Preliminary Results Year ended 31 December 2008. Philip Cox Chief Executive Officer.

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<ul><li> Slide 1 </li> <li> Preliminary Results Year ended 31 December 2008 </li> <li> Slide 2 </li> <li> Philip Cox Chief Executive Officer </li> <li> Slide 3 </li> <li> Preliminary Results March 2009 International Power 3 2008 highlights Strong financial performance profit from operations of 1,050m (2007: 904m) EPS of 32.4p (2007: 27.1p) free cash flow of 513m (2007: 653m) full-year dividend of 12.15p per share proposed - up 20% Profit from operations up in all regions strong growth in Australia and North America good performance of European assets offsets Rugeley outage consistent performance from Middle East and Asia Continued growth 3GW (net) of capacity additions announced in 2008 acquisitions: US peaking plants, Turbogs, Uch greenfield: Elecgas, T-Power, wind </li> <li> Slide 4 </li> <li> All numbers in this presentation exclude exceptional items and specific IAS 39 mark to market movements, unless stated otherwise Mark Williamson Chief Financial Officer Financial Review </li> <li> Slide 5 </li> <li> Preliminary Results March 2009 International Power 5 North America Europe Middle East Australia Asia Corporate costs Profit from operations Interest PBT Tax Minority interest Profit for the year EPS DPS 177 581 69 168 104 (49) 1,050 (368) 682 (123) (69) 490 32.4p 12.15p Year ended 31 December 136 574 68 82 96 (52) 904 (308) 596 (113) (77) 406 27.1p 10.16p 30% 1% 105% 8% (6%) 16% 19% 14% 9% (10%) 21% 20% 2008 m 2007 m % change Income statement Constant currency 9% 13% Reported </li> <li> Slide 6 </li> <li> Preliminary Results March 2009 International Power 6 North America Profit from operations up 30% 136m 177m 148m 108m 29m 28m Improved contribution from Hays higher south zone demand in Q2 2008 congestion in south zone outage in 2007 Reduced load factor at Midlothian mild weather in H1 2008 Coleto Creek higher load factor dust emissions control equipment installed 2007 Reduced load factor at New England lower off peak running and cooler summer capacity payments underpin PFO IPA Central first time contribution capacity payments underpin PFO Milford PPA expired January 2009 exceptional charge of 37m 20072008 Share of JVs and associates Subsidiaries </li> <li> Slide 7 </li> <li> Preliminary Results March 2009 International Power 7 Europe Significant reduction in Rugeleys earnings record achieved dark spreads in 2007 extended outage and delayed FGD in 2008 Saltend high load factor Strong performance at First Hydro and Deeside benefiting from low plant availability in the UK record performance from First Hydro* Profit from operations up 1% 574m 581m 500m521m 81m 53m * First Hydro Holdings reports PBIT of 176m (2007: 133m) under UK GAAP 20072008 Share of JVs and associates Subsidiaries </li> <li> Slide 8 </li> <li> Preliminary Results March 2009 International Power 8 Europe Maestrale first full-year contribution acquired August 2007 low wind levels in 2008 ISAB benefited from a rise in oil prices limited impact of major incident in October 2008 CIP6 tariff step down in November 2008 Czech Republic strong performance as power prices tracked high German power prices All other European assets delivered a consistent performance </li> <li> Slide 9 </li> <li> Preliminary Results March 2009 International Power 9 Middle East Profit from operations up 1% 68m 69m 43m 44m 26m 24m Strong operational performance across Middle East portfolio Completed construction at Ras Laffan B in June 2008 Hidd achieved full commercial operation in May 2008 2007 benefited from development fee for Fujairah F2 20072008 Share of JVs and associates Subsidiaries </li> <li> Slide 10 </li> <li> Preliminary Results March 2009 International Power 10 Australia Significantly improved contributions from Hazelwood and Loy Yang B Synergen able to capture high spot prices Simply Energy 100% owned additional route to market Other assets performed well Stamp duty agreed on Loy Yang B 20m exceptional charge Profit from operations up 105% 82m 168m 164m 83m 4m (1m) 20072008 Share of JVs and associates Subsidiaries </li> <li> Slide 11 </li> <li> Preliminary Results March 2009 International Power 11 Asia Malakoff sold in May 2007 Strong performance from Paiton Acquisition of additional 31% of Uch Pakistan overdue receivable is US$149m no earnings impact Profit from operations up 8% 96m 89m 14m 20072008 82m 15m 104m Share of JVs and associates Subsidiaries </li> <li> Slide 12 </li> <li> Preliminary Results March 2009 International Power 12 Interest cover and effective tax rate PFO JVs and associates Interest Tax PBIT Total interest Subsidiaries JVs and associates Interest cover Profit before total tax Total tax Subsidiaries JVs and associates Effective tax rate Profit after tax 2.6x2.5x 1,050 99 31 130 1,180 (368) (99) (467) 713 (123) (31) (154) 559 904 91 60 151 1,055 (308) (91) (399) 656 (113) (60) (173) 483 2008 2007 Year ended 31 December m 22% 26% </li> <li> Slide 13 </li> <li> Preliminary Results March 2009 International Power 13 Free cash flow Operating cash flow from subsidiaries Dividends - JVs and associates Capex - maintenance Cash generated from operations Net interest paid Tax paid Free cash flow m 992 145 (71) 1,066 (312) (101) 653 971 135 (108) 998 (399) (86) 513 2008 2007 Year ended 31 December m 2007 free cash flow enhanced by: one-off timing benefit of working capital reductions (including early US cash receipts) lower than average maintenance capital expenditure in 2007 2008 free cash flow impacted by: build up of coal stock at Rugeley (70m) interest increased FX and acquisitions Maintenance capital expenditure for 2009 estimated at 160m </li> <li> Slide 14 </li> <li> Preliminary Results March 2009 International Power 14 Movement in net debt Free cash flow Growth capex Acquisitions and investments Disposals Dividend paid FX &amp; other Net receipts from / (payment to) minorities Change in net debt Opening net debt Debt acquired Closing net debt 653 (160) (842) 418 (160) (250) (35) (376) (3,575) (711) (4,662) 513 (156) (680) - (166) (1,193) 28 (1,654) (4,662) (2) (6,318) 2008 2007 m Year ended 31 December 2008 closing net debt at 2007 FX rates 4,998m </li> <li> Slide 15 </li> <li> Preliminary Results March 2009 International Power 15 Balance sheet Non-current assets Goodwill and intangibles PP&amp;E Investments Other long-term assets Net current liabilities Non-current liabilities Net debt Net assets Gearing Debt capitalisation 991 5,961 1,480 1,626 10,058 (644) (1,473) (4,934) 3,007 164% 62% 1,137 7,318 1,803 1,943 12,201 (137) (1,611) (6,318) 4,135 153% 60% 31 December 2008 m 30 June 2008 Net debt of JVs and associates 1,820m (30 June 2008: 1,336m) </li> <li> Slide 16 </li> <li> Preliminary Results March 2009 International Power 16 Net debt structure Cash and cash equivalents Recourse debt Convertible bond (2023) Convertible bond (2015) Convertible bond (2013) Non-recourse debt IPM - acquisition debt North America Europe Middle East Australia Asia Total net debt 1,129 (149) (560) (191) (900) (306) (1,457) (3,227) (410) (1,103) (44) (6,547) (6,318) Total m IPR Corporate Notes Project debt is secured on the assets and cash flow of the related project (non-recourse) The convertible bonds are shown at their final maturity date although they can be converted earlier As at 31 December 2008 Project cash/ (debt) 354 (149) (560) (191) (900) - (546) 775 - (306) (1,457) (3,227) (410) (1,103) (44) (6,547) (5,772) JVs and associates off-balance sheet net debt - (197) (297) (864) (68) (394) (1,820) Maturity 2023 2015 2013 2012 2010-2015 2010-2026 2016-2025 2010-2019 2020 Maturity 2010-2019 2009-2035 2021-2030 2009 2011-2018 m </li> <li> Slide 17 </li> <li> Preliminary Results March 2009 International Power 17 2008 project debt financings Pelican Point ElecgasIPA CentralT-Power MonthFebruaryMarchJulyDecember Project debtA$190m494mUS$400m term391m Tenor10 year term27 year term7 year term23 year term Margin115 140bp65 100bp325bp170 220bp Merchant/PPAMerchantPPAMerchantPPA RegionAustraliaEuropeNorth AmericaEurope Fixed underlying swap rate 7.4%4.6%3.5-5.0%4.0% </li> <li> Slide 18 </li> <li> Preliminary Results March 2009 International Power 18 T-Power case study Financial close 19 December 2008 420MW CCGT power plant in Belgium 391m of non-recourse debt raised with margin of 170 220bp and underlying swap rate of 4.0% achieved given: full turn-key EPC contract 15-year (option for five year extension) tolling agreement with Essent Trading International S.A. Success factors strong relationship with banks reputation for operational excellence high quality partners Siemens Project Ventures (33%) and Tessenderlo Chemie (33%) </li> <li> Slide 19 </li> <li> Preliminary Results March 2009 International Power 19 Project refinancings No material refinancings in 2009 Corporate revolver renewable in October 2010 Project refinancing Amount (local currency) DueComments 2009 SEA GasA$140mDecember 2009 Infrastructure project with contracted income 2010 US CCGTUS$769mJuly 2010 Low leverage Previously refinanced in challenging times HazelwoodA$445mFebruary 2010 Awaiting details of CPRS </li> <li> Slide 20 </li> <li> Preliminary Results March 2009 International Power 20 PFO (m) 773m 536m 222m 200420052006 Free cash flow (m) Earnings per share (pence) 22.4p 14.6p 8.6p 200420052006 Dividend per share (pence) 7.9p 4.5p 2.5p 200420052006 Proposed dividend (1) 904m 2007 27.1p 2007 10.16p Financial summary 2008 1,050m 2008 32.4p 2008 12.15p (1) 456m 285m 104m 2004200520062007 653m 513m 2008 </li> <li> Slide 21 </li> <li> Philip Cox Chief Executive Officer </li> <li> Slide 22 </li> <li> Preliminary Results March 2009 International Power 22 Significant decline in spot and forward prices since H2 2008 economic downturn rapid decline in gas prices reduced trading liquidity Long-term market fundamentals attractive TXU filed to retire an additional 3,836MW of capacity south zone supply and transmission constraints limited new-build wind generation low load factors 2009 contracted position gas plant lightly contracted Coleto Creek highly contracted in 2009 quoted spreads for 2009 assume no recovery in forward market Market update - Texas Downside case reflects demand reduction in 2009 and 2010 2009 0 5 10 15 20 % ERCOT reserve margin 2010201120122013201420152016 Base case Downside case Target reserve </li> <li> Slide 23 </li> <li> Preliminary Results March 2009 International Power 23 Market update - New England Capacity payments - an important and secure income stream capacity payments accounted for some 50% of Blackstone and Bellingham 2008 PFO payment levels fixed through May 2012 Reserve margin increasingly dependent on demand side management cumulative demand side management 3GW represents 9% of reserve margin reliance on older, less efficient capacity increased volatility on high demand days majority of new-build in Connecticut limited impact on our plants could lead to shut down of 2,660MW RMR plants CO 2 RGGI auctions held latest auction cleared at $3.38/ton IPR portfolio well positioned Reserve margin reflects reduced demand growth and additional supply following latest capacity auction 2009 0 10 20 30 40 % New England reserve margin 2010201120122013201420152016 Including demand resources Target reserve Excluding demand resources </li> <li> Slide 24 </li> <li> Preliminary Results March 2009 International Power 24 Market update - PJM 1,857MW modern portfolio of peaking plants acquired in 2008 all assets integrated into existing portfolio and delivering a good operational performance PJM capacity auction expected to reflect lower demand growth forecasts however impact to be offset by 3,300MW of Duquesne demand which rejoined PJM anticipated approval of higher Cost of New Entrant (CONE) level by FERC Overall, smaller impact of weaker market conditions on peaking plants due to low load factors - generally </li></ul>

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