Analytikerpresentasjon Third-quarter kvartal 2010 presentation to analysts

Transcription

1 Analytikerpresentasjon Third-quarter kvartal 21 presentation to analysts Hafslund ASA 15. juli 21 Christian Berg, CEO Hafslund ASA 28 October 211 Christian Berg, CEO

2 Highlights third quarter 211 Strong third-quarter cash flow: NOK.9 billion for repayment of interest-bearing debt. Hydropower reservoir content in south-eastern Norway continued to improve due to considerable precipitation. High hydropower production: 22 percent above normal for the quarter. Hydropower sales price: NOK.25 per kwh, down 31 percent from Q3 21. Effect of REC investment s share price development on operating profit: minus NOK 36 million (Q3 21: NOK million). Sale of Cogen and Network Norway shareholdings frees up NOK 534 million of capital. s.2

3 EBITDA third quarter Hydropower District Heating Network Power Sales Venture REC Other Activities EBITDA s.3

4 EBITDA and power price development most recent three years * 12-month rolling EBITDA vs. wholesale power prices 3 NOK million øre/kwh 55 5 EBITDA most recent 3 years reflect: Core business activities: up NOK 581 million Q Q Q Q Q Q Q Q Q Q Q Q Q Bioenergy cost expansion: NOK 29 million Power prices and the Network business regulated income ceiling are key value drivers. EBITDA sensitivity: a NOK.1 per kwh change in wholesale power prices results in an approximately NOK 36 million annual change in EBITDA. Sale of the fiber optic network business in Q4 21 reduced EBITDA by about NOK 12 million EBITDA Power prices s.4 * EBITDA excluding profit effect of share investments and interest and currency derivatives (in NOK million). Power price achieved by Hafslund s Hydropower business

5 Interest-bearing debt: down NOK.9 billion in 3Q 211 Net interest-bearing debt and equity ratio Change in interest-bearing debt in Q3 211 Amounts in NOK million NOK billion Equity ratio in % Net interest-bearing debt EBITDA Interest paid -81 Change in market value of financial instruments 366 Redused working capital 64 6 Investments Net capital freed up, shares, loan portfolio adj., et Payment of dividend Net interest-bearing debt Q3 21 Q4 21 Q1 211 Q2 211 Q3 211 s.5

6 Working capital seasonal variation Working capital and power prices NOK million øre/kwh Seasonal variation in working capital driven by both volume sold and prevailing power prices. June through September is typically the least working-capital intensive period. 5-5 sep.9 dec.9 mar.1 jun.1 sep.1 dec.1 mar.11 jun sep.11 Working capital reduced an additional NOK.6 billion in Q GWh Working capital Average power price Hafslund Power Sales volume sold October launch of monthly billing of customers invoiced for both Power Sales and Network grid rental will trim working capital requirements Q3 9 Q4 9 Q1 1 Q2 1 Q3 1 Q4 1 Q1 11 Q2 11 Q3 11 s.6

7 Hydropower NOK million Q3 11 Q3 1 YTD 11 YTD 1 Operating revenue EBITDA Operating profit Sales price (NOK/kWh) Production volume (GWh) Investments Profit and operating revenue figures reflect higher power production and lower power prices than in Q3 21. Production: 22 percent greater than in normal production. Nord Pool Spot (NO1) spot price: NOK.25 per kwh (Q3 21: NOK.36 per kwh). EBITDA per quarter EBITDA rolling 12-month Projected fourth-quarter 211 generation: approximately 775 GWh; anticipated volume is 9 GWh or 13% above normal for the fourth quarter Q3 9 Q4 9 Q1 1 Q2 1 Q3 1 Q4 1 Q1 11 Q2 11 Q3 11 s.7 EBITDA EBITDA rolling 12-month

8 Hydropower production profile GWh Jan Feb Mar Apr Mai Jun Jul Aug Sep Okt Nov Des Mean* s.8 *Mean = 3,1 GWh based on 1-year average production adjusted for capacity improvements.

9 District Heating NOK million Q3 11 Q3 1 YTD 11 YTD 1 Operating revenue EBITDA Operating profit (26) (22) 7 13 Gross margin (NOK/kWh) Production volume (GWh) Investments Q3 is the seasonally weakest quarter; deliveries are typically 1 percent of normal annual production. District heating delivery increased due to organic growth. Contribution margin per kwh: down NOK.5 per kwh due to lower power prices compared with Q3 21. EBITDA per quarter EBITDA rolling 12-month New customer tie-ins in first nine months of 211: total annual energy outtake of 39 GWh. Investments in Q3 211 are for increased renewable energy production capacity: 36 percent, and customer tie-ins: 64 percent. Q3 9 Q4 9 Q1 1 Q2 1 Q3 1 Q4 1 Q1 11 Q2 11 Q3 11 EBITDA EBITDA rolling 12-month s.9

10 District Heating energy sources and unit cost Energy prices (NOK/kWh) Q3 1 Q4 1 Q1 11 Q2 11 Q3 11 Waste & biofuel Heat pumps Biooil and biodiesel Electricity Oil/natural gas Total production cost District Heating incl. Distribution Gross contribution margin High proportion of base load (waste) resulted in low per-kwh production costs in Q Production costs depend on energy sources used and price differentials. Proportion of electricity and renewable energy sources: up 6 percentage points to 8 percent in last 12 months GWh % 9 8 Reliance on renewable inputs increased due to burning bio-oil as peak load energy source and start-up of new incineration line at Oslo s EGE plant Proportion of renewables to increase further in 212: Q3 1 Q4 1 Q Q Q new EGE incineration line at full production capacity 1 MW bio-oil-fueled boilers on line as of January 212 s.1 Oil/natural gas Electricity Bio-oil & bio-diesel Heat pumps Waste & biomassmasse % electricity and renewable energy sources (rolling 12-mo 56 MW wood-fueled boiler capacity Q4 212.

11 District Heating production profile GWh Jan Feb Mar Apr May Jun Jul Aug 67 6 Sep 13 Oct Nov Dec Mean* s.11 * Mean = projected 211 production given normal temperatures (1-year average) and current and planned customer tie-ins to the grid.

12 Network NOK million Q3 11 Q3 1 YTD 11 YTD 1 Operating revenue EBITDA Operating profit Investments High supply reliability: slight increase in number of service interruptions, but shorter duration and less impact. Outage penalty (KILE) expenses down 1 percent compared with Q3 21. EBITDA per quarter 35 EBITDA rolling 12-month 1 2 EBITDA level: slightly over NOK 1 billion in most recent 12 months Operating profit for 211 is projected at nearly NOK 5 million. Low interest rates on benchmark Norwegian government bonds. 5 2 Q3 9 Q4 9 Q1 1 Q2 1 Q3 1 Q4 1 Q1 11 Q2 11 Q3 11 EBITDA EBITDA rolling 12-month s.12

13 NVE s use of 5-year Norwegian government bond interest rates and Network s real interest expense NVE determines that Network s loan interest expenses are less than or equal to the average interest on 5-year Norwegian government bonds plus a credit risk premium of 75 basis-points. For the years 22 through 27, the differential between 5-year government bond interest rates and swap interest averaged 52 basis points. In 28 through Q3 211, the average differential rose to 97 basis points. Network pays an additional credit risk premium of some 125 basis points above prevailing swap interest for a 5-year loan. The projected imbalance for 211 between Network s interest expenses on a 5-year loan and the amount NVE s regulatory model allows is roughly 1.6 percentage points. NVE has notified it will re-examine how it determines loan interest expenses. s.13

14 Power Sales NOK million Q3 11 Q3 1 YTD 11 YTD 1 Operating revenue EBITDA Operating profit Investments Revenue decline due to lower prices for wholesale power contracts traded via Nord Pool Spot. Currently 863 Power Sales customers via wholly or partly owned companies, up 1% in Q EBITDA per quarter EBITDA rolling 12-month Satisfactory underlying performance in a seasonally weak quarter. However, Q3 211 profit charged NOK 47 million due to change in market value on portfolio of power derivatives Power Sales Q3 211 after-tax profit: NOK 15 per customer Q3 9 Q4 9 Q1 1 Q2 1 Q3 1 Q4 1 Q1 11 Q2 11 Q3 11 EBITDA EBITDA rolling 12-month s.14

15 Heat and Bioenergy NOK million Q3 11 Q3 1 YTD 11 YTD 1 Operating revenue EBITDA (12) (42) (1) (44) Operating profit (22) (58) (29) (76) Energy production (GWh) Sales price (NOK/kWh) Used waste (thousand tonns) Investments Heat (energy recovery facilities): EBITDA: NOK 7 million, up NOK 3 million from Q3 21. Satisfactory capacity utilization: 24% increase in power generation. Waste-derived energy recovery comprises 42% of revenues. Challenging market conditions persist that restrict access to waste. Bioenergy (wood pellets production): Pilot production begun: 2,7 metric tons of pellets sold late in Q EBITDA: NOK -19 million (NOK -47 million) in Q Gradual increase in capacity utilization in 212. s.15

16 Venture NOK million Q3 11 Q3 1 YTD 11 YTD 1 Operating revenue EBITDA Operating profit REC effect on EBITDA (36) (924) (1 991) Capital employed (excluding REC investment) Energy-efficiency technologies & other investments 14% NOK 534 million in capital freed up via sale of Network Norway and Cogen shareholdings. Capital employed, excluding REC: NOK 3 million after the abovementioned share divestiture. Further REC investment value decline results in NOK 36 million charge to operating profit in Q REC investment: 89. million shares or 8.93% shareholding market value: NOK 467 million (at NOK per share). Telecom 31% 48% Advanced Metering Systems (AMS) Renewable energy 7% s.16

17 Group profit and loss account NOK million Q3 11 Q3 1 YTD 11 Operating revenue (452) Cost og energy (1 231) (1 563) 332 (7 152) Gross margin (12) 3 44 Gain/loss financial items (377) 45 (422) (911) Operating expenses (522) (524) 2 (1 591) EBITDA (54) 938 Depreciation (23) (222) 19 (64) Operating profit (64) 457 (521) 335 Interest expences (123) (117) (7) (381) Market value change loan portfolio (66) (29) (37) (114) Financial expenses (189) (145) (44) (495) Pre-tax profit (253) 312 (565) (16) Tax (61) (164) 13 (341) Profit after tax (314) 148 (462) (52) Earnings per share (EPS) in NOK (1.61).76 (2.37) (2.57) s.17

18 Group balance sheet NOK million Intangible assets Fixed assets Financial assets (412) Accounts receivables and inventory (364) Cash and cash equivalents Assets (31) Equity (incl. Min. int.) (311) Allocation for liabilities Long-therm debt (338) Other currently liabilities (132) Short-term debt Equity and liabilities (31) Net interest-bearing debt (877) Equity ratio 33 % 33 % -1 % 35 % s.18

19 s.19 We deliver the energy solutions and infrastructure of the future

20 Additional analytic information

21 Earnings per share (excluding REC) By quarter NOK s.21

22 Group cash flow statement NOK million Q3 11 Q3 1 YTD 211 EBITDA (54) 938 Paid intrests (81) (92) 11 (413) Paid tax (192) Marketvalue changes and other liquidity adjustments 398 (33) Change in working capital, etc Total cash flow from operations Net operations and expansion investments (288) (498) 21 (776) Sold operations Portfolio changes Venture, etc Cash flow from investments activities (187) (46) Cash flow to down payments and interests s.22

23 Capital employed and return on capital employed Distribution of capital employed Return on capital employed (excl. REC) Market 5% REC 2% 21% Power production 11.5% 2.5 % 1.6% 2.5 % 3% Venture 6.% Network 43% 5% Heat and Bioenergy 9. % 8.1 % 22% District Heating 29 21* 211* * Return on capital employed (ROCE) in 21, of which 9.% is exclusive of the Hafslund Fibernett sales gain and the Biowood Norway write-down in Q s.23 ** Rolling 12-month return on capital employed in 211 of which 8.1% is exclusive of the Hafslund Fibernett sales gain and the Biowood Norway write-down in Q

24 Capital structure development NOK billion Equity ratio in % Q3 9 Q4 9 Q1 1 Q2 1 Q3 1 Q4 1 Q1 11 Q2 11 Q3 11 Net interest-bearing debt Equity ratio s.24

25 Loans portfolio data Debt maturity profile NOK million Portfolio data Q3 11 Q2 1 Bonds 49 % 47 % 2 % Certificate loans 5 % 6 % -1 % Other loans 46 % 47 % -1 % Certificate loans Bond loans Other loans Loans at maturity, next 12 months NOK million Nominal value - market value of loans Market value interest rate swaps Average interest incl. derivatives Q3 11 Q % 4.4 %.1 % Proportion of loan portfolio with fixed interest Loans at maturity next quarter (NOK million) Unused drawing facilities (NOK million) 48 % 45 % 3 % Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep s.25 Certificate loan Bond loans Other loans

26 Power and CO2 price development 14 EUR EUR/MWh 2 EUR/tCO2 Oct.9 jan.1 apr.1 jul.1 Oct.1 jan.11 apr.11 jul.11 Oct.11 jan.12 FWD 214 FWD 212 CO2 211 Nordic spotmarket s.26 Source: (as of 3 September 211)

27 Hydropower Glomma waterway flow 3 m3/sec jan feb mar apr may jun jul aug sep oct nov dec Max. capacity utilization s.27 Q3 211 production: 22 percent above normal for the reporting period. Water influx above maximum capacity utilization of 1 m³ throughout the quarter. Projected Q4 211 production: about 775 GWh (approx. 9 GWh above normal for the reporting period). provided normal reservoir levels and precipitation.

28 Other Activities NOK million Q3 11 Q3 1 YTD 11 YTD 1 Support (29) (3) (1) (89) Power trading (2) () (21) 6 Real estate Billing and customer service Financial derivatives, ass. comp Operating profit other s.28

29 Key figures Group YTD 211 YTD 21 Capital matters Total assets Captial employed Equity Market capitalization Equity ratio 33 % 35 % Net interest-bearing debt Profitability excl. REC Profit after tax (52) (1 37) Earnings per share (EPS) (2.57) (7.2) Cash flow per share District Heating YTD 211 YTD 21 Capital employed Sales price (NOK/kWh).76.7 Gross margin (NOK/kWh) Sales volume (GWh) Power Generation YTD 211 YTD 21 Capital employed Sales price (NOK/kWh) Production volume (GWh) Network YTD 211 YTD 21 Capital employed Annual Income ceiling NVE-capital (regulatory) Power Sales YTD 211 YTD 21 Capital employed of this working capital Total volume (GWh) Venture YTD 211 YTD 21 Capital employed exl REC Market value REC s.29

30 Definitions Navn Definisjon Group Capital employed Equity + Net interest-bearing debt + Net tax positions Equity ratio (in%) (Equity incl. Minority interests / Total assets) X 1 Earnings per share Profit after tax / Average no. of shares outstanding Cash flow per share Net cash from operations / Average no. of shares Return on equity Result after tax / Average equity (incl. Minority interests) Return on capital employed Operating profit / (Average equity + Net interest-bearing debt + Net tax positions) Power generation Mean production Average power generation over the past 1 years. s.3

31 Shareholders as of 3 September 211 # Shareholder Shareholding in thousands Class A shares held Class B shares held Total Ownership Share of voting rights 1 City of Oslo % 58.5 % 2 Fortum Forvaltning AS % 32.8 % 3 Østfold Energi AS % 4.5 % 4 Odin Norden %. % 5 MP Pensjon PK %. % 6 Odin Norge %. % 7 Folketrygdfonet %.1 % 8 Hafslund ASA %. % 9 AS Herdebred %.1 % 1 New Alternatives Fund, Inc %.3 % Total, 1 largest shareholders % 96.3 % Other shareholders % 3.7 % Total % 1 % s.31 Merk: Antall 1. aksjer

32 Investor information Additional information is available from Hafslund s website: You can subscribe to Hafslund press releases Group SVP & CFO, Finn Bjørn Ruyter Finn.bjorn.ruyter@hafslund.no Tel: SVP Communications and Corporate Social Responsibility, Karen Onsager karen.onsager@hafslund.no Tel: Financial Director and Investor Relations contact, Morten J. Hansen mjh@hafslund.no Tel: s.32

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