2Q09 Results

August, 2009

2Q09 highlights2Q09 highlights

2

►

2nd Quarter of 2009– 1.7% increase on captive consumption, 0.4% reduction on total market

– Collection rate reached 103.1% on 2Q09

– Ebitda of R$ 342 million

– Net income totalized R$ 155 million

– Distribution in May of R$ 308 million regarding the 1st installment of complementary dividends and R$ 69 million in interest on equity

– On June 16, 2009 ANEEL concluded the 2007 periodic tariff reset

►

Subsequent Events– On June 30, 2009 ANEEL authorized an average tariff readjustment index of +14.88% to Eletropaulo, applicable

to the tariff as from July 4, 2009, which includes the 2007 tariff reset effects

– Proposal of intermediate dividends distribution: R$ 323 million referred to 1S09 results

• R$ 1.82 / common share

• R$ 2.00 / preferred share

– 3th amendment to the Debt Confession agreement that will extend the final maturity from 2022 to 2028 and the average term of that debt from 7.2 years to 10.5 years

– Payment held in August 10, 2009 by the São Paulo Municipality regarding the first installment of the agreement

Captive market growth of 1.7% in the quarterCaptive market growth of 1.7% in the quarter

--9.4%9.4%

Free Clients

1,899 1,720

+1.7%+1.7%

Captive Market

8,351 8,493

2Q092Q08Average Tariff of Sold Energy² – R$ / MWh+5.8%+5.8%

270285

Residential

+0.2%+0.2%

218 219

Others

+3.0%+3.0%

262270

Captive Market

+3.8%+3.8% --0.4%0.4%+4.6%+4.6%--8.9%8.9% +5.1%+5.1%

Residential Industrial Commercial Public Sector and Others

Total Market

Consumption Evolution - (GWh)1

6282,5101,608

3,605

10,250

660

3,742

1,4652,626

10,212

2Q092Q08

3

269 267

Commercial

--0.8%0.8%+3.2%+3.2%

249 257

Industrial

+12.0%+12.0%

6269

TUSD

1 - Own consumption not considered 2 – Captive market + Tusd

5

Collection rate and energy lossesCollection rate and energy losses

►

Collection rate (LTM): 98.1% (2Q08) x 100.2% (2Q09)

►

Cuts and Reconnection – Monthly Average (2Q08 X 2Q09)

– Cuts: increase from 10,000 to 84,000

– Reconnections: increase from 12,000 to 56,000

►

Past due bill Credit Report (2Q09 Average): 230,000

►

Fraud and Illegal Connections (2Q09)

– 89,000 inspections and 10,000 frauds detected

– 20,000 illegal connections regularized

Collection Rate – % over Gross Revenue Losses – % last 12 months

97.899.599.1

200820072006

5.55.5 5.15.1

6.56.5 6.56.5

11.612.0

5.05.0

6.56.5

11.5

Commercial Losses Technical Losses

2Q09

5.35.3

6.56.5

11.8

2Q08

5.25.2

6.56.5

11.7

200820072006 2Q082

103.1

2Q092

100.9

1 - Current Technical Losses used retroactively as reference 2 – Collection rate following the new methodology of calculation

1 – System Average interruption Duration Index 2 – System Average Interruption Frequency Index3-LTM Source: ANEEL, Eletropaulo and ABRADEE

6

ABRADEE ranking position among the 28 utilities with more than 500 thousand customers

SAIDI1 SAIFI2

►

SAIDI Aneel Target 2009: 10.09 hours ►

SAIFI Aneel Target 2009: 7.87 times

SAIDI & SAIFISAIDI & SAIFI

9.208.907.87

2006 2007 2008

SAIDI (hours) SAIDI Aneel Target

10.47

2Q09³

11.81 11.34 10.92

2006 2007 2008 2Q08³

5.645.205.52

SAIFI (times) SAIFI Aneel Target

5.47

8.61 8.49 8.41

3o3o 3o 1o

9.20

2Q08³ 2Q09³

5.48

5º 1o

InvestmentsInvestments

7

Paid by customers

CAPEX – R$ million Investments 2Q09

2006 2007 2008 2009e

301301364364

410410

6969378378

433433457457

4784787777

6464

Customer service / System expansion

Paid by the clients

Losses recovery

Maintenance

IT

Other

Capex

4747

542542

7676

87871111

2Q08

103103

112112

99

2Q09

50%50%

23%23%

14%14%

3%3%3%3% 8%8%

8

Final 2007 Tariff Reset in 2009Final 2007 Tariff Reset in 2009At Jul/07 pricesAt Jul/07 prices

Regulatory Ebitda1 – Reintegration quota

Remuneration Basis

Gross Basis x Depreciation Rate

Net Basis x WACC (pre-tax) Gross Capital Remuneration

Depreciation1

Reference Company(PMSO)

Part B: 2,071

4,822 x 15.08%

10,880 x 4.32%

786

727

470

Other Revenues: -43

Total: 2,028

Investment: 1,652

Xe Factor: 2.00%

Unrecoverable Revenues

88

SectorCharges

Energy Sup. and Trans.

ChargesPart A: 5,420

4,574

846

R$ million

Revenue Required: 7,491

9

54.80%54.80%35.80%35.80%

8.76%8.76%

0.64%

30.48%30.48%

13.74%13.74%

55.78%55.78%

2009 Tariff Readjustment2009 Tariff Readjustment

Effects of the 2007 Tariff

Reset

Other Financial Items

Basis Adjustment

494

(50)

171

Part B

Part A 6,672

2,595

Part A

Part B

Financial Items

CVAs

IRT 2009 – 14.88%Includes the -0.54% negative effect of

the 2007 Final Tariff Reset

CVAs

CVAs and Financial Effects

Amounts in R$ million

Energy Purchased

Sector Charges

Transmission Charges

Part A – 54.80%

Gross revenueGross revenue

Gross Revenue - R$ million

Deductions to Gross RevenueNet Revenue

2Q08 2Q09

+3.7%+3.7%

+4.9%+4.9%

981981

1,8251,825

2,806

1,0511,051

1,8931,893

2,944

►

Market comparison (2Q09 x 2Q08)

– +8.01 Tariff readjustment since 07/04/08

– Maintenance of revenues from free clients

– Negative effect of R$ 31.2 million referred to 2009 Tariff Readjustment, compensated by other impacts

resulting in a R$ 6.4 million positive effect on net income10

6M08 6M09

+4.5%+4.5%

+5.7%+5.7%

1,9471,947

3,5823,582

5,529

2,1012,101

3,7433,743

5,844

Operating expensesOperating expenses

►

Price per MWhTietê: 2Q08: R$ 132.0 2Q09: R$ 149.7Itaipu: 2Q08: R$ 92.2 2Q09: R$ 145.5Leilões: 2Q08: R$ 76.2 2Q09: R$ 83.9Total AverageTariff: 2Q08: R$ 94.0 2Q09: R$ 115.3

Operating Costs and Expenses¹ - R$ million

PMS2 and Other Expenses

+8.6%+8.6%

291291

1,1271,127

1,418

371371

1,1701,170

1,541

Energy Supply and Transmission Charges

11

2Q08 2Q096M08 6M09

+8,0%+8,0%

561561

2,2412,241

2,802655655

2,3712,371

3,026+8.0%+8.0%

1 - Depreciation not included 2 - Personnel, Material and Services

Operating expenses evolutionOperating expenses evolution

12

Personnel and Pension Fund

Material and Third Party Services

Other Expenses

Personnel

Pension Fund

Labor Lawsuits

ADA3 and Write-Off

Provisions and Contingencies

Others2

+27.2%+27.2%

76

93

2Q092Q08

122

86

95

190

371

291

+55.2%+55.2%

72

45

70

75

190

122

27

23

28

29

36

9593

38

17

40

2Q092Q08 2Q092Q08

+1.7%+1.7%

1 – Personnel, Material and Services 2 - Indemnification, Losses, Publicity, Banking Fees, IPTU, among others3 – Allowance for doubtful accounts

PMS1 and Other Expenses - R$ million Personnel - R$ million Other Expenses - R$ million

Operating expenses evolutionOperating expenses evolution

Others2

+27.2%+27.2%

Provisions and Contingencies

ADA1

And Write- Off

2Q092Q08

291291 371371

Material and Services

Pension Fund

1210

Operating Expenses – R$ million

13

2232(9)13

Plano Cruzado

1 - Allowance for doubtful accounts, exclude Plano Cruzado2 - Leasing and Rents, indemnifications, Losses, Publicity, Banking Fees, IPTU, among others

Variation of Variation of EbitdaEbitda

Ebitda – R$ million

2Q08 2Q09

342342

68

Net Revenue

Provisions and Contingencies

Pension Fund

(32)(22)

Energy Supply and

Transmission Charges

(43)

394394

--13.3%13.3%

Others1

(23)

141 - Personnel, Material, Third Party Services, ADA, Losses, among others

2Q09 x 2Q08 results2Q09 x 2Q08 results

►

Average Selic:

– 11.7% (2Q08) x 10.3% (2Q09)

►

Average balance of cash investments:

– R$1,430 million (2Q08) x R$ 1,082 million (2Q09)

2Q08 2Q09

(0)

(10)

155197

2Q08 2Q09

Net Income - R$ millionFinancial Result - R$ million

►

2009 tariff reset and tariff readjustment effects

►

Negative impacts from PMSO, mainly labor contingencies

►

Proposal of R$ 323 million in dividends

– Ex dividends date: 08/14/2009

– Payment date: 09/24/2009

15

302348

6M08 6M096M08 6M09

(36)(48)

R$ 366 million paid as dividends in 2Q09R$ 366 million paid as dividends in 2Q09

►

Payment in May of the first installment of the 2S08 dividends and interest on equity

►

The Company keeps its cash invested on Certificates of Deposit (CDs) and Government Notes, with average profitability of 102.3% of CDI on 2Q09

1Q08 2Q08 3Q08 4Q08 1Q09

Initial Cash 1,334 1,478 1,454 1,373 1,536

Operating Cash Flow 418 497 613 491 301

Investments (80) (60) (107) (126) (104)

Net Financial Expenses (101) (41) (107) (37) (113)

Net Amortizations (4) (30) (21) (40) (184)

CESP Foundation (57) (58) (32) (46) (58)

Income Tax (33) (114) (68) (80) (119)

Dividends (0) (218) (359) -

Free Cash Flow 144 (24) (81) 162 (278)

Final Cash 1,478 1,454 1,373 1,536 1,258

Managerial Cash Flow – R$ million

-

16

2Q09

1,258

448

(113)

(45)

(54)

(56)

(83)

(269)

989

(366)

Debt profileDebt profile

17

Net Debt (R$ billion) Net Debt/ Adjusted Ebitda¹

Net Debt Average Cost and Average Term (Principal)

2006

3.7

2007

3.0

2008

2.5

2.1x1.3x 1.2x

5.76.8 7.1

CDI² Average Term - Years

3.0

1.2x

2Q09

6.4

2.7

2Q08

1.5x

14.1%

Effective Rate

14.7% 15.4% 22.2% 9.3%

1 - Accumulated 12 Months Adjusted EBITDA 2 – Brazil’s Interbank Interest Rate

6.9

2006

93.2%

2007

121.8%

2008

123.9%

2Q09

91.6%

2Q08

182.5%

Sustainable amortization scheduleSustainable amortization schedule

►

99.7% of total debt in local currency

►

0.3% of total debt in foreign currency (R$ 12 million) : 98% protected by hedge

33

524524250250 250250 250250

5050 125125375375157157

213213

111111 111111 111111

111111111111

1,1091,109

1111

2009 2010 2011 2012 2013 2014 2015 2016-2028

Amortization Schedule – Principal – R$ million

Local Currency (ex FCESP)

FCESP1

Foreign Currency²

18

1 - FCesp = Pension Fund2 – Exchange rate on 06/30/2009 – US$ 1.00 = R$ 1.9516

Corporate governanceCorporate governance

19

2006 2007 2008

7,508

26,066 25,677

AES Eletropaulo2 X Ibovespa X IEE

IBOVIEEELPL6

1- Index –12/30/08 = 100 2 - Preferred shares class B

2Q09

27,689

95

105

115

125

135

145

dec-081 feb-09 apr-09 jun-09

6M09

36.2%37.1%

33.7%

►

A) 02/25/2009 – Finsocial and São Paulo municipality agreement

►

B) 04/16/2009 – Public Consultation of Tariff Reset

►

C) 04/27/2009 – Dividends declaration

►

D) 06/16/2009 – Second Periodic Tariff Reset Revision

mar-09 may-09jan-09

AA

BB

CC

DD

Average Daily Volume2 - R$ thousand

2Q09 ResultsThe statements contained in this document with regard to the business prospects, projected operating and financial results, and growth potential are merely forecasts based on the expectations of the Company’s Management in relation to its future performance.Such estimates are highly dependent on market behavior and on the conditions affecting Brazil’s macroeconomic performance as well as the electric sector and international market, and they are therefore subject to changes.