LEADING PLAYER WITH STRONG PORTFOLIO OF ASSETS

Value added customer solutions

SLIDE 10

CONSISTENT COMMERCIAL STRATEGY

ENGIE Energía Perú - Corporate Presentation / September 2018 10

Our portfolio & contracts

+ 380 MW1 new contracts in 2017 + 57 MW1 new contracts in 2018 Number of clients grew from 45 (2016) to 78 (2018) Marcobre (84MW), Distriluz (30MW), Grupo Nexa (62MW), Quellaveco (35MW)

Main commercial pillars

• 1. Value  quality and new services
• 2. Relationship plan with clients and

new projects

• 3. Internal reorganization to respond

quickly to market

• 4. Continuous communication with

authorities, market and media

+70%

AGRESSIVE COMPETITORS

The market

SLOW GROWING DEMAND REGULATORY UNCERTAINTY

FOCUS ON MANTAINING OUR EFFICIENT PORTFOLIO CONTRACTED

1- Includes new contracts with free clients and existing expansions

GROWTH POTENTIAL

+

SLIDE 11

• 10

20 30 40 50 60 70 80 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18

Increasing number of clients

ENGIE Energía Perú - Corporate Presentation / September 2018 11

 Limited spot market risk

• Fully contracted capacity for next 2 years

and 91% on average for 2020-2021

• Average active PPA life of 5.4 years, new

PPAs to start in 2019 and 2020

• Most of EEP´s contracts do not include

termination clauses

 Strong credit profile

• +50% of portfolio investment grade clients

& +70% above BB- (Or local equivalent) in terms of sales

 Low commodity risk

• Indexation ~60% of portfolio to Natural

Gas prices in line with generation costs

 Main commercial pillars

• Value  quality and new services
• Relationship plan with clients and new

projects

• Internal reorganization to respond quickly

to market

• Continuous communication with

authorities, market and media

51% 49%

Balanced portfolio

Regulated Free clients

 Diversification PORTFOLIO APPROACH

Resilience in face of unfavorable market conditions

SLIDE 12

AGENDA

12 ENGIE Energía Perú - Corporate Presentation / September 2018

ENGIE Energia Peru overview Capital structure Energy Market update Appendix

SLIDE 13

787 MUSD

By Currency By Source

SOLID FINANCIAL DISCIPLINE

OPTIMIZING COSTS, DIVERSIFYING FINANCIAL SOURCES & LIMITING RISKS

ENGIE Energía Perú - Corporate Presentation / September 2018 13

Net debt / EBITDA

2.79x 2.79x 2.76x 3.18x 2.80x 2.56x 2.42x 2.46x 2.64x 2.88x 919 926 898 981 904 872 792 800 763 729 330 332 326 309 323 341 327 325 288 253

• 1

2 3 4 5 6 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Net Debt/EBITDA Net Debt EBITDA LTM

Debt Breakdown - As of June 2018

64% 36% 47% 38% 16%

Credit Rating – September 2018

AAA.pe Stable 25/05/2018 AAA.pe Stable 28/05/2018

Local capital market as an important partner

• First bond program started in 2007 currently ~48MUSD
• utstanding
• Third program for up to 500MUSD started in 2015:
• 2016 → 1st issuance of 250MPEN @ 7.125% (10 yr)
• 2017 → 2nd issuance of 79MPEN @ 6.0% (7 yr)
• 2017 → 3rd issuance of 250MPEN @ 6.53% (10 yr)
• 2018 → 3rd issuance of 230MPEN @ 6.718% (10 yr)
• 2016-2018 issuances ~2x times over subscripted

SLIDE 14

SUCCESSFUL FINANCIAL PLAN EXECUTION IN A HIGHLY VOLATILE ENVIRONMENT

ENGIE Energía Perú - Corporate Presentation / September 2018 14

• Total debt reached 787MUSD as of June 2018, decreasing 6.0% from December 2017 (837MUSD), following expected

amortization schedule

• In 2017 – 2018 EEP successfully closed financial conditions for up to 320MUSD for an average fixed cost of

3.67% and average life of 7 years,

• 100MUSD in local capital markets ( 7 – 10 year bonds)  @ average cost of 3.4%, 100% disbursed
• 150MUSD through a 5.5 year Corporate Loan  @ average cost of 3.25%
• 70MUSD in local capital markets (10 year bonds)  @ average cost of 4.9%, 100% disbursed

Through the 2017/2018 financial plan execution EEP was able to achieve important gains by following its financial priorities:

1. Optimize cost, reducing average long term cost from 4.8% in 2017 to 4.3% in H1 2018 2. Improve debt structure, increasing debt duration from 2.8 years to nearly 4 years in 2018 3. Eliminate interest rate/refinancing risk 4. Maintain flexibility to continue looking for costs optimizations and investment opportunities

SLIDE 15

DEBT PROFILE IMPROVEMENT IN THE LAST 18 MONTHS

ENGIE Energía Perú - Corporate Presentation / September 2018 15

Today (June 2018) One year ago (March 2017)

158 152 90 80 1

• 30

15 25

• 10

50 50

• 76
• 50

100 150 200 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Financial leases Bonds 1rst P Corporate loans Bonds 3rd P MUSD MUSD

• Avg. LT cost of debt of 4.8%

@ ~2.8yr duration

• Avg. LT cost of debt of 4.3%

@ ~4yr duration

72 123 90 80 1

• 24
• 76

77 70

• 50

50

25

• 13

25 10

• 50

100 150 200 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Financial leases Bonds 3rd Program New Corporate loan Intipampa Bonds 1rst Program2

SLIDE 16

AGENDA

16 ENGIE Energía Perú - Corporate Presentation / September 2018

ENGIE Energia Peru overview Capital structure Energy Market update Appendix

SLIDE 17

ENGIE Energía Perú - Corporate Presentation / September 2018 17

MARKET UPDATE (1/3)

6,746 7,620 8,340 9,248 10,150 12,774 12,848 13,535 13,874 14,095 14,208 14,208 4,961 5,291 5,575 5,737 6,332 6,492 6,888 7,370 7,868 8,453 8,933 9,393

• 2,000

4,000 6,000 8,000 10,000 12,000 14,000 16,000

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

Installed Capacity (MW) Maximum Demand (SEIN)

COES Forecast

Source: COES

By 2022, the Reserve Margin back to 2013 levels

Reserve Margin 36% 44% 50% 61% 60% 97% 87% 84% 51% 76% 67% 59%

SLIDE 18

ENGIE Energía Perú - Corporate Presentation / September 2018 18

MARKET UPDATE (2/3)

Natural Gas

• Gas price declaration from July 2018 to June 2019 with a minimum gas price being the

variable price of the gas supply (other than the take or pay which is a fixed cost). From July 2019 to June 2022 new minimum price to be declared will be the molecule price (MINEM proposal)

• On Gaseoducto del Sur, 3 options are being studied by MINEM, in order to bring

natural gas efficiently to the South of the country

• Non-conventional (NC) Renewable Energy expected to generate 15% of energy by 2030
• MINEM working on a proposal in order to make NC Renewable Energy more
• competitive. Proposal expected to be ready end 2018
• Main topics to be solved include (but are not limited to): (i) recognition of firm power , (ii)

participation on any of the tenders for regulated clients, (iii) operational preference

• MINEM pre-published a draft of the Regulation for Distributed Generation for comments

(Ley N˚28832 for Medium Generation and Decreto Legislativo N˚ 1221 for Micro Generation)

• Key topics include (but are not limited to): (i) power bands, (ii) pricing includes or not

payment for the existing network, (iii) participants

Natural Gas Non-conventional Renewable Energy Distributed Generation

SLIDE 19

ENGIE Energía Perú - Corporate Presentation / September 2018 19

MARKET UPDATE (3/3)

Natural Gas

• In 2015, regulated clients with demand over 0.2MW and less than 2.5MW represented 33%
• f the maximum regulated demand (1240MW of 3750MW)
• In 2018, 930MW of those regulated clients converted to Free clients
• Distribution companies are over contracted (around 780MW) until December 2021
• MINEM has published a “Decreto Supremo” that authorizes the modification of the long

term contracts with the Distribution companies

• 3 items can be modified: (i) life of contracts, (ii) contracted power, and/or (iii)

discount to take or pay prices

• Addendums can be subscribed until 31st December 2018

Distribution

• “Mercado Mayorista de Electricidad” i.e. free clients could buy 10% of their capacity

demand in the spot market

• Requisites for the Free Clients include to have an independent supply and give

guarantees to the COES

• Up to now, no client has made the necessary investment to participate

in the spot market and assume price volatility

Spot market

SLIDE 20

AGENDA

20 ENGIE Energía Perú - Corporate Presentation / September 2018

ENGIE Energia Peru overview Capital structure Appendix

SLIDE 21

ENGIE S.A. LEADING THE ENERGY REVOLUTION THROUGH 3 PILLARS

ENGIE Energía Perú - Corporate Presentation / September 2018 21

ENERGY REVOLUTION & MEGA TRENDS Customer Centricity

Environmental awareness Energy efficiency Digitalization New technologies

3 pillars

DECARBONIZATIO ION

Worldwide renewable energies: annual additional capacity to grow by +70% in 2030 vs 2015

DECENTRALIZATION

Decentralized solutions to more than double by 2030

DIG IGITA ITALIZATIO IZATION

Digital changes energy systems and improves customer

• ffers

SLIDE 22

Generation

12,848 MW Total Capacity

ENERGY SYSTEM

Composed by three different sectors

ENGIE Energía Perú - Corporate Presentation / September 2018 22

Transmission

27,358 km Basic transmission

Distribution

7.1 million clients

Energy Sales

44,500 GWh

• 87% Private
• Free market – market

prices

• Two type of clients:
• Free clients: Mainly

mining and industry. Consumption > 0.2

• MW. Private auctions
• Regulated Distribution
• companies. Public

auctions

• 100% Private
• Exclusive concession
• Regulated tariff
• Open Access
• Main players: ISA

(56%), Abengoa (11%) & Red Electrica (3%)

• 38% Private
• Exclusive concession
• Two type of clients:
• Free clients:

Industries with consumption below 2.5 MW.

• Households and

industries with demand below 0.2MW

• Main players:

Government (62%), Enel disco (20%) & Luz de Sur (15%)

37 24 21 18 Mining and smelting Industry Residential Commercial

* Figures full year 2017

SLIDE 23

ENERGY GENERATION MARKET

An energy matrix with strong natural gas and hydro components

ENGIE Energía Perú - Corporate Presentation / September 2018 23

• Main regulated clients are

Enel Distribución and Luz del Sur (Distribution companies in Lima)

• Main free clients are

Mining and industrial companies

• Clients with a consumption

above 0.2MW are able to contract directly with generation companies (free clients)

• Natural Gas generation is

concentrated in Chilca district (60km from Lima)

• Diesel plants dispatch in

case of emergency and transmission congestion

• Market share as of

December in terms of energy generation

• Others include: Colbun, I

Squared, Statkraft, Termochilca, among

• thers

Clients Generation matrix Market share Market Installed capacity 12,848 MW Peak demand 6,888 MW Annual energy Generation 48,993 GWh

+1% +2%

• 1%

57% 3% 37% 3%

Hydro Non Conventional Renewables Natural Gas Coal & diesel

16% 22% 16% 13% 34%

ENGIE Government Enel Generación IC Power Others

45% 55%

Regulated Clients Free Clients * Figures full year 2017

SLIDE 24

BUSINESS MODELS IN ENERGY GENERATION

ENGIE Energía Perú - Corporate Presentation / September 2018 24

• Investments are repaid by long term commercial

contracts (PPAs). Private auctions & negotiations

• Commercial margin & Producer margin
• Capacity (fixed fee) and energy (variable charges) charges
• Contractual and physical position determines “buyer” or

“seller” position in spot market



Hydro investment cost is higher than natural gas thermoelectric investment and operational cost



Given hydrological seasonality, hydro power plants are normally net sellers in the spot market during wet season

• Government auctions every 2-3 years. Lower tariff projects

are awarded

• The project commits to generate a certain amount of energy

per year and receives a fixed tariff ($/MWh) for ~20 years

• Electricity consumers are charged an additional fee in their

electricity bill (charge is the difference between the auctioned tariff and the spot prices)

• Geographic diversification of natural gas generation
• Public auctions for dual fuel (Natural gas / diesel plants)
• Projects are available for the national system and receive an

annuity for ~20 years

• Electricity consumers are charged an additional fee in their

electricity bill

After the privatization of the sector in the 90´s, the government developed different mechanisms to increase energy generation sources looking for i) hydro and natural gas power balance, ii) diversification of non conventional renewable sources, iii) geographic diversification of natural gas thermoelectric generation and iv) increase reserve for emergencies Cold reserves & Nodos Non Conventional Renewables Traditional model Hydro

SLIDE 25

MAIN REGULATION FRAMEWORK

ENGIE Energía Perú - Corporate Presentation / September 2018 25

• Centralized generation
• 2 markets: PPA market and the spot market
• PPA market
• Private negotiations or private / public auctions
• Protection against short term volatility
• Spot market (physical exchange)
• Goal of the dispatch system is to minimize total cost for the system
• Marginal cost or spot price is the result of the system optimization and reflects

the variable cost to generate an additional unit of electricity at a given time

• Spot settlement between generators (sellers and buyers depending on

contractual positions)

• Natural Gas generators declare variable cost to optimize its fixed cost structure

Generators Distribution companies Free clients

SEIN

Generators Free clients

Interconnected Energy System

SLIDE 26

MARGINAL COST RESULTING FROM SETTING UP DISPATCH ORDER

ENGIE Energía Perú - Corporate Presentation / September 2018 26

Jun-18

SLIDE 27

ENERGY PRICE SEIN (USD/MWH)

ENGIE Energía Perú - Corporate Presentation / September 2018 27

10 20 30 40 50 60 70 Ene-09 Abr-09 Jul-09 Oct-09 Ene-10 Abr-10 Jul-10 Oct-10 Ene-11 Abr-11 Jul-11 Oct-11 Ene-12 Abr-12 Jul-12 Oct-12 Ene-13 Abr-13 Jul-13 Oct-13 Ene-14 Abr-14 Jul-14 Oct-14 Ene-15 Abr-15 Jul-15 Oct-15 Ene-16 Abr-16 Jul-16 Oct-16 Ene-17 Abr-17 Jul-17 Oct-17 Ene-18 Abr-18 Jul-18

Marginal Cost Free Client Regulated Client

USD/MWh

Note: Monthly average prices Source: COES

SLIDE 28

NATURAL GAS MEDIUM TERM UPSIDES

ENGIE Energía Perú - Corporate Presentation / September 2018 28

A. Phase 1: up to 1,110MW of installed capacity serving as emergency plants but able to generate with natural gas once available in the south of Peru

• Cold Reserve: option granted under the

existing concession contract after 2018

• Nodo Energético: once Natural Gas arrives

to the South

• Similar operation to Chilca 1 plant before it

was converted to Combined Cycle

• No significant investments required
• Similar operation and economic impact of Chilca 1 Combined Cycle

Project

• Approximately 700MUSD

additional investments to convert to combined cycle and 48 months for development and construction

B. Phase 2: up to an additional 550MW in steam turbines with the conversion to Combined Cycle

Delays in the GSP postpone these options and potential upsides

SLIDE 29

Yuncan +134MW

2004 2007 2010 2013 2016 2019

PROVEN TRACK RECORD IN DRIVING ORGANIC GROWTH

ENGIE Energía Perú - Corporate Presentation / September 2018 29 Nodo Ilo & Chilca Dos +723MW

Total Capacity

MW

374 868 1,068 1,860 2,665 2,456 2,497 EBITDA

MUSD

80 84 163 270 309 325 253* Market Cap

MUSD

• 645

1,600 2,005 1,611 1,351 1,205

374 374 MW MW

Hydro Natural Gas Dual Fuel Solar

Chilca 1 +854MW Ilo 31 +500MW Quitaracsa +112MW Intipampa +41MW

2,497 MW MW AVERAGE GROWTH

16% 16%

More than 3x capacity in 10 years Investments for 1.6 BnUSD in 2010 - 2018

2017

Ilo 1 ‐105MW

2018

* EBITDA last 12 months

SLIDE 30

FIRST STEP IN NON CONVENTIONAL RENEWABLES

Intipampa Solar Power Plant

ENGIE Energía Perú - Corporate Presentation / September 2018 30

IN INTIP TIPAMPA - Key ey fac acts ts

• Location the project is located in the south of Peru,

Moquegua

• Description: The project will deliver 108.404 GWh/year to

the system

• Economics: the project is backed by a 20 year Investment

Agreement with Ministry of Energy and Mines @48.5$/MWh until 2038 (approx. 20-21 years)

• Investment: ~50MUSD below initial estimate of 55MUSD

In 2016, ENGIE Energía Perú was awarded as part of the 4th Renewables Auction process the construction of a 40.5 MW solar plant, which will benefit 90,000 households and avoid 50,000t of CO2 / year Intipampa project successfully entered into operation on 31st March 2018

SLIDE 31

+182.0 +214.2

• 28.0

+3.8

• 58.5

+8.4 +2.6 +142.7 +110.8

EBITDA H1 2016 EBITDA H1 2017 EBITDA H1 2018 EBITDA H2 2017

EBITDA: H1 2018 VS. H1 2017 -71.6 MUSD

31 ENGIE Energía Perú - Corporate Presentation / September 2018

• 33%

+ 29%

Marginal cost reduction SPCC PPA maturity and end of Las Bambas by the end

• f August

2017 Jetty contract (mainly one shot initial payment) and Services to SPCC 2017 effect ‐28.0MUSD mainly due to commercial penalty fee Las Bambas

Impact of the end of PPA’s in H1 2017 partially offset by commercial effort driving H1 2018

By effect In US$ millions

SLIDE 32

DEBT EVOLUTION

ENGIE Energía Perú - Corporate Presentation / September 2018 32

389 654 716 808 956 1,009 837 787

• 200

400 600 800 1,000 1,200 2011 2012 2013 2014 2015 2016 2017 June 2018 MUSD Total Debt

• EEP started an aggressive expansion plan in 2011. Total investments of 1.6 BnUSD between 2011

and 2018 for the execution of 6 projects adding 1,657MW

• After Nodo Energetico and Chilca2 projects COD in 2016 and Intipampa projects COD in 2018, Engie

Energía Peru´s debt reached its maximum historical level

• Since 2017 EEP´s debt is decreasing consistently to have flexibility for future opportunities

SLIDE 33

DIVIDEND PAYMENTS: 680 MUSD SINCE 2004

ENGIE Energía Perú - Corporate Presentation / September 2018 33

Dividend Policy: Minimum payout ratio of 30%

Payout ratio

• f 38% in

2017

32 42 28 13 12.4 15 20 20 24 31 33 24 43 31 11 13 16 18 22 30 9 6 34 36 42 41 15 10 10 34 77 42 71 85 59 24 25.4 31 38 42 54 49 49

86% 193% 100% 113% 90% 89% 30% 30% 31% 30% 31% 30% 38% 38%

0% 20% 40% 60% 80% 100% 120% 140% 160% 180% 200%

10 20 30 40 50 60 70 80 90 100

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Extraordinary Annual 2nd Half 1rst Half Payout ratio

SLIDE 34

OUR ORGANIZATION, GOVERNANCE & ETHICS

ENGIE Energía Perú - Corporate Presentation / September 2018 34

Acting in accordance with an internal set of values based on honesty, integrity and respect to human rights…



Ethics Chapter that guides our relationship with clients, suppliers, partners and Government among our main stakeholders



Practical approach 1. Annual training plan to all employees 2. Practical Guide to Ethics 3. Control systems 4. Anonymous ethical complaints channel



Independent Ethics Officer, appointed by the board of directors

Shareholders assembly Board of directors CEO Audit Committee Transactions between affiliates Committee Executive Operations Regulatory Commercial Development Construction Risk & Finance Ethics

COO CFO Commercial Development Corporate Affairs Legal

Committees & Task forces Internal Auditor

 The Board of Directors includes three independent members out of a total of 7 directors

HR

SLIDE 35

THANKS

35

This presentation September contain certain forward-looking statements and information relating to ENGIE Energía Perú S.A. (“Engie Energía Perú” or the “Company”) that reflect the current views and/or expectations of the Company and its management with respect to its business plan. Forward-looking statements include, without limitation, any statement that September predict, forecast, indicate or imply future results, performance or achievements, and September contain words like “believe”, “anticipate”, “expect”, “envisage”, “will likely result”, or any other words or phrases of similar meaning. Such statements are subject to a number of significant risks, uncertainties and assumptions. We caution that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in this presentation. In any event, neither the Company nor any of its affiliates, directors, officers, agents or employees shall be liable before any third party (including investors) for any investment or business decision made or action taken in reliance on the information and statements contained in this presentation or for any consequential, special or similar

• damages. The Company does not intend to provide eventual holders of the notes with any revised forward-looking statements of analysis of the differences

between any forward-looking statements and actual results. There can be no assurance that the estimates or the underlying assumptions will be realized and that actual results of operations or future events will not be materially different from such estimates. This presentation and its contents are proprietary information and September not be reproduced or otherwise disseminated in whole or in part without ENGIE Energía Perú prior written consent.

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+51 1 616 79 79 investor.relations@pe.engie.com Adriana Burneo, Head of Corporate Finance & Investor Relations – adriana.burneo@engie.com Marcelo Soares, Chief Financial Officer – marcelo.soares@engie.com

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ENGIE Energía Perú - Corporate Presentation / September 2018