FIXED INCOME INVESTOR PRESENTATION 2 Q 2 0 | R E S U L T S Viso - - PowerPoint PPT Presentation

FIXED INCOME INVESTOR PRESENTATION

2 Q 2 0 | R E S U L T S

Visão geral Sustainable Value Financial Highlights ISA CTEEP

51%

IE Madeira

RAP²2020/2021 cycle BRL281 million

100%

IENNE

RAP2020/2021 cycle BRL53 million

ISA CTEEP

RAP2020/2021 cycle BRL3,131 million

IE Serra do Japi

100%

RAP2020/2021 cycle BRL56 million

100%

IE Pinheiros

RAP2020/2021 cycle BRL63 million

100%

Evrecy

RAP2020/2021 cycle BRL13 million

100%

IE Sul

RAP2020/2021 cycle BRL20 million

51%

IE Garanhuns

RAP²2020/2021 cycle BRL48 million

100%

IEMG

RAP2020/2021 cycle BRL20 million

Largest publicy traded pure transmission utility in Brazil

▪

Transmission of 33% of Brazil’s energy generation and 94% of the energy in the State of São Paulo

▪

Benchmark player in costs and quality

▪

Capacity in operation¹

▪ 18.6 thousand km of transmission lines ▪ 65.9 thousand MVA of transformation capacity ▪ 126 substations

▪

RAP2020/2021 cycle* of ISA CTEEP’s

• perational assets:

BRL3.7 billion2

Note: ¹ Considers the full capacity of IE Madeira and IE Garanhuns ² RAP 2020/2021 cycle adjusted to ISA CTEEP’s participation * RAP 2020/2021 cycle with PA, net of PIS and COFINS

IE Itapura Bauru

100%

RAP2020/2021 cycle BRL12 million

100%

IE Itaúnas

RAP 2020/2021 cycle BRL53 million

100%

IE Biguaçú

RAP 2020/2021 cycle BRL41 million

50%

IE Paraguaçu

RAP² 2020/2021 cycle BRL60 million

Largest publicly traded pure transmission utility in Brazil

▪

Growth with sustainable value creation

▪

Construction capacity ▪ 7.6 thousand km of transmission lines ▪ 1.7 thousand MVA of transformation capacity

▪

Organic growth¹: CapEx of BRL215 million/year with RAP of BRL45 million/year

▪

Greenfield projects: ANEEL capex BRL5 billion with RAP2020/2021 cycle* of BRL565 million

50%

IE Aimorés

RAP² 2020/2021 cycle BRL41 million

50%

IE Ivaí

RAP² 2020/2021 cycle BRL150 million

100%

IE Tibagi

RAP 2020/2021 cycle BRL26 million

100%

IE Itapura Lorena

RAP 2020/2021 cycle BRL11 million

100%

IE Aguapeí

100%

IE Itaquerê

RAP 2020/2021 cycle BRL52 million RAP 2020/2021 cycle BRL60 million

Note: ¹ Average for the last 7 years ² RAP 2020/2021 cycle adjusted to ISA CTEEP’s participation *RAP 2020/2021 cycle with PA, net of PIS and COFINS 100%

IEMG

RAP 2020/2021 cycle BRL33 million

100% 100%

Evrecy

RAP 2020/2021 cycle BRL38 million

Corporate Governance Structure

Human Resources Committee Audit Committee Fiscal Council

8 effective members, of which 2 are independent and one is elected by the employees 5 effective members and 5 substitute members

Board of Directors Rui Chammas CEO

Ethics and Transparency recognized at ISA and at ISA CTEEP level 2019 Transparency Trophy from ANEFAC Experienced Management team focused

• n value

creation

Shareholders CFO and IRO COO Institutional Relations Officer Alessandro Gregori Filho Carlos Ribeiro Carlos Ribeiro (interim) Chief Project Officer Rui Chammas (interim)

Note ¹On 6/30/2020

América Central Brasil

20% of participation in the Transmission market in June, 2020

Bolivia Argentina Peru

70% of participation in the Transmission market in June, 2020

Colombia

70% of participation in the Transmission market in June, 2020

Chile

12% of participation in the Transmission market in June, 2020

▪ Largest high-tension electric

transmission network in Latin America

INTERCONEXIÓN ELÉCTRICA, S.A.E.S.P .

A multilatina company recognized for the excellence of its operations Solid Presence in Latin America: 6 countries and Central America, 3 sectors, 43 companies and subsidiaries

ISA

Operational:

▪ 46,374 km of transmission lines ▪ 92,600 MVA in power capacity

Under construction:

▪ 7,431 km of transmission lines ▪ 15,482 MVA in power capacity ▪ Businesses in: ▪ Energy transmission ▪ Highway concessions ▪ Information Technology/Telecom

▪ Controlled by the Colombian

government (51% of shares)

▪ Market cap: USD6 billion¹

Financial Highlights ISA CTEEP Sustainable Value

P E S S O A S

Regulação Valor Justo Jurídico Gestão de Litígios Crescimento Disciplina de Capital Integração Subsidiárias Projetos Crescimento Orgânico Operação e Manutenção Eficiência, Qualidade, Segurança

REMUNERATION FROM ASSET AVAILABILITY

Note: ¹ Considers RAP proportional to ISA CTEEP’s participation in assets with partnerships

BRL4,263 million Permitted Annual RAP (RAP) - 2020/2021 Cycle¹

73% 14% 13% Renewed Contract (Contract 059) Bid Contracts in operation Bid Contracts in construction 68% RBSE 11% New Investments 21% Operation & Maintenance

RBSE (BASIC NETWORK OF EXISTING SERVICE) CASH FLOW BOOSTS CASH GENERATION FOR THE NEXT YEARS

▪ ANEEL included the remuneration of the

financial component by “Ke” in RAP starting from the 2021 cycle. The amount not received in the first three cycles of RBSE will be included, through an adjustment installment, in the 2020 to 2023 cycles.

▪ The regulatory WACC and the Regulatory

Remuneration Base were updated in the tariff reset process.

▪ The receipt of the economic component of

RBSE was also adjusted according to assets depreciation.

Note: ¹ Note: The graph shows amounts defined for the revenue cycles 2017/2018 (REH ANEEL 2,258), 2018/2019 (REH ANEEL 2,408) and 2019/2020 (REH ANEEL 2,565) and 2020/2021 (REH ANEEL 2,725). Assumptions for future cycle as per REN ANEEL 762/2017 and based on the worksheets published at the end of CP 22/2020.

RBSE Receipt Flow1 (BRL million)

Focus in cost efficiency, service quality and

• perational safety to maximize results

0.0031% 0.0056% 0.0020% 0.0025% 0.007% 0.0010% 12.95 16.37 7.69 7.06 2.16 2.67 0.55 0.35 0.2 0.17 0.07 0.11

ISA CTEEP South Southeast/ Midwest SIN Northeast North

FREQ (times)

Equivalent Frequency of Interruption

DREQ (minutes)

Equivalent Duration of Interruption

ISA CTEEP South Southeast/ Midwest SIN Northeast North

IENS (%)

Index of Non-Supplied Energy

ISA CTEEP South Southeast/ Midwest SIN Northeast North e

December 2019 figures

OPERATIONAL ASSETS

▪ 18.6 thousand km of

transmission lines

▪ 65.9 thousand MVA of

power transformation capacity

▪ RAP (RAP) of BRL3.7

million¹

Note: ¹ RAP 2020/2021 cycle weighted by ISA CTEEP’s participation

IENNE (100%)

TL: 710 km Substation: none RAP: BRL53 million

IE Garanhuns (51%)

TL: 633 km Substation: 2.1 thousand MVA RAP¹: BRL48 million

IE SUL (100%)

TL: 167 km Substation: 900 MVA RAP: BRL20 million

IE Madeira (51%)

TL: 2.4 thousand km Substation: 7,5 thousand MVA RAP¹: BRL282 million

ISA CTEEP

LT: 14.3 thousand km Substation: 48.8 thousand MVA RAP: BRL3.1 billion

IE Serra do Japi (100%)

TL: 137 km Substation: 2.0 thousand MVA RAP: BRL56 million

IEMG (100%)

TL: 173 km Substation: none RAP: BRL20 million

Evrecy (100%)

TL: 154 km Substation: 450 MVA RAP: BRL13 million

Substation Line Entrance Transmission Line (TL) In operation

IE Itapura – Bauru (100%)

1 Static Component (Bauru Substation) RAP: BRL12 million

IE Pinheiros (100%)

TL: 1 km Substation: 4.2 thousand MVA RAP: BRL63 million

Nota: ¹ Considers project information (100%) ² RAP 2020/2021 cycle adjusted to ISA CTEEP’s participation

IE Itaquerê (100%)

3 Comp. Synchronous (Araraquara Substation) CAPEX ANEEL: BRL398 million RAP20/21 cycle : BRL52 million ANEEL Term: Aug/21

IE Aguapeí (100%)

TL: : 111 km Substation: 1.4 thousand MVA ANEEL CAPEX: BRL602 million RAP20/21 cycle : BRL60 million ANEEL term: Aug/21

IE Paraguaçu (50%)²

TL: 338 km Substation: none ANEEL CAPEX: BRL510 million RAP20/21 cycle : BRL60 million ANEEL term: Feb/22

IE Itaúnas (100%)

TL: 79 km Substation: 1.2 thousand MVA 1 Static Comp. CAPEX ANEEL: BRL298 million RAP20/21 cycle : : BRL53 million ANEEL term: Feb/22

IE Aimorés (50%)²

TL: 208 km Substation: none ANEEL CAPEX: BRL341 million RAP20/21 cycle : BRL41 million ANEEL term: Feb/22

IE Tibagi (100%)

TL: : 18 km on double circuit Substation: 500 MVA ANEEL CAPEX: BRL135 million RAP20/21 cycle : BRL21 million ANEEL term: Aug/21

IE Ivaí (50%)²

TL: 599 km (230/500 kV) in double circuit Substation: 3 thousand MVA CAPEX ANEEL: BRL2 billion RAP20/21 cycle : BRL150 million ANEEL term: Aug/22

Under construction Substation Line Entrance Transmission Line (TL)

IE Itapura – Lorena (100%)

TL: 6 km of double circuit Substation: 1.2 thousand MVA CAPEX ANEEL: BRL238 million RAP20/21 cycle : BRL11 million ANEEL term: Sep/22

IE Biguaçú (100%)

TL: 57 km Substation: 300 MVA ANEEL CAPEX: BRL641 million RAP20/21 cycle : BRL41 million ANEEL term: Sep/23

ASSETS UNDER CONSTRUCTION

▪ 2 thousand km of

transmission lines1

▪ 12 thousand MVA of power

transformation capacity1

▪ RAP of BRL565 million²

Evrecy (100%) Minuano

TL: 169 km Substation: 2.7 thousand MVA CAPEX ANEEL : BRL682 million RAP20/21 cycle : BRL38 million ANEEL term: Dec/24

Três Lagoas (100%)

TL: 37 km Substation: none CAPEX ANEEL: BRL99 million RAP20/21 cycle : BRL5 million ANEEL term: Jun/23

IEMG (100%) Triângulo Mineiro

TL: 173 km Substation: 1.6 thousand MVA CAPEX ANEEL: BRL554 million RAP20/21 cycle : BRL33 million ANEEL term: Dec/24

Sustainable Value Financial Highlights ISA CTEEP

51% 76% 83% 89%

NET RAP (BRL MILLION)

Notes: LTM considers the last 12-month results ending on June 30, 2020 ¹ Excluding depreciation and contingencies ² Net income adjusted for non-controlling interest The figures for Net RAP and EBITDA do not consider results of affiliates, which are accounted for as equity income

O&M COSTS¹ (BRL MILLION) EBITDA ICVM 527 (BRL MILLION) NET INCOME² (BRL MILLION)

EBITDA Margin

REGULATORY RESULTS HIGHLIGHTS

STRONG CASH GENERATION BOOSTED BY RBSE

2019 2017 1,778 2018 LTM 2,775 2,767 3,619 2017 2019 2018 LTM 1,351 2,287 2,254 3,219 615 2018 2017 1,276 2019 1,983 LTM 1,222 509 538 594 555 2018 2017 2019 LTM

allows financing the investment cycle

Debt Breakdown on 6/30/2020 Debt Profile on 6/30/2020

2Q20 2019 2018 2017 Consolidated debt Gross Debt (BRL billion) 4.1 3.2 3.0 1.9 Net Debt (BRL billion)1 2.6 2.5 2.5 1.5 Indicators Net Debt /EBITDA (x) 1.0 1.0 1.0 1.0 Average cost of debt (%) 5.1% 7.5% 7.9% 8.3% Average term (years) 3.1 4.0 3.2 3.3 Interest coverage (x)² 19.4 11.8 15.8 20.4 Consolidated debt + JV³ Gross Debt (BRL billion) 5.9 5.1 4.2 4.4 Net Debt (BRL billion) 3.4 3.4 3.6 3.8

Note ¹ Net debt consider availabilities of ISA CTEEP and Subsidiaries ² Consider interest coverage for covenants calculation of infrastructure debentures and Law 4,131 (EBITDA covenant/ Financial Result) ³ Consider ISA CTEEP and JV pro forma availabilities (IE Madeira, IE Garanhuns and IE Ivaí)

13% 47% 20% 20%

Others BNDES - TJLP Local Bonds Law 4,131

ADEQUATE DEBT PROFILE WITH

Debt (BRL million) and Average Debt Cost (%) Consolidated Debt Amortization Schedule (BRL million) 7.5% 7.9% 8.3% 5.1%

Average cost

77% 23% 67% 2017 88% 12% 2018 33% 2019 69% 31% 2Q20 1,943 3,015 3,244 4,076

Long term Short term

251 731 78 394 721 610 51 2026 to 2029 2024 2022 2021 1S20 2023 2030 to 2032 2025 1,239

AAA (bra) rating by Fitch

Note: BNDES’ EBITDA considers the jointly controlled subsidiaries’ debt (IE Madeira and IE Garanhuns)x

The covenants and established requirements are being duly fulfilled on all issuances

BNDES (annual verification) I) Infrastructure Debentures (4th, 5th and 6th issuance) II) International Credit - Law 4,131 (quarterly verification) Financial Indicators Jun/20 Financial Indicators Jun/20 Net Debt/EBITDA ≤ 3x 0.99 Net Debt/EBITDA ≤ 3.5x 0.73 Net Debt/Net Debt + Shareholders' Equity ≤ 0.6x 0.20 EBITDA Debentures/Financial Result > 2.0x 19.39

Over BRL4.7 billion

• f funding raised in the last

years

6th Debenture Issuance Volume: R$ 350 MM Cost: 105.65% of CDI Term: 3 years

Green Bond

Pioneer in issuing green bonds in transmission sector

1st Issuance of Promissory Notes Volume: R$ 200.0 MM Cost: 120% of CDI Term: 6 months 3rd Issuance of Promissory Notes Volume: R$ 200 MM Cost: 106.5% of CDI Term: 6 months 2nd Issuance of Promissory Notes Volume: R$ 200.0 MM Cost: 119.5% of CDI Term: 1 year 4th Issuance of Promissory Notes Volume: R$ 200 MM Cost: CDI + 0.4% p.a. Term: 1 year 5th Issuance of Promissory Notes Volume: R$ 300 MM Cost: CDI + 0.48% p.a. Term: 1 year 6th Issuance of Promissory Notes Volume: R$ 400 MM Cost: 104.9 of CDI Term: 1 year 4th Debenture Issuance Volume: R$ 148.6 MM Cost: IPCA + 6.04% p.a. Term: 5 years 3rd Debenture Issuance Volume: R$ 500 MM Cost: 116.0% of CDI Term: 5 years 2nd Debenture Issuance Volume: R$ 700 MM Cost: 105.5% of CDI Term: 2 years 1st Debenture Issuance Volume: BRL 548.6 MM Cost: CDI + 1.30% p.a. IPCA + 8.10% p.a. Term: 5 years and 8 years 5th Debenture Issuance Volume: R$ 300 MM Cost: IPCA + 5.04% p.a. Term: 7 years 7th Debenture Issuance Volume: R$ 621 MM Cost: IPCA + 4.70% p.a. Term: 7 years

FREQUENT IN THE LOCAL MARKET

2008 2016 2009 2013 2011 2012 2018 2017

8th Debenture Issuance Volume: R$ 409 MM Cost: IPCA + 3.50% p.a. Term: 10 years

2019

Green Bond

One of the lowest-cost issuance in the in the market for the same duration in 2019

2008 2016 2009 2013 2011 2012 2018 2017 2019

e-mail: ri@isacteep.com.br phone: +55 11 3138-7557 www.isacteep.com.br/ir

INVESTOR RELATIONS