First quarter 2020
8 May 2020
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Agenda
• Highlights and project update
Raymond Carlsen, CEO
• Financial review
Mikkel Tørud, CFO
• Summary and outlook
Raymond Carlsen, CEO
Gurun, part of the 197 MW Quantum Solar Park, Malaysia.
Q1'20: Record high power production – robust operations in turbulent times
- Power production of 349 GWh in the quarter up 162% from first quarter 2019
- EBITDA* of NOK 346 million in the quarter, up from NOK 315 million in first quarter 2019
- The 258 MW Upington project in South Africa completed
- New bank facility of USD 75 million established and USD 90 million revolving credit facility refinanced
- Limited impact of COVID-19 on operating assets some effects on project commissioning & project development
*EBITDA and other alternative performance measures (APMs) are defined and reconciled to the IFRS financial statements as a part of the APM section of the first quarter report on pages 30-33.
The 258 MW Upington project in South Africa completed
A portfolio of 1.9 GW in operation and under construction
1,505 MW in operation (172 MW added in Q1 and 140 MW added in Q2):
Ukraine, 101 MW
Czech, 20 MW Rwanda, 9 MW
Malaysia, 197 MW
Brazil, 162 MW Egypt, 390 MW Ukraine , 235 MW
Mozambique, 40 MW
399 MW under construction:
Argentina, 117 MW
Malaysia, 47 MW
COVID-19: Limited impact on our operations
Operations
- Essential infrastructure
- All plants in full operation
Construction
- Some deferred commissioning of new solar plants
- Currently estimating two to five months delays
Project development
- Certain delays in maturing backlog and pipeline projects
- Current environment offers M&A opportunities
Sustainability: Key updates and developments
ESG Reporting
- Published Sustainability Report 2019
- Key results and new targets
- ESG resource section on website
- Easy access to ESG reporting data and policies
- Strong ESG reporting ratings 2020
- ISS ESG: A- (Excellent)
- Sustainalytics: Low risk ranked no. 1 of 450 utilities
Project work
Long term involvement in local communities
- Strong local presence, committed to play an important role also in challenging times
- Relief efforts related to COVID-19 established through our network channels and extended programmes
- Local development programmes continue according to plan
Key ambitions 2020:
22 sustainability targets for 2020
9
Responsible procurement
Engaging key suppliers to capture larger parts of our value chain's environmental impact
Climate action
Setting and pursuing emissions reduction target for our company
Financial review
Mikkel Tørud, CFO
Record high power production – robust operations in turbulent times
Proportionate financials
- Continued strong growth in Power Production revenues and EBITDA
- Reduced construction revenues as projects near completion
- Change in segment mix resulting in higher overall EBITDA margin
- Unrealised currency gain of NOK 320 million impacting net profit
Power Production Installed capacity increased by 781 MW the last 12 months
• 172 MW in South Africa in commercial operation in Q1'20
The 35 MW Los Prados plant, Honduras.
Services EBITDA growing with a larger asset portfolio
Services: Combining O&M and Asset Management
Jasin solar plant, Malaysia.
Development & Construction Reduced construction revenues as projects are near completion
• NOK 400 million of remaining revenue of current portfolio
Installation work ongoing in Ukraine.
165 MUSD bank facility established – reduced funding costs
- Total assets increased to NOK 24.4 billion
- New bank facility of USD 75 million established and USD 90 million revolving credit facility refinanced
- NOK 1.5 billion of undrawn credit facilities
- Group* book equity at NOK 5.6 billion equity ratio of 84%
| NOK million |
Consolidated |
SSO prop.
share |
Group level* |
| Cash |
3,058 |
2,266 |
717 |
Interest bearing
liabilities* |
-15,096 |
-10,404 |
-1,061 |
| Net debt |
-12,038 |
-8,139 |
-343 |
*Defined as 'recourse group' in the corporate bond and loan agreements
Consolidated financial position (NOK million)
Q1'20 movement of free cash
Short term guidance
- D&C value of portfolio under construction: NOK 1.5 billion
- Remaining NOK 400 million value to be recognised
- Power production from plants in operation end of Q1 2020:
| GWh |
Q1'20 |
Q2'20e |
2020e |
| Proportionate |
349 |
365-390 |
1,450-1,550 |
| 100% basis |
623 |
660-700 |
2,700-2,800 |
• Services revenues is expected to reach NOK 230 million in 2020 with an EBITDA margin of around 30%.
The 9 MW Asyv plant, Rwanda.
Solid partnerships with Development Banks under extraordinary times
- Multilateral development banks (DFIs) have financed infrastructure in emerging markets for decades
- Project structures and contracts are set up to mitigate risk and facilitate non-recourse project level debt
- DFIs in active dialogue with state owned utilities to ensure continued operations of critical infrastructure
- DFIs with strong appetite for financing of new projects also under challenging conditions (e.g. COVID-19)
Outlook and summary
Raymond Carlsen, CEO
Solid market position – attractive project opportunities for further growth
Key project pipeline updates
Africa 2,357 MW
- Sites representing 950 MW ready to be bid in South Africa
- Broad pipeline in several countries
South East Asia 1,535 MW
- Several opportunities in Vietnam, 1,000 MW in pipeline
- Malaysia, Bangladesh and Indonesia prioritised markets
A leading player in emerging markets
- Limited impact of COVID-19
- Certain delays in maturing backlog and pipeline
- Current environment offers M&A opportunities
- Completing another 399 MW over the next quarters
- Solid partnerships with development banks supporting our strong financial position
- Targeting installed capacity* of 4.5 GW by end 2021
The 54 MW Boguslav solar plant, Ukraine.
*In operation and under construction.