Investor presentation. innogy SE March 2019

Transcription

1 Investor presentation

2 GROUP innogy is a stable business with a platform for growth innogy is active along the energy value chain in three divisions Sustainable generation of electricity Efficient distribution of energy Customer products and services Renewables Grid & Infrastructure Retail Wind Hydro Solar 3.6GW installed capacity 1 Grid Assets Grid+ Broadband 11.7bn Commodity 21.5m regulated Energy+ asset base 2 customers 2019 targeted net investments of ~ 2.5bn Targeted payout ratio of 70-80% of adjusted net income Market cap of around 22.3bn (as of 12 March 2019) 42,904 employees (as of 31 Dec 2018) Note: All figures as of FY2018 unless stated otherwise. 1 Accounting view. 2 Czech gas grid business removed from RAB following sale to RWE in February

3 GROUP Financials at a glance Adjusted EBIT 1 million Adjusted net income (ANI) million Dividend (payout in % of ANI) 2,735 2,816 ~2,630 1,123 1, (79%) 1.60 (73%) 1.40 (~75%) 1,026 FY 2016 FY 2017 FY 2018 FY 2016 FY 2017 FY 2018 FY 2016 FY 2017 FY Including Corporate/New Businesses. 2

4 RENEWABLES We develop value-accretive growth options Renewables capacity in operation, under construction and under development, pro-rata Onshore Offshore Hydro Solar/other Post 2024 total pipeline in operation currently under construction thereof depending on successful auction results: COD of projects currently under development 3 1 As of 31 December Ramp-up only includes Renewables division. Pro-rata view in GW. 2 Including pre-construction/preparation works. 3 COD = Commercial Operation Date Based on planned commissioning dates, excluding M&A activities and project-specific auctions. Figures may not add up due to rounding differences. 3

5 RENEWABLES Triton Knoll Financial close Q Country Technology Location Planned capacity Investment UK Offshore wind Area of c. 118km 2, 32km off the coast of Lincolnshire ~860MW (90 MHI Vestas V MW turbines) ~ 2 billion (incl. up to 0.5 billion for grid connection) Ownership Mean wind speed 59% innogy; 25% J-Power; 16% Kansai Electric Power 9.83m/s (at 107m height) Water depths 15 to 24m (avg. 18m) Status/consents FID/construction Fully developed, all required consents in place onshore works began on schedule in Q3 2018, offshore works from 2020 Commissioning Start of commissioning scheduled for 2021 Support scheme UK CfD 1, 74.75/MWh 2 for a total period of 15 years Triton Knoll offshore array Offshore cable corridor Onshore cable corridor Landfall 10 km Proposed Triton Knoll substation Bicker Fen substation Next steps Delivery of project safely, in time and budget 1 innogy to review all options regarding the future ownership structure. 2 CfD strike price in 2012 prices. 4

6 RENEWABLES Kaskasi FID planned for Q Country Technology Location Planned capacity Germany Offshore Wind Area of c. 17.4km 2, 33km off the coast of Heligoland ~325MW (turbine type not defined yet) Amrumbank West Kaskasi Ownership 100% innogy 1 Mean wind speed 10.1m/s (at 103m LAT) Water depths 18 to 25m (avg. 22m) Status/consents Allocated grid connection; converter station existing; BSH application to be updated in 2019 FID/construction Manufacturing works to begin in 2020, offshore works from 2021 Commissioning Start of commissioning scheduled for 2022 Support scheme Guaranteed minimum tariff for 20 years after first feed in (successful bid price provides a floor) Next steps FID/FC planned for Q Nordsee Ost North Sea Netherlands Operation Base Heligoland Germany 1 innogy to review all options regarding the future ownership structure. 5

7 RENEWABLES Valuable project opportunities across technologies passed FID and are currently being under construction 1 Technology Onshore Wind Ohio Large-scale Solar Project name Country/Location Planned capacity Scioto Ridge United States, Ohio 242MW Limondale Sun Farm Australia, New South Wales 349MWp New South Wales Construction Capex ~USD 300m ~EUR 300m (incl. project rights) Average load factor 30% 23% Status Pre-construction works Construction works Planned Commissioning Support scheme 13-yr PPA, project captures 100% PTCs Merchant, Green Certificates, PPAs Project Scioto Ridge is part of the Onshore Wind development pipeline (> 20 projects, >2 GW) that innogy acquired in December 2017 innogy benefits from BELECTRIC s global experience in constructing and operating utility-scale solar power plants 1 Including pre-construction/preparation works. 6

8 GRID & INFRASTRUCTURE G&I solid business development Germany 3 rd regulatory periods have started, no substantial earnings impact expected Court case on return on equity rate for 3 rd regulatory period ruled in favour of grid operators. Appeal against the ruling to the Federal Court by BNetzA BNetzA determines Xgen for gas at 0.49% and for electricity at 0.9% for 3 rd regulatory period 1. Legal actions from DSOs against both Xgen values are pending Investments in broadband (FTTx) doubled in 2018 to around 200m; similar level expected for 2019 Eastern Europe Overall stable parameters and earnings development of underlying business for current regulatory periods innogy concessions up for renewal 2 100% 75% 50% 25% 0% 9-11 years weighted average concession duration 3 ~27% ~73% > 2023 Around 2/3 of RAB 4 in Germany based on concessions Strong portfolio of ~3,800 concessions; 5 long-term average expiry profile provides stability 1 Xgen for electricity and gas was 1.5% in the 2 nd regulatory period. 2 Concession renewals based on customers supplied, taking into account exercise of early cancellation options, excluding water concessions. 3 Based on customers supplied. 9-year weighted average takes early cancellation options into account. 11-year weighted average excl. early cancellation options. 4 RAB = Regulated Asset Base 5 Including concessions of our grid participations. 7

9 APPENDIX G&I Eastern Europe stable regulatory environment providing visibility on earnings Region RAB ( bn) WACC (%) 1 Regulatory period Expected allowed revenues 2 Hungary 0.8 n/a Poland Slovakia Total 2.0 Overall stable earnings development of underlying business Capex spending recognized in RAB on a yearly basis Overall stable parameters for current regulatory periods Rising labor costs (due to economic growth and low unemployment rates) affect Opex & Capex Close contact to authorities to shape the future regulatory framework CZ gas grid business sold to RWE in February PL: nominal; SK: real. 2 Reference: 2018 Revenues. 3 WACC not published by regulator. Only allowed revenues acknowledged by the Regulator. 8

10 RETAIL & EMOBILITY Retail & emobility mixed picture, but stabilising trend in Continental Europe Retail UK SSE and npower terminate merger plan Loss of customers due to strong competition Harsh regulatory interventions e.g. start of SVT price cap emobility Acquisitions in USA Activities pooled in new company EBIT positive in the early 2020s > 25,000 charging points installed Retail Continental Europe Partnership with MediaMarktSaturn as new sales channel in Germany Acquisition of EnergieWonen and ZON7 in the Netherlands to strengthen energy+ business: solar power systems for households Overall stabilisation of customer base > 9,000 1,900 Networked charging points + + Serviced charging points 15,000 Private charge ports and wallboxes 9

11 GROUP Outlook for 2019 million unless stated otherwise FY 2018 reported FY 2019 guidance Renewables Grid & Infrastructure 1 1,962 1,700 1,800 Retail Adjusted EBIT 1 2,630 ~2,300 Adjusted financial result (773) (650) (750) Tax rate for adjusted net income 25% 25 30% Adjusted net income 1,026 ~850 Dividend 1.40 per share 70 80% of ANI Net investment 2 1.8bn ~ 2.5bn figures include CZ gas grid figures only include EBIT of CZ gas grid until end of February. Including Corporate/New Businesses. 2 Excluding disposal proceeds from sale of Czech gas grid. Capital expenditure on property, plant and equipment and on intangible assets, financial assets./. proceeds from disposal of assets/divestitures and net changes in equity. 10

12 GROUP Refinancing needs between 1bn and 2bn per annum in the coming years Maturity profile of bonds and loans as of 31 December 2018 ( billion) 7 6 Maturities of loans from RWE AG (lhs) Maturities of loans from EIB (lhs) Maturities of senior bonds (lhs) 5 Total outstanding bonds and loans (rhs) Cumulative maturities As of 31 December Senior bonds and RWE + EIB loans ( bn) % of total debt 36% 19% 13% 32% Total bonds and loans of ~ 16bn: t/o senior bonds of innogy SE/ Finance B.V. of ~ 13bn t/o loans from RWE AG of ~ 2bn t/o EIB loans of ~ 1bn innogy s public issuances since the IPO: First senior bond in April 2017 ( 750m, 1%, maturity 2025) First green bond in October 2017 ( 850m, 1.25%, maturity 2027) Senior bond in January 2018 ( 1,000m, 1.50%, maturity 2029) Senior bond in May tapped in July ( 750m, 0.75%, maturity 2022) Senior bond in May 2018 ( 500m, 1.625%, maturity 2026) 11

13 GROUP innogy s credit rating innogy's investment grade ratings (last updated as of 31 December 2018) Fitch Moody s S&P Long-term issuer default rating BBB+ Baa2 BBB Outlook Stable Outlook Stable Outlook Stable Outlook Senior unsecured rating A- Baa2 BBB Short-term issuer rating F2 P2 A-2 12

14 APPENDIX

15 APPENDIX Key sensitivities to our planning assumptions Driver Affected area Type Sensitivity Group impact 3 Wind/Water levels Renewables P&L +/- 10% from normal +/- ~ 120m Power prices 1 Renewables P&L +/- 10 /MWh +/- ~ 20m Interest rates Pension provisions 2 B/S +/- 50bps -/+ ~ 900m 1 A corresponding power price change across all countries for the part of the generation with market price exposure which is unhedged for Net impact after corresponding effect on plan assets. 3 Annual impact on adjusted EBIT for P&L figures for

16 APPENDIX Strict investment criteria to focus on value creation Investment framework hurdle rate build up Base WACC (post-tax) Current hurdle rate ranges 1 Core business 1 New markets/ technologies 2 Minimum value contribution for new projects Renewables 5% 8% 5% 14% Risk premium Technology risk Construction risk Regulatory risk G&I 5% 7% 6% 10% Country risk premium Project specific hurdle rate Project WACC (unlevered, post-tax) 1 Hurdle rates under regular review in order to reflect latest market conditions. 2 The core business encompasses the conventional retail electricity and gas business as well as the activities in the Grid & Infrastructure division and the construction of renewable energy assets (wind farms and hydro power stations) in our core markets in Europe. We have different return criteria for new energy service products (referred to as the Energy+ business) in the retail business and for new technologies and/or markets. Retail 7% 9% 5% 10% (Energy+) 15

17 APPENDIX Renewables projects under construction 1 Project Country Technology Installed capacity (MW) innogy share Pro-rata capacity (MW) Planned COD Support scheme Triton Knoll UK Offshore % CfD Mynydd Y Gwair UK Onshore % 33 H CfD Clocaenog Forest UK Onshore % 96 H CfD Bad á Cheò UK Onshore % 27 H CfD Scioto Ridge US Onshore % PPA, 100% PTC Limondale AUS Solar % Green Certificates Stawiec PL Solar 1 100% 1 H CfD Total 1,608 1,256 1 Construction pipeline as of 31 December Including pre-construction/preparation works. Note: Rounding differences may occur. 16

18 APPENDIX Renewables capacity overview (pro-rata view) As of 31 December 2018 Megawatt (MW) Onshore Offshore Hydro Biomass Biogas Solar PV Total Germany ,249 United Kingdom ,088 Ireland Spain Netherlands Poland Italy France Portugal Belgium Total 1,907 1, ,531 Note: Rounding differences may occur. 17

19 APPENDIX Overview average net revenues per technology and country Average net revenue in /MWh 1 Offshore Onshore Wind Wind Hydro Total United Kingdom Germany Netherlands Poland Italy Spain France Portugal Ireland Accounting view. By net revenue (2018); net revenues defined as gross revenues minus sales cost. 18

20 APPENDIX Renewables other operational KPIs Accounting view Wind Onshore Germany 18% 18% United Kingdom 26% 25% Spain 26% 24% Netherlands 27% 26% Poland 28% 24% Ireland - - Italy 21% 19% Average load factor 24% 23% Load factor Wind Offshore Germany 37% 33% United Kingdom 40% 36% Average load factor 39% 35% Hydro Germany 44% 43% United Kingdom 26% 24% Spain 9% 24% France 28% 29% Portugal 15% 28% Average load factor 38% 38% Wind Onshore Germany 1,013 1,013 United Kingdom Spain 1, Netherlands Poland Italy Ireland - 7 Total production volume 4,214 4,141 Production volumes (GWh) Wind Offshore Germany United Kingdom 2,242 1,981 Belgium - - Total production volume 3,187 2,839 1 Load factor defined as production volume divided by maximum possible volume based on capacities at end of year. Hydro Germany 1,454 1,436 United Kingdom Spain France Portugal Total production volume 1,796 1,793 19

21 APPENDIX Retail B2C customer number development Total customers ( 000) Germany Eastern Europe NL/BE UK Thereof: electricity customers ( 000) 16,019 (1.4)% 15,789 (2.6)% 15,378 22,821 (1.9)% 22,396 (3.6)% 21,597 2,898 2,799 2,435 2,401 2,336 2,252 4,897 4,727 4,071 3,990 4,091 4,178 6,730 6,563 6,515 4,470 4,349 4, Dec Dec Dec 18 5,423 5,502 5,555 Thereof: gas customers ( 000) 6,801 (2.8)% 6,608 (5.9)% 6,218 1,999 1,929 1,636 8,031 7,819 7, Dec Dec Dec 18 2,068 2,012 1,934 1,433 1,411 1,378 1,301 1,256 1, Dec Dec Dec 18 20

22 APPENDIX ESG our achievements in 2018 Our progress in 2018 innogy supports the Task Force on Climate-related Financial Disclosures; first disclosures in innogy s 2018 Annual report innogy is committed to all Sustainable Development Goals (SDGs) of the United Nations; main impact on SDG 7, 9 and 13, which are included in innogy s Green Bond Framework In 2018 innogy scored an A in the MSCI 1 ESG rating Selected sustainablility KPIs Nonfinancial KPIs Expansion on renewables capacity 3,955 MW 3,864 MW CO 2 -emissions (EU ETS) 0.52 million t 0.63 million t LTIF SAIDI (DE) 3 not yet available 13.4 min/customer Purchase volume covered by innogy Code ofconduct 100 % 99.8 % Further information on non-financial topics and KPI disclosures are in our Sustainability report MSCI = Morgan Stanley Capital International. 2 Lost Time Incident Frequency (number of accidents with at least one day of absence for each million hours worked). 3 System Average Interruption Duration Index. In 2016 it was 14.2 min/customer (Electricity Germany). 4

23 APPENDIX Overview of senior bonds and loans As of 31 December 2018, by maturity Senior bonds Issuer Notional amount (LCY 1, million) Carrying amount (in EUR million) Coupon (%) Maturity innogy Finance B.V. EUR 1,000 1, Jan 19 innogy Finance B.V. EUR Jan 20 innogy Finance B.V. GBP Apr 21 innogy Finance B.V. EUR 1,000 1, Aug 21 innogy Finance B.V. GBP Jul 22 innogy Finance B.V. EUR Nov 22 innogy Finance B.V. GBP Dec 23 innogy Finance B.V. EUR Jan 24 innogy Finance B.V. EUR Apr 25 innogy Finance B.V. EUR May 26 innogy Finance B.V. EUR Oct 27 innogy Finance B.V. EUR 1, Jul 29 innogy Finance B.V. GBP Jun 30 innogy Finance B.V. EUR Feb 33 innogy SE USD Apr 33 innogy Finance B.V. GBP Jan 34 innogy SE EUR Oct 37 innogy Finance B.V. GBP 1,000 1, Jul 39 innogy SE JPY 20, Feb 40 innogy SE EUR Dec 42 innogy SE EUR Feb 43 Total 13, Loans from RWE 5 Instrument Notional amount (LCY 1, million) Carrying amount (in EUR million) Coupon (%) Maturity Intercompany loan6 EUR Mar 19 Intercompany loan6 EUR Oct 20 Total 1, Loans from EIB Instrument Notional amount (LCY 1, million) Carrying amount (in EUR million) Coupon (%) Maturity EIB loan EUR Oct 20 EIB loan GBP Feb 23 Total 1, thereof: step-up effect 44 thereof: step-up effect 614 Note: Rounding differences may occur. 1 Local currency. 2 Swapped in Euro: JPY20,000m in 159m. 3 Interest rate after swap in Euro. 4 Notional-weighted average coupon. 5 One additional loan of 18m not included. 6 Related to hybrids issued by RWE. 22

24 IR contacts Holger Perlwitz Fixed Income T holger.perlwitz@innogy.com Verena Nicolaus-Kronenberg T verena.nicolaus-kronenberg@innogy.com Tobias Harburg T tobias.harburg@innogy.com Marisa Weiskirch T marisa.weiskirch@innogy.com Britta Wöhner T britta.woehner@innogy.com Martin Jäger T martin.jaeger@innogy.com Sandra Schuck T sandra.schuck@innogy.com 23

25 Financial calendar 2019 and important links Financial calendar 2019 Important links 30/04/2019 Annual General Meeting 06/05/2019 Dividend payment 14/05/2019 Q statement 09/08/2019 Half-year report /11/2019 9M 2019 statement innogy factbook innogy investor presentation Financial reports Bonds Sustainability report Corporate Governance 24

26 Notice This document contains forward-looking statements. These statements are based on the current views, expectations, assumptions and information of the management, and are based on information currently available to the management. Forward-looking statements shall not be construed as a promise for the materialisation of future results and developments and involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those described in such statements due to, among other things, changes in the general economic and competitive environment, risks associated with capital markets, currency exchange rate fluctuations, changes in international and national laws and regulations, in particular with respect to tax laws and regulations, affecting the Company, and other factors. Neither the Company nor any of its affiliates assumes any obligations to update any forward-looking statements. 25