30 MW #4 #2 Offshore under 4,811 develop 71 ment MW 418 MW MW Offshore 388 under develop 200 MW ment #3 MW 521 #1 MW 1,251 144 #3 MW MW 204 2,371 MW MW 2 ( 1) December 2016: Installed capacity includes EDPR’s Equity consolidated: 177 MW in Spain and 179 MW in the US; Includes 82 M W of Solar PV
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Ongoing renewable competitiveness improvement… Renewables are a competitive and cheap technology (wind LCoE -66% since 2009 1 ) Quality assets to cope with the increasing energy demand and the need of a low carbon economy …supporting increasing growth in main markets… Solid specific market fundamentals, namely in the US despite new macro landscape, Quality assets based on clear bipartisan support along with state level targets, coal shut-down plans and C&I 2 increasing market …with EDPR well positioned to benefit from its 2020 strategy A strong renewable sponsor exposed to attractive markets, with clear competitive advantages supported by unique Quality assets core competences on project development, PPAs origination & asset management (O&M strategy and low-risk profile) (1) Source: Lazard ´ s Levelized Cost of Energy Analysis from Jan-2017; (2) Commercial & Industrial companies 6
2016 Performance Quality Selective and Self-funding assets profitable growth business 97.7% availability +820 MW installed in 2016 Asset rotation € 550m cashed-in higher than 97.5% target; benefitting from higher than 700 MW target; along with € 0.4bn from CTG; predictive maintenance and O&M strategy with 248 MW already under construction attractive € 1.7m/MW multiple Quality assets Quality assets Quality assets 30% load factor vs 29% in 2015 >65% of 2020 target secured Lower cost of debt at 4.0% but 96% of P50 impacting € 29m in EBITDA +3.5 GW of additions in 2016-20 € 2.3bn restructured & prepaid since 2015 -5% YoY Core Opex/Avg. MW NP € 56m -66% YoY due to one-offs € 0.6bn Net Debt & TEI reduction -8% per GWh; O&M strategy and scale € 104m adj. net profit (-4% YoY) after € 1.06bn of total investments 95% of Revenues fixed 1 € 698m (+13% YoY) RCF 2 € 1,171m EBITDA (+12% YoY adj.) € 61/MWh avg. selling price in line with guidance higher than +8% CAGR 15-20 growth target from young assets exposed mostly to PPA/FiT 7 (1) Based on status at the beginning of 2016; (2) RCF stands for Retained Cash Flow
Installed Capacity 1 2016 Under Additions 2 (EBITDA MW + Equity Consolidated) Construction Rest of +429 MW +100 MW Europe Portugal Brazil 15% 12% 2% +72 MW +21 MW 10.4 GW Spain 23% +120 MW +127 MW North America 48% +200 MW - +820 MW +248 MW Average Installed Capacity increased by 960 MW (+11% YoY) 2016 execution above expectations: 820 MW added YTD and 248 MW under construction (1) Incl. equity consolidated: 177 MW in SP & 179 MW in the US; (2) In EU: PT (4 MW), FR (24 MW), IT (44 MW); does not consider 50 MW deconsolidated in PL; 9 200 MW in MX to start full consolidation in 2017
EDPR Load Factor analysis vs. long-term average (P50) Load Factor and Technical Availability (%) 2015 2016 +7% 2016 vs. D % YoY 2016 Average (P50) -1% -3% -3% -3% -4% 26% -0.2pp 97% -7% -11% 1Q 2Q 3Q 4Q 33% +1.1pp 96% 2016: EDPR Load Factor vs. Market Averages (2) (%) EDPR Mkt 35% +4.3pp 107% - +6pp +2pp +1pp - +2pp - 30% 96% +0.4pp EDPR 97.7% -0.1pp Availability 1 Load factor increased to 30% in 2016 on the back of new assets with above average load factors High level of availability (97.7%) reflecting distinctive core competences 10 (1) Technical Energy Availability (TEA); (2) Avg NCF sources: REE/AEE (Spain), REN (Portugal), RTE (France), Elia (Belgium), Terna/ANEV (Italy), PSE/URE (Poland) & Transelectrica (Romania)
Electricity Production (TWh) TWh r % YoY +14% Output growth across all platforms; +12% impact from 2015 ENEOP consolidation (+1.0 TWh YoY) 24.5 +0.1 21.4 +3.0 Impact from capacity additions with +13% above average load factors Reflecting mainly 120 MW of +200% capacity added YoY D Load 2015 Capacity 2016 Growth Factor In 2016 EDPR generated 24.5 TWh avoiding 20.1 mt of CO 2 emissions Electricity Output breakdown: 51% in US, 46% in Europe and 3% in Brazil 11
EDPR Price Evolution ( € /MWh) r % YoY 1 2016 • Driven by ENEOP consolidation -5% € 81.5 -2% • Poland: 87 MW with GC fully exposed to market price € 64.0 € 60.5 • PPA (-7%): different mix profile 1Q: € 60.8 • Non-PPA (-21%): flat wholesale + 2Q: € 58.7 $46.4 -9% hedges; 2015 benefitted from sale 3Q: € 61.2 of 2014 REC stock 4Q: € 61.3 • Reflecting a different mix of a new R$216 -42% wind farm in operation 2015 2016 Selling price -5% YoY due to different mix and lower pool price mitigated by hedging strategy 12 (1) Evolution calculated in local currency
Revenues Main drivers for Revenues performance ( € million) +7% Load factor: 96% of P50 +9% ex-one-off Negative impact of € 29m (vs - € 6m in 9M16) 1,651 1,547 Higher output: +14% YoY Includes + € 30m one-off from TEI’s from +960 MW (Avg. EBITDA) YoY residual interest EU +12%; NA +13%; BR +200% accretion Lower average selling price: -5% YoY EU -2%; NA -9% (in $); BR -42% (in R$) 2015 2016 Higher YoY revenues supported by new additions, offsetting the lower price in the period Lower than average wind resource with € 29m negative impact 13
Opex (excludes Other Operating Income) ( € million) Core Opex/Avg. MW ( € k) (Supplies & Services and Personnel Costs) -6% -5% 566 -8% per MWh 534 45.1 42.8 Levies & - € 61m YoY Non-current of write-offs +6% Core Opex (1) 2015 2016 2015 2016 Core Opex per average MW decreasing 5% YoY boosted by EDPR’s control over costs and higher installed capacity 14 (1) Includes Supplies and Services and Personnel Costs
EBITDA per Region (1) EBITDA ( € million) (%) +3% Rest of Portugal +12% ex-one-offs Europe 18% 16% 1,171 1,142 Brazil 2016: - € 103m one-offs YoY: 2% € 125m: ENEOP PPA in 2015 € 1,171m € 61m: lower YoY write-offs Spain €39m: other including TEI’s minority interest accretion 21% € 1,192m recurring (FY15) North America 43% 2015 2016 EBITDA +3% YoY, impacted by 2015 one-offs and benefitting from top-line evolution and cost control 15 (1) Includes hedges gains in Spain, Rest of Europe and US
2016 Execution Avg. MW Load Selling Core Opex EBITDA in Operation Factor Price per MW (ex-one-offs) (MW) (%, P50) ( € /MWh) ( € k) ( € bn) +10-12% YoY c.31% c. € 60 per MWh -1% CAGR 15-20 Double digit YE16 Outlook • 2015 new MW • new accretive • new project mix • O&M Strategy • vs € 1.07bn FY15 (presented in • ENEOP • 95% contracted projects (M3 & SP) one-offs adjusted YE15 results, • wind resource • larger portfolio • benefiting from consolidation revenues & BP 2016-20) recovery efficient hedges accretive projects +11% YoY 30% in 2016 € 61 per MWh -5% YoY EBITDA +12% YoY 2016 competitive 96% of P50 low market prices control over ex-non recurring; Operational projects with scenario due to mitigated by costs and Reported EBITDA: Performance contracted lower 4Q hedging strategy O&M strategy +3% YoY revenues ( € 40m gain) 16
Adjusted Net Profit ( € million) 2015 2016 ( € million) Reported -4% 166.6 56.3 (66%) Net Profit Project Finance 108 +6.2 +20.7 104 Renegotiation Write-offs & +70.2 +14.5 Impairments Forex losses (gains) & +2.3 (1.4) Forex derivatives Provisions & other (137.7) +13.4 Adjust. (inc. ENEOP PPA) Adjusted (4%) 107.7 103.6 Net Profit 2015 2016 On a like-for-like basis and excluding non-recurring, Net Profit was -4% YoY impacted by lower wind resource 17
• Top line performance and cost efficiency EBITDA • Revenues accrued as LT receivables along with cash adjustments such 1 LT receivables & cash-adjustments as realized revenues by TEI (vs accounting), write- offs, provisions… • Income taxes related to the current period fiscal profits; 2 Current income taxes excludes tax provision/deferred taxes • Net interests expenses from financial debt along with institutional 3 Interests, TEI, fees & derivatives partnerships costs and banking fees, forex and energy derivatives • Minority interests on cash-flows generated by assets with minority 4 Dividends and interests to Minorities partners; includes net dividends, capital distributions and interests • Net Cash-flow generated by operations and available to Retained Cash Flow (RCF) re-invest, distribute and pay debt principal Retained Cash Flow metric captures assets’ cash generation capabilities and EDPR ability to grow profitable 18
EBITDA ( € 8m) 1 LT receivables & Cash Adjustments ( € million) 2016 ( € 22m) Spanish regulatory adjustment on standard GWh € 1,171m Receivables (to be received from 2017 till the end of assets’ regulatory life) (2016) € 8m LT ( € 18m) Restricted Green Certificates in Romania (to be sold after Jan-18) (2016) Adjust. Cash + € 32m TEI realized revenues (vs accounting), gains on assets, write- offs, provisions, etc… (2016) ( € 50m) 2 Current income taxes 2016 Current income taxes in line with 2015 Tax provisions/deferred taxes not included (“non - cash”) 1 2016 19 (1) As of Dec-16 EDPR had € 2.8bn of tax losses carried forward (mostly US)
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