Annual Media Conference Olten, 26 March 2018

Transcription

1 Olten, 26 March 2018

2 Agenda 1. Demanding environment 2. European business supports Swiss production 3. Financial results 4. Focus on core business 5. Outlook 6. Questions and answers Alpiq Holding Ltd. 2

3 Power production impacted by low wholesale prices and currency effects EUR/CHF EUR/MWh EUR/MWh Ø Terminpreise mit Hedge-Level CH Ø Spotpreise Terminpreise DE (Stichtag ) SNB decision from 2015 has negative currency effect with a time lapse As expected, consequences of the decision to discontinue the minimum EUR exchange rate 2015 evident in 2017 Ø hedging rate 2015: CHF 1.19/EUR 2016: CHF 1.19/EUR 2017: CHF 1.04/EUR Drop in wholesale prices leads to lower hedge level Ø hedge level 2015: EUR 54/MWh 2016: EUR 47/MWh 2017: EUR 44/MWh Forward prices at low level in short/medium term Ø forward prices from 2019 to 2021: EUR 37/MWh (CAL Base DE) EUR 41/MWh (CAL Base CH) Forward prices as at reporting date 30 Jun 2017 Ø forward prices from 2019 to 2021: EUR 29/MWh (CAL Base DE) EUR 34/MWh (CAL Base CH) Alpiq hedges energy and currency in advance on a rolling two- to three-year basis on average Alpiq Holding Ltd. 3

4 Asymmetry on the Swiss electricity market distorts competition 20.2 Rp/kWh End customer price (household) in regulated Swiss market (including grid and compensatory feed-in remuneration) Rp/kWh 6.5 Rp/kWh 5.2 Rp/kWh 3.5 Rp/kWh 1 ElCom (2017), median values 2 Swisselectric 3 Gösgen and Leibstadt nuclear power plants five-year average with long-term fund performance 4 Cal-17 Baseload CH (average from 1 Jan 2016 to 31 Dec 2016) Energy price for end customers in regulated market 1 Hydropower production costs 2 Nuclear power production costs 3 Wholesale price 4 Nuclear power Hydropower Regulated end customer price Decommissioning and waste disposal funds Taxes and duties Amortisation and financing Operation and maintenance Compensatory feed-in remuneration Duties Grid utilisation fee Energy price Power production operating at a loss in the partially liberated Swiss market Alpiq Holding Ltd. 4

5 European business supports Swiss production Alpiq increases net revenue to CHF 7.2 billion EBITDA before exceptional items of CHF 301 million Net debt reduced from CHF 0.9 billion to CHF 0.7 billion Liquidity of CHF 1.4 billion at sound level International energy business generates more than 60% of earnings Swiss business impacted by wholesale prices and currency effects Spin-off and sale of the industrial business creates added value and strengthens core business No more net debt thanks to sales proceeds of CHF 850 million Alpiq Holding Ltd. 5

6 2017 Key Financial Figures Net revenue +18% EBITDA Net income Operating cash flow Net debt 82-24% >100% -17% CHF million 6, FX effect 7, FX effect >-100% FX effect Dec Dec 2017 Results of operations before exceptional items (EI) Higher net revenue mainly attributable to trading and sales activities in Market France As announced, EBITDA of CHF 301 million down on the previous year Operating Cash Flow significantly improved, i.a. due to active capital management Net debt reduction of CHF 142 million compared to the end of 2016 Alpiq Holding AG 6

7 Development of EBITDA Results from Swiss electricity production lowers results -24% CHF million EBITDA 2016 before EI FX Hedges Price effect KKL downtime Production volumes Portfolio Switzerland International Thermal Production & RES Trading & Commerce Gotthard project 2016 Cost reduction and efficiency improvement Various EBITDA 2017 before EI and FX effect FX effect EBITDA 2017 before EI Alpiq Holding AG 7

8 EBITDA development by business division (I) Generation Switzerland burdened by external factors CHF million Generation Switzerland Negative exchange rate effects caused by expiring hedges Wholesale prices below production costs Unscheduled extension of the maintenance work and an imposed power reduction at the Leibstadt nuclear power plant Lower production volumes -180 EBITDA 2016 before EI Business development FX effect EBITDA 2017 before EI Result Generation Switzerland Results of partner power plants (consolidated in full and using the equity method) include O&M, amortisation and depreciation, taxes and fees as well as capital costs, either at the partner power plant or at Alpiq directly Alpiq Holding AG 8

9 EBITDA development by business division (II) CHF million Digital & Commerce Successful use of price volatilities in Italy and Eastern Europe Sales activities in Market France up on the previous year 56 Optimisation of power plant portfolio in CH and Spain below previous year No contribution form AVAG after disposal in July 2016 CHF million Industrial Engineering Contributions from Thermal Production and RES up on the previous year Margins in energy and power plant technology down on the previous year Increasing demand in the area of dismantling nuclear facilities CHF million 63 EBITDA 2016 before EI -8 Business development 1 FX effect 56 EBITDA 2017 before EI Building Technology & Design Significant increase in order intake and order backlog Decrease in EBITDA attributable to the successful completion of the Gotthard Base Tunnel project in the previous year Positive contribution to earnings from acquisition of Lundy Projects Ltd. Alpiq Holding AG 9

10 Continuing operations Swiss production supported by European business EBITDA before EI continuing operation Increased contribution from thermal production and RES CHF million 2016 Therm. Production / RES 2017 Stronger results from international production Negative exchange rate effects caused by expiring hedges, wholesale prices below production costs Digital & Commerce Generation Switzerland Alpiq Holding AG 10

11 Development of net income CHF million Current income tax expense: higher tax expense on account of higher earnings Deferred income tax expense: one-off effect from tax rate reduction in previous year Fewer tax loss carryforwards recognised Higher deferred tax liabilities from temporary measurement differences Net income 2016 before EI Delta at EBITDA level before EI Depreciation, amortisation and impairment Share of results of partner power plants and other associates Financial result Income tax expense Net income 2017 before EI and FX effect FX effect Net income 2017 before EI Alpiq Holding AG 11

12 Change in cash flow from operating activities 2017 compared to CHF million Cash flow from operating activities 2016 Depressed operating profitability (EBITDA before EI) Payment due to change in method nuclear funds 2016 Compensation from Swissgrid in 2017 Balance sheet management Cash flow from operating activities 2017 Alpiq Holding AG 12

13 Statement of cash flows CHF million 1,524 Purchase of Lundy Projects Ltd. Capital increase Nant de Drance SA Investments in fixed assets 1,403 Liquidity as at 1 Jan 2017 Cash flow from operating activities CAPEX Dividends from partner power plants and interest received Proceeds from disposals Repayment of financial liabilities Interest paid Distribution to hybrid investors/ Dividend paid Currency translation differences Liquidity as at 31 Dec 2017 Alpiq Holding AG 13

14 Maturity profile as at 31 December 2017 Financial liabilities staggered over long term 1,403 Total: CHF 2,117 million CHF million Dec ff Liquidity Bank loans and margining Private placements Bonds Maturities are countered by a sound liquidity base of around CHF 1.4 billion Maturity profile staggered over long term without significant spikes Further systematic reduction of debt in the pipeline Alpiq Holding AG 14

15 Financial liabilities Debt situation improved significantly 4.0 3, CHF million 997 2, , , Net debt EBITDA before exceptional items Net debt/ebitda before exceptional items Net debt further reduced by CHF 142 million to CHF 714 million Net debt/ebitda before exceptional items of 2.4 Alpiq Holding AG 15

16 Development debt situation after closing of the transaction 2,117 2, CHF million 1, Gross debt Liquidity ff Bank loans and margining Private placements Bonds Sales proceeds for InTec and Kraftanlagen Group of CHF 850 million Net debt becomes Net liquidity of CHF 136 million Alpiq Holding AG 16

17 Balance Sheet remains stable Alpiq with sound liquidity and stable equity 38.8% 38.9% 10,008 10,197 12% 42% 33% 61% 7% 54% Sound liquidity: CHF 1.4 billion Stable equity: CHF 4.0 billion 58% 39% 55% 39% Equity ratio at 38.9% Assets held for sale Current assets Non-current assets Liabilities Total equity Equity ratio Alpiq Holding AG 17

18 Tax audit in Romania Assessment of Alpiq Energy SE, Prague, issued by Romanian tax authority ANAF in the amount of RON 793 million (CHF 199 million) for the period of 2010 to 2014 Alpiq has contested on account of its reasoning and the extent of the amount assessed Alpiq currently deems it unlikely that this assessment will result in a negative outcome for the company No liability (provision) of RON 793 million recognised; secured by a bank guarantee in the amount of CHF 202 million; disclosed under non-current term deposits Alpiq Holding AG 18

19 Stringent cost and balance sheet management dampens the decrease in earnings Currency effect & effects of low wholesale prices Lower results in Swiss portfolio Price effect Negative currency hedging effect of CHF -77 million Negative effect of wholesale prices CHF -44 million Downtime at Leibstadt nuclear power plant Results negatively affected by the unscheduled downtime Volume effect Net negative effect of CHF -11 million in 2017 Cost savings introduced Processes and systems sustainably simplified Complexity that had developed over time reduced Nearshoring continued Efficiency improvement Cost savings A total of around CHF 400 million saved as a result of cost-reduction and efficiency improvement Capital management intensified Intensive capital management Sale of Engineering Services business Net debt free Net debt Portfolio streamlining Net debt reduced to CHF 714 million ( ) Net liquidity of CHF 136 million free after closing Stable equity ratio of 38.9% Alpiq Holding AG 19

20 Alpiq splits off industrial business for CHF 850 million Generation Switzerland Digital & Commerce International thermal power production Industrial Engineering Building Technology & Design New renewable energies Kraftanlagen Group InTec Group 1,550 employees 7,650 employees, of which 4,420 are in Switzerland Transaction creates significant added value for the Alpiq Group and strengthens its core business New prospects with international industrial owner Alpiq Holding Ltd. 20

21 Alpiq focuses on the core business Production Swiss production Marketing Asset optimisation Digital & Commerce Customers Utilities International thermal production International electricity trading Industry and commerce New renewable energies Origination and retail Grid operators Decentralised production by third parties Digital solutions Prosumer Alpiq Holding Ltd. 21

22 2018 remains challenging Low wholesale prices continue to put Swiss production under pressure Slight relief for Swiss hydropower through market premium International energy business generates positive contributions to support Swiss production Alpiq Holding Ltd. 22

23 Recovery on the horizon in the medium to long term EUR/MWh EUR/t CHF/EUR CH Power Price CH Base Cal-19 CH Base Cal-20 CH Base Cal EUA Price (CO 2 ) EUA Cal-19 EUA Cal-20 EUA Cal-21 FX CHF EUR CHFEUR Cal-19 CHFEUR Cal-20 CHFEUR Cal-21 Alpiq Holding Ltd. Slightly positive development on the markets Marginal recovery in electricity and CO 2 prices Positive effect from CHF/EUR exchange rate with a time lapse Policy-makers recognise need for action Full liberalisation of the electricity market would correct market asymmetry New market model and water tax regulations would make it possible to operate economically with hydropower EU electricity accord would secure international market access for hydropower 23

24 Alpiq is fit for the future Successful divestment creates significant added value for the Group No more net debt thanks to sale proceeds of CHF 850 million Focus on core business: Generation Switzerland, Digital & Commerce, international thermal production, new renewable energies Positive developments on markets (electricity/co 2 prices) and regarding regulation (hydropower) in the medium/long term Opportunities in the areas of decarbonisation, decentralisation and digitalisation Alpiq Holding Ltd. 24

25 You ask. We answer.

26 Organisation prior to closing General Management CEO Jasmin Staiblin 1 Generation Switzerland Michael Wider 1 Digital & Commerce Markus Brokhof 1 Industrial Engineering Reinhold Frank 1 Building Technology & Design Peter Limacher 1 Financial Services CFO Thomas Bucher 1 Hydro Power Generation Christian Plüss smart Energy West Michel Kolly Nuclear Decommissioning Hans Genthner Building Technologies Switzerland Peter Limacher Accounting & Controlling Edgar Lehrmann Legal & Compliance Peter Schib Nuclear Power Generation Michaël Plaschy smart Energy East Peter Dworak Power & Heat Matthias Zwicky Building Technologies Europe Javier Romero Taxes Eva Catillon Human Resources Daniel Huber Digital Technologies & Innovation Hans Dahlberg Industrial Plants Reinhold Frank Transportation Thomas Rapp Treasury & Insurance Lukas Oetiker Communications & Public Affairs Richard Rogers Operations Petter Torp Renewable Energy Sources André Schnidrig M&A and Infrastructure Martin Schindler Risk Management Walter Hollenstein General Management Business Division Business Unit Functional Division Functional Unit 1) Member of the Executive Board Alpiq Holding Ltd. 26

27 Financial calendar May th Annual General Meeting of Alpiq Holding Ltd. (Lausanne) 27 August 2018 Interim results 2018 (Olten) Media Breakfast and Analyst Conference Call Alpiq Holding Ltd. 27

28 Disclaimer This communication contains, among other things, forward-looking statements and information. Such statements include, but are not limited to, statements regarding management objectives, business profit trends, profit margins, costs, returns on equity, risk management or the competitive environment, all of which are inherently speculative in nature. Terms such as "anticipate," "assume," "aim," "goals," "projects," "intend," "plan," "believe," "try," "estimate," and variations of such terms, and similar expressions have the purpose of clarifying forward-looking statements. These statements are based on our current estimates and assumptions, and are therefore to some extent subject to risks and uncertainties. Therefore, Alpiq's actual results may differ materially from, and substantially contradict, forward-looking statements made expressly or implicitly. Factors contributing to or likely to cause such divergent outcomes include, but are not limited to, the general economic situation, competition with other companies, the effects and risks of new technologies, the Company's ongoing capital needs, financing costs, delays in integrating mergers or acquisitions, changes in operating expenses, currency fluctuations, changes in the regulatory environment on the domestic and foreign energy markets, oil price and margin fluctuations for Alpiq products, attracting and retaining qualified employees, political risks in countries where the Company operates, changes in applicable law, the realisation of synergies and other factors mentioned in this communication. Should one or more of these risks, uncertainties or other factors materialise, or should any of the underlying assumptions or expectations prove incorrect, the results may differ materially from those stated. In light of these risks, uncertainties or other factors, the reader should not rely on such forward-looking statements. The Company does not assume any obligation beyond those arising out of law to update or revise such forward-looking statements, or to adapt them to future events or developments. The Company points out that past results are not meaningful in terms of future results. It should also be noted that interim results are not necessarily indicative of the year-end results. This communication is neither an offer nor an invitation to sell or buy securities. Alpiq Holding Ltd. 28