EDP-Energias — M&A Activity 2020

May 18, 2020

Investors & Analysts' Briefing

Reuters: EDP.LS Bloomberg: EDP PL

EDP TO SELL 2 CCGT PLANTS AND B2C SUPPLY BUSINESS IN SPAIN FOR €515 MILLION

Lisbon, May 18th, 2020: EDP - Energias de Portugal, S.A. ("EDP"), agreed to sell a portfolio of thermal assets and supply clients in Spain to Total. The disposed portfolio comprises:

• i. Two CCGTs power plants (Castejón I & III), with 843 MW of installed capacity located in Navarra, North of Spain;
• ii. The B2C energy supply business in Spain, which includes 1.2 million clients¹ in free market, and the 50% stake in our joint venture with CIDE for electricity supply in this segment (CHC Energia).

The agreed transaction value represents an Enterprise Value of €515 million (with equity value subject to customary adjustments up to the completion of the transaction). The transaction is expected to be completed in the second half 2020, following the fulfilment of the applicable corporate restructuring and regulatory conditions.

This transaction results from a proactive portfolio optimization strategy under execution by EDP, as defined in the 2019-2022 Strategic Plan, and framed within the reshaping of the Iberian Portfolio which aims at reducing exposure to thermal and merchant activities in Iberia. With this transaction EDP clearly surpasses its €2 billion disposals target in Iberia, while securing at the same time 65% of the €6 billion target of total expected disposal proceeds, (including asset rotations), providing the company added flexibility in managing the remaining execution of the plan.

This deal delivers significant value crystallization, highlighting once again the quality of the EDP portfolio, reinforces the low risk profile of EDP and the weight of regulated and LT contracted activities on EBITDA. The transaction is expected to be earnings enhancing on a recurrent base versus 2019-2022 Business Plan assumptions and with a positive impact on Net Debt/EBITDA of 0.1x.

Spain will continue to be a key market in EDP's portfolio, where the Group continues investing in renewables, electricity networks and energy supply and services. In supply, EDP keeps developing competitive offers in the B2B segment and is growing into new energy solutions, such as distributed generation and electric mobility services, in line with EDP's mission of leading the energy transition to create superior value.

This information is disclosed pursuant to the terms and for the purposes of the article 17 of Regulation (EU) No. 596/2014 of the European Parliament and of the Council and of article 248-A of the Portuguese Securities code.

EDP – Energias de Portugal, S.A.

Investor Relations

Department Miguel Viana, Head of IR Sónia Pimpão Carolina Teixeira Andreia Severiano Pedro Gonçalves Santos phone +351 21 001 2834 fax +351 21 001 2899 ir@edp.com

¹ Corresponds 2.5m contracts of which 0.9m electricity contracts, 0.8m gas contracts, 0.6m services contracts and 0.2m clients from 50% stake in CHC

edp

Reshaping the Iberian Portfolio

Disposal of 2 CCGT plants and B2C Supply Business in Spain

Lisbon, May 18th 2020

All figures as of 2019; (1) By # of supply points in free market; (2) Corresponds 2.5m contracts of which 0.9m electricity contracts, 0.8m gas contracts, 0.6m services contracts and 0.2m clients from 50% stake in CHC; (3) CHC, 50/50 joint ventures with CIDE, which has 0.4m clients.

We are reducing merchant and thermal exposure in Iberia while maintaining our strong hedging and energy management capabilities as well as optionality in the new downstream segment

Reducing exposure to merchant and thermal in Iberia...

Maintain our strong hedging and energy management capabilities

Retain B2B and optionality in the new downstream segment

Keep B2B business enabling to continue contracting substantial volumes of energy

Growth in new energy solutions in distributed solar

Growth in new energy solutions in the area of e-mobility

Weight of disposed portfolio in EBITDA Spain and Client Solutions & EM Iberia business

EDP's consensus Sum of the Parts valuation Client Solutions & EM Iberia business

(1) Includes the enterprise values attributed to CSEM Iberia by the following analysts that disclose this detail: AllianceBernstein, Bank of America Merrill Lynch, Caixa Bank BPI, Credit Suisse, Goldman Sachs, JB Capital, JP Morgan, Kepler Cheuvreux, Morgan Stanley, RBC, Santander and Société Générale.

.

• wind (#3 player), hydro ✓ wind & solar under development

(LT contracted)

• of RAB
• electricity distributed

• of grid

• 10TWh of electricity, 4TWh of gas

• ✓ Growth in distributed solar and e-mobility
• gas plants, coal, nuclear
• ✓ 0.7 GW of coal to be shutdown by 2022
• ✓ Coal-to-gas conversion project at Aboño 1

edp

Leading the energy transition
to create superior value