AES To Delay Filing of 2004 Annual Report on Form 10-K.

ARLINGTON, Va. -- The AES Corporation (NYSE:AES) announced today that it would delay the filing of its 2004 Annual Report on Form 10-K with the Securities and Exchange Commission. The company requires additional time to restate its 2002 and 2003 financial statements primarily due to an error in 2002 relating to the recording of deferred taxes on the pension liability for its Brazilian utility, Eletropaulo. AES expects to file its Form 10-K on or before March 31, 2005. Based on management's review, the company determined that these errors were inadvertent and unintentional. These adjustments have no impact on the consolidated revenues, gross margin or net cash flow of AES for these restated periods.

The error occurred in 2002 at the time when AES first began to consolidate Eletropaulo's financial statements after gaining control of the utility early that year. The restatement will impact the previously reported 2002 and 2003 balance sheets primarily by increasing deferred tax assets and reducing accumulated other comprehensive loss (a component of stockholders' equity). The company also expects to increase its previously reported 2002 net loss by $28 million.

In addition, AES plans to restate its 2002 and 2003 financial statements for a balance sheet reclassification involving the allocation of foreign currency translation adjustments to the minority shareholders for certain subsidiaries. This entry will have no effect on the income statement or net cash flow of AES for 2002 or 2003.

In connection with its year-end closing procedures, AES identified additional year-end adjustments that will change fourth quarter 2004 results from the previously reported earnings released on February 3, 2005. It is expected that the adjustments identified will, in the aggregate, have an insignificant impact on income from continuing operations, net income, net cash flow and earnings per share calculations.

These amounts are subject to audit by AES's independent registered public accountants, Deloitte & Touche LLP. AES is assessing the impact these adjustments will have on its Sarbanes-Oxley evaluation of internal controls for the year ended December 31, 2004.

Separately, AES resolved the previously announced issue under discussion with the Division of Corporation Finance of the Securities and Exchange Commission regarding the accounting treatment for the early 2004 restructuring transaction between several of its Brazilian subsidiaries and Banco Nacional de Desenvolvimento Economico e Social (BNDES). As a result, AES will reclassify balance sheet amounts previously reported in 2004 related to the release of accumulated other comprehensive losses recorded as part of the Brazil restructuring transaction. The impact of this reversal will result in an increase in the balance of additional paid in capital of $855 million and a corresponding increase of $855 million in the balance of accumulated other comprehensive loss, both components of stockholders' equity. This balance sheet reclassification does not impact the statement of operations, net cash from operating activities or total stockholders' equity of the company.

None of the adjustments or restatements described above will have an impact on AES's previously disclosed 2005 guidance.

About AES

AES is a leading global power company, with 2004 sales of $9.5 billion. AES operates in 27 countries, generating 44,000 megawatts of electricity through 120 power facilities and delivers electricity through 17 distribution companies. Our 30,000 people are committed to operational excellence and meeting the world's growing power needs. To learn more about AES, please visit www.aes.com or contact media relations at [e-mail].