Energias do Brasil SA and subsidiaries - EDP no Brasil | Investidores

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MESSAGE FROM THE CHIEF EXECUTIVE OFFICER MANAGEMENT REPORT 2009 2 2009 MANAGEMENT REPORT 2009 was a decisive year for the future of EDP Energias do Brasil. In an external environment marked by the volatility of the markets and credit restrictions, we made significant changes in the Company, making it stronger and more competitive, and continued to travel our strategic path of oriented growth, superior efficiency and controlled risk. Naturally, our operations were subject to the uncertainty scenario triggered by the international financial crisis, and sought to prioritize the maintenance, as far as possible, of operating profit margins and to ensure the financing required for our expansion plan. We advanced in our strategic determination to increase revenues. We opened Pequena Central Hidrelétrica de Santa Fé, in Espírito Santo State, proceeded with the construction of the Pecém Thermoelectric Plant, in Ceará State, in strict compliance with the schedule established, moved forward with the repowering projects of three other plants, and, in partnership with EDP Renováveis S.A, launched the implementation of the new wind power park of Tramandaí, to be constructed in Rio Grande do Sul State. This venture falls within the commitment we made to expand our renewable energy portfolio. In order to properly guarantee our growth plan, we obtained financing from the Brazilian Bank for Economic and Social Development - BNDES ( (R$ 1.4 billion) and the BID (US$ 327 million) for the Pecem I Thermoelectric Power Plant; we also obtained from the BNDES a credit line of R$ 900 million of the credit revolving facility type, an innovation in the electric energy sector, and issued Promissory Notes in the amount of R$ 230 million. The success of these transactions in a year marked by a financial crisis evidenced the recognition of our financial strength by the capital market. Incidentally, this recognition was reinforced by the assignment of the investment grade rating to our Distributors EDP Bandeirante and EDP Escelsa by Moody's rating agency. The company also drew more attention to itself through the public stock offering corresponding to 9.9% of total capital, which had been held in treasury since late 2008. Demand was four times greater than supply. We attracted new investors from Brazil, USA, Canada and several European countries, increasing the diversity of our shareholding portfolio. We raised R$ 441.8 million, an amount we immediately used to reduce and extend our debt, making it cheaper. Further, we significantly increased the liquidity of our shares on the Stock Exchange. Within the company, our actions were based on the challenge of promoting changes to our employees' behavior and efficiency gains, which are key aspects of the Business Transformation Program we launched: "Winning Program". This Program entailed the reduction of hierarchical levels and area heads, a revision of production processes and the development of a new business philosophy. Under this Program, we established management commitments among Executive Officers and each of the persons responsible for the Company's units, defining individual audacious aspirations and targets directly related to the Company's transformation. In addition to this internal transformation, which was beneficial for the health, competitiveness and strength of our Company, 2009 was, beyond doubt, a positive year for the other relationship publics. 2009 was the year when we fully consolidated the EDP brand in the Brazilian market. We believe to have consistently evolved from various perspectives, consolidating what it means to be "EDP". The returns delivered to stockholders were better than those for 2008. Operating revenue reached R$ 4.65 billion, a figure which is consistent with that recorded in 2008; manageable expenses decreased by 10% as compared with 2008; EBITDA grew by 4%, reaching R$ 1.42 billion; net
3 2009 MANAGEMENT REPORT income amounted to R$ 625 million, an increase of 61% over that for 2008; this results not only from our good operating performance, but also from the sale of our ownership interest in the company ESC 90 Telecomunicações, fulfilling our goal of concentrating our operations in our main business. This good performance was reflected in the quotation of the shares of EDP Energias do Brasil on the stock exchange, which appreciated by 60% during the year. We invested in programs and revised processes to improve our relationship with customers, with initiatives included in the Mais Cliente Project. We carried out Energy Efficiency projects aimed at lower income customers and health institutions, which involved the distribution of 263 thousand efficient bulbs, the regularization of 13 residential connections, enabling a global saving of over 27,000 MWh per year. As far as our suppliers are concerned, we intensified our partnerships and made our goods and service purchase processes more encompassing and competitive. In the environmental scenario, we increased the commitment of all employees to the Econnosco Project, which combines the raising of awareness of our employees to responsible consumption and the saving of natural resources. As regards the community, the projects of the EDP Institute placed emphasis on education and local development through initiatives which consolidate our closeness with the communities, and served over 157 thousand people throughout 2009. For the fourth consecutive year, we were named to the BM&BOVESPA Sustainability Index, having attained a score of excellence in 3 of the 6 categories which comprise this index. In preparation for the future, we launched the 2020 EDP Program aimed at promoting, within and outside the Company, innovation and entrepreneurship in the electric energy sector. To this program, we associate the award we consider as the largest one in Brazil. Over the next ten years, we intend to award prizes to the ideas and projects which contribute toward the creation of new patterns in the electric energy sector. Under the EDP 2020 Program, we intend to combine today's flexible approach to the indispensable long-term vision in order to ensure the Company's sustainability. We are now faced with the challenges of completing and extending the transformation started in 2009, revising and improving our processes, developing the ongoing growth projects and increasing compliance of the entire Company with our strategy. We enthusiastically work under the belief that we can make EDP a company which fully satisfies its Customers, Stockholders, Employees, Business Partners, the Society and the Communities in which we operate in 2020 and all the years before and after that. António Pita de Abreu Chief Executive Officer CORPORATE ORGANIZATION CHART EDP Energias do Brasil is a holding company with investments in the electric energy sector, consolidating generation, distribution and trading assets in six states: The Company operates in the energy generation sector in six Brazilian states (Espírito Santo, Mato Grosso do Sul, Tocantins, Ceará, Santa Catarina and Rio Grande do Sul) and in the distribution sector in two Brazilian states (São Paulo and Espírito Santo).
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Net revenues 1,136,436 Electricity
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Energias do Brasil SA and subsidiaries - EDP no Brasil | Investidores

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