Brazil day 2008 new york october 2008
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Challenges and opportunities of the new Brazilian regulatory framework for water and sanitation : the case of Sabesp. Brazil Day 2008 New York October , 2008. Three highlights. Sabesp is strongly committed to public policies and market standards for efficiency and profitability

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Brazil day 2008 new york october 2008

Challenges and opportunities of the new Brazilianregulatoryframeworkforwater and sanitation: the case of Sabesp

BrazilDay 2008New YorkOctober, 2008


Three highlights

Three highlights...

  • Sabesp is strongly committed to public policies and market standards for efficiency and profitability

  • The new regulatory framework creates new challenges and opportunities

  • Universal coverage of services and environmental solutions are Sabesp´s top priorities


Outline

Outline

  • Sabesp

  • The new regulatory framework

  • Challenges and opportunities


1 sabesp

1. Sabesp


The state of s o paulo in comparative perspective

The State of São Paulo in comparative perspective...

Brazil

São Paulo

41 million inhabitants

645 municipalities

Source: IBGE, Seade and Banco Central do Brasil


Brazil day 2008 new york october 2008

Brazil and São Paulo in comparative perspective...

Source: IMF, Seade Foundation, IBGE


Sabesp 26 2 million clients in the state of s o paulo 60 of the urban population

Sabesp: 26,2 million clients in the State of São Paulo...(60% of the urban population)

  • Company figures:

  • Foundation: 1973

  • Employees: 16.800

  • Municipalities: 366

  • Business units: 16


One of the largest water and sewage service providers in the world

One of the largest water and sewage service providers in the world…

Source: Pinsent Masons – water Yearbook – 2006- 2007

(×) includes 3,1 millionclients in municipalities currently served on a wholesale basis


Strong corporate governance

Strong corporate governance…

  • Mixed capital company

  • Listed on the “Novo Mercado” and NYSE, leading to high corporate governance standards

  • 100% common shares


Net revenue has increased

Net revenue has increased...


Ebitda margin has remained at a high level

EBITDA margin has remained at a high level...


Net debt ebitda ratio has declined

Net Debt / EBITDA ratio has declined...

Net Debt vs. EBITDA* (R$ million)

* In 1S08, EBITDA of the last twelve months


2 the new regulatory framework

2. The new regulatoryframework


The regulatory framework has changed

The regulatory framework has changed...


Changes in the legislation allow for new business opportunities

Changes in the legislation allow for new business opportunities...

  • Joint ventures with domestic and foreign companies

  • New business opportunities

    • Urban cleaning and waste management

    • Waste disposal

    • Energy

    • Urban runoff treatment and management


Sabesp s vision of the future

Sabesp´s vision of the future...


3 challenges and opportunities

3.Challenges and opportunities


Key achievements since 2007

Key achievements since 2007...

  • Renewal of 156 concessions; commitment to renew the remaining 210 by 2010

  • Pro-activity and partnership with clients and municipalities

  • Launching of focused and efficient investment programs

  • New products and services for environmental solutions

  • Strengthening corporate governance


Achieve universal coverage of core services by 2018

Achieve universal coverage of core services by 2018...

111 municipalities

already

have full water and

sewage

services


Universal coverage will be achieved as a result of the implementation of structural programs

Universal coverage will be achieved as a result of the implementation of structural programs...

São Paulo metropolitan region

PMA – Water supply

“Tietê” project

“Vida Nova” program

“Córrego Limpo” program

Regional systems

“Água do Litoral” program

“OndaLimpa” program

Other regional programs


Tiet program one of the most ambitious environmental program for the tiet basin

Tietê program: one of the most ambitious environmental program for the Tietê Basin…

* in negotiation


Tiet s sewage treatment system

Tietê´s sewage treatment system...

WWT Pq. Novo Mundo

Capacity:

2,5 m³/s

WWT Barueri

Capacity:

9,5 m³/s

WWT São Miguel

Capacity:

1,5 m³/s

WWT ABC

Capacity:

3,0 m³/s

WWT Suzano

Capacity:

1,5 m³/s


Onda limpa clean wave program one of the largests sanitation programs in latin america

Onda Limpa (Clean Wave) program: one of the largests sanitation programs in Latin America…

Investment in Baixada Santista region in 2007-11: US$ 780 million

Increase in sewage collection:

to 95% from 53%


Capex plan for 2007 2010

Capex plan for 2007 – 2010…

Total investment plan of R$ 5.9 billion for 2007- 10

1,745

1,574

1,591

02

960


Access to long term low cost financing

Access to long term, low cost financing…

  • Total debt´s average life of 7.2 years

  • Access to international and domestic capital markets and multilateral financing

  • 83% of foreign currency debt is from multilateral financing

Total Debt by Currency

Total Debt Breakdown

Others

Foreign Currency

Gov. Ag. Foreign

CEF and BB

Gov. Ag. Local

Foreign Capital Markets

Local Currency

Local Capital Markets


Brazil day 2008 new york october 2008

Reduce water losses to enhance operational efficiency and financial and environmental sustainability...

Waterlosses as “% of revenue” and “liters / conection x day”


Explore new business opportunities such as the sale of wastewater reuse

Explore new business opportunities, such as the sale of wastewater reuse...

Wastewater reuse / Treated wastewater


Brazil day 2008 new york october 2008

Explore new business opportunities, such as the partnership with OHL and ETEP to undertake the sewage treatment services in Mogi-Mirim...


Remembering three highlights

Remembering three highlights...

  • Sabesp is strongly committed to public policies and market standards for efficiency and profitability

  • The new regulatory framework creates new challenges and opportunities

  • Universal coverage of services and environmental solutions are Sabesp´s top priorities


Brazil day 2008 new york october 20081

Thankyou!

www.sabesp.com.br

BrazilDay 2008New YorkOctober, 2008


Annex

Annex


Sabesp overview

Foundation in 1973

Employees: 16,800

Serves the City of São Paulo and 366 out of 645 municipalities in the State

Provides water to 23.1 million people and sewage services to 19.0 million people

Also sells wholesale treated water to 6 municipalities (3.3 million people)

Covers 60% of State's urban population

Sabesp overview

Main Operational Indicators (1)

Basic Information

Water

Sewage

Connections (million) 6.85.2

Coverage (%) 100%79%

Treatment (%) 100%70%(²)

Volume Billed (m³ million) 791.4643.9

Network (km thousand) 62.5 40.9

(1) Asof June 30, 2008

(2) Treated sewage as percentage of collected sewage

Brazil

São Paulo

Regional Systems

Metropolitan Region


Financial highlights

Financial Highlights

(In R$ million)

Note: Financials are in Brazilian Corporate Law.

*earnings per share


Debt amortization profile

Debt amortization profile…

  • The US dollar-denominated debt is long-term and low cost (multilateral agencies). Currently, SABESP’s credit rating by S&P is brA+ (domestic) and BB- (international).

1,300

966

880

325

557

555

344

332

243

124

97

78


Explore new business opportunities such as cooperation with other sanitation companies

Explore new business opportunities, such as cooperation with other sanitation companies…

 CAEMA - MA

 CAERN - RN

 CAGEPA - PB

 CASAL -AL

 CAERD - RO

 CESAN - ES

 SANESUL - MS

 CASAN - SC

  •  signed

  • tobesigned

  •  beingdeveloped

 CORSAN -RS


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