Companhia Energetica de Minas Gerais CEMIG : Presentation of 2Q 2019 Results

RESULTS

Disclaimer

Certain statements and estimates in this material may represent expectations about future events or results, which are subject to risks and uncertainties that may be known or unknown. There is no guarantee that the events or results will take place as referred to in these expectations.

These expectations are based on the present assumptions and analyses from the point of view of our management, in accordance with their experience and other factors such as the macroeconomic environment, and market conditions in the electricity sector; and on our expectations for future results, many of which are not under our control.

Important factors that could lead to significant differences between actual results and the projections about future events or results include our business strategy, Brazilian and international economic conditions, technology, our financial strategy, changes in the electricity sector, hydrological conditions, conditions in the financial and energy markets, uncertainty on our results from future operations, plans and objectives, and other factors. Because of these and other factors, our real results may differ significantly from those indicated in or implied by such statements.

The information and opinions herein should not be understood as a recommendation to potential investors, and no investment decision should be based on the veracity, currentness or completeness of this information or these opinions. None of our professionals nor any of their related parties or representatives shall have any liability for any losses that may result from the use of the content of this presentation.

To evaluate the risks and uncertainties as they relate to Cemig, and to obtain additional information about factors that could give rise to different results from those estimated by Cemig, please consult the section on Risk Factors included in the Reference Form filed with the Brazilian Securities Commission (CVM) - and in the 20-F form filed with the U.S. Securities and Exchange Commission (SEC).

In this material, financial amounts are in R$ million (R$ mn) unless otherwise stated.

Financial data reflect the adoption of IFRS.

HIGHLIGHTS

ICMS case:	Structural	Management of
Court confirms	reorganization and
tax credits	operational efficiency	debt portfolio
	initiatives

Strong growth in	Cemig GT -	Execution of
operational cash flow	Auction to purchase	Disinvestment
(measured as Ebitda)	renewable supply	Program

Court confirms tax credits

• On May 8, 2019 the Regional Federal Appeal Court of the First Region gave final judgment - against which there is no appeal - recognizing Cemig's right to exclude amounts of ICMS (value-added) tax from the calculation base for Pasep and Cofins taxes, as from to 5 years prior to filing the case - i.e. backdated to July 2003.

Pasep and Cofins credits	Cemig H	Cemig D	Cemig GT	Other	Total
investees
Escrow deposits	-	1,138	204	-	1,342
Taxes paid	484	4,833	640	26	5,983
Total	484	5,971	844	26	7,325
Maximum possible value of reimbursement to clients*		4,130			4,130
Effects on statement of income
Recovery of credits of PIS, Pasep and Cofins taxes	183	830	409	16	1,439
charged on amounts of ICMS tax
Net financial income	297	991	226	10	1,524
Income tax and Social Contribution tax	-163	-594	-212	-9	-978
	317	1,227	423	17	1,984

( * ) From the amount to be reimbursed to consumers, R$20 million will be deducted related to Pasep and Cofins.

4

R$ mn

Cemig D- 7th debenture issue

• R$ 3.66 billion, in two series

 1st Series:	maturity 5 years;	total R$ 2.16 billion - pays interest at 0.454% p.a. above CDI Rate.
 2nd Series:	maturity 7 years;	total R$ 1.5 billion - pays 4.10% p.a. plus inflation correction by IPCA index.

• Replaces more expensive debt
• • Estimated average cost: reduced from 144.13% to 108.61% of CDI rate
  • Increases average tenor of total debt of Cemig D - from 2.9 years to 5.1 years.

Position on March 31, 2019

Average tenor: 2.9 years	After re-profiling - July 2019
	Average tenor: 5.1 years

			1,171
	776	794
									565	565
909								282		565		700
		463	480	-	-	-						282	700
	383					480
			234	256	231				463
15					383	256
						-		234	231
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2019	2020	2021	2022	2023	2024	2025	2026
15				-

5	2019	2020	2021	2022	2023	2024	2025	2026