Corporate presentation

1

Institutional Presentation

October, 2008

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Agenda

►Financial Performance

►Portfolio Overview

►Value Creation

►Company Profile

3

Agenda

►Financial Performance

►Portfolio Overview

►Value Creation

►Company Profile

4

Equatorial Overview

Holding company with investments in the energy sector, focused on distribution and generation

Differentiated experience in operating and financial restructuring of companies in the Brazilian energy sector

Controlled by PCP Fund, investment vehicle owned by former partners of Banco Pactual (sold in 2006 to UBS)

Current investments:

• Distribution company in the State of

Maranhão

• 2nd largest distribution company in the

Northeast of Brazil, in terms of

concession area*

• 4th largest distribution company in the

Northeast of Brazil, in terms of billed

energy*

• Annual gross revenues of R$1.2 billion in

2007

• Holding company with investments in

distribution, generation and trading.

Located in the State of Rio de Janeiro

• 3rd largest distribution company of Brazil in

terms of billed energy*

• 4th largest customer base in Brazil*

• 852 MW of installed capacity

• Annual gross revenues of R$8.1 billion in

2007

RS

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CE RN

PEAL

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PEAL

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• Company responsible for implementing

and operating the Tocantinópolis and

Nova Olinda thermoelectric plants in the

State of Maranhão

• Fuel: high-viscosity heavy oil.

• Joint installed capacity of 331 MW

• 240 MW of energy sold at the A-3 auction

in 2007.

• Start-up scheduled for January 2010

Geranorte

*Source: ABRADEE

5

Equatorial’s History

May 2004 Mar. 2006 Apr. 2006 Dec. 2007 Feb. 2008 Apr. 2008

CEMAR’s acquistion

PCP Fund acquires a

controlling stake of

Equatorial

Equatorial’s IPO

Control concentrated in

PCP Fund

Incorporation of a

controlling stake of

Light

Equatorial migrates to

the “Novo Mercado”

Oct. 2008

Acquisition of 25% of

Geranorte

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Ownership Structure

• Total no. of shares:

• Share price*:

• Free float:

• ADTV90:

105,638,030

R$ 11,50

44.4% / R$540 MM

R$2,8 MM

* On 09/30/2008

PCP Latin America

Power S.A.

55.5%

CEMAR New Projects

RME

Rio Minas e Energia

Participações SA

Light S.A.

25.0%

52.1% 65.1%

Equatorial Energia

Geranorte

25.0%

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Corporate Strategy

CEMAR and Light

Increased returns through outstanding financial and

operating performance

Consolidation of

distributors in Brazil and

Latin America

Acquistion of full or shared control

Added value through financial and operational restructuring, synergy

gains and loss reduction

Geranorte and other

investments in

generation

Brazil’s investment needs in generation over the next few years will create

growth opportunities for Equatorial.

Geranorte thermal plants present an above average rate of return

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Firmino Sampaio

Chairman of the Board

of Directors

• CEO of Eletrobrás (1996-2001), CEO and CFO of COELBA (1984-1996)

• Member of the boards of directors of Furnas, Itaipu Binacional, CHESF, Eletrosul, Gerasul, CEMIG, ENERSUL, CEMAT and Light

• Degree in Economics from the Federal University of Bahia and postgraduate degree in Industrial Planning from SUDENE/IPEA/FGV

Management

• CEO of Equatorial since March, 2007. CEO and CFO of CEMAR (2004-2006)

• Worked for 6 years at Banco Pactual in the Principal Investments and Corporate Finance divisions

• Degree in Computer Science from PUC-RJ and in Business Administration from IBMEC. CFA chartered by CFA Institute in 2003. Concluded the Owner and

President Management Program of Harvard Business School in 2008

Carlos Piani

CEO

Eduardo Haiama

CFO & IRO

Tinn Amado

Regulatory Affairs

Officer

Management is composed by professionals with substantial experience in the financial, operational and regulatory areas

• CFO and IRO of Equatorial since 2008. IRO of CEMAR since 2008.

• Between 2004 and 2008, Mr. Haiama worked at Banco UBS Pactual on the equities’ research team as senior analyst of the utilities segment.

• Received a degree in electric engineering at USP – University of São Paulo (Escola Politécnica) and postgraduated at a MBA Course at Duke University.

• Regulatory Affairs Officer of Equatorial since April 2008 and of CEMAR since August 2006

• Consulting partner of Amado Consultoria, providing advisory services in economic regulation

• Worked at ANEEL for 3 years as an analyst for the Distribution Service Regulation Department

• Degree in Electrical Engineering from the Federal University of Itajubá (UNIFEI) and a Master’s degree in Regulation and Protection of Fair Trading from Brasília

University (UnB)

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PCP Fund

Long Term

Investments

Hedge Funds Brazil

and EMFund of Funds (G7)

Public Equities

Private Equity

Real Estate

• In 2001, Banco Pactual created a Principal

Investment Unit to manage the partnership’s

excess capital and diversify its investments

• In 2006, with the sale of Banco Pactual to UBS,

part of the proceeds from the sale was reinvested

in the Principal Investment Unit, which was

renamed UBS Pactual Alternative Investments

• Today, UBS Pactual Alternative Investments

manages the capital of Pactual’s former

partners through a major fund of funds entitled

PCP, formerly named Pactual Capital Partners

• PCP has over US$3 billion under management

with investments in fund of funds, hedge funds,

public equities, private equity and real estate

History

PCP Fund

• Fundamental and long-only

strategy

• Acquisition of control or shared

control of private and public

companies (Ex: Iven, Light,

Equatorial)

• Investments through PCP’s

associated company PDG Realty

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Agenda

►Financial Performance

►Portfolio Overview

►Value Creation

►Company Profile

11

Since CEMAR’s acquisition, Equatorial has been presenting an excellent

financial performance

Net Operating Revenues

R$ million

CAGR = 21%

EBITDA and Margin EBITDA

R$ million / % of NOR

CAGR = 42%

Financial Performance

423

526

629

810879

2003 2004 2005 2006 2007

93 85

189

341379

43%42%

30%

22%

16%

2003 2004 2005 2006 2007

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Net Income

R$ millionDeclared Dividends

R$ million

85

165151

2003 2004 2005 2006 2007

Total = R$401million

Sustained positive results allowed Equatorial to pay out R$401 million in

dividends

Financial Performance

(57)

123

229

125

154

2003 2004 2005 2006 2007

13

105

225

339

305

627

0.6

0.3

1.6

6.7

4.0

2003 2004 2005 2006 2007

Consolidated Net Debt and Net

Debt/EBITDAR$ million / Times

Improved operating performance and financial restructuring led to a

significant reduction in leverage

Financial Performance

14

24

3647

65

93

165173

208

31 34

68 67

10998

104

77

104

39%

36%

18%20%

24%

28%

42% 39%

36%

44%

48%45% 45%

43%

29%

24%

32%

-

50

100

150

200

250

3Q04

4Q04

1Q05

2Q05

3Q05

4Q05

1Q06

2Q06

3Q06

4Q06

1Q07

2Q07

3Q07

4Q07

1Q08

2Q08

3Q08

Quarterly EBITDA and EBITDA Margin

R$ million/% of Net Revenues

Growth (3Q08/3Q07)

= 100%

Light’s incorporation in the 1Q08 substantially increased Equatorial’s operating result…

Financial Performance

15

Consolidated Net Debt and Net Debt /

EBITDA

R$ million / Times

…without affecting financial leverage

Financial Performance

385360

180

242

582

806

749

339373

305332

105 105

244

176

225

382

1,1

0,5

3,9 4,0

3,32,4

1,6

1,5

0,7

0,3

0,3

0,6 0,7 0,6

0,9

3,0

1,3

-

100

200

300

400

500

600

700

800

900

3Q04

4Q04

1Q05

2Q05

3Q05

4Q05

1Q06

2Q06

3Q06

4Q06

1Q07

2Q07

3Q07

4Q07

1Q08

2Q08

3Q08

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Agenda

►Financial Performance

►Portfolio Overview

►Value Creation

►Company Profile

17

CEMAR: Highlights

MA

Distribution company in the State of Maranhão

1.4 million clients (4th largest in the Northeast region)*

Billed energy (2007): 3,219 GWh (5th largest in the

Northeast)*

Annual gross revenues of R$1.2 billion in 2007

Energy Sales (2007)

Clients (2007)

1.4 million

3,219 GWh

*Source: ABRADEE

RS

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DF

PB

40%

31%

18%

11%

Residential Commercial Industrial Others

87%

7%5%

1%

Residential Commercial Industrial Others

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CEMAR: History

CEMAR under control of

Equatorial

1958-

Jun. 2000

Aug.2000-

Aug.2002Aug.2002-May

2004

May 2004-

Present

State owned

CEMAR under PPL Global’s

control

ANEEL’s intervention

CEMAR under control of

Equatorial

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CEMAR: Ownership Structure

65.1%

Eletrobrás OthersEquatorial Energia

CEMAR

Eletrobrás

33.6% 1.2%

OthersEquatorial Energia

CEMAR

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CEMAR: Distribution

• 1.4 million clients in 217 municipalities, covering the

whole state of Maranhão (total area 333,000 km²)

• Energy sales reached 3,219 GWh in 2007, 10.5%

higher than in 2006. Maranhão presented one of the

highest growth rates of energy consumption in Brazil

• Service quality has been presenting positive evolution.

Since 2003, DEC and FEC indices have dropped 58%

and 49%, respectively

• More than 151 thousand clients connected through the

Light for All Program

• In 12/07, energy losses reached 28.7%, 1.1 pp lower

than in 2006

• Tariff readjustments occur every August, with next tariff

revision set to 08/09

2005 2006 2007 9M08

Net Revenues R$ MM 665 810 879 721

PMSO R$ MM 126 129 126 105

EBITDA R$ MM 189 341 379 305

Clients '000 1.254 1.349 1.438 1.511

PMSO/Client R$/Client 101 95 88 70

EBITDA/Client R$/Client 150 253 264 201

DEC (*) Hours/Year/Client 54.6 42.6 28.7 27.8

FEC (*) Times/Year/Client 39.3 32.9 24.6 18.6

Losses (LTM) % 29.5% 29.8% 28.7% 28.6%

CAPEX R$ MM 103 137 199 172

PLPT(**) R$ MM 129 169 195 120

(*) Last 12 months

(**) Light for All Program

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Holding company with distribution, generation and trading interests

3rd largest distributor in Brazil in terms of energy sales*

4th largest customer base in Brazil*

Generation plants with 852 MW of installed capacity

Gross revenues of more than R$8 billion in 2007

*Source: ABRADEE and Light

Light S.A.: Highlights

Energy Sales (2007)

18,307 GWh

EBITDA by Segment (2007)

R$1.1 billion

RS

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84,5%

15,2%0,3%

Distribution Generation Trading

40,1%

31,4%

7,5%

11,0%

Residential Commercial Industrial Others

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• After a negative result in its 2003 tariff revision process and poor management, Light became insolvent and was forced to renegotiate its debt with creditors

• In March, 2006, a consortium (RME) formed by PCP, Cemig, AG Concessões and Luce Fund won a competitive bidding process for the acquisition of a

controlling stake at Light

• The consortium acquired 79.4% of Light’s total and voting capital for US$320 milllion

• After fulfilling a series of prerequisites, including the approval of regulatory authorities in Brazil and France, the consortium effectively took over the

company in August, 2006

Creation of Light, a

private CompanyLight’s Privatization

Eletropaulo’s

acquistion

Split of EDF-AES

Acquisiton by EDF

1905 1979 May 1996 Apr. 1998 Oct.2001 Jan.2002 Jul.2005 Aug. 2006

Light joined

Bovespa’s Novo

Mercado

RME acquires

control of Light

Acquisition by

Eletrobrás

Light S.A.: History

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Light S.A.: Ownership Structure

CEMIGCompanhia Energètica

de Minas Gerais

AGCAndrade Gutierrez

Concessões

LUCELUCE do Brasil

Fundo de Investimento

em Participações

EQTLEquatorial Energia

RMERio Minas Energia

Participações S.A

LIGHT S.A.(Holding)

BNDESPAR

MARKET

25.0% 25.0% 25.0% 25.0%

52.2% 33.7%

14.1%

Free Float: 47,8%

Light S.E.S.A (Distribution)

Light Energia(Generation)

Light EscoLtda(Trading)

Lightger(New Projects)

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• 3.9 million clients in 31 municipalities in Rio de Janeiro,

covering 25% of the state, which represents a 10,970 km² area

• Energy sales reached 18,307 GWh, accounting for

approximately 72% of all electricity consumed in the State in

2007

• Service quality among the highest in Brazil. In the 1H08, the

FEC (LTM) index reached 7.8x and the DEC (LTM) index

11.4 h

• Collection rate improved significantly after the change in

control, increasing from 93% in 2006 to 99.4% in 2007

• Energy losses, which totaled 20.4% in 2Q08, represent a

challenge in the concession area

• The last tariff revision, held in november 2008, Light’s tariff

increased by 1.96%

Light S.A.: Distribution

2005 2006 2007 9M08

Net Revenues R$ MM 4.875 4.743 4.755 3.579

PMSO R$ MM 511 533 567 413

EBITDA R$ MM 751 599 938 748

Clients '000 3.732 3.802 3.881 3.741

PMSO/Client R$/Client 137 140 146 110

EBITDA/Client R$/Client 201 158 242 199

DEC (*) Hours/Year/Client 8.8 8.0 9.1 11.5

FEC (*) Times/Year/Client 7.7 6.3 6.3 7.1

Losses % 18.7% 19.8% 20.6% 20.4%

CAPEX R$ MM 277 322 330 405

(*) Last 12 months

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• Light owns and operates 5 hydro power plants

and two water pumping stations

• The 5 plants are located in three generation

regions: Santa Branca, Lajes and Ilha dos

Pombos

• Total installed capacity of 852 MW, for assured

energy of 537 MW

• Light Generation has average contract selling

price of R$60/MWh, with the bulk of contracts

expiring in 2012 and 2013

• 3 new hydro power plants currently being

developed: SHP Paracambi (25 MW of

installed capacity) and SHP Lajes (17 MW) in

the Lajes complex and HPP Itaocara on the

Paraíba do Sul River (195 MW)

Light S.A.: Generation

2005 2006 2007 9M08

Net Revenues R$ MM 20 249 271 197

PMSO R$ MM 3 55 60 93

EBITDA R$ MM 14 147 169 153

Assured Capacity MW 537 537 537 537

EBITDA/Assured Cap. R$'000/MW 26 274 314 284

26

• Through its subsidiary Light Esco, Light acts as a

trader and broker for free clients

• In its trading activities, Light has 30 clients with total

energy sales of 90 GWh in 2007

• Clients include Unilever and InBev

• As a broker, Light has 10 clients, including TV Globo

and Gerdau Steel and traded 1,200 GWh in 2007

Light S.A.: Trading

2005 2006 2007 9M08

Net Revenues R$ MM - 4 31 24

PMSO R$ MM - 2 9 22

EBITDA R$ MM - 2 4 2

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25.0%

GNP*

50.0%

Fundo de Investimento em

Participações BrasilEquatorial Energia

Geranorte

*GNP is composed by Servtech (50%) and Grupo Ligna (50%)

25.0%

Geranorte: Ownership Structure

28

Geranorte: Highlights

• Two thermoelectric power plants fueled by high-viscosity heavy oil

• Location: Miranda do Norte, Maranhão.

• Joint installed capacity of 331 MW

• 240 MW of energy sold at the A-3 auction in 2007

• Total fixed annual revenue (for both plants) of R$ 136.2 million, during 15 years

• Start-up scheduled for January of 2010

• Total CAPEX: Between R$500 million and R$ 550 million

• Equatorial’s share of CAPEX (25%): R$125 million. Equity = approximately R$45 million

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Agenda

►Financial Performance

►Portfolio Overview

►Value Creation

►Company Profile

30

Strengths

Financial strength and solid

management team with

turnaround experience

Growth prospects and

consolidation opportunities

Result-oriented management

model

High level of

Corporate Governance

31

Carlos Piani

CEO

Eduardo Haiama

CFO and IRO

Thomas Newlands

IR Analyst

Phone 1: 55 21 3206-6635

Phone 2: 55 21 3206-6607

E-mail: [email protected]

Website: http://www.equatorialenergia.com.br/ir

Contacts

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► This presentation may contain forward-looking statements, which are subject to risks and uncertainties, as they

were based on the expectations of Company’s management and on available information. These prospects include

statements concerning the Company’s current intensions or expectations for our clients.

► Forward-looking statements refer to future events which may or may not occur. Our future financial situation,

operating results, market share and competitive positioning may differ substantially from those expressed or

suggested by said forward-looking statements. Many factors and values that can establish these results are

outside Company’s control or expectation. The reader/investor is prevented not to completely rely on the

information above.

► The words “believe", “can", “predict", “estimate", “continue", “anticipate", “intend", “forecast" and similar words, are

intended to identify affirmations. Such estimates refer only to the date in which they were expressed, therefore

Company has no obligation to update said statements.

► This presentation does not consist of offering, invitation or request of subscription offer or purchase of any

marketable securities. And, this statement or any other information herein, does not consist of a contract base or

commitment of any kind.

Disclaimer