1H 2014 RESULTS. Conference Call, 8 August 2014

Transcription

1 1H 2014 RESULTS Conference Call, 8 August 2014

2 H Consolidated Results Vector Cuatro Other Initiatives Outlook 2

3 H HIGHLIGHTS Euro millions Jun 14 vs Jun 13 % Jun 13 INSTALLED CAPACITY - MW % 680 ENERGY PRODUCTION - GWh % 987 REVENUES - m % EBITDA - m % 88.5 NET EARNINGS - m % 19.3 Starting from January 2014, new IFRS 11 (JV s accounting treatment) has been adopted and according to this principle investments in Frullo Energia Ambiente, La Muela and Palermo Energia Ambiente have been recognised by equity method. Also the 1H 2013, for comparative purposes, has been reclassified with the new IFRS 11. 3

4 H : KEY FACTORS Operating Business Ongoing Activities H Results Poor wind conditions across Europe Low tariffs and no incentives in Spain Penalties on non programmable sources (E.g. minimi garantiti, captured price) and on programmable sources (CIP 6) According to the Framework Investment Agreement with CII, FKR is actively in talks for the sale of the minorities in Nutberry and West Browncastle wind farms Results in line with expectations Increasing contribution from the UK due to change of perimeter (Nutberry - 15MW, full year - and West Browncastle -30 MW, one month) Cash generation from operating plants and cash-in from the Borea deal with CII enabled a strong reduction of the Net Financial Position 2014 Guidance 4

5 1H 2014 FINANCIAL HIGHLIGHTS June June % millions of euro Revenues % Net Operating costs (55.1) (53.5) Ebitda % % on Revenues 56.7% 62.3% Depreciation - Amortization - Write Off (32.4) (33.0) Operating result % % on Revenues 31.2% 39.1% Financial income and charges (25.3) (25.2) Equity investments Earnings Before Taxes % Taxes (9.4) (13.2) Net Result % Minorities (3.0) (0.1) Net Group Result Impairment test: (1.9 m) (4.1m) millions of euro June 2014 Dec 2013 Net Invested Capital 1, ,106.9 Equity Net Financial Position (597.9) (728.1) of which: Proj. Fin. and MLT no recourse (692.6) (690.8) NFP excluding Derivatives Instruments (531.2) (673.7) 5

6 EVOLUTION OF INSTALLED CAPACITY AND PRODUCTION MW BY TECHNOLOGY +6.8% MW BY COUNTRY +6.8% Solar WTE/Biomass Wind France Spain UK Italy 1H H H H 2014 GWh -9.1% WASTE (KTON) -8.2% Solar WTE/Biomass Wind H H H H 2014 Also the 1H 2013, for comparative purposes, has been reclassified with the new IFRS 11. 6

7 FINANCIAL HIGHLIGHTS: REVENUES AND EBITDA Euro millions Revenues by Technology 142 m 3.8% 22.0% 127 m 3.8% 20.1% 74.2% 76.1% Solar Wte/Biomass Wind Revenues by Country 142 m 2.6% 127 m 2.2% 3.3% 26.9% 0.6% 34.2% 68.3% 61.9% France Spain UK Italy 1H H H H 2014 EBITDA * by Technology EBITDA by Country 4.5% 10.6% 84.9% 4.9% 4.5% 90.6% Solar Wte/Biomass Wind 88.5 m 25.1% 67.6% 2.5% 4.8% 72.1 m 37.4% 58.1% 4.0% 0.5% France Spain UK Italy 1H H 2014 * Breakdown of EBITDA by technology made on total Ebitda gross of holding impact 1H H

8 EBITDA 1H 2014 VS 1H 2013: KEY FACTORS Euro millions 95.1 (6.6) 88.5 (12.8) 2.4 (3.8) (3.1) Nutberry and West Browncastle H IFRS 11 Adj H IFRS11 Net Volumes Perimeter Change Prices Trezzo Break Down Exchange rate Other H

9 FINANCIAL HIGHLIGHTS: CASH FLOW Euro millions NFP December 2013 CAPEX net of Disposals Exch difference on assets Derivatives Fair Value Variation Cash Flow from Operations Cash from CII Subloan CII Dividends NFP June m (47) (15) (598) (728) (22) (16) (12)

10 FINANCIAL HIGHLIGHTS: NET FINANCIAL POSITION 1/2 Euro millions NFP BREAKDOWN DERIVATIVES IMPACT ON NFP (67) (22) (49) (27) (4) (728) (598) Cash SPVs Cash (693) PF Derivatives FKR Corp. Loan Subloan CIP MLT Loans & Local Comm. Other net debts (598) NFP (674) NFP excluding derivatives Derivatives (531) (54) (67) December 2013 June

11 FINANCIAL HIGHLIGHTS: NET FINANCIAL POSITION 2/2 Euro millions PLANT UNDER CONSTRUCTION/IN OPERATION PROJECT FINANCE HEDGED 2.0% 12m 25.2% 175m 98.0% 586m 74.8% 518m Under Development and Construction Operating Unhedged pf Hedged pf 11

12 H Consolidated Results Vector Cuatro Other Initiatives Outlook 12

13 FKR THREE PILLARS STRATEGY PARTNERSHIPS Co-development of the FKR portfolio with strategic partners to continue the business as usual in different countries SERVICE DIVISION Developing a service division with the aim to cover the whole value chain in the renewable energy industry in order to extract more value from the Assets (inside and outside the Group) and to manage the market rule INNOVATION Creation of an innovation division to propose new products and processes for Energy Hubs capable of optimizing the performances of the renewable assets and their integration with the grids 13

14 FKR AND VECTOR CUATRO COMPETENCIES Market competencies from an asset owner point of view: knowledge of the renewable energy markets (wind, solar, WTE and biomass) Technical competencies also to improve asset performances through integration Portfolio management Finance & Incentives Strong experience in the wind sector + Strong commercial acumen and client acquisition skills resulting in solid client relationships Deep-rooted service provider mentality to solve the client's needs and meet his expectations Asset Management (Performance monitoring & reporting, maintenance & troubleshooting) and Engineering competencies (Development & construction supervision) Mainly PV but also WIND competencies (Development, Permitting and Engineering) Cohesive, highly motivated, young, dynamic and internationally minded management team The integration will bring several competencies that are required to be successful in the market, speeding up change 14

15 VECTOR CUATRO PROFILE Vector Cuatro S.L. is a Spanish company active in the management of the whole value chain of energy projects: from advisory to structuring, from engineering to management and administration of renewables facilities The company has been founded in 2007 by Borja Escalada, CEO and major shareholder of Vector Cuatro (~ 51%). The management team owns, directly and indirectly, the remaining 49% of the capital. Vector Cuatro is currently managing around 934 MW of third party assets with a team made of around 100 employees Main presence in Spain, Italy, France with significant opportunities growth in Japan, Mexico and other countries ( North America, South Africa, Bulgaria) 15

16 VECTOR CUATRO DIRECT PRESENCE AND ACTIVITIES Spain Asset Management Engineering Transaction &legal ser. France Asset Management Engineering Legal services Japan Engineering Transaction &legal ser. Canada Asset Management Mexico Start-up: Asset Management Engineering Transaction &legal ser. Italy Asset Management Engineering Bulgaria Asset Management 16

17 VECTOR CUATRO PRESENCE 1) 833 MWs* Asset Management (MWs under management) 2) 4,020 MWs Engineering services (historical MWs) 3) 3,501 MWs Transaction services (historical MWs) Direct office presence of Vector Cuatro * As of 31 December

18 VECTOR CUATRO ACTIVITIES Asset management Operational management: periodical site visit; daily performance monitoring, enforcement of the terms of agreement of the plant s service providers, insurance company claims, management of the providers, drafting of service reports; Reporting, accounting and fiscal activities; Management of SPVs Engineering: design and optimization, construction supervision, technical due diligence, both of projects and under-operation facilities Transaction services: development & identification of opportunities, financial advisory, technical & financial due diligence, design and structuring, fund raising, financing and investment closing, divestment Legal services : legal support and legal advisory Engineering 18% 2013 REVENUES BREAKDOWN Transaction Services 7% Legal 2% Asset Management 73% 18

19 A LONG TERM PORTFOLIO WITH BLUE CHIPS CLIENTS Vector Cuatro has a blue chip customer portfolio mainly composed of financial and industrial players investing in the renewable sector Entry services are usually transaction and engineering services, which are used to establishing a trusted relationship and recognition 48% of contracts in terms of revenues has a long term duration between 20 and 25 years (usually with a notice period of 1-2 years) and 33% has a Short/medium term duration between 2 and 5 years Asset Management activities are carried-out by a state-of-the-art IT platform, which includes both in house tools and customized developments based on leading external solutions 19

20 VECTOR CUATRO KEY FINANCIALS Euro millions 7,4 9,0 Highly attractive margin profile (EBITDA margin at around 20%) Expected strong growth in 2014: Revenues: +22% YoY EBITDA: +8% YoY 1,7 1,8 1,3 1,0 Low impact from D&A and financial charges Revenues Ebitda EbT Net Result 2013A 2014E Net Debt at 0.5 m end of

21 POTENTIAL UPSIDE FROM THE INTEGRATION Existing Vector Cuatro s wind competencies combined with FKR deeper Wind/WTE/Biomass know-how will extend product offering beyond PV and cross-sell asset management services to other renewables plants owned by Vector Cuatro s existing and future clients Technological diversification as a key driver for the future: Vector Cuatro and FKR will develop the opportunity to expand the service platform to new technologies in the renewable sector Expansion into new countries and opportunity to increase the existing portfolio Further optimization of asset management activities currently carried out internally by FKR Performance improvements on both FKR asset base (wind, PV, biomass, WTE) and third parties asset base 21

22 H Consolidated Results Vector Cuatro Other Initiatives Outlook 22

23 ACQUISITION OF 51% OF VERUS ENERGY OAK LIMITED 1/2 Partnership with Verus Energy Limited: acquisition of 51% of the special purpose project entity, Verus Energy Oak Limited ( VEOL ) that owns the authorization to construct a new plant in Waste to Energy through an advanced technology in West Bromwich (UK). The plant envisages energy recovery through the thermal treatment of RDF (Refuse Derived Fuel: i.e. solid fuel obtained from non-hazardous waste) and uses bubbling type fluid bed stage gasification technology to do so. Given the technological solution adopted, defined as Advanced Conversion Technology in the United Kingdom, the production of electricity by the plant will benefit from a favourable incentive regime as compared with other waste-to-energy production technologies. 23

24 ACQUISITION OF 51% OF VERUS ENERGY OAK LIMITED 2/2 Should the investment be decided, following completion of the due diligence investigations still underway and the verification of bankability, the project will presumably have the following details : Location: West Bromwich (8 km west of Birmingham) Input Capacity: 130,000 tons/year of Refuse Derived Fuel (RDF) Plant Nominal Capacity: 16.2 MW Total Capex expected: approx. GBP 80m Revenues expected: approx. GBP 20-21m EBITDA expected : approx. GBP 9-10m The project will produce power equivalent to the demand from UK homes and it will avoid ton. of CO 2 per year. 24

25 WEST BROWNCASTLE WIND FARM Location: South Lanarkshire (Scotland) N. of Turbines: 12 Plant Nominal Capacity: 30 MW Output expected: approx. 74 GWh Incentives: ROCs and LECs Revenues expected: approx. GBP 7,5m Ebitda expected: approx GBP 5,5m The wind farm will produce power equivalent to the demand from UK homes and it will avoid ton. of CO 2 per year. 25

26 H Consolidated Results Vector Cuatro Other Initiatives Outlook 26

27 OUTLOOK: TARGET CONFIRMED Euro millions Regulation changes - CIP 6 - and energy price trend should continue in the second part of the year Well on track with the diversification toward a new business model more balanced in favour of programmable sources and services PRICES (ITA & SPAIN) NET VOLUMES PERIMETER (NUTBERRY & WEST BROWNCASTLE) CIP6 EXPIRING (TREZZO) DEVEX

28 CONTACTS IR CONTACTS FKR ON LINE IR Manager Giorgio Botta Milan Via Alberto Falck Sesto San Giovanni Milano IR Consultant Vincenza Colucci CDR Communication Srl Tel NEXT EVENTS October 2 nd, 2014 STAR Conference London November 12 th, 2014 Board of Directors to approve Q results 28

29 DISCLAIMER This document has been prepared by Falck Renewables S.p.A. (the "Company") for use during meetings with investors and financial analysts and is solely for information purposes. The information set out herein has not been verified by an independent audit company. Neither the Company nor any of its subsidiaries, affiliates, branches, representative offices (the Group ), as well as any of their directors, officers, employees, advisers or agents (the Group Representatives ) accepts any responsibility for/or makes any representation or warranty, express or implied, as to the accuracy, timeliness or completeness of the information set out herein or any other related information regarding the Company and/or Group, whether written, oral or in visual or electronic form, transmitted or made available. This document may contain forward-looking statements about the Company and/or the Group based on Company s current views, beliefs, expectations, opinions, as well as based on current plans, estimates, assumptions, projections and projects of the Company and/or Group. These forward-looking statements are subject to significant risks, uncertainties and other factor (many of which are beyond the Company and/or the Group s control) which might cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. Given these risks, uncertainties and other factors, you should not place undue reliance on the forward-looking statements in this document. The information set out in this document is provided as of the date indicated herein. Except as required by applicable laws and regulations, the Company assumes no obligation to provide updates of any of the aforesaid forward-looking statements or to conform these statements to its actual results. Under no circumstances shall the Company, the Group and/or any of the Group Representatives be held liable (for negligence or otherwise) for any loss or damage howsoever arising from any use of this document or its contents or otherwise in connection with the document or the aforesaid forward-looking statements. This document does not constitute an offer to sell or a solicitation to buy or subscribe the shares of the Company or Group and neither this entire document or a portion of it may constitute a recommendation to effect any transaction or to conclude any legal act of any kind whatsoever. This document may not be reproduced or distributed, in whole or in part, by any person other than the Company. By viewing and/or accepting a copy of this document, you agree to be bound by the foregoing limitations. 29