Investor Presentation Disclaimer This - - PowerPoint PPT Presentation
Investor Presentation Disclaimer This - - PowerPoint PPT Presentation
Investor Presentation Disclaimer This document has been prepared by EDP - Energias de Portugal, S.A. (the "Company") solely for use at the presentation to be made on this date and its
RESULTS PRESENTATION 2
Disclaimer
This document has been prepared by EDP - Energias de Portugal, S.A. (the "Company") solely for use at the presentation to be made on this date and its purpose is merely of informative nature and, as such, it may be amended and supplemented. By attending the meeting where this presentation is made, or by reading the presentation slides, you acknowledge and agree to be bound by the following limitations and
- restrictions. Therefore, this presentation may not be distributed to the press or to any other person in any jurisdiction, and may not be reproduced in any form, in whole or in part for any other purpose without
the express and prior consent in writing of the Company. This presentation and all materials, documents and information used therein or distributed to investors in the context of this presentation do not constitute or form part of and should not be construed as, an
- ffer (public or private) to sell or issue or the solicitation of an offer (public or private) to buy or acquire securities of the Company or any of its affiliates or subsidiaries in any jurisdiction or an inducement to enter
into investment activity in any jurisdiction. Neither this presentation nor any materials, documents and information used therein or distributed to investors in the context of this presentation or any part thereof, nor the fact of its distribution, shall form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever and may not be used in the future in connection with any offer (public or private) in relation to securities issued by the Company. Matters discussed in this presentation may constitute forward-looking statements. Forward-looking statements are statements other than in respect of historical facts. The words “believe,” “expect,” “anticipate,” “intends,” “estimate,” “will,” “may”, "continue," “should” and similar expressions usually identify forward-looking statements. Forward-looking statements include statements regarding: objectives, goals, strategies, outlook and growth prospects; future plans, events or performance and potential for future growth; liquidity, capital resources and capital expenditures; economic outlook and industry trends; energy demand and supply; developments of the Company’s markets; the impact of legal and regulatory initiatives; and the strength of the Company’s competitors. The forward-looking statements in this presentation are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management’s examination of historical operating trends, data contained in the Company’s records and other data available from third parties. Although the Company believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict and are beyond its control. Important factors that may lead to significant differences between the actual results and the statements of expectations about future events or results include the company’s business strategy, financial strategy, national and international economic conditions, technology, legal and regulatory conditions, public service industry developments, hydrological conditions, cost of raw materials, financial market conditions, uncertainty of the results of future operations, plans,
- bjectives, expectations and intentions, among others. Such risks, uncertainties, contingencies and other important factors could cause the actual results, performance or achievements of the Company or
industry results to differ materially from those results expressed or implied in this presentation by such forward-looking statements. The information, opinions and forward-looking statements contained in this presentation speak only as at the date of this presentation, and are subject to change without notice unless required by applicable law. The Company and its respective directors, representatives, employees and/or advisors do not intend to, and expressly disclaim any duty, undertaking or obligation to, make or disseminate any supplement, amendment, update or revision to any of the information, opinions or forward-looking statements contained in this presentation to reflect any change in events, conditions or circumstances.
3
Strategy Execution
RESULTS PRESENTATION 4
The first year of the 2019-22 Strategic Plan was marked by important steps towards the delivery of our commitments Leading the energy transition to create superior value
Accelerated and focused growth Continuous portfolio optimization Solid balance sheet and low-risk profile Efficient and digitally enabled Attractive shareholder remuneration
12th Mar
STRATEGIC UPDATE 2019-22
2019 2020 2022
20th Feb STRATEGIC PILLARS:
RESULTS PRESENTATION 5
Renewables projects secured by PPAs for 2019-22 rose from 40% in Mar-19 to 76% in Feb-20 of the 7 GW built-out target for the period
Projects already secured
Build-out GW; Feb-20
5.4 GW
0.1 1.3 0.7 2019 1.0 0.4 1.0 2020 2021 0.5 0.3 0.6 2022 0.7 post-2022 0.9 1.3 1.4 1.8 1.2
Accelerated and focused growth
wind solar
- ffshore
Unprecedent execution
Leadership position in securing LT contracts in 2019-20 1.6 GW1 of PPA secured in the US #1 awarded in Poland & Italy auctions Increased market position in wind in Brazil to #4 Expansion to new geographies Colombia (0.5 GW) & Greece (0.1 GW)
Renewables Capacity LT contracts secured for 19-22
2.5 40% 76% 35% 2.9 Dec-18 Feb-20 Mar-19 5.4
+3.0 GW
GW
1) Gross capacity
RESULTS PRESENTATION 6
€9 Bn Expansion Capex opportunities analyzed in 2019 at top decision-making level €6 Bn approved and successful … … in 40 projects located in 12 geographies … totalling 5.5 GW of renewables to be deployed in 2020-24
1) Average of successful projects analyzed in Investment Committee in 2019
Selective screening process of investment projects...
We are managing to grow while meeting our investment thresholds
… achieving risk/return discipline
Achieved1 Threshold Attractive returns
>1.4x
IRR/WACC
>1.4x
Sound contracted profile and time to cash
>15 yr
Contracted period
17 yr
25%
NPV/CAPEX
28%
>60%
Contracted NPV
>60%
Accelerated and focused growth 2/3 success rate on projects submitted to top level investment decision
RESULTS PRESENTATION 7
Improved outlook for renewables growth in the medium-term both in terms of technology and public support
Renewables development platform
Accelerated and focused growth
Continued decline in LCOE Hybrid projects: hydro/solar/wind Wind repowering Offshore fixed/floating Green hydrogen Storage US: Federal and State-level incentives: PTC extension (60% up to 2024) Renewable Portfolio Standards (13 States enacted RPS targets in 2019) EU: Green deal launched by the EC (€1 Trl investment plan): 2030: Emissions at least -50% vs. 1990 2050 carbon neutrality Potential increase of renewable targets Technological opportunities 10.8 GW of wind & solar assets in
- peration in 10 geographies
Development teams with extensive track record Procurement and O&M scale in renewables New markets under analysis Increasing public support
- n renewables
2020-22 Growth: Corporate PPA (North America, Brazil, Spain), PPA Auctions (mostly EU) Focus on internal pipeline development (+ opportunistic quasi greenfields)
RESULTS PRESENTATION 8
Wind Offshore: 50:50 JV with ENGIE creating a top global player
1.5 3.7 5-7 5.2 5-10 2019 2025E 10-17 Under construction/installed Under development
JV Offshore capacity
2-3x
Recent developments: US Mayflower (0.8 GW) PPA awarded in Massachusetts Floating wind offshore: Largest wind turbine installed in a floating platform (8.4 MW)
GW Gross
Portfolio description
Accelerated and focused growth
RESULTS PRESENTATION 9
Electricity distribution in Brazil: regulatory reviews provide visibility up to 2022/23
887 1,025
2018 Efficiency Regulated Revenues 2019 Market 2022
+40% +35% +25% 1,393
REAL GAINS of + 35-45%
1 2 3
EBITDA from distribution Brazil
R$ Mn
Regulated Revenues
Regulatory reviews in 2019 (visibility up to Aug-22 for EDP ES and Oct-23 for EDP SP) Net RAB Growth: + 36% Return on RAB at 8.09% Regulatory haircut over investments <0.5% (#1 in Brazil)
1
Market
Electricity demand in 2019 (+2.3% in EDPB vs 1.1% in Brazil)
2
Efficiency
Reduction of losses (-1.24pp in EDP SP and -0.23pp in ESP ES1) Greater efficiency in costs vs the Regulatory target
(2019 as a transitional year in the strategy of insourcing of O&M services)
3
1) Non-technical losses in Low Voltage
Accelerated and focused growth
R$ 234 Mn RAB update R$ 134 Mn employees benefits
Strategic Update target
RESULTS PRESENTATION 10
Strong performance on deployment of transmission lines in Brazil, with projects ahead of schedule and benefitting from competitive financing
24 Q 21 18 7 11
113 km COD Dec-18 123 km COD Apr-21E 142 km COD Dec-21E 203 km Partial COD Jan-20 485 km COD Dec-20E 375 km COD Mar-21E
EBITDA from transmission in Brazil
Transmission portfolio Accelerated and focused growth EBITDA from transmission expected to represent >15% of EBITDA from EDP Brasil by 2022
R$ Mn 30 231 2022 2018 2019
+3.5x
59% of R$3.9 Bn CAPEX executed Better than expected funding conditions
% of completion
53% 91% 100% 49% 52%
Under licensing +7.7x
Strategic Update target
RESULTS PRESENTATION 11
Increasing penetration of new client solutions, while normalizing supply margin
Client Solutions – 2019 Performance
Accelerated and focused growth
Stable Client Base
+0.1% Clients
Electricity and gas supply points Iberia
New client solutions
>100 MWp Decentralized solar
sold capacity in Iberia & Brazil
>330 Contracted public charging points
# Iberia & Brazil
20% Savings from energy efficiency
In the bill of our B2B clients in Portugal
Increased digitalization
56% Selfcare Portugal
Focus on service quality to retain high value clients
- 23% Complaints YoY
# complaints/ 1k contracts Iberia
Increase services penetration
+5% Services contracted with clients
18.9% Homecare Services/contracts
Supply EBITDA
2018 >100 2022 2019 ~-5 ~90
€ Mn
Strategic Update target
RESULTS PRESENTATION 12
Asset rotation in renewables: 2019 deals better than in the Strategic Plan assumptions, positive outlook for 2020-22
>4
>25% 2020-22 2019-22 2019
Proceeds from asset rotation
€ Bn
2 deals agreed, with better than expected results: Europe: 997 MW wind portfolio (491 MW net), EV €1.6 Mn/MW, €0.8 Bn proceeds Brazil: 137 MW (Babilónia), EV €2.2 Mn/MW (closed in Feb-20), €0.3 Bn proceeds Positive outlook supported by low interest rate context and strong appetite from investors for infrastructure/renewables assets: 2020: Target deals in the US and Europe (~0.7 GW net) Continuous portfolio optimization
Strategic Update target
RESULTS PRESENTATION 13
Full visibility on >€2 Bn asset disposal target in the Strategic Plan
Hydro plants for sale
Disposal of 25% of hydro portfolio in Iberia: €2.2 Bn for 1.7 GW in Portugal... ... while other complementary options may still be considered
Other Iberian assets Asset reshuffling
- pportunities in Brazil
All necessary regulatory requests were already submitted The carve out of the assets and the transitional agreements are under preparation
Expected financial closing in 2H20 Hydro disposal rationale
Continuous portfolio optimization
Transaction multiple: 14.4x EV/EBITDA2018
(positive read across of remaining hydro assets)
Derisking: market price exposure and concentration of hydro volatility
Active portfolio optimization to create sustained shareholder value
RESULTS PRESENTATION 14
Strong operating costs performance in all divisions
Weight on Opex
Opex1 Opex1 in BRL
- Adj. Core Opex1/MW3
Operations Indicator YoY Change Highlights Opex ex-forex1 Iberia 57% EDP Brasil 15% EDPR 29%
- 2%
+3% 0% +1%
xx%
Avg MW +1% Predictive maintenance up to 67%
- Avg. Inflation: +3.7%2
Predictive maintenance generation up from 34% to 68% +34% smart meters in Portugal
- 1%
Opex like-for-like (excl. growth)
1) Recurring Opex Pro-forma (excludes IFRS16 impact); 2) Avg. IPCA 2019 vs. 2018; 3) Core Opex/Avg MW adjusted by IFRS16, One-offs, pass-through costs and FX
On track to achieve OPEX reduction targets of: €50 Mn in 2020 and €100 Mn in 2022 Efficient and digitally enabled
- €20 Mn OPEX YoY on a like-for-like basis
Strategic Update target
RESULTS PRESENTATION 15
Execution of disposal plan improves risk profile and reinforces balance sheet
% of EBITDA
Increasing the share of low-risk profile Deleveraging in the short-term Increasing visibility over EDP target to reach solid investment grade (BBB)
4.0x <3.2x
2018 2019 2020 2022
3.6x <3.0x
Net Debt / EBITDA
Solid balance sheet and low risk profile
Strategic Update targets
2020 post-disposal
~80%
2019
79%
Contracted exposure 2018
~75%
RESULTS PRESENTATION 16
€4.4 Bn of EUR and USD bonds maturing until 2022, with interest costs significantly above current market yields
Market yields of 5y EDP Bonds, % (Jan 2019-Feb 2020)1
- 130 bp
- 234 bp
∆ Jan19-Feb20 0.1% 2.3%
- 1
1 2 3 4 5 Sep May Jan Mar Jul Nov Jan Feb EUR2 USD3
EDP consolidated debt maturities in 2020-2022
4.1% 4.1% 4.9% 4.1% 5.3% 20205 5.4% 2021 6.0% 1.7 2.6% 2022 3.2 1.4
€ Bn and bonds’ coupon rate Most recent bond deals
Sep-19: €600 Mn green bond issued (0.43% yield) 1Q20: Repurchase and clean-up call of the 2015 €750 Mn hybrid (5.375% coupon)
1) As of 14/02/2020 | 2) EDPPL 1.125 02/12/2024 REGS Corp | 3) EDPPL 3.625 07/15/2024 144A Corp | 4) Includes commercial paper and project finance | 5) Includes the €750 Mn hybrid issued in 2015 (5.375% coupon) that was repurchased in 1Q2020
EUR Other debt4 BRL USD
Solid balance sheet and low risk profile
Jan-20: €750 Mn green hybrid bond issued (1.75% yield)
Avg cost of debt 2019 at 3.9% (vs avg. 4% assumption for 2019-22 in Strategic Plan)
RESULTS PRESENTATION 17
Strong improvement of recurring organic cash flow over the last two years
0.8 1.2 1.4 2019 2017 2018
Recurring Organic Cash Flow € Bn Uses of cash (Strategic Plan 2019-22)
Net investments Sources of Cash Dividends ~2 Deleverage >12 ~3 >8
€ Bn
2021-22E 2019-20E
Solid balance sheet and low risk profile
CAGR17-19
+35%
RESULTS PRESENTATION 18
Distinctive green positioning: Fully on track to deliver our decarbonization commitments
Sines (1.2 GW) Aboño 1&2 (0.9 GW) Soto 3 (0.3 GW)
Aboño 1 will be converted to gas (COD 2022); Aboño 2 as a backup Shutdown up to 2023, conditional on positive margins No production since Jun-19
Become coal-free before 2030 % renewables generation Specific emissions
(vs 2005 levels)
2019 Performance: Penalized by weak hydro resources in Portugal Attractive shareholder remuneration
- 66%
- 85%
- 90%
2005 2030 2019 2025 20% 66% >90% 2030 2019 2005 2025 >80%
Coal production in Iberia 2019: -49% YoY
628 gCO2 / kWh
Strategic Update target
2050: Net zero emissions commitment
RESULTS PRESENTATION 19
Distinctive Green Positioning: We have been consistently recognized by relevant ESG ratings on our sustainable corporate strategy
#1 Global
Integrated Utilities
(Score 90)
#1 Global
Integrated Utilities
(Score 68)
Top 5 Global
Utilities (Score 4.7) Attractive shareholder remuneration
Historical rankings:
2009 - 2019
2019 ranking:
#1 or #2 for 10yrs
Avg Score 87 (out of 100)
93th Percentile1
Global Utilities
2012 - 2018 #5 (in 2012/16) and #9 (in 2014)
Avg Score 61 (out of 100)
2011 - 2019
Avg Score 4.2 (out of 5)
2015 - 2017
Avg Score 842 (out of 100)
1) Bloomberg; | 2) In 2018 Sustainalytcs has launched the ESG Risk Rating methodology and replaced the ESG Rating methodology. EDP overall Risk Rating in February 2020 was 24.95.
RESULTS PRESENTATION 20
Improved visibility over 2019 of Strategic Plan execution, support reiteration of our 2020-2022 key financial targets
3.7 2019 2020E
>4.0
2022E
~3.7
EBITDA
€ Bn
Recurring Net profit
€ Bn
0.9
~0.9
2020E 2019 2022E
>1.0 Attractive shareholder remuneration
Dividend 0.19 20191 2020-22E
€ / share
81% payout ratio
Target payout range
75 - 85%
Dividend floor
€0.19/share
1) Proposal of dividend, subject to AGM approval
Leading the energy transition to create superior value
Strategic Update targets Strategic Update targets Strategic Update targets
21
Results Analysis
RESULTS PRESENTATION 22
2019 Key Highlights €3,706 Mn €854 Mn 3.6x €0.19 / share
Previous Guidance
(as of Oct-19)
~€3.6 Bn ~€0.8 Bn YoY Deleverage € 0.19/share Dividend floor
(vs. 4.0x in Dec-18) (+7% YoY) (+12% YoY) Sound 4Q19 performance supported delivery of 2019 Financial targets
EBITDA Recurring Net Profit Net debt / EBITDA Dividend
Hydro volumes Portugal +56% vs. historical avg. Good results in energy management in Iberia Gain in asset rotation in Brazil (cashed-in Feb-20) Continuing growth in networks in Brazil Interest costs started downwards trend in 4Q19
4Q19 Highlights 2019 Figures
Net debt Dec-19: €13.8 Bn, +3% YoY
(81% payout)
RESULTS PRESENTATION 23
Hydro production in Iberia -3.7 TWh YoY, despite strong recovery in the 4Q, while wind resources improved YoY to just 3% below average
EDP Hydro production in Iberia
Hydro resources
- vs. LT Avg.1
+5%
EDP Wind production
- 6%
Wind resources
- vs. LT Avg. (P50)
1) Hydro resources reference from Portugal only
- 19%
- 3%
2019 2018 28.1 29.8
+6%
- 27%
4Q 9M 10.0 2018 2019 13.7
TWh
- 39% in 9M19 vs.
Historical average1
TWh
- Avg. Load factor
30% 32%
Hydro reservoir YE (TWh)
1.5 2.4
0.4 TWh above historical average +56% in 4Q19 vs. Historical average1
- 47%
+55%
RESULTS PRESENTATION 24
EBITDA +12%, with solid growth contributions from the three business platforms
312 474 831 991 2,197 2,286
- 23
Networks
2019 2018
- 46
Renewables
3,706
Client solutions & EM Other/adjust
3,317
+4% +52% +19%
EBITDA 2019 € Mn; YoY growth,%
+12%
∆ YoY
+€ 89 Mn +€ 160 Mn +€ 162 Mn
+€348 Mn Wind & Solar
- €159 Mn Hydro Iberia
- €100 Mn Hydro Brazil
+€7 Mn Iberia +€154 Mn Brazil +€199 Mn Iberia
- €37 Mn Brazil
RESULTS PRESENTATION 25
Wind & Solar EBITDA +27%, impacted by higher generation, avg selling price and asset rotation gains in Europe and Brazil
654 120 651 615 914 2018
- 6
1,300 Brazil & Other 2019 Europe North America 1,648
EBITDA – Wind & Solar € Mn; YoY growth,%
+27%
2019 2018 YoY
Production vs. LT Avg. (P50), %
- 3%
- 6%
+3 pp
- Avg. Installed Capacity1, GW
10.9 +1% 10.8 Electricity Production, TWh 30.0 28.4 +6%
- Avg. selling price, €/MWh
54.7 53.7 +2% Asset Rotation Gains, € Mn 313 109
- +40%
- 6%
1) Considers capacity at EBITDA level
RESULTS PRESENTATION 26
273 173 583 440 896 Brazil Portugal 2019 25 41 2018 Spain 638
EBITDA from Hydro down by 29%, despite recovery in 4Q19, with lower volumes and prices partially mitigated by hedging
EBITDA – Hydro € Mn; YoY growth, %
- 29%
2019 2018 YoY
Avg selling price, $R/MWh 170 186
- 9%
2019 2018 YoY
Physical Guarantee, TWh 6.7 7.3
- 8%
- 25%
- 37%
- 39%
Avg selling price1, €/MWh 54 62
- 14%
Hydro Production, TWh 10.0 13.7
- 27%
Gain on mini-hydro sale, € Mn
- 82
- 1) Does not consider results from hedging
RESULTS PRESENTATION 27
Regulated Networks EBITDA +19%, mainly driven by Brazil growth in distribution and transmission
206 360 145 155 481 477 2018 2019 Portugal4 Spain 991 831 Brazil4
- 1%
EBITDA – Networks € Mn; YoY growth,%
+19%
+75% +7%
1) RoRAB of HV/MV | 2) Excludes IFRS16 impact of €6 Mn| 3) Accounting RAB as of Dec-19 | 4) The overall impact of one-off on EBITDA growth was immaterial: (i) in 2019, €28 Mn provision for the amounts to return to the tariff, €31 Mn gain related with a change in future liabilities arising from a change in health care services supplier and restructuring costs (€12 Mn) mainly in Portugal; (ii) In 2018, restructuring costs (€17 Mn)
2019 2018 YoY
Return on RAB Portugal1, % 5.13% 5.42%
- 28 bp
Opex Iberia2, €Mn 389 404
- 4%
2019 2018 YoY
Electricity distributed, TWh 25.6 25.0 +2% Transmission EBITDA, € Mn 51 7
- RAB distribution3, € Mn
1,131 984 +15% RAB Iberia, €Mn 3,924 3,946
- 1%
Return on RAB Spain, % 6.50% 6.50%
RESULTS PRESENTATION 28
Client Solutions & Energy Management EBITDA +52%, benefiting from hedging results and normalization of supply margins in Iberia
40 135 114 142 88 248 Supply & EM Brazil
- 5
474 25 2018 2019 Thermal & EM Iberia Thermal Brazil Supply Iberia 312
EBITDA – Client Solutions & Energy Management € Mn; YoY growth,%
+52%
2019 2018 YoY
Thermal availability, % 95% 80% +15 pp Supply volumes, TWh 14.1 18.1
- 22%
Better results from energy management and forward hedging in energy markets, mostly in 4Q Coal production -49% YoY (18% avg load factor in 4Q19) Normalization of supply margins in Iberia, following a particularly adverse 2018 # of clients complains in supply: -23% YoY
ADOMP1, € Mn 25
- 1) One-off revenues from the downwards revision of the regulatory level of the availability factor. This amount is net of PIS/COFINS
∆ YoY
+€ 106 Mn +€ 93 Mn
- € 21 Mn
- € 15 Mn
RESULTS PRESENTATION 29
Financial Deleverage: Net debt/EBITDA down to 3.6x following recurring EBITDA (+13%) vs Net Debt (+3%)
Change in Net Debt: Dec-19 vs. Dec-18, € Bn
3.6x 4.0x 0.7 13.8
Net Debt Dec-18
- 1.4
Recurring Organic Cash Flow
1.2
Net expansion investment Dividends to Shareholders
13.5
- 0.1
Other & One-off Net Debt Dec-19
New Hybrid (50% equity): -€0.5 Bn
- Reg. Receivables and related taxes: €0.2 Bn
Pension fund extraord. contribution: €0.2 Bn
Net debt / EBITDA1
1) Based on net debt excluding regulatory receivables and on recurring EBITDA of the last 12 months. Excludes €829 Mn related with Leasings’ debt accounted as Other Liabilities (IFRS 16 impact)
+€2.1 Bn expansion investment
(70% renewables, 29% networks)
- €1.0 Asset Rotation renewables
+20% YoY 50% of Recurring Organic CF
RESULTS PRESENTATION 30
Interest related costs +2% to €685 Mn with the 4Q19 showing already a downward trend
62% 58% 25% 29% 9% 11% 4% 2018 BRL 2% Other 2019 USD EUR
Avg nominal debt by currency3 Net Financial Costs: 2019 vs. 2018 € Mn
554 671 685 670 117 2019 15 2018 Interest related Non- interest1 14 2018 adj. Non- interest2 2019 adj.
1) Other items in 2018 includes: +€18 Mn of badwill arising from the acquisition of a stake in Celesc, -€39 Mn debt repayment, +€113 Mn of Capital Gains, -€5 Mn of Net foreign exchange differences and derivatives and +€30 Mn pro-forma impact from IFRS 16 | 2) Other items in 2019 are related with -€19 Mn Net foreign exchange differences and derivatives, €31 Mn Feedzai gain and €3 Mn of capital gains | 3) Includes FX Hedges
+10 bp 3.9%
- Avg. cost of debt
+2%
impacted by €1 Bn hybrid bond issue in Jan-19 and higher avg. weight of USD & BRL
Euro denominated Hybrid: 11% in 2019 vs 5% in 2018 +€17 Mn 9M19
- €3 Mn 4Q19
RESULTS PRESENTATION 31
Of which:
- >90% due in 2024/25
- 25 counterparties
Financial liquidity as of Dec-19
Cash & Equivalents: €1.6 Bn Available Credit Lines: €5.5 Bn Total Liquidity €7.1 Bn
EDP consolidated debt maturity profile as of Dec-19
2020 2023 2021 0.6 2026 2022 1.5 2024 2025 1.6 2027 > 2027 3.2 1.7 1.4 2.0 2.9 1.4
EDP SA & EDP Finance BV and Other EDP Brasil
2020 main events 1Q20: €0.75 Bn hybrid replacement (new issue + buy back) Mar 9th: €0.8 Bn tariff deficit sale € Bn € Bn 2H20 E: €2.2 Bn hydro disposal financial closing
Financial liquidity of €7.1 Bn in Dec-19 covering refinancing needs beyond 2022
(1)
1) Includes €0.75 Bn hybrid replacement in 1Q20 and USD 0.6 Bn bond paid in Jan-20
RESULTS PRESENTATION 32
Reported Net Profit 2019 penalized by one-off items, namely coal impairments in Iberia and Fridão provision
1) One-offs impacts at net profit level: 2018: regulatory impacts (-€208 Mn), impairments at coal plants in Iberia (-€21 Mn), restructuring costs (-€21 Mn), net gain on disposals (mini-hydros: +€40 Mn; Bioelectrica: +€24 Mn), debt prepayment fees and others (-€26 Mn) and CESE (-€65 Mn); in 2019: impairments (-€224 Mn, mainly coal in Iberia), provision for Fridão (-€59 Mn), gain on the revaluation of Feedzai and provision reversal at São Manoel (+€28 Mn), sharing of some gains with consumers (-€22 Mn), restructuring costs (-€8 Mn), Medical plan Brazil (+€10 Mn), CESE (-€66 Mn).
3,706 1,838 512 1,867 645 226 68 388 EBITDA
- Fin. Results &
Associates Income Taxes D&A and Provisions EBIT Extraordinary Energy Tax Non-controlling interest Net Profit
One-Off1 Items
- 11
- 399
- 409
+40 +103
- 68
- 8
- 342
Reported Net Profit Bridge 2019 € Mn
- 1% YoY
Net Profit Breakdown 2019 € Mn 153 392 64
- 98
512
Portugal: 2nd year with negative results,
penalized by low hydro conditions and
- ne-off items:
Coal impairments (€94 Mn) Fridão provision (€59 Mn)
RESULTS PRESENTATION 33
111 141 263 404 137 186 285 123 797 2018 2019 854
Recurring1 Net Profit 2019 € Mn
Recurring Net Profit +7%, supported by record results at EDPR and EDP Brasil, while penalized by Portuguese activities
Portugal: Turnaround of supply operations; Hydro production -28% YoY EDP Brasil all time record reported net profit +5% YoY in BRL EDPR all time record reported net profit +52% YoY
+7%
∆ YoY
+€ 48 Mn +€ 141 Mn +€ 30 Mn
- € 162 Mn
1) One-offs impacts at net profit level: 2018: regulatory impacts (-€208 Mn), impairments at coal plants in Iberia (-€21 Mn), restructuring costs (-€21 Mn), net gain on disposals (mini-hydros: +€40 Mn; Bioelectrica: +€24 Mn), debt prepayment fees and others (-€26 Mn) and CESE (-€65 Mn); in 2019: impairments (-€224 Mn, mainly coal in Iberia), provision for Fridão (-€59 Mn), gain on the revaluation of Feedzai and provision reversal at São Manoel (+€28 Mn), sharing of some gains with consumers (-€22 Mn), restructuring costs (-€8 Mn), Medical plan Brazil (+€10 Mn), CESE (-€66 Mn).
34
Annex
RESULTS PRESENTATION 35
List of wind & solar projects already secured for 2019-22
Projects already secured
MW Prairie Queen Timber Road IV Bright Stalk Hidalgo II Nation Rise (CA) Broadlands I Headwaters II Rosewater1 Crossing Trails Reloj del Sol WildCat Mexico project Indiana Crossroad1 Riverstart Sonrisa California Project Golden Eye
Project Name CoD Region MW
199 125 205 50 100 200 198 102 104 209 180 100 302 202 200 200 139 2019 2019 2019 2019 2020E 2020E 2020E 2020E 2020E 2020E 2020E 2021E 2021E 2021E 2022E 2022E 19/20E Kansas Ohio Illinois Texas Ontario Illinois Indiana Indiana Colorado Texas Texas Mexico Indiana Indiana California California East NA
Projects already secured
MW
Country CoD Status MW
29 105 2019 2021/22E Installed U/development 47 279 2019 2020/22E Installed U/ const. & dev. 19 95 2019 2020E Installed U/ const. & dev. 50 125 2019 2020/21E Installed U/development 38 327 2020E 2020/22E U/construction U/ development
Projects already secured
MW
Project Name CoD Country MW
Aventura II-V Boqueirão I-II Monte Verde VI Santa Rosa & Mundo Novo Alpha Beta Pereira Barreto Lagoa 111 80 46 156 212 280 205 66 2022E 2022E 2022E 2022E 2022E 2022E 2021E 2022E Brazil Brazil Brazil Brazil Colombia Colombia Brazil Brazil 119 2020/22E U/ development
1) Build and Transfer project
RESULTS PRESENTATION 36
Wind & Solar North America: 6.3 GW of capacity in the US, Mexico and Canada
1 EBITDA + Equity capacity (Only EBITDA capacity represented in the map) | 2 PTC (Production Tax Credit) | 3 ITC (Investment Tax Credit)
Remuneration framework for renewables in the US Wind & Solar installed capacity
Start of Construction... 2019 2020 2021 2022 2023 >2023
Total North America 200 MW 30 MW Existing 25-year PPA 20-year FiT 8 years 6.3 GW Installed Capacity1 Average age
New York
357 26 |
Ohio
392
- |
South Carolina
60
- |
Indiana
612 189 |
Illionois
660 341 |
Wisconsin
98
- |
Minnesota
101
- |
Iowa
600
- |
Washington
101
- |
Oregon
300
- |
California
228
- |
Texas
460 240 |
Oklahoma
548
- |
Kansas
400
- |
2019
PPA/Hedge Merchant 86% 14% ... End of Construction 2016 2017 2018 100% 30% 80% 24% 60% 18% 40% 12% 60% 18% 2019 2020 2021 2022 2023 >2023 2016 2017 2018 30% 26% 22% 10% PTC2 (Wind onshore): % of full PTC ($24/MWh in 2018) ITC3 (Wind offshore): % of Capex ITC3 (Solar): % of Capex
RESULTS PRESENTATION 37
Wind offshore: List of projects
EDP/Engie JV for offshore wind: Projects with PPA/FiT secured Project CoD JV Stake (%) ~3.3 GW Under Construction/Secured1 MW Floating offshore 2020 79.4 25 Construction: 2 out of 3 turbines under operation Under development (UK, US, Poland) ~1.9 GW Total Projects ~5.2 GW Seamade 487 17.5 2020E Construction: Installation of 58 foundations completed Moray East 2022E 56.6 950 Construction: Final stage of piling Floating offshore 2021E 80.0 30 Development: Grid connection secured Tréport & Nourmoutier 2024E 60.5 992 Development: Permit granted for both projects Mayflower 2025E 50.0 804 Development: FEED2 design ongoing Status
1 Considering 100% of projects capacity | 2 FEED: Front End Engineering & Design
RESULTS PRESENTATION 38 1 Provisory data; TIEPI MV, % of the reference value defined in the Quality Service Regulation | 2 Nominal pre-tax, before CESE
Networks Iberia: 54 TWh of electricity distributed in Iberia, with superior quality of service
Iberia Networks portfolio in Iberia
2019
Electricity Distributed TWh
45.6 8.3 53.9
Supply points Thousand
6,277 668 6,946
Network Thousand km
227 21 248
Regulated Asset Base, € Bn
3.0 1.0 4.0
Electricity distribution in Portugal
Quality service1 High/Medium Voltage Low Voltage 278 concessions, 92% of them expiring in 2021-22 RAB €1.2 Bn RoRAB2 5.4% (2019) Country-level concession up to 2044 RAB €1.8 Bn RoRAB2 5.1% (2019) 2017
RESULTS PRESENTATION 39
Corporate Governance
EDP Shareholder Structure (Mar-2020) Corporate Governance Highlights
21.5%
China Three Gorges (PRC) BCP Pension Fund (Portugal)
7.2% Oppidum (Spain) 5.1%
Blackrock (US)
2.5% 2.1%
Paul Elliott Singer (US)
2.3% 2.4%
Sonatrach (Algeria)
2.9%
Alliance Bernstein (US) Qatar
2.2%
State Street (US) Norges Bank (Norway)
2.6%
Free Float 48.8%
0.6%
Treasury Stock
Dual model GSB Composition EBD Composition
Executive Board of Directors (EBD) and General and Supervisory Board (GSB) All major corporate and strategic decisions scrutinized by the GSB after proposal of the EBD 9 executive members 21 non-executive members, of which the majority are independent
RESULTS PRESENTATION 40
Key data in EDP securities
Source: Bloomberg as of March 20th, 2020. 1 Amounts shown are net of notes repurchased in Dec-18
1 1 1
Equity Stock Exchange (€) P/E 2019E P/E 2020E P/BV 2019E DY 2019E Market Cap
- Avg. Daily Volume
52 Weeks (# tm)
EDP SA Euronext Lisbon €3.19 15.0 14.3 1.2 6.0 €11,646m 8.8 EDP Renováveis Euronext Lisbon €9.33 35.9 18.5 1.2 0.9 €8,139m 0.3 EDP Brasil BM&FBOVESPA R$14.34 8.7 8.7 1.1 4.8 R$8,702m 2.8
Bonds Currency Amount (million) Maturity Coupon Market Price (Bid) Market Yield ISIN Code EDP BV Euro MTN EUR 233 29-06-2020 4.125% 101.0 0.237% XS0223447227 EDP BV Euro MTN EUR 462 14-09-2020 4.875% 102.2 0.266% XS0970695572 EDP BV Euro MTN EUR 553 20-01-2021 4.125% 103.0 0.426% XS0995380580 EDP BV Euro MTN EUR 1,000 18-01-2022 2.625% 103.3 0.78% XS1111324700 EDP BV Euro MTN EUR 600 23-03-2023 2.375% 104.2 0.94% XS1385395121 EDP BV Euro MTN EUR 600 29-09-2023 1.875% 102.8 1.06% XS1558083652 EDP BV Euro MTN EUR 1,000 12-02-2024 1.125% 99.9 1.14% XS1471646965 EDP BV Euro MTN EUR 750 22-04-2025 2.000% 102.7 1.44% XS1222590488 EDP BV Euro MTN EUR 600 13-10-2025 1.875% 102.1 1.49% XS1893621026 EDP BV Euro MTN EUR 750 26-01-2026 1.625% 100.3 1.56% XS1846632104 EDP BV Euro MTN EUR 600 16-09-2026 0.375% 92.8 1.56% XS2053052895 EDP BV Euro MTN EUR 500 22-11-2027 1.500% 98.7 1.68% XS1721051495 EDP Hybrid Notes EUR 1,000 30-04-2079 4.496% 99.0 4.29% PTEDPKOM0034 EDP Hybrid Notes EUR 750 20-07-2080 1.700% 85.4 2.2% PTEDPUOM0017 EDP BV Euro MTN GBP 325 04-01-2024 8.625% 121.9 2.5% XS0397015537 EDP BV Dollar USD 750 14-01-2021 5.250% 102.3 2.3% XS1014868779 EDP BV Dollar USD 1,000 15-07-2024 3.625% 97.1 4.36% XS1638075488
RESULTS PRESENTATION 41
IR Contacts Next Events
E-mail: ir@edp.com Phone +351 210 012 834 Site: www.edp.com Apr 1st-2nd: BofA Energy & Utilities Conference Apr 16th: General Shareholders’ Meeting May 7th: 1Q20 Results