Conference Call

4rd Quarter 2014

Highlights
OPERATING

Energy consumption in the distribution company grew by 3.0% between 2014 and 2013;

Non-technical losses (12 months) stood at 40.9%, 0.4 p.p. down quarter-over-quarter with a drop of 1.3 p.p. yearover-year;

Collection fee reached 98.6% in 2014;

Allowance for doubtful accounts (PCLD) of 1.3% of revenue from energy billing in 2014, compared to 1.8% in 2013;

DEC and FEC (12 months) improved by 33% and 21%, respectively over Dec/2013;

Net revenue, excluding construction revenue, grew by 25.6% year-over-year, totaling R$8,289.9 million; net
revenue, excluding construction revenue and CVA (compensation of Portion A variation) would total R$7,270.0
million in 2014, 10.1% up on 2013;

Consolidated EBITDA in 2014 of R$1,809.7 million, 6.7% up on 2013. Adjusted by CVA balance and equity
accounting, EBITDA would total R$1,332.4 million in 2014, a 14.1% decrease in relation to EBITDA in 2013 of
R$1,551.1 million (adjusted by CVA and VNR new replacement value);

Net income of R$662.8 million in 2014, 12.9% up on 2013. Adjusted by CVA balance and equity income gain, the
net income would total R$299.1 million in 2014, a 39.1% decrease compared to the net income in 2013 of R$491.1
million (adjusted by CVA and VNR);

Consolidated net debt of R$6,076.5 million, 4.7% up on 3Q14;

Extraordinary tariff review of Light SESA had an average increase of 22.48% as of March 2, 2015;

Increase in flags tariff. The red flag will increase from R$30.00 to R$55.00/MWh and the yellow flag from R$15.00 to
R$25.00/MWh;

Recognition of CVA balance, in the amount of R$1,019.8 million, which now is recorded under net revenue as of
December 2014;

R$143.2 million gain on equity income due to Light Energias dilution of interest in Renova, from 21.9% to 15.9%.

FINANCIAL

REGULATORY

ACCOUNTING

Energy Consumption
Distribution Quarter
TOTAL MARKET (GWh)

5.7%

2.5%
6,531

5,673

5,965

26.1C

25.7C
24.6C

23.9C

4Q11

6,694

4Q12

4Q13

4Q14

1Note:

To preserve comparability in the market approved by Aneel in the tariff adjustment process.
the billed energy of the free customer CSN has been considered back.

Energy Consumption
Distribution 2014
TOTAL MARKET (GWh)

+4.9%

3.0%
25,717

22,932

23,384

24.7C
23.9C

2011

26,493

2012

24.1C

2013

24.7C

2014

1Note:

To preserve comparability in the market approved by Aneel in the tariff adjustment process.
the billed energy of the free customer CSN has been considered back.

TOTAL MARKET
Electricity consumption (GWh)
Total market Quarter
+2.5%

6,530

6,694

1,348

1,241

1.348

+4.9%

2,099
2,099

4Q13

1.241

+6.0%

2,203
2,203

4Q14

RESIDENTIAL

-7.9%

1,439

1,326

1,083

972

356

354

4Q13

4Q14

COMMERCIAL

2,031
216

2,153
216

+5.3%

1,815

1,938

961
49
912

4Q13

4Q14

4Q13

INDUSTRIAL

Free

1,012
53
959
4Q14

OTHERS

5,182

5,453

4Q13

4Q14
TOTAL

Captive
5

TOTAL MARKET
Electricity Consumption (GWh)
Total Market - Year

+3.0%
25,717
5,326

7.7%
8,312

4,993

+4.9%
8,950

-6.6%
5,668

2013

26,493

2014

RESIDENTIAL

5,296

4,273

3,900

1,395

1,396

2013

2014

COMMERCIAL

7,939
853

8,328
879

7,086

7,449

3,798
200
3,598

3,919
214
3,705

2013

2014

2013

2014

INDUSTRIAL

Free

+3.2%

OTHERS

20,391

21,500

2013

2014
TOTAL

Captive
6

Collection
COLLECTION RATE BY SEGMENT
Year

100.6% 98.6%

101.2% 101.5%

99.2% 97.8%

PCLD/Gross Revenue
(Billed Sales) - Year
105.7%
96.5%
2.9%

-0.5 p.p.

1.8%
1.3%

Total

Retail

Large Costumers

2013

Public Sector

2012

2013

2014

2014

Operating Quality Indicators

DEC e FEC - 12 MONTHS
(WITH PURGE)

Dic/Fic Compensation
INDICATOR

Regulatory
TARGET 2014

Overall DEC

8.96

Overall FEC

6.84

-33.4%
18.40

-30.1%

48.6
12.25
-21.1%

33.9

8.31
6.56

DEC

FEC

2013

2013

2014

2014

* DIC Individual Length of Interruption / FIC Individual Frequency of Interruption

Loss Prevention
LOSS (12 MONTHS)

INSTALLED METERS
(Thousand Units)

- 1.3 p.p.

42.2%

8,352

5,738

42.4%

41.9%

41.3%

40.9%

Aneel
TARGET
august/15
39.92%

8,748

8,815

8,754

8,847

5,955

5,972

5,904

5,927

44.0%

+190

102
79
480

30
2,614

2,793

2,843

2,850

2,920

dec-13

mar-14

jun-14

sep-14

dec-14

Comercial Losses GWh

% Non-technical losses/ LV Market

Tec. Losses GWh

142

197

272

330

115

2010

2011

2012

2013

2014

Communities
Out of Communities
9

Losses Combat Actions - APZ Results

Until December, the program covered 624 thousand customers in 37 APZs,
of which 26 had the results calculated:
APZ LOSSES

APZ EVOLUTION

50.2%
22.0

22.2

19.2

16.4

20.3

37

20.0

26
BEFORE sep-13 dec-13 mar-14 jun-14 sep-14 dec-14

624

13
416

APZ COLLECTION
93.9

91.2

95.5

100.2

98.2

97.1

200

89.20
2012

2013

2014

Number of APZs
Number of Clients (Thousand Units)
BEFORE sep-13 dec-13 mar-14 jun-14 sep-14 dec-14
10

Losses Combat Actions - APZ Results

Neighborhood

Curicica
Realengo/Batan
Cosmos 1
Cosmos 2
Sepetiba
Caxias 1 e 2
Belford Roxo 1 e 2
Vigrio Geral
Caxias 3
Nova Iguau 1
Nova Iguau 2
Nilpolis
Mesquita + Nilpolis Convencional
Ricardo de Albuquerque
Cabritos/Tabajaras/Chapu
Mangueira/Babilnia/Santa Marta
Coelho da Rocha
Caxias 4
Alemo
Cidade de Deus
Tomazinho
Formiga/Borel/Macaco/Salgueiro/Andara
Monte Lbano
Caxias 5
Cordovil
den
Nova Iguau 3
Total

Implementation Year

Number of
clients

Non-Technical Losses /
Grid Load*
Before

Current

Collection Rate
UPP Area
Before

Current

2010
2010/2013
2012
2012
2012
2012
2013
2012
2013
2013
2013
2013
2010
2013

13.505
20.474
22.271
20.422
21.172
14.579
22.089
18.142
17.762
20.456
22.335
10.882
20.119
26.224

38%
38%
49%
46%
57%
59%
63%
35%
43%
49%
46%
42%
51%
35%

10%
10%
14%
13%
31%
34%
24%
12%
16%
27%
19%
27%
16%
11%

95%
94%
92%
92%
88%
83%
88%
94%
96%
90%
88%
90%
84%
94%

98%
97%
97%
105%
96%
93%
95%
99%
96%
97%
98%
96%
98%
96%

N
N/Y
N
N
N
N
N
N
N
N
N
N
N
N

2012

8.517

68%

32%

62%

97%

2013
2013
2014
2011
2013
2012
2013
2014
2014
2014
2014

18.913
19.984
13.062
20.585
12.787
18.216
11.506
22.298
12.735
18.007
22.243
469.285

41%
42%
63%
52%
43%
51%
36%
49%
28%
55%
49%
50%

11%
14%
31%
31%
16%
26%
15%
30%
15%
14%
30%
20%

92%
90%
91%
84%
87%
50%
92%
94%
93%
86%
89%
90%

99%
99%
93%
91%
96%
91%
97%
92%
96%
96%
96%
97%

N
N
Y
Y
N
Y
N
N
N
N
N

* Reflects the accumulated results until Dec/14, since the beggining of the implementation of each APZ
Subtitle: N = No / Y = Yes

11 APZ's under phase of implementation and still without recorded results, totaling
155,000 customers.
11

Net Revenue
NET REVENUE (R$MN)

NET REVENUE BY SEGMENT (2014)*

R$ MN

24.4%

9,230
941
7,422
820

1,020

Distribution
10.1%

128

83.0%**

+59.5%

2,066
365
1,701

3,295
306
1,020

6,602

Generation
6.8%

Commercialization and
service

7,270

10.2%

15.7%

1,969
* Eliminations not considered

4Q13

4Q14

2013

2014

** Construction revenue not considered

Construction Revenue
Booking of CVA
Revenue w/out construction and CVA
12

Operating Costs and Expenses

COSTS (R$MN)*
2014

DISTRIBUTION PMSO COSTS (R$MN)

-2.7%

5,052

783

761

2013

2014

Non manageable
(distribution**):
(66.9%)
-10.7%

214

191

4Q13

4Q14

1,123
Generation and
Commercialization:
(14.9%)

1,372
Manageable
(distribution):
(18.2%)

* Eliminations not considered

** Construction revenue not considered

R$ MN

4Q13

4Q14

Var.

2013

2014

Var.

PMSO

(214.1) (191.2) -10.7% (782.9)

(761.4)

-2.7%

Provisions

(57.2)

(83.8)

46.5%

(210.0)

(213.3)

1.5%

PCLD

(43.3)

(33.8)

-22.1%

(157.9)

(125.0)

-20.8%

Contingencies

(13.9)

(50.0)

260.6%

(52.1)

(88.3)

69.4%

(84.7)

(93.5)

10.4%

(335.2)

(356.6)

6.4%

Other operational/
102.2
revenues expenses

(24.0)

87.3

(40.7)

Depreciation

Total

(253.8) (392.6)

54.7% (1,240.8) (1,372.0) 10.6%

13

RTE e FLAGS TARIFF

RTE (extraordinary tariff review) of Light SESA with an average increase of 22.48% as of March
2, 2015. Low-tension consumer will perceive a 21.06% increase;
Voltage Level
(Consumption segment)
A2
A3a
A4
AS
B1 (Residential)
B2 (Rural)
B3 (Commercial/Industrial)
B4 (Il. Public)
High Voltage
Low Voltage
Average Readjustment

2.12
6.37
0.22
3.47

22.48
14.54

CDE Tusd

CDE Energy

P&D

Itaipu

CCEARs

Average
Increase
25.14%
27.30%
26.07%
20.91%
21.06%
21.05%
21.05%
21.05%
25.68%
21.06%
22.48%

Tariff
Readjustment

ANEEL increased flags tariff as of March 2, 2015.

COLOR OF FLAG
GREEN
YELLOW
RED

Last Value
(Per MWh)
R$ 15.00
R$ 30.00

New Value
(Per MWh)
R$ 25.00
R$ 55.00

14

EBITDA
EBITDA BY SEGMENT (R$ MN)

ADJUSTED EBITDA - BY SEGMENT

1,551
28.9%

1,332

EBITDA Consolidado
(R$ MM)

4Q13

4Q14

Distribution

226.1

725.9

14.9%

26.2%

21.0%

17.1%

119.8

196.0

444.1

491.3

80.6%

151.7%

79.5%

81.7%

2.8

17.0

26.3

88.8

2.0%

7.7%

4.4%

9.9%

(6.9)

(5.1)

(11.3)

(20.5)

341.7

933.9

1,696.8 1,809.7

304.7

288.0

1,551.1 1,332.4

20.1%

31.2%

EBITDA Margin (%)

27.9%

Generation
EBITDA Margin (%)

Commercialization
71.1%
304
38.8%

288
23.6%

61.2%

76.4%

4Q13

4Q14

72.1%

EBITDA Margin (%)

Others and
eliminations
Total

2013

2014

Adjusted Total
EBITDA Margins (%)

2013

2014

1,237.7 1,250.2

25.7%

21.8%

Generation e Comercialization
Distribution

Percentages does not consider eliminations.

15

EBITDA
EBITDA e Adjusted EBITDA
2013 / 2014 (R$ MN)
-14.1%
6.6%
1.688
668
-1,600

1,020
CVA
21

-130

-5

140

334

143
1,810

1,697

1,551

Adjusted
EBITDA
2013

20
125

1,332

Regulatory
Assets and
Liabilities

VNR

EBITDA
2013

Net
NonManageable Other
Provisions
Revenue Manageable Costs
Operational
Costs
(PMSO)
Revenues

Equity
Pikup

EBITDA
2014

Regulatory
Assets and
Liabilities

Renova
Equity
Pikup

Adjusted
EBITDA
2014
16

Net Income
2014
ADJUSTED NET INCOME
2013 / 2014 (R$ MN)
-39.1%
+12.9%
-6

-8

113

-24
221

82
14

663

587

143

491
299

Adjusted Regulatory
Net Income Assets and
2013
Liabilities

VNR

Net Income
2013

EBITDA

Financial
Result

Taxes

DepreciationNet Income Regulatory

2014
Assets and
Liabilities

Renova
Equity
Pikup

Adjusted
Net Income
2014

17

Indebtedness
Loan of R$ 2 Billion in 2014 for investments and working capital needs

IPCA
9.9%

Others
6.4%

AMORTIZATION SCHEDULE* (R$ MN)

TJLP
14.2%

Average Term: 4.4 years

1,301

U$/Euro *
0.5%

1,016

1,002

794

779
501

CDI
69.0%

504

424
188

* Considering

Hedge

2015

2016

2017

2018

2019

2020

2021

2022

After 2022

* Just principal

COST OF DEBT

l
eal CuDEBT
sto Rea
Custo RNET

11.03%
8.21%
4.25%

2.24%

11.31%

9.68%

5,250

3.39

4.46%

3.55%

5,544

6,077
3.70

2.84
2010

2011

2007

2012

2008

2013

Nominal Cost
2009

2009

2014

2009

set/10

Real Cost
2010

2011

09
20
2 010

dec/13

Custo Real

sep/14

ea
Custo R

dec/14

Net Debt / EBITDA

2012

18

Investments
CAPEX (R$ MN)
CAPEX BREAKDOWN (R$ MN)
2014
1,055
929

154
701

797

103

845

132

202

1,054

122
187

Administration
57.0

155
Commerc./
Energy
Eficiency
15.8

182
775

694

713

698

Losses
Combat
359.7

2011

2012

2013

Other
23.4

746

519

2010

Generation
49.2

Develop. of
Distribution
System
548.9

2014 Budget 2014 Actual

Others Investiments
Special Obligations - Losses
Investments in Electric Assets (Distribution)
19

Important Notice
This presentation may include declarations that represent forward-looking statements according to Brazilian regulations and
international movable values. These declarations are based on certain assumptions and analyses made by the Company in
accordance with its experience. the economic environment. market conditions and future events expected. many of which
are out of the Companys control. Important factors that can lead to significant differences between the real results and the
future declarations of expectations on events or business-oriented results include the Companys strategy. the Brazilian and
international economic conditions. technology. financial strategy. developments of the public service industry. hydrological
conditions. conditions of the financial market. uncertainty regarding the results of its future operations. plain. goals.
expectations and intentions. among others. Because of these factors. the Companys actual results may significantly differ
from those indicated or implicit in the declarations of expectations on events or future results.

The information and opinions herein do not have to be understood as recommendation to potential investors. and no
investment decision must be based on the veracity. the updated or completeness of this information or opinions. None of the
Companys assessors or parts related to them or its representatives will have any responsibility for any losses that can
elapse from the use or the contents of this presentation.
This material includes declarations on future events submitted to risks and uncertainties. which are based on current
expectations and projections on future events and trends that can affect the Companys businesses. These declarations
include projections of economic growth and demand and supply of energy. in addition to information on competitive position.
regulatory environment. potential growth opportunities and other subjects. Various factors can adversely affect the estimates
and assumptions on which these declarations are based on.

20

Contacts
Joo Batista Zolini Carneiro
CFO and IRO

Gustavo Werneck
Superintendent of Finance and Investor Relations
+55 21 2211 2560
gustavo.souza@light.com.br

Mariana da Silva Rocha

IR Manager
+ 55 21 2211 2814
mariana.rocha@light.com.br

ri.light.com.br

www.facebook.com/lightri

twitter.com/LightRI
21