1H 2018 Results. July 25th, Conference call & webcast

Transcription

1 1H 2018 Results July 25th, 2018 Conference call & webcast Date: Wednesday, July 25th, 2018, 15:00 CET 14:00 UK/Lisbon Webcast: Phone dialin number: +44 (0) Phone Replay dialin number: +44 (0) (until August 1st, 2018) Access code: EDP Renováveis, S.A. Head office: Plaza de la Gesta, Oviedo, Spain

2 Table of contents 1H 2018 Highlights Consolidated Financial Statements Asset Base Capital Expenditures and PP&E Operating Performance Financial Performance CashFlow Net Debt and Institutional Partnership Liability Business Platforms Quarterly Data Income Statements Annex Equity Consolidated & Noncontrolling Interest (MW) Remuneration Frameworks Sustainability Highlights Share Performance & Shareholder Structure

3 1H 2018 Highlights Installed Capacity (MW) EBITDA MW Other equity consolidated EBITDA MW + Equity Consolidated Operating Data EBITDA MW metrics Load Factor (%) Output (GWh) Avg. Electricity Price ( /MWh) Consolidated Income Statement ( m) Revenues EBITDA EBITDA/Revenues EBIT Net Financial Expenses Share of profit of associates Noncontrolling interests Net Profit (Equity holders of EDPR) CashFlow ( m) Operating CashFlow Retained CashFlow Net Investments Balance Sheet ( m) PP&E (net) Equity Net Debt Institutional Partnership Liabilities Employees Total Results Highlights 10, , (25) 11,044 10, % 34% (0.1pp) 15,451 14,546 +6% (11%) (7%) (5%) 74% 73% +2pp (7%) (133) (148) (10%) 1 2 (58%) (7%) % % (12%) (1%) 2017 YTD 13,534 13,185 +3% 7,994 7,895 +1% 3,216 2, % 1,121 1,249 (10%) 2017 YTD 1,326 1,220 +9% EDPR managed, by Jun18, a portfolio of operating assets of 11.0 GW spread over 11 countries, of which 10.7 GW fully consolidated and 331 MW equity consolidated (equity stakes in Spain and US). Over the last year, EDPR portfolio increased by 616 MW, of which 66 MW were net added in, 423 MW in and 127 MW in. EDPR produced 15.5 TWh of clean electricity (+6% YoY), avoiding 12.4 mt of CO2 emissions. The increase in production benefitted mainly from the capacity additions (+641 MW EBITDA YoY) with higher expected load factor. The achieved load factor in the was 34% (stable YoY), representing 99% of the longterm average (P50; vs 100% in the ). In the period, EDPR maintained high level of technical availability (97%), however lower YoY( at 97.8%), due to adverse weather conditions in certain regions. Theaveragesellingpriceintheperiodtotalled 53.5/MWh,11%YoYmainlyasaresultofforextranslationand lower YoY prices achieved in (6% YoY; mostly due to Poland and Romania) and (3% YoY;hedgesgainsinandmixeffectfromnewMW).Asaresultofhighergeneration(+6%YoY;+ 66mYoY), lower average selling price (11% YoY; 45m YoY), negative impact from forex translation and other ( 52m YoY) and the 10year life PTCs scheduled expiration of specific tax equity structures ( 34m), Revenues totalled 923m (7% YoY). Operating Costs totaled 293m (+1% YoY), while Core Opex per average MW in operation was 20.3k(1%YoY). In the reported EBITDA summed 686m (5% YoY; +1% YoY exfx), as a consequence, and given stable YoY depreciation and amortization costs, including provisions, impairments and net of government grants, EBIT decreased to 427m(7% YoY). Net Financial Expenses decreased to 133m ( 15m YoY), benefitting from the gain ( 15m) from the sale of a stake in a UK offshore project (1Q18), along with both lower Institutional Partnerships costs ( 8m; 16% YoY in Euros) and Net interest costs( 6m;9% YoY). At the bottom line, Net Profit summed 139m(+4% YoY). Noncontrolling interests in the period totalled 101m, decreasing by 7m YoY as a result of topline performance. In the period, EDPR delivered solid cashflow generation. Following EBITDA cashgeneration, income tax of the period, interests, banking and derivatives expenses and minority dividends/interest payments, Retained CashFlow ( RCF ) totalled 507m. RCF decreased by 67m vs reported in, while increasing + 16m (+3%) vs adjusted. As of Jun18, Net Debt totalled 3,216m (+ 410m vs Dec17) reflecting on the one hand assets cash generated and on the other hand investments in the period, a settlement of a cross interest rate swap in place to hedge the USD investment in the US against forex differences and forex translation. Institutional Partnership Liabilities decreased to 1,121m ( 128m vs Dec17), reflecting the benefits captured by the projects and tax equity partners despite forex translation($191m vs Dec17). 2

4 Consolidated Financial Statements Consolidated Income Statement ( m) Electricity sales and other Income from Institutional Partnerships Revenues Other operating income Operating Costs Supplies and services Personnel costs Other operating costs EBITDA EBITDA/Revenues Provisions Depreciation and amortisation Amortisation of deferred income (government grants) EBIT Financial income/(expense) Share of profit of associates PreTax Profit Income taxes Profit of the period Net Profit (Equity holders of EDPR) Noncontrolling interests (292.7) (159.6) (57.0) (76.1) % (0.3) (266.9) (132.8) (288.8) (155.4) (49.9) (83.5) % (0.4) (270.8) (147.8) 2.5 Assets ( m) (4%) Property, plant and equipment, net 13,534 (24%) Intangible assets and goodwill, net 1,555 (7%) Financial investments, net 307 Deferred tax assets % Inventories 35 +1% Accounts receivable trade, net % Accounts receivable other, net % Assets held for sale 50 (9%) Collateral deposits 40 Cash and cash equivalents 389 (5%) Total Assets 16,637 +2pp Equity ( m) (33%) (1%) Share capital + share premium 4,914 (29%) Reserves and retained earnings 1,326 Net Profit (Equity holders of EDPR) 139 (7%) Noncontrolling interests 1,615 Total Equity 7,994 (10%) (58%) Liabilities ( m) 13,185 1, , (6%) Financial debt 3,645 3,237 Institutional partnerships 1,121 1,249 (54.5) (70.7) (23%) Provisions Deferred tax liabilities (1%) Deferred revenues from institutional partnerships Other liabilities 2,177 2, % Total Liabilities 8,643 8, (7%) Total Equity and Liabilities 16,637 16, ,914 1, ,560 7,

5 Asset Base Installed Capacity (MW) EBITDA MW Spain Portugal France Belgium Poland Romania Italy United States Canada Mexico Total EBITDA MW Equity Consolidated (MW) Spain United States Total Equity Consolidated Total EBITDA MW + Equity Consolidated EBITDA MW Spain Portugal France Belgium Poland Romania Italy US Canada Mexico EDPR ,244 1, ,098 5, , , ,044 YTD Assets Average Age & Useful Life by Country YoY Under Construc ,086 (25) (25) , As ofjun18, EDPR managed a globalportfolio of11.0gwofinstalled capacity spread over 11 countries, of which accounted for 48%, including 2.4 GW in Spain, 1.3 GW in Portugal, 1.6 GW in RoE. accounted for 49%, including 5.2 GW in the US, 0.2 GW in Mexicoand30MWinCanada.Theremaining0.3GWinrepresented3%oftheportfolio. From the global portfolio of 11,044 MW, 10,899 MW are related to wind onshore technology, while the remaining 145 MW comprised solar PV power plants in the US (90 MW), Romania (50MW)andPortugal(5MW). In the EDPR installed 37 MW, all in, namely Italy following Dec16 auction outcome. In the last 12 months EDPR increased its global portfolio by 616 MW, of which 423 MW in, 127 in and 66 MW net in. In, 25 MW net were added in Spain (related to the acquisition of a 50% participation in a Spanish wind farm that was previously accounted as equity), 4 MW in France and 37MW in Italy. In a total of 423 MW were added corresponding to Meadow Lake V (100 MW; Indiana), Redbed Plains (99 MW; Oklahoma), Quilt Block (98 MW; Wisconsin), Hog Creek (66 MW; Ohio) and the solar Cypress Creek (60 MW; South Carolina). In 127 MW were completed related to the JAU and Aventura wind farms. As of Jun18, EDPR had 1.1 GW of new capacity under construction. In 270 MW were under construction, with 68 MW in Spain, 102 MW in Portugal, 26 MW in France and 74 MW in Italy. In the US 679 MW were under construction related to Turtle Creek (202 MW; Iowa), Meadow Lake VI (200 MW; Indiana), Prairie Queen (199 MW; Kansas) and Arkwright Summit (78 MW; New York). In 137 MW were under construction related to the Babilonia wind project. EDPR s portfolio, considering EBITDA MW as of Jun18 had an average age of 7.6 years, in detail EDPR s portfolio in had an average of 8.9 years, 6.9 years in and 3.0 years in. In EDPR s depreciation and amortization schedule considered 30 years ofusefullifeforwindassetsand35yearsforsolarassets. 4

6 Capital Expenditures and PP&E Investments ( m) Other Total Capex Financial investments/(divestments) Government grant Asset rotation proceeds Net Investments Property, Plant & Equipment PP&E ( m) PP&E (net) () PP&E assets under construction (=) PP&E existing assets (net) (42.8) % % (28%) (91) % % (43) (1%) (3) ,534 13, , ,247 12, In the Capex totaled 465m, reflecting the capacity under construction and enhancements in capacity already in operation. Out of the 465m, 231m were in North America, 143m in and 88m were related to growth in. Capex in represented 49% of total Capex in, reflecting EDPR s growth strategy based on markets with stable regulatory frameworks and longterm contracts, providing visibility over future returns. During the period, represented 31% and 19% of total Capex. Total net investments in the, calculated as total capex net of financial investments and divestments(includingthesaledownofa20%stakein a UKoffshorewindfarmfor 36m) and net of government grants and proceeds from asset rotation was 422m( 3m YoY). In the, Net PP&E totaled 13.5bn, 348m higher YTD given investments and forex translations. PP&E includes total investments, capex (gross of government grants) and adjustments from Purchase Price Allocation (resulting from M&A transactions) incurred with existing assets, assets under construction or under development. PP&E in existing assets (net), adjusted for assets under construction, reached 12.2bn. Invested capital on existing assets, adjusted for assets under construction, gross of depreciation and net of government grants received, amounted to 17.1bn by Jun18. As of Jun18, represented 51% of invested capital in existing assets, 47% and accounted for the remaining. Out of the 47% invested capital in existing an assets,21%wererelatedtospain,11%toportugaland15%totherestof. (+) Accumulated Depreciation 5,347 5, () Government Grants (10) (=) Invested capital on existing assets 17,080 16, Capex per Platform Invested Capital on existing assets (1) 19% Other 1% 2% 31% North America 465m 17.1bn 51% Spain 21% Portugal 11% 49% RoE 15% (1) Considers EBITDA MW, with percentages calculated in Euros 5

7 Operating Performance Load Factor Total Renewables Index (vs P50) Electricity Generation (GWh) Total Selling Prices (per MWh) Average Selling Price Electricity Sales and Other ( m) Total Income from Institutional Partnerships ( m) Total Revenues Revenues ( m) Revenues per avg. MW in operation ( k) Note: Operational Performance considers only capacity consolidated at EBITDA level 29% 38% 28% 39% +1pp (1pp) 30% 36% (6pp) 34% 34% 99% 100% (1pp) 6,341 6,041 +5% 8,690 8,191 +6% % 15,451 14,546 +6% (6%) $45.1 $46.5 (3%) R$208.4 R$223.7 (7%) (11%) (1%) (8%) % (4%) (24%) (7%) (13%) 2018 Achieved Load Factor vs Avg. 101% 98% 93% 99% GWh Generation vs previous period +34% +5% +6% In EDPR reached a 34% load factor (flat YoY) reflecting 99% of P50 (long term average 1H) along with capacity additions with higher load factors. In the 2Q18, EDPR reached a 29% load factor(vs31%inthe2q17),withqoqcomparisonimpactedbylowerwindresource(p50of92% in2q18vs99%in2q17). In, EDPR reached a 29% load factor (+1pp vs ), with YoY comparison explained by the outstanding wind resource in Spain and Portugal during 1Q18. During the period, EDPR accomplished a load factor of 30% in Spain (vs 28% in ), above market average (+1pp). In Portugal, EDPR reached a load factor of 31% (vs 28% in ) and higher than expected for an average 1H. In RoE, EDPR delivered a 26% load factor (1pp YoY). In, EDPR achieved a 38% load factor (1pp YoY). In, EDPR reached a 30% load factor during, impacted by the outstanding wind resource in the previous year vs below average resource in the. EDPR produced 15.5TWh ofclean energy in, +6%YoY. Theincreasein production benefits from the capacity additions over the last 12 months (0.6 GW YoY) along with stable YoY wind resource(34%). EDPR s average selling price in the was 53.5/MWh (vs 59.9/MWh in ). In, the realized price decreased by 6% YoY, mainly due to negative price developments in Spain(4% YoY) and the Rest of (16% YoY), primarily in Poland, on the back of substitution fee calculation method and Romania, given that green certificates have halved in 2018 as per regulation announced in In the average selling price in was $45.1/MWh (3% YoY) with YoY comparison impacted by hedging gains in the previous year and to a lesser extent, new capacity additions mix. In the average price decreased 7% YoY to R$208, given mix effect from a new wind farm in operation(production vs price). In electricity sales decreased by 4% to 823m, impacted by forex and lower average selling price. Electricity sales in decreased slightly to 493m (1% YoY) with higher output balancing lower price effect. In, electricity sales decreased by 8% YoY in Euros, driven by unfavorable price development and forex. In, electricity sales increases 1% YoY, with higher generation offsetting price effect and negative forex impact. Income from Institutional Partnerships in Euros decreased 24% to 100m, mainly on the back of scheduled PTC expirations(after 10 year life; 34m) and forex(15% YoY in local currency). AllinallEDPR srevenuesdecreasedby7%to 923mandrevenuesperaverageMWinoperation totalled 87k(vs 99k in ). +6% 6

8 Financial Performance Revenues to EBITDA Revenues ( m) Other operating income Operating Costs Supplies and services (S&S) Personnel costs (PC) Other operating costs EBITDA Efficiency and Profitability Ratios Revenues/Average MW in operation ( k) Core Opex (S&S + PC) /Average MW in operation ( k) Core Opex (S&S + PC) /MWh( ) EBITDA margin EBITDA/Average MW in operation ( k) EBITDA to EBIT ( m) EBITDA Provisions Depreciation and amortisation Amortisation of deferred income (government grants) EBIT % Net Financial Expenses ( m) % (292.7) (159.6) (57.0) (76.1) % (7%) Net interest costs of debt (66.7) (73.2) (9%) Institutional partnerships costs (40.4) (48.4) (16%) % Capitalised financial expenses % (288.8) +1% Forex differences 1.4 (0.1) (155.4) +3% Other (37.3) (32.0) +16% (49.9) +14% (83.5) (9%) Net Financial Expenses (132.8) (147.8) (10%) (5%) % 99.0 (13%) 20.6 (1%) 14.1 (1%) 73% +2pp 72.0 (11%) % (5%) (0.3) (0.4) +33% (266.9) (270.8) (1%) (29%) (7%) Profits of Associates % Share of profit of associates (58%) Profit Before Taxes to Net Income ( m) % PreTax Profit (6%) Income taxes (54.5) (70.7) (23%) Profit of the period (1%) Noncontrolling interests (7%) Net Profit (Equity holders of EDPR) % In the, EDPR revenues decreased 7% YoY to 923m, mainly due to unfavorable price developments ( 45m), expected PTC expiration ( 34m) and forex translation and other ( 52m YoY), while being mitigated by higher output (+ 66m). Other operating income amounted to 55m (vs. 19m in ), with YoY evolution reflecting mainly insurance, liquidated damages and other business compensations. Operating Costs (Opex) totaled 293m, reflecting forex translation and with the 1% YoY increase justified by higher capacity in operation. In detail, Core Opex, defined by Supplies and services(including O&M activities) and personnel costs, totaled 217m (+6% YoY). Core Opex per avg. MW ( 20k) decreased by 1% YoY, reflecting forex and strict control over costs and EDPR s asset management strategy. Core Opex per MWh was 14, representing a decrease of 1% YoY, propelled by higher production. Other operating costs (including taxes and rents to public authorities and nonrecurring costs) decreasedto 76m(vs 84min;9%YoY). Inthe,EBITDAdecreased5%YoYto 686m(74%EBITDAmargin)andunitaryEBITDAper MWinoperationtotaled 64k(vs 72kin). Operating income (EBIT) decreased 7% YoY to 427m, driven by EBITDA performance and stable depreciation and amortization (incl. government grants and provisions), due to forex translation despite higher capacity in operation. At the financing level, net Financial Expenses decreased to 133m(10% YoY), mainly reflecting lower net interest cost of debt ( 67m; 9% YoY), and lower institutional partnership costs ( 16%YoY). In the period pretax profit summed 295m, with income taxes totaling 55m, reflecting an effective tax rate of 19%. Noncontrolling interests amounted to 101m (7% YoY), as a result of top line performance. All in all, Net Profit totaled 139m, increasing 4% YoY, with top line performance offset by positive YoY evolution of financial results and lower tax rate. 7

9 CashFlow CashFlow From EBITDA to Retained CashFlow (RCF) to Debt and TEI reduction ( m) EBITDA Current income tax Net interest costs Share of profit of associates FFO (Funds From Operations) Net interest costs Share of profit of associates Income from institutional partnerships Noncash items adjustments Changes in working capital Operating CashFlow 686 (36) (67) (1) (96) (27) (73) (3) (132) (3) (22) 535 (5%) (32%) +9% (62%) (6%) (9%) +62% +27% +9% Note that RCF includes tax benefits generated by the projects in the US under the TE structures, which are not included in Organic Free Cashflow concept (5%) (36) (130) (45) +3% 1 (12%) +507 (460) Capex Financial (investments) divestments Changes in working capital related to PP&E suppliers Government grants Net Operating CashFlow (465) 43 (39) 120 (424) (10%) (0.5) (303) +87% (0.0) (193) (52) (277) (282) Sale of noncontrolling interests and shareholders' loans Proceeds from institutional partnerships Payments to institutional partnerships Net interest costs (post capitalisation) Dividends net and other capital distributions Forex & others Decrease / (Increase) in Net Debt 9 (84) (57) (82) (317) (410) 248 (1) (131) +36% (67) +16% (81) (2%) (150) (112%) (375) (9%) EBITDA Cash Income adjustments Taxes & LT receivables Interests, Dividends deriv.& & interests TEI to costs Minorities RCF Asset Rotation & CTG Cash Investm. Dividends to EDPR shareh. Forex & Other Net Debt & TEI Increase In the, EDPR generated Operating Cashflow of 581m (+9% YoY), with income tax and income from institutional partnerships YoY evolution offsetting EBITDA performance. ThekeyitemsthatexplainthecashflowevolutiontochangesinNetDebtare: Funds from operations, resulting from EBITDA after net interests expenses, share of profits of associates and current taxes, were 585m(vs 621m in ); Operating Cashflow, which is the EBITDA net of income tax and adjusted by noncash items (namely income from US institutional partnerships) and net of changes in working capital, was 581m(+9% YoY); Capital expenditures with capacity additions, ongoing construction and development works totalled 465m (+10% YoY). Other net investing activities amounted to 4m, reflecting on theonehand thecashinof 36mfromUKoffshorestakesaledown, andon theother hand invoice payments to equipment suppliers related to some investments made in the previous year; Payments to institutional partnerships totalled 84m, contributing to the reduction of Institutional Partnership liabilities. Total net dividends and other capital distributions paid to minorities totalled 82m (including 52m to EDPR shareholders). In the period, forex & others had a negative impact increasing Net Debt by 317m, mainly reflecting forex translation and the settlement of a cross interest rate swap in place to hedge the USD investment in the US against forex differences. Retained Cashflow, which captures the cash generated by operations to reinvest, distributed dividends & amortized debt, was 507m (12% YoY). RCF decreased by 67m vs reported in, while increasing + 16m (+3%) vs adjusted. In Jun18, Net Debt & Institutional Partnership liabilities increased by 282m. (1) Adjusted by nonrecurring items 8

10 Net Debt and Institutional Partnership Liability Net Debt ( m) 2017 Jun18: Financial Debt by Currency Jun18: Financial Debt by Type Nominal Financial Debt + Accrued interests on Debt Collateral deposits associated with Debt Total Financial Debt Cash and cash equivalents Loans to EDP Group related companies and cash pooling Cash & Equivalents Net Debt 3,645 (40) 3, ,216 3,237 (43) 3, , USD 47% Other 10% EUR 43% Variable 17% Fixed 83% Average Debt ( m) 2017 % Jun18: Average Interest Rate Cost Jun18: Financial Debt by Maturity Average nominal financial debt Average net debt 3,471 3,002 3,476 3,048 (0.2%) (2%) 3.9% 4.0% 56% Net Debt Breakdown by Assets ( m) Net debt related to assets in operation Net debt related to assets under construction & develop. Institutional Partnership ( m) Institutional Partnership Liability (1) 2, , , , (128) Jun17 Jun18 24% 13% 7% AsofJun18,EDPR snetdebttotaled 3.2bn,higherby 410mfromDec17,reflectingonthe onehand theinvestments donein theperiodand forextranslation andon theotherhand the cashflow generated by the assets. By Jun18, 75% of EDPR s financial debt was funded through longterm loans with EDP Group EDPR s main shareholder while loans with financial institutions represented 25%. Liabilities referred to Institutional Partnerships totaled 1,121m( 128m vs Dec17), reflecting the benefits captured by the projects and tax equity partners along with forex. As of Jun18, 43% of EDPR s financial debt was Euro denominated, 47% was funded in US dollars, related to the company s investment in the US, and the remaining was mostly related with debt in Canadian dollars, Polish Zloty and ian Real. EDPR continues to follow a longterm fixed rate funding strategy, matching the operating cashflow profile with its financial costs and therefore mitigating interest rate risk. Accordingly, 83% ofedpr sfinancialdebthadafixed interestrate. As ofjun18,7%ofedpr sfinancialdebthad maturity in 2018, 13% of EDPR s financial debt had maturity in 2019, 24% of EDPR s financial debthadmaturityin2020and56%in2021andbeyond. Inthe,theaverageinterestratewas4.0%(+0.1ppYoY). (1) Net of tax credits already benefited by the institutional investors and yet due to be recognised in the P&L 9

11 Business Platforms 10

12 410 MW Feedin Tariff 15 years 1,253 MW Feedin Tariff Auction (ENEOP) 15+7 years Portugal EDPR EU: 2018 EBITDA MW by Market 71 MW PPA Market price + Green Certificate France Spain Belgium 2,244 MW Return on standard asset Italy Poland 418 MW PPA Market price + Green Certificate Romania 181 MW < 2013:market price + GC Auctions 521 MW Market price + Green Certificate See page 24 for more detail on regulation EBITDA MW Spain Portugal France Belgium Italy Poland Romania Load Factor (%) Spain Portugal France Belgium Italy Poland Romania 2,244 2,194 1,253 1, ,098 5, % 28% +1pp 31% 28% +2pp 27% 24% +3pp 23% 20% +3pp 29% 28% +1pp 26% 29% (3pp) 26% 30% (4pp) 29% 28% +1pp EDPR sebitdainstalledcapacityintotaled5.1gwbyjun18,increasing91mwyoy,of which 25 MW net were added in Spain (related to the acquisition of a 50% participation in a Spanish wind farm that was previously accounted as equity), 4 MW in France and 37 MW in Italy. Fromthetotal5,098MWinstalled capacity in (EBITDAMW) 5,043MWwererelated to wind onshore technology and 55 MW to solar PV (of which 50 MW in Romania and 5 MW in Portugal). In Spain, EDPR had 2.2 GW of which 9% had no capacity complement and the remaining capacity is remunerated with a pool price with caps and floors and a capacity complement in order to reach the targeted return on a standard asset. In Portugal, installed capacity was 1.3 GW,representing25%ofEDPR sebitdamwportfolioin.edprhad1.6gwinstalledin therestof( RoE ),accountingfor31%oftheebitdamwportfolioinasofjun 18. In addition to the 5,098 MW installed in as of Jun18, EDPR had 152 MW consolidated as equity, related to EDPR equity stakes in Spanish assets. In, EDPR reached a 29% load factor (+1pp vs ), with YoY comparison explained by the outstanding wind resource in Spain and Portugal during 1Q18. In theperiod,edpr accomplished a load factor of30%in Spain (vs 28%in ), abovemarket average (+1pp). In Portugal, EDPR reached a load factor of 31% (vs 28% in ) and higher than expected for an average 1H. In France, Belgium and Italy EDPR delivered higher YoY load factors 27%, 23% and 29% respectively while in Poland and Romania load factors decreased YoY, reaching 26% in both countries. Note: Operational Performance considers only capacity consolidated at EBITDA level 11

13 Spain Production (GWh) Production w/ capacity complement (GWh) Standard Production (GWh) Above/(below) Standard Production (GWh) Production w/o capacity complement (GWh) Selling Price + Capacity Complement Realised pool price ( /MWh) Regulatory Adjustment on standard GWh ( m) Remuneration to investment ( m) Hedging gains/(losses) ( m) Electricity Sales ( m) Portugal Production (GWh) Avg. Selling Price ( /MWh) Electricity Sales ( m) France Production (GWh) Avg. Selling Price ( /MWh) Electricity Sales ( m) 2,866 2,631 2, ( 7.7) 95.1 ( 11.8) , ,665 2,444 2, ( 6.8) 92.6 ( 16.0) , % +8% +5% +23% +6% % Belgium Production (GWh) Avg. Selling Price ( /MWh) Electricity Sales ( m) Italy (7%) +13% Production (GWh) % (26%) Avg. Selling Price ( /MWh) % +9% +2% +20% (0.1%) +19% In Spain, production reached 2.9 TWh (+8% YoY), of which 92% was generated from capacity with complement. According to the RDL 413/2014 approved in Jun14 renewable assets receive pool price with caps and floors and a capacity complement ( /MW) to achieve the standard return. In, the average realized pool price in the period was 46/MWh (vs 49/MWh in ), and regulatory adjustment was 8m (baseload higher than regulatory caps). Additionally, EDPR accounted 12m of hedging losses in. All in all, the electricity sales in the period totalled 206m (+3% YoY). For the 2H18 EDPR hedged 1.0 TWh at 40/MWh. In Portugal electricity sales totaled 158m (+11% YoY) reflecting the higher production YoY (+9%; 1.7 TWh), mainly explained by the outstanding wind resource in 1Q18. The avg. selling price increased 2% YoY to 94/MWh, driven by inflation indexation. In France production increased to 481 GWh benefitting from higher installed capacity. Average selling price during the period remained stable YoY at 91/MWh, leading to 44m electricity sales in the period(+19% YoY). Electricity Sales ( m) Poland Production (GWh) Avg. Selling Price ( /MWh) Electricity Sales ( m) Romania Production (GWh) Avg. Selling Price ( /MWh) Electricity Sales ( m) (2%) +11% (6%) % +14% +7% (12%) (33%) (45%) (13%) 77.6 (31%) (57%) In Belgium, production in increased 14% YoY to 71 GWh on the back of a higher wind resource YoY. During the period the average selling price was 104/MWh (2% YoY), reflecting theppapricestructure.allinall,electricity salesinincreased11%yoyto 7m. In Italy, production in increased to 190 GWh (+14% YoY), benefitting from a strong wind resource. During the period, the average selling price decreased by 6% to 114/MWh due to lower market prices (in wind farms installed before 2013), leading to electricity sales of 22m (+7%YoY). In Poland, production decreased by 12% YoY to 469 GWh, reflecting the lower wind resource YoY. The average selling price decreased to 52/MWh (33% YoY) on the back of lower green certificate prices and the new substitution fee calculation method (now calculated as 125% of previous year green certificate avg. price). As a result of lower production and average selling price, electricity sales summed 23m(vs 41m in ). InRomania,productionindecreasedto588GWh(13%YoY)drivenbyalowerloadfactor during the period(26%,4pp YoY), while average selling price dropped to 53/MWh(31% YoY), given that green certificates were halved as expected per regulation. All in all electricity sales summed 23mvs 53min. Note: For analysis purposes hedging results are included in electricity sales 12

14 Electricity Output Average Selling Price Revenues Income Statement ( m) GWh /MWh m Revenues 6,041 +5% (1%) (6%) 6, Other operating income Operating Costs Supplies and services (S&S) Personnel costs (PC) Other operating costs EBITDA EBITDA/Revenues Provisions Depreciation and amortisation Amortisation of deferred income (government grants) EBIT (141.2) (145.0) (81.3) (79.3) (14.2) (14.4) (45.7) (51.4) % 72% (0.3) (0.3) (122.2) (123.7) (1%) +265% (3%) +3% (1%) (11%) +3% +3pp (20%) (1%) (88%) +4% Opex ratios Employees Core Opex (S&S + PC) /Average MW in operation ( k) Core Opex (S&S + PC) /MWh( ) (0.0%) (3%) (10%) In,EDPRoutputinincreasedby5%to6.3TWh,withYoYcomparisonimpactedby higher wind resource along with capacity additions. In, an generation accounted for 41% of EDPR s total output. The average selling price in decreased by 6% to 78/MWh, mainly driven by the lower average selling price in Poland and Romania (33% and 31% YoY, respectively), and to a lesser extent in Spain (4% YoY), partially compensated by the positive price performance in Portugal(+2% YoY). Revenues in totalled 493m (1% YoY or 5m) with lower average sellingprice (6% YoY) offsetting higher YoY output(+5%). In the, other operating income totaled 17m, mainly on the back of insurance on losses damages and others, and operating costs reached 141m (3% YoY) due to the decrease in other operating costs (11% YoY), while supplies and services increased by 3% YoY on the back of higher installed capacity. Inthe,CoreOpex(definedasSuppliesandServicesandpersonnelcosts)peraverageMW inoperationreached 19k(flatYoY)andCoreOpexperMWhdecreasedto 15. All in all, EBITDA totaled 369m (+3% YoY), reflecting an EBITDA margin of 75% (+3pp YoY). In the, depreciation and amortization (including provisions, impairments and net of amortization of government grants) was flat YoY, leading to an EBIT of 246m(+4% YoY). Note: From 2018 onwards Offshore platform is no longer reported under 13

15 (USD) EBITDA MW EDPR US: 2018 EBITDA MW by Market US PPA/Hedge 4,265 4, Washington Iowa Wisconsin (1) Minnesota Illinois US Merchant Canada Mexico Total EBITDA MW 5,284 4, Oregon Load Factor (%) US West Central East Canada Mexico Average Load Factor Electricity Output (GWh) US Canada Mexico Total GWh Average Selling Price (US$/MWh) US Canada Mexico Avg. Final Selling Price 38% 35% 42% 35% 30% 45% 38% 8, , % 29% 43% 38% 34% 44% 39% 7, ,191 (1pp) +5pp (1pp) (3pp) (3pp) +1pp (1pp) +5% (10%) +36% +6% 45.8 (4%) % % 46.5 (3%) 300 California 228 MW per Incentive MW with PTCs MW with ITCs MW with Cash Grant and Self Shelter Revenues (US$m) Electricity sales and other Income from institutional partnerships Total Revenues Kansas 400 Texas Oklahoma New York 282 Ohio South Carolina 60 Indiana 615 PPA/Hedge Merchant 2, ,014 +3% (15%) (2%) As of Jun18, EBITDA installed capacity totalled 5,284 MW, of which 5,055 MW in the United States ( US ), 30 MW in Canada and 200 MW in Mexico. From the capacity installed in the US, 4,965 MW are of wind onshore technology, while 90 MW are related to solarpvpowerplants(+60mwyoydrivenbytheinstallationofcypresscreeksolarpvplantin South Carolina). In Jun18, 4,495 MW were under longterm contracts (PPA/Hedge) or predefined remuneration scheme, representing 85% of total EBITDA installed capacity in the region. Overthelast12months,EDPRinstalledinNorthAmerica423MWofcapacity,363MWofwind onshore capacity and 60 MW of solar PV, all remunerated with PPAs secured in advance and with a different revenue dynamic (price vs production). The YoY increase of 204 MW in merchant exposure in the US mainly reflects an incremental change during 2Q18, on the back of a PPA termination. In theregion, EDPR achieved a38%load factor as a results oflower weather resources (98% of P50 vs 100% of P50 in ). In detail, EDPR operations in the US reached a 38% load factor, 30%loadfactorinCanadaanda45%loadfactorinMexico. EDPR output in reached 8.7 TWh (+6% YoY), reflecting the growth in installed capacity with higher expected load factors. In detail, the increase in output was propelled by theuswith8.3twh(+5%yoy)andmexicowith0.4twh(+36%yoy). In the US, reflecting mainly hedge gains accounted in and to a lesser extend capacity additions with different mix of load factors vs prices, average selling price totaled $44/MWh( 4% YoY). In Canada, EDPR s average selling price was $114/MWh and in Mexico average selling price was $64/MWh. All in all, the realized average selling price in the region was $45/MWh. Electricitysalesincreasedby3%YoYto$380m,benefittingfromthe6%outputincreaseinthe region. Income from institutional partnerships decreased to $122m (15% YoY), reflecting the impact from scheduled PTC expiration in specific tax equity structures (10year life). All in all, revenues in decreased 2% YoY to $502m. Note: (1) Considers projects with PPAs/LT contracts already signed but not yet contributing for production 14

16 (USD) Electricity Output Average Selling Price Revenues Income Statement (US$m) GWh $/MWh $m Electricity sales and other Income from institutional partnerships (3%) (2%) Revenues +6% Other operating income Operating Costs 8,191 8, Supplies and services (S&S) Personnel costs (PC) Other operating costs EBITDA EBITDA/Revenues Provisions Depreciation and amortisation Amortisation of deferred income (government grants) EBIT % (15%) (2%) % (159.5) (141.2) +13% (89.7) (79.5) +13% (33.4) (27.7) +21% (36.4) (34.0) +7% (3%) 75% 75% (0.4pp) (0.1) (166.1) (152.2) +9% (10%) Opex ratios Employees Core Opex (S&S + PC) /Average MW in operation ($k) Core Opex (S&S + PC) /MWh($) % +8% % In the,edpr s electricity sales in increased by 3%YoY to $380m,drivenby the 6% YoY increase in electricity output and despite the lower average selling price in the period (3% YoY). Income from institutional partnerships and the output from projects generating PTCs decreased to $122m, following PTCs expiration of specific tax equity structures, despite new tax equity partnerships. Following the top line performance, revenues decreasedby2%yoy,reachingatotalof$502m. In the period, Other operating income totaled $35m (vs $16m in ), mainly from liquidated damages and other business compensations. Operating costs summed $160m(+13% YoY), with the increase of $10m in supplies and services and of $6m in personnel costs derived from the higher capacity in operation. Core Opex (defined as Supplies and Services and personnel costs) per avg. MWin operation increased by 5%to $23k, whilecoreopexper MWh increased 8%to $14. Given the top line performance and stable YoY net operating costs, EBITDA decreased by 3% YoYto$377m,withastableEBITDAmarginof75%. Following the EBITDA performance and the increase of 9% in depreciation and amortization (including impairments and net of amortizations of government grants), on the back of higher capacity in operation, EBIT amounted to $220m(10% YoY). Note: In average exchange was 1.21 $/EUR. Exchange rate at Jun18 was 1.17 $/EUR 15

17 (BRL) Electricity Output Average Selling Price Revenues Income Statement (R$m) GWh R$/MWh R$m Revenues % (7%) % 77.2 Other operating income Operating Costs Supplies and services (S&S) Personnel costs (PC) Other operating costs EBITDA EBITDA/Revenues Provisions Depreciation and amortisation Amortisation of deferred income (government grants) EBIT (29.0) (22.4) (4.6) (2.0) % (0.0) (25.1) (21.4) (14.7) (5.0) (1.7) % (17.6) % +36% +52% (9%) +20% 32% +6pp +43% +25% Opex ratios Employees Core Opex (S&S + PC) /Average MW in operation (R$k) Core Opex (S&S + PC) /MWh(R$) (14%) +2% % As of Jun18, EDPR had a total installed capacity of 331 MW in, an increase of 127 MW YoY. ian projects operate under programs with longterm contracts to sell the electricity produced for 20 years, providing longterm visibility over cashflow generation throughout the projects life. In the, EDPR generated 420 GWh vs 314 GWh in (+34% YoY), with increase in production mainly explained by capacity additions with stronger wind resource. The average selling price in was R$208/MWh during the period, reflecting mainly the different mix of a new wind farm in operation(production vs price). In the period, EDPR s revenues in reached R$77m(+21% YoY), propelled by the increase in electricity generation and despite the lower average selling price. In, Other operating income reached R$8m and Operating costs totaled R$29m (+R$8m YoY), in line with higher installed capacity. Reflecting the strict control over costs, higher average capacity in operation and increased efficiency, Core Opex, defined by Supplies and Services (incl. O&M activities) and Personnel costs, totaled R$27m, with Core Opex per Avg. MWdecreasingby14%YoYandperMWhamountingtoR$64. Allinall,EBITDAreachedR$56m(+32%YoY)withanEBITDAmarginof72%(vs66%in). Following the EBITDA performance and the increase of R$8m YoY in depreciations and amortizations (including impairments and net of amortizations of government grants), EBIT reached a total amount of R$31m (+25% YoY). The YoY increase in depreciation and amortization reflects the higher capacity in operation in. In the 2013 ian energy auctions, EDPR was awarded a 20year PPA at JAU & Aventura wind farms, already installed by Dec17. In 2014 EDPR reached a 20year PPA for 137 MW at Babilônia wind farm, which remains under construction with expected CoD in In the 2017auction, EDPR was awarded a 20year PPA for Mundo Novo & Aventura II wind projects, totaling 219 MW with expected CoD in These projects strengthen EDPR s presence in a market with low risk profile, strong growth prospects and attractive weather resource. Note: In the average exchange rate was 4.14 BRL/EUR. Exchange rate at Jun18 was 4.49 BRL/EUR. 16

18 Quarterly Data 17

19 Quarterly Data Quarterly Data 2Q17 3Q17 4Q17 1Q18 2Q18 YoY QoQ EBITDA MW EDPR Load Factor EDPR GWh EDPR Tariff/Selling Price ( /MWh) (1) ($/MWh) (R$/MWh) Average Porfolio Price ( /MWh) Revenues ( m) EDPR EBITDA ( m) EDPR EBITDA Margin EDPR Net Profit EDPR ( m) Capex ( m) EDPR Net Debt ( m) Institutional Partnership Liability ( m) (1) 5,007 5,057 5,061 5,061 5,098 4,861 5,060 5,284 5,284 5, ,072 10,321 10,676 10,676 10,713 25% 38% 38% 31% % 81.9% 66.4% 75.1% 22% 23% 55% 23% 2,658 2,473 3,155 4,002 2,548 4, ,827 5,271 7, ,130 1, % 61.0% 87.6% 76.1% 31 28% 36% 22% (3pp) (14pp) 38% 41% 35% (3pp) (7pp) 47% 24% 35% (3pp) +10pp 34% 38% 29% (2pp) (10pp) 3,910 4, , ,430 3, , % 73.6% 110.4% 78.0% ,999 2,806 1,131 1, % 67.1% 59.6% 72.0% ,973 1,133 +2% +9% +62% +6% 188 (17%) 197 (12%) % 395 (14.1%) (9%) (38%) (0.1%) (15%) +56% +65% (2%) (24%) (9%) +1% (14%) (12%) +2pp +2pp +16pp +2pp +0.7% +0.3% (0.4%) +4% (17%) (4%) (38%) (9%) +34% (25%) 139 (14%) (39%) 165 (10%) +13% 9 +36% +84% 305 (12%) (20%) 73.8% 83.9% 82.1% 77.3% ,216 1,121 (32%) +171% (65%) +5% (40%) +3% (1%) (2pp) +17pp +23pp +5pp (52%) (30%) (30%) (3%) (25%) +8% (1%) (1) Excludes institutional partnership revenues 18

20 Income Statements 19

21 EDPR: Income Statement by Region ( m) N. America Other/Adj. Consolidated Electricity sales and other Income from institutional partnerships Revenues (2.3) (2.3) Other operating income Operating Costs Supplies and services Personnel costs Other operating costs 17.3 (141.2) (81.3) (14.2) (45.7) (131.9) (7.0) (74.2) (5.4) (27.6) (1.1) (30.1) (0.5) 7.4 (12.5) 1.3 (14.1) (292.7) (159.6) (57.0) (76.1) EBITDA EBITDA/Revenues % % 72% (7.4) n.a % Provisions Depreciation and amortisation Amortisation of deferred income (government grants) (0.3) (122.2) 0.3 (137.2) 7.5 (0.0) (6.1) 0.0 (0.0) (1.4) 0.0 (0.3) (266.9) 7.9 EBIT (8.8) ( m) N. America Other/Adj. Consolidated Electricity sales and other Income from institutional partnerships Revenues Other operating income Operating Costs Supplies and services Personnel costs Other operating costs EBITDA EBITDA/Revenues Provisions Depreciation and amortisation Amortisation of deferred income (government grants) EBIT (0.9) (0.9) (145.0) (130.4) (6.2) (7.1) (288.8) (79.3) (73.5) (4.3) 1.6 (155.4) (14.4) (25.6) (1.5) (8.4) (49.9) (51.4) (31.4) (0.5) (0.3) (83.5) (7.9) % 75% 66% n.a. 73% (0.3) (0.1) (0.4) (123.7) (140.5) (5.1) (1.4) (270.8) (9.3) (1) Note on Offshore: From 2018 onwards Offshore is no longer under the an platform, being reported under "Other/Adj" 20

22 EDPR : Income Statement by Country ( m) Spain Portugal RoE Other/Adj. (1) Total Revenues Operating Costs and Other operating income EBITDA EBITDA/Revenues Depreciation, amortisation and provisions EBIT (61.1) % (52.9) (10.8) (21.5) (38.7) (2.7) (124.0) % % (13.5) n.a % (27.0) (40.0) (2.2) (122.1) (15.8) ( m) Spain Portugal RoE Other/Adj. (1) Total Revenues (15.4) Operating Costs and Other operating income (66.7) (24.4) (45.3) (3.9) (140.3) EBITDA EBITDA/Revenues % % % (19.3) n.a % Depreciation, amortisation and provisions (51.9) (27.2) (40.3) (2.1) (121.4) EBIT (21.4) (1) Important note on Spain and Other: Pursuant the changes in thespanish regulatory framework, EDPR hedges its exposure to the Spanish pool price, accounted at the an platform level (Other/Adj.). On page 12, the hedging was included in the Spanish division only for analytical purposes. 21

23 Annex 22

24 Equity Consolidated & Noncontrolling Interest (MW) Equity Consolidated (MW) (1) EDPR Interest MW Share of profit EBITDA Equivalent Country YoY YoY % Spain (25) 2.6m 1.7m + 0.9m 8.2m 8.2m (0.4%) US ($3.3m) $0.8m ($4.1m) $2.5m $2.8m (9%) Noncontrolling Interest (Net MW) Installed Capacity (MW) YoY Spain Portugal (3) As of Jun18, EDPR managed a total of 2.8 GW corresponding to minorities held by institutional and strategic partners on the back of Asset Rotation strategy and partnership transactions. The YoYincreaseof57MWreflects mainlyedpr partnershipswith CTG in and in NorthAmerica due to post flip adjustments of tax equity investors. Rest of (RoE) EDPR s Asset Rotation strategy is based on selling minority stakes in its optimized wind farms to reinvest in the development of quality and value accretive projects. 1,215 1,220 (5) Total 2,786 2, (1) Breakdown only considers associate companies with installed capacity 23

25 Remuneration Frameworks Country Short Description Country Short Description Existing wind farms receive Feedin tariff for 15 years: Sales can be agreed under PPAs (up to 20 years), Hedges or Merchant prices Green Certificates (Renewable Energy Credits, REC) subject to each state regulation Tax Incentive: France First 10 years: 82/MWh; Years 1115: depending on load factor hours to hours; indexed Assets under construction will receive 15yr CfD which strike price value similar to existing FIT fee plus a management premium US PTC collected for 10years since COD ($24/MWh in 2017) Wind farms beginning construction in 2009 and 2010 could opt for 30% cash grant in lieu of PTC Belgium Market price plus green certificate (GC) system Separate GC prices with cap and floor for Wallonia ( 65/MWh100/MWh) Option to negotiate longterm PPAs Electricity price can be established through bilateral contracts Canada Feedin Tariff (Ontario). Duration: 20years Renewable Energy Support Agreement (Alberta) Poland Wind receive 1 GC/MWh which can be traded in the market. Electric suppliers have a substitution fee for non compliance with GC obligation. From Sep17 onwards, substitution fee is calculated as 125% of the avg market price of the GC from the previous year and capped at 300PLN. Mexico Spain Bilateral Electricity Supply Agreement under selfsupply regime Duration: 25years Wind energy receives pool price and a premium per MW, if necessary, in order to achievea targetreturn established as the Spanish 10year Bond yields plus 300bps Premium calculation is based on standard assets (standard load factor, production and costs) Romania Wind assets (installed until 2013) receive 2 GC/MWh until 2017 and 1 GC/MWh after 2017 until completing 15 years. 1 out of the 2 GC earned until Mar2017 can only be sold from Jan2018 and until Dec2025. Solar assets receive 6 GC/MWh for 15 years. 2 out of the 6 GC earned until Dec2024 can only be sold after Jan2025 and until Dec2030. GC are tradable on market under a cap and floor system (cap 35 / floor 29.4) Wind assets (installed in 2013) receive 1.5 GC/MWh until 2017 and after 0.75 GC/MWh until completing 15 years The GCs issued starting in Apr2017 and the GCs postponed to trading from Jul2013 will remain valid and may be traded until Mar2032 Portugal MWs from previous regime: Feedin Tariff inversely correlated with load factor throughout the year. Tariff updated monthly with inflation, through the later of: 15years of operation or 2020, + 7 years (extension cap/floor system: 74/MWh 98/MWh) ENEOP: price defined in an international competitive tender and set for 15 years (or the first 33 GWh per MW) + 7 years (extension cap/floor system: 74/MWh 98/MWh).Tariff for first year established at c. 74/MWh and CPI monthly update for following years VENTINVESTE: price defined in an international competitive tender and set for 20 years (or the first 44 GWh per MW) Italy Projects online before 2013 are (during 15 years) under a pool + premium scheme (premium=1x 180/MWh P1 )x0.78, being P1 previous year average market price Assets online from 2013 onwards were awarded a 20 years contract through competitive auctions. According with the auction scheme, the electricity produced by these wind farms will be sold to the market and if the realized market price is lower than the awarded price, the difference will be paid by Gestore dei Servizi Energetici ( GSE ) Installed capacity under PROINFA program Competitive auctions awarding 20years PPAs 24

26 Sustainability Highlights Environmental Metrics Social Metrics CO2 Avoided (kt) MW certified ISO Employees training hours (#) MW certified OHSAS % 11,958 12,370 +2% 9,292 9,507 20, % 23, % 9,480 9,507 Compliance YoY Human Capital Overview YoY Monetary value of environmental sanctions ( k) Employees Turnover % of female workforce 1,326 10% 31% 1,183 8% 33% +12% +2pp (2pp) Waste treatment (1) YoY Health & Safety indicators YoY Total waste (kg/gwh) Total hazardous waste (kg/gwh) Total Oil related wastes (%) % % (22%) (23%) (5pp) Number of industrial accidents (3) Injury rate (IR) (4) Lost work day rate (LDR) (2) % +97% +287% % of hazardous waste recovered 92% 96% (4pp) Corporate Citizenship YoY Employee Volunteering (hours) 1, % Economic Metrics Main Events in Sustainability Economic Value ( m) Directly Generated Distributed Accumulated UN Sustainable Development Goals YoY 1,033 1,053 (2%) (1%) (3%) Sustainability recognitions Date Description Feb18 EDPR has been recognized by the Top Employers Institute as one of the best companiestoworkforinspainin2018. Mar18 EDPR publishes its integrated 2017 Annual Report based on GRI reporting guidelines. Apr18 EDPR employees planted trees in Spain and Portugal to follow through with the environmental activities of reforesting, in response to the fires that devastated thousands of hectares of forest in both countries last summer. Jun18 EDPR celebrated Global Wind Day with open house at Carondio wind farm in Asturias, Spain. This event is a wonderful occasion to explain how a wind farmworksanditsbenefitsforsocietyasawhole. Note: (1) Adj. by nonrecurring items; (2) Includes staff and contractors data; (3) Injury Rate calculated as [# of accidents with absence/hours worked * 1,000,000]; (4) Lost Work Day Rate calculated as [# of working days lost/hours worked * 1,000,000] 25