Investor presentation, March 20th 2018

Transcription

1 Investor presentation, March 20th 2018

2 Another year of strong results 2017 ANNUAL RESULTS BKW Growth achieved on all levels: revenue +5%, operating profit +10% and net profit +16% Strong operating cash flow: CHF 493m Successful repositioning of Energy business: EBIT +16% Profitable growth of Services: revenue +30%, EBIT +46% Continued consistent cost reduction CHF m +5% +7% 2,577 2,452* 2,300* CHF m +12% * +10% 309* Operating revenue Operating profit * Comparable figures

3 Financials FY 2017

4 Income statement 2017 ANNUAL RESULTS BKW CHF m FY 2016 reported* One-off effects FY 2016 comparable FY 2017 change comparable in % Operating revenue 2, ,452 2, % Energy procurement/transport Operating costs ,098 EBITDA % Depreciation, amortisation and impairment Income from associates EBIT % Financial result Income taxes Net loss from discontinued operations Net profit % *restated for discontinued operations

5 EBIT development / price effect on revenue 2017 ANNUAL RESULTS BKW CHF m Market price of electricity CHF 670m EUR/MWh EUR/MWh price effect on operating revenue Operating profit increased again despite negative price effect of CHF 140m

6 Cost reduction before acquisitions 2017 ANNUAL RESULTS BKW CHF m , reported cost reduction 2017 before acquisitions acquisitions 2017 reported Significant cost savings before acquisitions: More than CHF 130m in last three years

7 Investments 2017: Successful acquisitions 2017 ANNUAL RESULTS BKW Energy Other Services Investments 60% in growth CHF 265m whereof - Services CHF 155m - Energy (wind & small hydro) CHF 110m Grid CHF 450m 40% in maintenance/replacement CHF 185m whereof - Grid CHF 130m - Energy CHF 35m - Other CHF 20m Energy Investments partner plants CHF 60m 60% invested in growth - in line with long-term capex plan

8 Funds from operations at CHF 465m 2017 ANNUAL RESULTS BKW CHF m year average Consecutive strong funds from operations: investments fully covered by own generated funds

9 Liquidity at CHF 1.2bn 2017 ANNUAL RESULTS BKW CHF m Operating activities Investing activities Financing activities , ,223 Liquidity unchanged at strong CHF 1,2bn despite high investments

10 Sound financial situation: Net debt reduced 2017 ANNUAL RESULTS BKW CHF m 1'500 1' ' ,248 1, Cash & equivalents & current financial assets Financial debt Net financial debt -1'500-2'000-1,687-1,600 Net debt reduced thanks to strong funds from operations despite significant investments

11 Maturity profile of financing 2017 ANNUAL RESULTS BKW CHF m Liquidity CHF 150m CHF 350m Bonds Registered bonds Convertible bond 800 CHF 130m 600 CHF 200m EUR 40m 400 CHF 300m EUR 85m EUR 150m Long-term financing framework ensures financial flexibility

12 Sound balance sheet: equity ratio at 37.5% 2017 ANNUAL RESULTS BKW CHF bn 34.3% 37.5% 2,4 8,6 5,6 2,4 9,1 5,7 6,7 6,2 3, ,4 Non-current assets Current assets Equity Liabilities Equity ratio Increased equity ratio thanks to strong net profit, conversions and FX

13 Share price development and shareholder structure 2017 ANNUAL RESULTS BKW CHF % BKW SPI 37.5% 10.0% 52.5% Canton of Berne Groupe E Ltd. Free float Performance FY 2017: +18%, doubled in 3 years; free float at 37.5% (incl. convertible bond)

14 Dividends 2017 ANNUAL RESULTS BKW CHF dividend per share Pay out ratio Dividend per share Target range of pay out ratio Pay out ratio 80% 70% 60% 50% 40% 30% 20% Increasing dividends reflect successful transformation

15 Operating revenue and EBIT per business area 2017 ANNUAL RESULTS BKW CHF m 1,353* -7% 1, % * +7% % % 736 Operating revenue Operating profit One-off effects % Energy Grid Services *restated for discontinued operations All business areas achieve higher EBIT

16 2017 ANNUAL RESULTS BKW Energy: negative price effects more than compensated CHF m 1,353-5% 1, % Operating revenue Operating profit Negative price effect on revenue: ~CHF -140m Compensated by Acquisition of AEK Investments in power plants (renewable energy) Higher thermal production volumes Overcompensated on EBIT-level by Successful management of energy position (trading) Reduction of expenditures Ongoing transformation of Energy business already successful

17 2017 ANNUAL RESULTS BKW Grid: acquisition of AEK in 2016 leads to increased revenue CHF m % 666 Increased revenue due to acquisition of AEK in 2016 Reduction of operating cost 2016: One-off compensation for expropriation of transmission grid (+CHF 38m) % Operating revenue Operating profit one-off effect EBIT-contribution increased in line with expectations

18 Services: continued strong growth leads to EBIT increase 2017 ANNUAL RESULTS BKW CHF m % 736 Sales over CHF 0.7 billion, up by 30% again 20 acquisitions in 2017 Continued improvement of EBIT-margin despite acquisition and integration cost % Operating revenue Operating profit Expansion on track with margin increase

19 Outlook and strategy update

20 Outlook FY ANNUAL RESULTS BKW BKW expects to successfully continue its transformation Large part of negative energy price effects expected to be compensated through further profitable growth of Services business repositioning of Energy business - aligned to changing market drivers consequent cost management BKW expects FY 2018 operating profit to be in the range of CHF 340 to 360m

21 BKW invests in attractive markets 2017 ANNUAL RESULTS BKW Transform Energy business - Develop Grid - Grow Services We build a robust business model by investing in attractive new markets

22 2017 ANNUAL RESULTS BKW Energy business influenced by changing market structures European power plants: Net increase of installed capacity until 2040 GW 120 Trading: increased volatility and extreme price situations Hours per year with price extremes % tomorrow 10% 30 today solar Solar wind Wind Gas gas Wasser hydro nuclear Kern Kohle coal fluctuating flexible base load <=0 /MWh >100 /MWh Lowest prices Highest prices International market drivers require repositioning of energy business

23 2017 ANNUAL RESULTS BKW BKW well positioned to exploit market opportunities - Transformation of energy trading to capitalize on opportunities in a volatile energy market - Competencies in direct marketing allow optimized and efficient integration of renewable energies in the energy market - Competitive edge with high share of own flexible power plants: - Advantageous geographical location - High flexibility - Competitive prices - Investments in renewable energies: wind & small hydro power BKW successfully adapts its energy business to market changes

24 2017 ANNUAL RESULTS BKW BKW well positioned in growing market of infrastructure services BKW Engineering BKW Building Solutions BKW Network Solutions BKW provides integrated, tailored solutions for customers in increasingly complex systems

25 Growing demand for engineering services 2017 ANNUAL RESULTS BKW Considerable need to invest in improving and expanding infrastructures Resilient business due to diversified customer segments (manufacturing, public sector) Customers need local service providers with capability to operate complex projects BKW - Successful growth: more than 20 acquisitions - Develop strong engineering network of expertise in D-A-CH region Large international players with wide competencies gap BKW Small regional players with limited competencies Strong professional network of regional companies BKW's strong international engineering network meets customer needs

26 2017 ANNUAL RESULTS BKW Growing need for integrated building technology solutions Switzerland: high market volume; fragmented structure Decentralisation of energy production Growing need for integrated solutions, driven by increasing complexity of new technologies Major potential in energy efficiency and need for comfort BKW - Successful growth: already #7 in Switzerland - Professionalism in a highly fragmented market - Regional approach matches industry structure and ensures margins BKW solutions meet market trends: Capability to exploit new market opportunities

27 2017 ANNUAL RESULTS BKW Growing need for maintenance of extensive and widespread network infrastructures Extensive and widespread networks need considerable maintenance Increased complexity of networks requires expertise Water grid: significant needs for maintenance and renovation Largely identical customer base for multi-grid infrastructure services BKW - Successful growth in water grid: two substantial acquisitions - Electricity grid: strong track record with major market share - High competencies enable exploitation synergies of scale Longtime expertise in operating and optimizing complex network infrastructures

28 BKW: a successful network of companies 2017 ANNUAL RESULTS BKW BKW companies combine competencies to provide tailored customer solutions BKW Engineering BKW Building Solutions BKW Network Solutions Exchange of "best in class" processes competencies and tools improves network Joint development and use of technology platforms such as Building information modelling Knowledge data bases Customer relationship management Attractive employer for talents BKW a strong international network of competence in infrastructure services

29 2017 ANNUAL RESULTS BKW Digitialization as an opportunity for profitable growth Mobile Office Knowledge sharing Energy Monitoring Common systems Transparency BIM: Building Information Modelling BKW future CRM Energy efficiency Digital monitoring of Production facilities mybkw.ch Self-consumption communities Optimization of maintenance Home Energy Combine competencies to increase efficiency and grow profitably

30 Next 4 years: total investments of CHF 1.3bn / CHF 600m in growth markets 2017 ANNUAL RESULTS BKW Other Maintenance/ replacement 56% Grid CHF 1.3bn in next 4 years Services Growth 44% Energy Substantial investments planned financed by own cash flow generation

31 Strategic transformation on track 2017 ANNUAL RESULTS BKW Strategic initiative Transform energy Already achieved Align energy trading to volatile market Invest in new renewable energy production Decommission KKM in 2019 Growth of 30% in 3 years, 580 MW installed capacity, 170 MW under constr. Project on track Grow infrastructure services Buildup of services network Improve efficiency and consequent cost management Revenue above CHF 700m, margins improved, 20 acquisitions Buildup of strong network of companies Organization according to market needs Significant reduction of expenditures achieved: -7% / CHF 65m in 2017 BKW strategy delivers

32 BKW well positioned in attractive markets 2017 ANNUAL RESULTS BKW Transform Energy Develop Grid Grow Services BKW capitalizes on changing markets

33 Thank you for your attention

34 Questions?

35 Financial calendar and contact information 2017 ANNUAL RESULTS BKW Financial calendar Annual General Meeting: 18 May 2018 Ex-dividend Date: 23 May 2018 Dividend Payment: 25 May 2018 Publication of 2018 Half-year Results: 4 September 2018 For further information, please contact: Thomas Herren, Investor Relations Officer Tel (+41) investor.relations@bkw.ch

36 Disclaimer 2017 ANNUAL RESULTS BKW This presentation contains forward-looking statements which are made on the basis of current expectations and assumptions. These forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements. Potential risks and uncertainties include, among others, such factors as market and economic conditions, governmental regulations, competitive conditions, interest rates and fluctuation in currency exchange rates. Although BKW believes that its expectations reflected in any such forward-looking statement are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved. BKW undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.