Alerion Cleanpower

Investor Presentation • Feb 25, 2016

Milan, 25th February 2016

Agenda

1. The New Alerion

• 1. Portfolio of operating assets
• 1. 9M 2015 Consolidated Results

Appendix: Wind farms

• 2003 : Alerion listed on the Milan Stock Exchange as holding co. with equity interests in various businesses
• 2004-2007: Increasing focus on renewable energy
• 2008: F2i enters Alerion shareholding through capital increase (initially 10%)

• 2008-2014: Total focus on wind power

• 2015: New Shareholders Agreement and new CEO with two main targets:

• - Cost reduction
• - Growth (mainly) through M&A

Overview Alerion at a glance

• Independent Italian renewable energy company, specialized in the production of electricity from wind
• Currently manages and operates a portfolio of:

10 wind farms in Italy (total gross installed capacity of 295 MW) and

1 wind farm in Bulgaria (total gross installed capacity of 12 MW)

• Over 8 years of residual average incentives (portfolio average)
• Listed on the Milan Stock Exchange since 2003

(€'million)	2014 FY	9M 2015
Net Production (GWh)	378	303
Revenues	46	37
EBITDA	22.6	22.8
	49%	61%
Net Debt		212
Net Debt (exc. Derivatives)		194
Equity		115

Overview Operating Plants - Italy

Shareholders Structure Overview

F2i is the main shareholder of the Company with a stake of 16.03% of the share capital and, since April 2015, is part of a Shareholders' Agreement, which holds 26.24% of the share capital, expiring in October 2016.

Shareholders	Ownership	% of S.A.
F2i Energie Rinnovabili	16,0%	61,1%
Other private investors	10,2%	38,9%
Total	26,2%	100,0%

• Mauro Miglio (CEO), appointed on the 15th September 2015
• Gastone Colleoni (Chairman)
• Corrado Santini, Mario Bonamigo, Patrizia Savi, Sylvia Bartyan, Luca Arnaboldi

Strategic priorities

3

Cost reduction and operational streamlining 1

2 Financial discipline

Pursuit of economies of scale, also through M&A

Strategic priorities

Cost reduction and operational streamlining

2015 actions implemented:

• Line-by-line cost cutting (corporate and operating)
• FTE reduced by 30% (2016 vs 2014)
• O&M renegotiations
• Extraordinary maintenance on Agrigento plant
• New HQ
• More than 90% of Opex already contracted
• Tax optimization: structure rationalization, IMU decrease

Simple and low-risk cost structure:

• Maintenance Capex fully included in Opex
• No exposure to raw material prices

Focus on plant productivity:

• Preventive maintenance
• Real-time monitoring
• Daily wind forecast for maintenance optimization
• New technologies (turbine upgrade systems, blade profile, etc.)

Plant energy production forecast

Strategic priorities Financial discipline

Solid and predictable cash flow generation:

• Incentive scheme, reducing exposure to wholesale electricity prices
• Low working capital requirements
• Negligible ordinary capex

Bond:

• €130 million; 6% pa
• Listed on MOT; bullet repayment in 2022
• Dividend min. €2 million/year + 50% consolidated net income

Discretionary use of cash flow generation:

• Expected deleverage in short-medium term
• Capex for new greenfield plants (next incentive auctions )
• Acquisition of operating wind farms

Strategic priorities Pursuit of economies of scale, also through M&A

• Italian market is still very fragmented
• Opportunities of growth through business combinations

Agenda

1. The New Alerion

2. Portfolio of operating assets

1. 9M 2015 Consolidated Results

Appendix: Wind Farms

Physical and Revenue Flows Market and regulatory framework

Supportive regulatory framework Market and regulatory framework

• The new "Energy Strategy" for Italy confirms developments of renewable energies among its priorities, with the objective to meet the EU targets by 2020
• All existing plants completed prior to 2013 benefit from Green Certificates ("GC") regime:
• Downward protection from power price fluctuations
• GC purchase price year t = 78% x (180 €/MWh Power Price)
• Power price and incentives are inversely correlated Any decline in power prices would lead to an increase in incentives
• From 2016, this incentive scheme will be replaced by a feed-in tariff scheme for the residual incentive eligibility period, calculated with the same formula currently used to define the GC purchase price

Portfolio of operating plants

• Portfolio of 11 fully built and operating plants; 307 MW of gross installed capacity directly managed
• Assets with a proven historical production track record, higher than Italian wind sector median, and with an average incentive residual period of more than 8 years
• WTGs manufactured by leading suppliers, all providers of O&M services

Incentive residual period

Albanella 2016
Agrigento 2019		8 yrs
Ciorlano	2023	average
Lacedonia	2023
Ordona		2024
Callari		2024
S. Martino		2025
Castel di Lucio		2025
Licodia		2025
Krupen		2025
San Marco in Lamis		2026

O&M suppliers

56%

Portfolio of operating plants

Plant Location	Company	Installed	Ownwership	End of incentive
		Capacity		period
Albanella	Eolo .r.l S	8.5	100%	Feb. 2016
Ciorlano	.r.l Dotto S	20.0	100%	March 2023
Agrigento	.r.l WPS S	34.0	100%	Jan. 2019
Lacedonia	.r.l Ecoenergia Campania S	15.0	50%	Sept. 2023
Callari	Callari .r.l S	36.0	100%	Jan. 2024
Ordona	Ordona .r.l S	34.0	100%	March 2024
Castel di Lucio	.r.l Minerva S	23.0	100%	April 2025
Licodia	eolico Licodia Eub .r.l Parco S	22.1	80%	Sept. 2025
S. Martino in Pensilis	Molise .r.l New Green S	58.0	50%	Oct. 2025
S. Marco in Lamis	.r.l Renergy San Marco S	44.2	100%	Dec. 2026
Krupen	Wind EOOD	12.0	51%	Oct. 2025

Total 306.75

Agenda

• 1. The New Alerion
• 1. Portfolio of operating assets
• 1. 9M 2015 Consolidated Results

Appendix: Wind Farms

9M 2015 Consolidated results

Profit and Loss

Profit & Loss (m€)	FY 2013	FY 2014	9M 2014	9M 2015	Change
Consolidated Production (GWh)	411.3	377.9	284.0	302.7	18.7
Total Revenues	54.0	45.9	34.6	37.1	2.5
Operating Costs	(23.6)	(22.9)	(15.9)	(14.2)	1.7
Provisions for risks	(0.4)	(0.8)	(0.4)	(0.9)	(0.5)
Results from Joint Ventures	1.3	0.4	(0.4)	0.8	1.2
EBITDA	31.3	22.6	17.8	22.8	5.0
Ebitda margin %	58%	49%	52%	61%
Amortization and Depreciation	(16.9)	(22.8)	(16.7)	(16.7)	0.0
EBIT	14.4	(0.2)	1.1	6.1	5.0
Net Financial Income/(Expenses)	(14.6)	(34.2)	(11.3)	(10.6)	0.7
Profit/(Loss) before taxes	(0.2)	(34.4)	(10.2)	(4.5)	5.7
Taxes	(0.1)	6.6	1.4	1.9	0.5
Net Income/(Loss)	(0.3)	(27.8)	(8.8)	(2.6)	6.2
Minorities Net Income/(Loss)	0.5	(1.0)	(0.3)	(0.1)	0.2
Group Net Income/(Loss)	(0.8)	(26.8)	(8.5)	(2.5)	6.0

Growth in installed capacity resulting from the acquisition of 50% of Agrigento farm and production higher than 2014, despite the electrical output of 3Q2015 was affected by the low wind of summer months

+7%

+28%

EBITDA increase reflects a significant reduction in operating costs (-1.7 million euro), also resulting from the start of the cost reduction and operational streamlining program

9M 2015 Consolidated results

Balance Sheet

Balance Sheet	FY 2014	9M 2015	Change
(m€)				NFP
				(m€)	FY 2014	9M 2015	Change
Fixed asset	299.5	311.5	12.0
Other non current assets	19.4	15.2	(4.2)	Cash and Cash Equivalents	47.9	21.0	(26.9)
of which receivables for electricity and incentives	14.8	25.7	10.9	Other Financial Receivables	15.3	10.2	(5.1)
				Total Activities	63.3	31.2	(32.0)
Net Invested Capital	318.9	326.7	7.8	Banks Debt	(229.3)	(92.3)	137.0
				Bond	-	(131.4)	(131.4)
Shareholders' Equity	114.6	111.9	(2.7)	Other Financial Debts	(2.2)	(1.9)	0.3
Minority Shareholders' Equity	2.4	3.0	0.6	Total Liabilities	(231.5)	(225.6)	5.9
Total Equity	117.0	114.9	(2.1)
				NFP excluding Derivatives	(168.2)	(194.4)	(26.2)
Cash and Cash Equivalents	47.9	21.0	(26.9)	Derivatives	(33.7)	(17.5)	16.2
Other Financial Assets and Liabilities	(249.9)	(232.9)	17.0
Net Financial Position	(201.9)	(211.8)	(9.9)	Net Financial Position	(201.9)	(211.8)	(9.9)
Equity and Net Financial Position	318.9	326.7	7.8

Net Financial Position as at 30 September 2015 amounted to 211.8 million euro, + 9.9 million vs Dec. 2014:

• Operating cash flows (34 million euro)
• Positive fair value change of derivatives (2.6 million euro)
• Purchase of 50% and full consolidation of Agrigento wind farm (32.5 million euro)
• Dividends (2 million euro)
• interest expenses (12.2 million euro)

Financial Structure Bond Issue

• On the 11th February 2015, Alerion issued a 130 million euro bond, listed on the MTO market
• Proceeds were used to refinance most of the project financing in place and making available cash to take over 50% stake of Agrigento wind farm (currently fully owned)
• After bond issue, 7 out of 9 fully consolidated wind farms have no project financing and operating cash flows are fully available at corporate level

Bond main terms

Issuer	Alerion Clean Power SpA
Size	130 € million
Maturity	7 year tenor
Coupon	6% fixed
Interest payment	Annual
Optional redemption	Non-callable for 3 years
Listing	MOT - Milan Stock Exchange
Guaranties	Security on intercompany loans
Change of control	Allowed
Governing law	Italian law
Covenants	- D/E max = 2 - Dividend distribution: 50% of Net consolidated earnings with a floor of 2 million euro per year

Appendix

Wind Farms

Installed Capacity	34.0 MW
Location	Ordona (Foggia province)
Project Company	Ordona Energia S.r.l.
Ownership	100%
Pro-quota installed capacity	34.0 MW
Commercial Operation Date	March 2009
No of Turbines	17
Incentive Scheme	Green Certificates/Feed in tariff
End of Incentives	March 2024

EquivalentHours

Ordona (34 MW) San Marco in Lamis (44,2 MW)

Installed Capacity	44.2 MW
Location	San Marco in Lamis (Foggia province)
Project Company	Renergy San Marco S.r.l.
Ownership	100%
Pro-quota installed capacity	44.2 MW
Commercial Operation Date	January 2012
No of Turbines	13
Incentive Scheme	Green Certificates/Feed in tariff
End of Incentives	December 2026

Installed Capacity	34.0 MW
Location	Agrigento (Agrigento province)
Project Company	Wind Power Sud S.r.l.
Ownership	100%
Pro-quota installed capacity	34.0 MW
Commercial Operation Date	February 2007
No of Turbines	40
Incentive Scheme
End of Incentives	January 2019

EquivalentHours

Agrigento (34 MW) Callari - Vizzini (36 MW)

34.0 MW	Installed Capacity	36.0 MW
Agrigento (Agrigento province)	Location	Vizzini (Catania province)
Wind Power Sud S.r.l.	Project Company	Callari S.r.l.
100%	Ownership	100%
34.0 MW	Pro-quota installed capacity	36.0 MW
February 2007	Commercial Operation Date	January 2009
40	No of Turbines	18
Green Certificates/Feed in tariff	Incentive Scheme	Green Certificates/Feed in tariff
January 2019	End of Incentives	January 2024

Castel di Lucio (2 MW)

Installed Capacity	23.0 MW
Location	Castel di Lucio (Messina province)
Project Company	Minerva S.r.l.
Ownership	100%
Pro-quota installed capacity	23.0 MW
Commercial Operation Date	April 2010
No of Turbines	27
Incentive Scheme
End of Incentives	April 2025

EquivalentHours

Licodia (22,1 MW)

23.0 MW	Installed Capacity	22.1 MW
Castel di Lucio (Messina province)	Location	Licodia (Catania province)
Minerva S.r.l.	Project Company	Parco Eolico Licodia Eubea S.r.l.
100%	Ownership	80%
23.0 MW	Pro-quota installed capacity	17.7 MW
April 2010	Commercial Operation Date	September 2010
27	No of Turbines	26
Green Certificates/Feed in tariff	Incentive Scheme	Green Certificates/Feed in tariff
April 2025	End of Incentives	September 2025

Installed Capacity	20.0 MW
Location	Ciorlano (Caserta province)
Project Company	Dotto s.r.l.
Ownership	100%
Pro-quota installed capacity	20.0 MW
Commercial Operation Date	April 2008
No of Turbines	10
Incentive Scheme
End of Incentives	March 2023

EquivalentHours

Ciorlano (20 MW) Albanella (8,5 MW)

20.0 MW	Installed Capacity	8.5 MW
Ciorlano (Caserta province)	Location	Albanella (Salerno province)
Dotto s.r.l.	Project Company	Eolo s.r.l.
100%	Ownership	100%
20.0 MW	Pro-quota installed capacity	8.5 MW
April 2008	Commercial Operation Date	March 2004
10	No of Turbines	10
Green Certificates/Feed in tariff	Incentive Scheme	Green Certificates/Feed in tariff
March 2023	End of Incentives	February 2016

Installed Capacity	58.0 MW
Location	San Martino in Pensilis (Campobasso)
Project Company	New Green Molise S.r.l.
Ownership	50%
Pro-quota installed capacity	29.0 MW
Commercial Operation Date	October 2010
No of Turbines	29
Incentive Scheme
End of Incentives	October 2025

EquivalentHours

Lacedonia (7,5 MW)

58.0 MW	Installed Capacity	15.0 MW
San Martino in Pensilis (Campobasso)	Location	Lacedonia (Avellino province)
New Green Molise S.r.l.	Project Company	Ecoenergia Campania s.r.l.
50%	Ownership	50%
29.0 MW	Pro-quota installed capacity	7.5 MW
		October 2008
		5
October 2025		September 2023
October 2010 29 Green Certificates/Feed in tariff	Commercial Operation Date No of Turbines Incentive Scheme End of Incentives	Green Certificates/Feed in tariff

Krupen (12 MW)

Installed Capacity	12.0 MW
Location	Krupen (Bulgaria)
Project Company	Wind Energy / Power2 / Stream / Systems EOOD
Ownership	51%
Pro-quota installed capacity	12 MW
Commercial Operation Date	October 2010
No of Turbines	4
Incentive Scheme	Feed – in Tariff
End of Incentives	October 2025

Group Presentation Disclaimer

• This document has been prepared solely for the use at investors and analysts meetings
• This document does not constitute an offer or an invitation to purchase or subscribe any shares and neither it nor any part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever
• Some information contained herein and other material discussed at the meetings may include forward looking information based on Alerion current beliefs and expectations. These statements are based on current plans, estimates, projections, and projects and therefore you should not place undue reliance on them
• Forward looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from those contained in any forward looking statement. Such factors include, but are not limited to: changes in global economic business, changes in the price of certain commodities including electricity and gas, the competitive market and regulatory factors
• Moreover, forward looking statements are valid only at the date are made