Ence Energia Y Celulosa Sa · BME:ENC
Ence Energia Y Celulosa Sa — H1 2016 Earnings Presentation
20 slides from Ence Energia Y Celulosa Sa's earnings presentation, Sep 21, 2016
Slide 1: 1H 2016 Results
1H 2016 Results September 21st 2016
Slide 2: Index
Index Highlights 1H 2016 Results Summary Fuente: Ence 2
Slide 3: Highlights
Highlights Sustained strong worldwide demand for market pulp with a 4.0% growth in 1H16 vs. 1H15, with 1 China showing a 16.3% YOY growth 2 Pulp sales volume increase by 3.9% mitigating 8.3% lower average selling prices 3 2Q16 cash cost lower than 1Q16 and 2Q15 Successful implementation of efficienc
Slide 4: Sustained strong market pulp demand growth in 1H16 (+4.0%)
Sustained strong market pulp demand growth in 1H16 (+4.0%) Led by eucalyptus pulp (+7.6%) Market pulp YOY demand evolution (PPPC W20) BEKP Chinese demand growth evolution (PPPC W20) 23.0 Mt 24.0 Mt 21.9 Mt 22.0 Mt 34.3% 21.4 Mt 0.5 % 4.1 % 4.0 % 2.5 % 26.7% 12.0% 15.3% 12.6% 6.3 % 9.7 % 7.6 % 5.2 %
Slide 5: Cash cost downward trend reflected in 2Q16
Cash cost downward trend reflected in 2Q16 €362/t excluding Navia annual maintenance shutdown Cash cost breakdown analysis (€/t) 367.0 379.6 366.8 30.6 361.8 29.3 26.1 355 350 28.9 28.1 28.6 119.1 127.3 121.6 189.7 193.5 190.4 2Q15 1Q16 2Q16 2Q16 ex 3Q16E 4Q16E maintenance shutdown Wood cost Convers
Slide 6: Lower wood cost linked to pulp price reduction
Lower wood cost linked to pulp price reduction Small land owners coordination initiatives to further reduce it Small land owner coordination initiative Wood cost (€/m3) (Coto Redondo) - 4.2 % 68 Ence is promoting the coordination of adjoining 66.7 eucalyptus plantations for harvesting and logistics
Slide 7: Successful efficiency improvement and capacity increase in Navia
Successful efficiency improvement and capacity increase in Navia will result in lower cash costs in the coming quarters Ence has successfully implemented in June the efficiency improvement and the 20,000 tons capacity increase planned for Navia mill, raising its production capacity to 540,000 tons p
Slide 8: €28.8M cash inflow expected for 2H16 from Energy receivables
€28.8M cash inflow expected for 2H16 related to receivable collection from the Energy business In 2Q16 the Ministry of Industry, Energy and Tourism (MINETUR) has resolved the pending classification of Huelva 41MW biomass plant into the Specific Remuneration Regime as a hybrid plant (85% biomass and
Slide 9: Asset divestments in 1H16 for a total amount of €34.9M
Asset divestments in 1H16 for a total amount of €34.9M €27.6M to be collected in 2H16 Asset divestments book value breakdown (€M) 78 4 In 1H16 Ence agreed the sale of 1,547 hectares for a total 50 amount of €34.9M with an 39 20 2 6 estimated capital gain of €14M. 24 €7.3M already collected in 1H16 2
Slide 10: Share buyback program up to €10M and €25M dividend payment
Share buyback program up to €10M or 4M shares on track €25M dividend payment in 2Q16 Maximizing shareholder remuneration Annual accrued dividends (€M) On June 23 Ence approved a share buyback program up to €10 M or 4M shares with the €0.15/share €0.14/share €0.13/share purpose of increasing future s
Slide 11: Index
Index Highlights 1H 2016 Results Summary Fuente: Ence 11
Slide 12: Key Figures 1H 2016
Key Figures 1H 2016 Consolidated key figures (€M) 313.2 289.2 €24M YOY difference at the revenue level reduced to €10.7M at the net result 85.4 level, mainly due to lower 63.1 45.6 23.7 22.1 11.4 financial expenses as well as lower taxes Total net revenues Adjusted EBITDA EBIT Net result 1H15 1H16 F
Slide 13: Pulp business Operating performance
Pulp business Operating performance Average selling pulp price (€/t) Pulp sales volume (t) Cash cost (€/t) 1Q16 one-offs 448.643 +2.3% 373 529 -8.3% +3.9% 7.8 431.767 485 365 365 1H15 1H16 1H15 1H16 1H15 1H16 Adjusted EBITDA (€M) €17M YOY reduction in Adjusted EBITDA following: 68 8.3% Lower average
Slide 14: Pulp business P&L and Cash Flow generation
Pulp business P&L and Cash Flow generation P&L (€M) Lower non-recurrent expenses by-19.2% 6.3 YOY Lower depreciation 51.1 1.7 charges by -14.5% YOY 44.8 22.3 due to the extension 22.5 7.2 4.5 of Pontevedra 12.5 concession Adjusted Non EBITDA Depreciation EBIT Financial Net FX Taxes Net profit Lower
Slide 15: Energy business Operating performance
Energy business Operating performance Average selling price (€/MWh) Energy sold (MWh) Revenues (€M) -9.8% 44 -13.5% 100 -13.6% 91 275,771 38 238,151 1H15 1H16 1H15 1H16 1H15 1H16 Adjusted EBITDA (€M) 9.8% lower average selling price due to lower pool prices, partially mitigated through our hedging p
Slide 16: Energy business P&L and Cash Flow generation
Energy business P&L and Cash Flow generation P&L (€M) Lower net profit as a consequence of €2.9M one-off provision on HU 12.0 41 MW 8.4 1.3 Partially offset by lower 0.3 7.1 depreciation charges (- 2.7 (1.1) 42.8% YOY) and lower financial result (-40.6%) Adjusted EBITDA Depreciation EBIT Financial r
Slide 17: Solid balance sheet and strong liquidity sustained
Solid balance sheet and strong liquidity sustained Group leverage at 1.5x Net Debt / Adjusted EBITDA as of 30/06/2016 Leverage (€M) Debt maturity calendar (€M) Leverage: 252.5 1.4x €250 M bond (5.375%) 72.1 €30 M bilateral loans (EUR +2.1%) Pulp 283.8 211.7 business 1.2 5.5 20.5 5.5 3.4 Gross debt C
Slide 18: Index
Index Highlights 1H 2016 Results Summary Fuente: Ence 18
Slide 19: Summary
Summary Sustained strong worldwide demand for market pulp with a 4.0% growth in 1H16 vs. 1H15, with 1 China showing a 16.3% YOY growth 2 Pulp sales volume increase by 3.9% mitigating 8.3% lower average selling prices 3 2Q16 cash cost lower than 1Q16 and 2Q15 Successful implementation of efficiency i
Slide 20: Thank you
Delivering value, delivering commitments THANK YOU
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