FINANCIAL RESULTS Q4 2010

Transcription

1 FINANCIAL RESULTS Q CEO CHRISTIAN RYNNING-TØNNESEN CFO STEIN DALE 17 FEBRUARY 2011

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3 HIGHLIGHTS Q Strong financial results driven by unusual cold and dry Nordic weather Underlying 1 pre-tax profit Q NOKm Underlying 1 pre-tax profit FY 2010 NOKm Accounted net profit FY 2010 NOKm NOK 14 bn equity injection proves solid support to growth strategy by owner Signing of new long-term contracts with industrial counterparts in Norway With Norske Skog and Finnfjord in the period (1.5 TWh/year) Full replacement of expired statutory-priced industry contracts in place Investment decision made for Kargi hydropower plant in Turkey (102 MW) Acquiring of remaining 33.3% stake in Baltic Cable AB Page 3 1 Underlying figures are adjusted for material non-recurring items and unrealised changes in value

4 HEALTH, SAFETY AND ENVIRONMENT Lost-time injuries per million hours HEALTH AND SAFETY Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q3 Q4 LTI lost-time injuries per million hours (12-month rolling period) Consolidated activities No serious injuries 23 lost-time injuries during 2010 H1-value FY 2010: 3.4 (3.8) Illness absence FY 2010: 3.4% (3.3%) Associated activities Q4: One person died in motorcycle accident at THPC in Laos Investigation conducted and local measures under implementation 2010: 5 fatalities ENVIRONMENT No environmental non-compliances during 2010 Page 4

5 2010 MILESTONES NO New industry contracts signed with Elkem, Norske Skog and Finnfjord Hydropower refurbishment projects - investment decisions Trondheim Energi Nett grid operations sold Inaugurated: Allain Duhangan, (43% 1, 192 MW) in India La Higuera (50% 1,155 MW) and La Confluencia (50% 1, 156 MW) in Chile Investment decision: Cheves (Peru,168MW) UK District heating plants - investment decisions Round 3 - bidder licence received for Dogger Bank through the Forewind consortium (25%) SE Baltic Cable acquiring of remaining 33.3% stake Several wind licenses awarded, but pending for appeal decisions GER Knapsack II (430 MW) - investment decision for extension of existing plant IT Divestment of solar power projects TUR Cakit (20 MW) - inaugurated Kargi (102 MW) - investment decision Page 5 1 SN Power s ownership share

6 DELIVER GROWTH IN PURE ENERGY Flexible European generation and market operations International hydropower Wind power District heating Small scale hydro power 6

7 MAIN PROJECTS UNDER CONSTRUCTION European Flexible Power Generation Projects (Figures in million) Remaining capex 1 (million) Total capex 1 (million) New capacity 2 Statkraft s ownership share Planned completion Svartisen NORWAY NOK 10 NOK MW 70% 2011 Eiriksdal and Makkoren NORWAY NOK 600 NOK MW 100% 2013 Nedre Røssåga NORWAY NOK 400 NOK % 2017 Knapsack II GERMANY NOK 2800 NOK MW 100% 2013 Ambuklao & Binga PHIL. USD 70 USD MW 50% & 2014 Kargi TURKEY EUR 250 EUR MW 100% 2013/2014 International Hydropower La Higuera CHILE 0 USD MW 45% Allain Duhangan INDIA USD 15 USD MW 43% La Confluencia CHILE USD 80 USD MW 50% /11 Wind power Cheves PERU USD 380 USD MW 100% /2014 Sheringham Shoal UK GBP 300 GBP MW 50% 2012 Total NOK NOK MW 1 Page 7 1 Statkraft s equity share 2 Total for project, incl. partners share 3 SN Power s share (60 % owned by Statkraft)

8 CAPEX DISTRIBUTION Capex ambition : NOK bn District heating, small scale hydro and reg co's ~5-10 % Wind power ~2-10 % European flexible power generation ~15-30 % International hydropower ~25-50 % 8 Lower range refers to committed share of total capex ambition, while upper range refers to planned share

9 CAPEX FLEXIBILITY Capex ambition : NOK bn ~55 % Planned New capacity 1 Maintenance ~35% ~10% Committed High capex flexibility to maintain credit strength Page 9 1 Investments approved by the board

10 EXPECTED DELIVERIES Increased value creation Contribution towards combating climate change Development in emerging markets Development of competence in Norway and other countries Page 10

11 FINANCIAL REVIEW CFO STEIN DALE

12 ELECTRICITY MARKET ELECTRICITY, AVERAGE MONTHLY PRICE EUR/MWh Nord Pool, system price EEX, spot price Q Average Nord Pool system price of 62.0 EUR/MWh (36.6) Average EEX spot price of 51.4 EUR/MWh (38.7) Nordic reservoir levels 36% below of median level at year end EUR/MWh ELECTRICITY, FORWARD PRICE % 95 NORDIC RESERVOIR WATER LEVELS Nordic 2011 Nordic 2012 Germany 2011 Germany Week Median Page 12 Sources: NordPool, EEX and NVE

13 STATKRAFT S POWER GENERATION Technology (TWh) 0.1 (0.1) 0.2 (0.2) 1.7 (2.0) 16.0 (15.6) Hydro Wind Gas Bio and solar Q Total generation 18.0 TWh (17.8) Geography (TWh) Norway Nordic ex. Norway Europe ex. Nordic Outside Europe 1.6 (1.7) 1.8 (1.6) 0.6 (0.5) 14.1 (14.0) Monthly power generation TWh Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Avg FY 10 generation of 57.4 TWh (57.0) Significant variations during 2010 due to extraordinary cold winter periods, and relatively low hydro reservoirs through the year Page 13

14 INCOME STATEMENT - ACTUAL 4th quarter Full year NOK million Gross operating revenues Energy purchase and transmission costs Unrealised changes in value energy contracts Net operating revenues Operating expenses before depreciation EBITDA Depreciations and write-downs Operating profit (EBIT) Share of profit from associates and joint ventures Net financial income/expenses Unrealised changes in financial items Net financial items Profit before tax Taxes Net profit Page 14

15 ADJUSTMENTS TO INCOME STATEMENT Q NOKm Energy contracts Changes mainly related to stronger gas prices and USD appreciations Reported pre-tax profit +508 Energy contracts Financial items Associated companies Unrealised changes in value (pre-tax) Nonrecurring items Underlying pre-tax profit Financial items Write-down on E.ON AG shares due to share price decline (NOKm ) Unrealised agio on internal and external debt in SEK and EUR (NOKm ) FX and currency contracts (NOKm +45) Non-recurring items Decreased pension liabilities following Norwegian pension reform (NOKm +339) Write-downs (NOKm 633) Non-recurring tax effect Deferred tax asset related to negative resource rent income (NOKm ) Page 15

16 UNDERLYING OPERATIONS NOK million Q Q FY2010 FY 2009 Gross operating revenues % % Adjusted EBITDA % % Adjusted EBIT % % Adjusted pre-tax profit % % Net cash flow from operating activities % % Gross investments % % Interest-bearing debt % Adjusted ROACE before tax % 15.2% +4.3 Page 16 1 Adjusted for material non-recurring items and unrealised changes in value

17 REVENUE BREAKDOWN Year NOK million Q42010 Q Net physical spot sales, incl. green certificates Concessionary sales at statutory prices Sales to industry at statutory prices Long-term commercial contracts Nordic and Continental DAMP* Trading and origination Distribution grid Retail sales District heating Other / eliminations Sales revenues Other operating revenues Gross operating revenues Energy purchases Transmission costs Net operating revenues Page 17 *DAMP = Dynamic Asset Management Portfolio

18 OPERATING EXPENSES NOK million Q Q Salaries and payroll costs Property tax and licence fees Other operating expenses Operating expenses before depreciation Depreciations Page 18 Underlying expenses: Adjusted for material non-recurring items and unrealised changes in value

19 SEGMENTS BREAKDOWN (I) NOK million GENERATION & MARKETS Gross operating revenues Q Profit before financial items and Q42010 tax NOK million SKAGERAK ENERGI Gross operating revenues Q Profit before financial items and tax Q42010 NOK million INDUSTRIAL OWNERSHIP Gross operating revenues Q Profit before financial items and tax Q42010 Earnings driven by higher Nordic power prices Negative gas power contributions due to low spark-spreads Generation of 14.0 TWh (13.3) Profit positively affected by higher power prices Generation of 1.6 TWh (1.7) Increased profits due to higher power prices and acquisition of retail sales operations from Trondheim Energi at YE 2009 Higher contributions from associated companies Page 19 Underlying operations: Adjusted for material non-recurring items and unrealised changes in value

20 SEGMENTS BREAKDOWN (II) NOK million WIND POWER 109 NOK million 300 EMERGING MARKETS 261 NOK million CUSTOMERS Gross operating revenues Q Profit before financial items and Q42010 tax Gross operating revenues Q Profit before financial items and tax Q Gross operating revenues Q Profit before financial items and tax Q42010 Increased revenues due to higher power prices Project and development activities impact profits Generation of 190 GWh (131) Increased profit due to increased generation at higher prices in associates Inauguration of La Higuera and La Confluencia hydropower plants in Chile in October (313 MW) Year-on-year revenues down due to sale of Trondheim Energi Nett and retail sale activities Increased contribution from district heating following higher prices and generation District heating generation of 348 GWh (278) Page 20 Underlying operations: Adjusted for material non-recurring items and unrealised changes in value

21 CASH FLOW FY 2010 NOK million Cash reserves From operations Change in short and long term items * Dividend etc. received Net investments Net borrowings incl private placement Equity injection Dividend and group contributions Currency effects Cash reserves Cash flow from operations up 7% to NOKm (12 714) Gross investments of NOKm (4 490) * Included in short-term item changes: Cash collateral: NOKm -448 Working capital: NOKm -49 Currency effects: NOKm Page 21

22 FINANCIAL STRENGTH AND RATING 40 % FFO/debt 35.8 % 36.3 % 12.0 FFO interest coverage 30 % % 18.9 % 18.7 % % % FFO of NOKm (8 559) Increased cash flow from operations Reduced interest bearing debt and interest costs Rating target of minimum current ratings Page 22 FFO = cash flow from operations before changes in short term items FFO interest coverage = (FFO + interest expenses) / interest expenses FFO/debt = FFO / gross interest bearing debt

23 LIABILITIES AND INTEREST EXPENSES NOK million % 6 % 4 % 2 % 5.1% 3.7% LONG-TERM LIABILITIES, DEBT REDEMPTION PROFILE >2021 Loans in subsidiaries Loans from Statkraft SF (back to back) 4.7% 6.7% AVERAGE INTEREST RATES 5.3% 4.9% Loans in Statkraft AS 4.8% 4.1% 4.2% 3.9% 4.1% 3.5% 2.3% 1.3% Funding 2010: New loans NOKm Repayment NOKm New credit facilities of NOK 12 bn Equity injection of NOK 14 bn. gives Statkraft a solid cash position (NOKm ) Interest-bearing liabilities NOK 40.5 bn NOK 50%, EUR 39%, SEK 6%, USD 5% 64% exposed to floating interest rates 0 % NOK SEK EUR USD Page 23

24 OUTLOOK NOK 14 bn equity injection provides solid support to growth strategy within clean and flexible energy NOK bn investment plan in the period High flexibility in order to maintain credit strength Lower hydro generation expected in 2011 compared to 2010 due to weak resource situation Forward prices indicate higher price level year-on-year Uncertainty linked to the hydrological situation and industry demand Page 24

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26 APPENDIX

27 FULL FINANCIAL STATEMENT (UNADJUSTED) 4th Quarter The year Figures in NOK million Profit and loss Sales revenues Other operating revenues Gross operating revenues Energy purchase Transmission costs Unrealised changes in the value of energy contracts Net operating revenues Salaries and payroll costs Depreciation, amortisation and impairments Property tax and licence fees Other operating expenses Operating expenses Operating profit Share of profit from associates and joint ventures Financial income Financial expenses Unrealised changes in the value of currency and interest contracts Net financial items Profit before tax Tax expense Net profit Of which minority interest Of which majority interest Other comprehensive income Change in the fair value of financial instruments Reclassification adjustment related to financial instruments recorded as a financial loss Estimate deviation pensions Translation differences Total other comprehensive income Total comprehensive income Of which minority interest Of which majority interest Page 27

28 BALANCE SHEET Figures in NOK million ASSETS Intangible assets Property, plant and equipment Investments in associates and joint ventures Other non-current financial assets Derivatives Non-current assets Inventories Receivables Short-term financial investments Derivatives Cash and cash equivalents Current assets Assets EQUITY AND LIABILITIES Paid-in capital Retained earnings Minority interests Equity Provisions Long-term interest-bearing liabilities Derivatives Long-term liabilities Short-term interest-bearing liabilities Taxes payable Other interest-free liabilities Derivatives Current liabilities Equity and liabilities Page 28

29 CASH FLOW STATEMENT The Year Figures in NOK million CASH FLOW FROM OPERATING ACTIVITIES Profit before tax Profit/loss on sales of non-current assets Depreciation, amortisation and impairments Profit from sale of business Share of profit from associates and joint ventures Unrealised changes in value Taxes Cash flow from operating activitites Changes in long-term items Changes in short-term items * Dividend from associates Net cash flow from operating activities CASH FLOW FROM INVESTING ACTIVITIES Investments in property, plant and equipment - maintenance Investments in property, plant and equipment - new capacity Proceeds from sales of non-current assets Capital reduction in associates and joint ventures Sale of business, net liquidity accruing to the group Business combinations, net liquidity accruing to the Group Loans to third parties Repayment of loans Investments in other companies Net cash flow from investing activities CASH FLOW FROM FINANCING ACTIVITIES New debt Repayment of debt Capital increase Capital reduction Dividend and Group contribution paid Share issue to minority Net cash flow from financing activities Net change in cash and cash equivalents Currency effect on cash flows Cash and cash equivalents Cash and cash equivalents Unused committed credit lines Unused overdraft facilities Page 29 *Changes in short term items are mainly related to change i w orking capital (NOK -49 million), changes in receivables and liabilities regarding cash collateral (NOK -448 million), changes related to derivatives (NOK 213 million), in addition to currency effects (NOK -881million).

30 DISTRIBUTION OF LOANS External loans in subsidiaries 8 % Certificates issued in the Norwegian market 2 % Loans f rom Statkraf t SF (backto-back agreements) 3 % Other loans raised in non-norwegian markets 47 % Loans issued in the Norwegian market 40 % Per 31 Dec 2010 Page 30

31 MAJOR SUPPLYER TO THE INDUSTRY GWh LONG-TERM CONTRACTED POWER SALES Concessionary power sales Statutory priced lease agreements Statkraft's share of leasing agreements Statutory priced industrial contracts Long-term market contracts New contracts Long-term contracts provides hedging ~50% of 2010 Nordic normal output Statkraft is the Norwegian industry s most important power supplier Remaining volume sold spot and hedged dynamically No fixed hedging targets Statutory-priced industrial contracts expire in 2011 Replaced by market-priced contracts New contracts signed with Norske Skog and Finnfjord in December and 0.7 TWh/year in the period of Page 31

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