AES Provides Update on Regulatory Developments at DP&L in Ohio; Reaffirms 2019 Guidance and Growth Rate Through 2022

The AES Corporation (NYSE: AES) announced that the Public Utilities Commission of Ohio (PUCO) has modified Dayton Power & Light’s (DP&L) rates, removing the annual Distribution Modernization Rider (DMR) currently in place through October 2020. The PUCO also ordered DP&L to file new rates reflecting this change by no later than November 29, 2019. DP&L expects to withdraw its current Electric Security Plan (ESP 3), and file new rates consistent with its most recent Standard Service Offer approved by the PUCO in 2016 and based on DP&L’s first ESP (ESP 1).

“We are disappointed with the PUCO’s decision, but we expect DP&L to continue to work with Commission Staff in order to reach a constructive outcome that will allow DP&L to invest in grid modernization, while at the same time continuing to have the lowest residential rates of any investor-owned utility in Ohio,” said Gustavo Pimenta, AES Executive Vice President and CFO. “While this decision will have a significant impact on DP&L, it will not affect AES’ 2019 guidance and expectations through 2022.”

Guidance and Expectations¹

The Company reaffirms its 2019 Adjusted EPS guidance of $1.30 to $1.38. The Company also reaffirms its average annual growth rate target of 7% to 9% through 2022.

The Company also reaffirms its 2019 Parent Free Cash Flow expectation of $700 million to $750 million and its average annual growth rate target of 7% to 9% through 2022.

1

Adjusted EPS and Parent Free Cash Flow are non-GAAP financial measures. See below for definitions of Adjusted EPS and Parent Free Cash Flow. The Company is not able to provide a corresponding GAAP equivalent or reconciliation for its Adjusted EPS guidance or its Parent Free Cash Flow expectation without unreasonable effort.

Non-GAAP Financial Measures

Adjusted EPS is defined as diluted earnings per share from continuing operations excluding gains or losses of both consolidated entities and entities accounted for under the equity method due to (a) unrealized gains or losses related to derivative transactions and equity securities; (b) unrealized foreign currency gains or losses; (c) gains, losses, benefits and costs associated with dispositions and acquisitions of business interests, including early plant closures, and the tax impact from the repatriation of sales proceeds; (d) losses due to impairments; (e) gains, losses and costs due to the early retirement of debt; (f) costs directly associated with a major restructuring program, including, but not limited to, workforce reduction efforts, relocations, and office consolidation; and (g) tax benefit or expense related to the enactment effects of 2017 U.S. tax law reform and related regulations and any subsequent period adjustments related to enactment effects.