ENCAVIS AG — Call Transcript 2017

Sep 1, 2017

Capital Stage AG – Earnings Call on first six months of FY17 01 September 2017

Management Board – Dr. Paskert new CEO as of Sep 1,2017

Dr. Dierk Paskert, CEO

• Since September 2017 CEO at Capital Stage AG
• Law and Business Administration at the Westfälische Wilhelms-University of Münster and the Julius-Maximilian University of Würzburg
• PhD at the Westfälische-Wilhelms-University of Münster
• Privatbank Trinkaus&Burkhardt, Investment Banking/M&A
• Veba-AG, M&A Activities/Business Development
• E.ON AG Düsseldorf, Senior Vice President, Corporate Development
• Member of the Management Board of E.ON-Energie München

Dr. Christoph Husmann, CFO

• Since October 2014 CFO at Capital Stage AG
• Business Administration at the Westfälische Wilhelms-University of Münster (Dipl.-Kfm.) and the Central University of Iowa in Pella / Iowa
• PhD at the Ruhr-University of Bochum
• VEBA AG, Controlling
• STINNES AG and HOCHTIEF AG, Head of Corporate Controlling and M&A
• Member (CFO) and later Chairman of the Management Board of HOCHTIEF Projekt Entwicklung GmbH

Holger Götze, COO

• Since mid October 2016 COO at Capital Stage AG
• 2014 until mid October 2016 CEO of CHORUS Clean Energy AG
• Since 2012 member of the Management of the CHORUS Group
• Previously held senior management positions at German subsidiaries of different banks, e.g. LBBW

Capital Stage AG – Earnings Call on first six months of FY17

Milestones - First 6 months of FY17

New acquisitions push total generation capacity to ~1.3 GW

• Acquisition of PV and wind parks with a total generation capacity of ~52 MW (same period 2016: ~54)
• Additionally wind parks with ~16 MW acquired by the Asset Management unit on behalf of 3rd parties
• Successful market entry in Denmark further increased regional diversification of portfolio

Favourable financing environment

• Credit facilities of ~EUR 40m agreed; interest rates < 2%
• Cash on hand for investments ~EUR 40m transferring into a total investment volume of ~EUR 160m
• Alternative and equity-linked financing instruments under review

Clear dividend strategy until FY2021

• For FY16 a dividend of EUR 0.20 was paid out and offered as scrip dividend; acceptance rate >50%
• Transparent and clear dividend strategy: Dividend increase by per cent to EUR 0.30 until FY2021*

CHORUS takeover successfully completed

• Takeover of CHORUS successfully completed within1 year and 3 months
• Termination of listing leads to savings of > EUR 1m p.a.
• New business Segment 'Asset Management' within Capital Stage Group

Strong KPIs in first 6 months of FY17

• Acquisitions, higher sun radiation and CHORUS-effect led to a strong increase in revenues and earnings
• Attractive and well filled pipeline of some ~200 MW on hand
• Guidance 2017 increased on August 24, 2017

Track Record: The portfolio amounts to ~1.3 GW

WIND PARKS		Own Assets	Asset Mgmt
	Germany	200 MW	138 MW
	France	36 MW	85 MW
	Austria	30 MW	-
	Finland	-	13 MW
	UK	-	18 MW
	Sweden	-	10 MW	15
	Italy	6 MW	-
	Denmark	25 MW
	Total	297 MW	264 MW
	SOLAR PARKS	Own Assets	Asset Mgmt
	Germany	251 MW	7 MW
	Italy	153 MW	7 MW
	France	202 MW	12 MW
	UK	93 MW	-
	Total	699 MW	26 MW
	Group Total		1 285 MW	New market entry in 2017

Track Record: Development of installed base

Creating a leading independent producer of renewable energy with a combined capacity of approx. 1.3 GW including asset management activities of about 290 MW

MW development of assets

Note: For CHORUS based on annual values. Increase in MW has been distributed evenly over the quarters.

Track Record: Balanced Portfolio

The portfolio spans across key markets in Europe

Track Record: Capital Stage portfolio without Asset Management

The amount of solar power is significantly higher among our own parks

Capital Stage AG – Operational figures first six months of FY17

Capital Stage – Strong growth in KPIs in first half of 2017

Strong first six months of FY17

• Very Strong increase in all operational KPIs
• New acquisitions, higher sun radiation (yoy), and CHORUS takeover main growth drivers
• Increase in Guidance 2017 due to strong KPIs and new acquisitions on August 24, 2017; based on existing PV/wind park portfolio as of August 2017

Operational KPIs in €m	H1 2016	H1 2017	Δ (in %)
Revenues	64.9	113.8	+75%
Operating EBITDA	50.8	88.0	+73%
Operating EBIT	31.9	55.9	+75%
Operating Cashflow	44.9	69.9	+56%

Capital Stage AG – IFRS financial figures first six months of FY17

Capital Stage – P&L Overview (in TEUR; IFRS)

Strong growth in IFRS financial figures in the first six months of FY17

IFRS (in TEUR)	1 HY 2016	1 HY 2017	Δ yoy in %
Revenues	64,850	113,775	+75
Other income	5,458	17,309	+217
Cost of materials	-408	-703	+72
Personnel expenditures	-2,781	-4,609	+66
Other expenditures	-13,186	-24,011	+82
EBITDA	53,933	101,760	+88
Depreciations	-25,219	-49,776	+97
EBIT	28,714	51,984	+81
Financial income	451	5,204	+1,053
Financial expenditures	-28,478	-28,567	0
EBT	688	28,621	+4,060
Taxes	-1,352	-8,396	+521
EAT	-665	20,225	+3,141

Capital Stage – P&L effects in 1 HY 2017

IFRS (in TEUR)	1.HY 2016	1.HY 2017	IFRS (in TEUR)	Q2 2016	Q2 2017
Revenues	64,850	113,775	Revenues	42,499	71,836
Other income	5,458	17,309	Other income	3,989	4,520
thereof PPA adjustments	919	12,579	thereof PPA adjustments	1,433	1,787
Cost of materials	-408	-703	Cost of materials	-135	-420
Personnel expenditures	-2,781	-4,609	Personnel expenditures	-1,579	-2,875
Other expenditures	-13,186	-24,011	Other expenditures	-7,020	-13,945
EBITDA	53,933	101,760	EBITDA	37,752	59,116
Depreciations	-25,219	-49,776	Depreciations	-12,646	-25,108
EBIT	28,714	51,984	EBIT	25,107	34,007
Financial income	451	5,204	Financial income	408	2,637
Financial expenditures	-28,478	-28,567	Financial expenditures	-12,642	-14,901
EBT	688	28,621	EBT	12,873	21,744
Taxes	-1,352	-8,396	Taxes	-4,698	-6,012
EAT	-665	20,225	EAT	8,176	15,732

	13

Capital Stage – Equity ratio above long term target level ~25%

Balance sheet		2012	2013	2014	2015	2016*	1.HY 2017
Balance sheet total	TEUR	455,017	593,191	985,799	1,324,816	2,353,797	2,394,766
Equity ratio	%	28.6	35.0	23.5	19.4	25.9	25.7
Operating ROE	%	5.7	5.6	7.9	10.5	5.3
Operating ROCE	%	5.2	5.0	5.9	7.1	5.0
Net Gearing		1.8	1.5	2.2	3.2	2.0	2.1
Net Debt/ EBITDA		6.0	5.2	6.9	8.1	10.0

Capital Stage AG – CHORUS integration / Business Segment Asset Management

16

Successful completion of CHORUS takeover

Takeover successfully completed in 1 year and 3 months

Group Structure – Encavis AG*

Capital Stage

Core Business

• Acquisition of PV/Wind parks
• Project Financing
• Legal
• Technical & commercial operations

Headquarter functions

• Corporate Finance
• Controlling
• Communications/IR
• HR
• Group Accounting (IFRS)

CHORUS

Asset Management (institutional clients)

• Sales/Marketing Activities
• Fund structuring
• Project financing
• Asset Sourcing
• Administration

Termination of listing of CHORUS in the General Standard of the Deutsche Börse leads to savings of > EUR 1m p.a.

Business Model: Asset Management for institutional investors

The Asset Management portfolio already comprises 290 MW

Focus	Institutional investors such as insurance companies, pension funds, banks, foundations, etc. •
Offering	Full service portfolio (deal origination, selecting and managing the acquisition, operating the park) •
Basis	Investment funds on the basis of a special Luxembourg SICAV-funds •
Financials	Management fees add > EUR 5m of recurring income to revenues •

AM: Managed capacity by geography

in MW	Solar	Wind	Combined
Germany	7	138	145	Italy
France	12	85	97
UK	-	18	18
Italy	7	-	7
Finland	-	13	13	France
Sweden	-	10	10
Total	26	264	290

AM: Portfolio by geography and technology

Capital Stage AG – Guidance 2017

Capital Stage – (operational) Guidance 2017

Guidance for the full FY2017

• New acquisitions and strong figures in H1 2017 led to increase in the Guidance 2017 on August 24, 2017

• Full consolidation of CHORUS
• Based solely on the existing portfolio as of August 24, 2017
• Further acquisitions in FY2017 may add to revenues and earnings

in mEUR	FY2016	FY2017 (e)*	yoy in % (e)
Revenues	141.8	> 215	> +50
Operating EBITDA	106.1	> 160	> +50
Operating EBIT	61.6	> 97	> +57
Operating Cashflow	103.8	> 150	> +40

(e) = expected; Based on portfolio as of Aug. 24, 2017

Capital Stage – Positive Growth Outlook

As one of the largest independent power producers (IPPs) in the renewable energy sector, Capital Stage is in an excellent position to continue its profitable growth path …

Renewable Energies continue to be a worldwide growth market with double digit growth rates

Low interest environment leaves a high pressure (e.g.) for insurance companies to invest in alternative assets such as renewable energies which offer reasonably steady and stable long-term returns

Capital Stage is active in a niche market for smallish PV (Ø 4.5 MW) and wind parks (Ø 10.2 MW) that offer on average higher IRRs. In the Asset Management segment Capital Stage profits from a reasonably high liquidity & pressure to invest among institutional investors

Capital Stage has a well filled project pipeline of some 200 MW; thereof 120 MW in exclusivity

Current cash on hand of ~EUR 40m translates into an investment volume of some ~EUR 160m

Further/alternative equity-linked financing instruments under review

• Market consolidation leaves opportunities for inorganic growth

Capital Stage AG – Q&A Session

Capital Stage AG – Earnings Call on first six months of FY17 01 September 2017