Ha Sustainable Infrastructure Capital, Inc. · NYSE:HASI
Ha Sustainable Infrastructure Capital — FY2023 Earnings Presentation
30 slides from Ha Sustainable Infrastructure Capital's earnings presentation, Feb 15, 2024
Slide 1: Earnings Presentation Full Year & Fourth Quarter 2023
Earnings Presentation Full Year & Fourth Quarter 2023
Slide 2: Forward Looking Statements
Forward Looking Statements Some of the information contained herein are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. When used herein, words such as "believe," "expect," "an
Slide 3: Successful 2023 Execution Positions Company for Long-Term Growth
Successful 2023 Execution Positions Company for Long-Term Growth • FY23 Distributable EPS1 of $2.23 and GAAP EPS2 of $1.42 Strong Financial • Record $2.3b of closed transactions at >9% investment yield1 for Results Reflect on-balance sheet transactions Resilient Business • 44% portfolio growth and 2
Slide 4: 2024-26 Guidance Bridge to Long-Term Business Model
2024-26 Guidance Bridge to Long-Term Business Model Distributable EPS1 Dividend Per Share (DPS) Long-Term Business Model 10% CAGR 50% payout ratio (Realized 2014-2023 CAGR of 10%) 2024 – 2026 Guidance 8-10% CAGR2 60-70% payout ratio Guidance Continued DPS growth while reducing payout ratio Primary u
Slide 5: Delivering on Investor Day Messaging
Delivering on Investor Day Messaging Organization to Support Seamless CEO & CFO transitions Business Growth Increased New >9% in 20231 Investment Yields Successfully Closed >$675m in 2023 Launched FTN Utilized Diversified $1.9b total debt2 raises including bank debt, secured, Funding Platform unsecu
Slide 6: Well Positioned for Business Landscape in 2024
Well Positioned for Business Landscape in 2024 Policy & Regulatory Interest Rates • Sustained earnings growth through various • Pricing new investment yields commensurate policy regimes with cost of funds • Existing pipeline diversity and continued • Industry adapting to a new equilibrium at expansi
Slide 7: Programmatic Partners Drive Consistent Diversified Volume
Programmatic Partners Drive Consistent Diversified Volume Closed Transactions2 BTM GC Two Highest Volume Asset Classes have Changed Every Year 52% 30% $2.3b Community Solar HASI $1.9b 18% $1.8b 12-mo Pipeline1 $1.7b >$5b Resi Other Community Solar Solar 26% FTN C&I 18% Public Public Resi Solar Publi
Slide 8: Continued Growth in Portfolio, Dist. NII and GoS Fees
Continued Growth in Portfolio, Dist. NII and GoS Fees Financial Results (FY23) Higher New Investment Yields in 2023 Change Improve Long Term Distributable NII Results Unaudited1 FY22 FY23 YoY >9% GAAP Diluted EPS $0.47 $1.42 >7.5% Distributable EPS $2.08 $2.23 +7% >7% >7% GAAP NII $45m $58m 2020 202
Slide 9: Consistent High Growth in Key Metrics
Consistent High Growth in Key Metrics Distributable EPS1 Distributable NII1 CAGR: 12% CAGR: 28% $2.08 $2.23 $217 $1.88 $180 $1.55 $m $1.40 $134 $82 $88 2019 2020 2021 2022 2023 2019 2020 2021 2022 2023 Gain on Sale, Fees, and Securitization Income Off Balance Sheet Managed Assets1 CAGR: 23% Portfoli
Slide 10: Record Portfolio Growth from Multiple Asset Classes
Record Portfolio Growth from Multiple Asset Classes Portfolio growth of $1.9b vs. Previous 3-Year Annual Average of $0.7b Community Solar GC Solar Other Portfolio Change ($m)4 C&I 10% Beginning Portfolio (9/30/23) $5,501 3% 19% Public Funding of new investments 246 Sector 5% Funding of prior investm
Slide 11: Strong Margins through Various Interest Rate Environments
Strong Margins through Various Interest Rate Environments Portfolio Yield 1 Interest Expense / Avg Debt Balance 2 Incremental investments at attractive margins 7.9% 2023 2023 New 7.6% 7.6% 7.5% 7.5% >9% New Asset Investment 6.8% Yield Yield1 5.4% 2023 5.1% 5.0% 2023 New 4.9% 7% 7% New Debt 4.6% Debt
Slide 12: Robust Funding Platform Supports Business Growth
Robust Funding Platform Supports Business Growth Entering 2024 with Strong • Raised $550m in corporate unsecured bonds in December, followed by $200m add-on in January Liquidity Cash >$930m • 2.0x debt to equity2 Liquidity Unsecured Revolver Sources1 • 92% of debt fixed or hedged3 CP • Baa3/BB+/BB+
Slide 13: 2023 Sustainability and Impact Highlights
2023 Sustainability and Impact Highlights Reported to investors that HASI is 100% aligned with the EU Taxonomy and believe that holding our shares is in compliance with SFDR Articles 6, 8, and 91 Submitted formal comments in support of an “Emissions Matching” approach – in alignment with our longsta
Slide 14: Proven Business Model for Investing in Energy Transition Assets
Proven Business Model for Investing in Energy Transition Assets ] Differentiated Climate | Clients | Assets Strategy Demonstrated success of consistent earnings growth through Resilient Business interest rate and public policy cycles Stability of Long-Term Reduction of reliance on capital markets ov
Slide 15: Appendix
Appendix 15
Slide 16: Cash Flow Sources and Uses
Cash Flow Sources and Uses $ millions1 2023 2022 2021 Adjusted Cash Flow from Operations Plus Other Portfolio Collections2 $266 $287 $259 (-) Dividend ($160) ($132) ($114) (=) Cash Available for Reinvestment $106 $155 $146 3 (-) Investments Funded ($2,225) ($871) ($960) (+) Capital Raised $1,969 $69
Slide 17: Summary of Total Debt and Hedge Portfolio
Summary of Total Debt and Hedge Portfolio Debt Amount Debt Facility (millions) 1 Interest Rate2 Maturity Year Corporate Senior Unsecured Notes $1,000 3.38% 2026 Corporate Senior Unsecured Notes $550 8.00% 2027 Term Loan A $532 6.47% 2025 Convertible Notes $403 3.75% 2028 Fixed Rate Debt Revolving Li
Slide 18: Strong Portfolio with Positive Credit Attributes
Strong Portfolio with Positive Credit Attributes Recent Portfolio Performance Positive Credit Attributes Rating Description Performance Metric Portfolio Structural Asset Class Obligor Credit (%) 4 Seniority 1 Performing1 ~99% > 295k consumers Typically Residential 28% WAVG FICO: “Very 2 Slightly bel
Slide 19: Explanatory Notes
Explanatory Notes Adjusted Cash Flow from Operations plus Other Portfolio Collections We operate our business in a manner that considers total cash collected from our portfolio and making necessary operating and debt service payments to assess the amount of cash we have available to fund dividends a
Slide 20: Supplemental Financial Data
Supplemental Financial Data Distributable Earnings and Earnings on Equity Method Investments We calculate distributable earnings as GAAP net income (loss) excluding non-cash equity compensation expense, provisions for loss on receivables, amortization of intangibles, non-cash provision (benefit) for
Slide 21: Supplemental Financial Data
Supplemental Financial Data Managed Assets As we both consolidate assets on our balance sheet and securitize assets, certain of our receivables and other assets are not reflected on our balance sheet where we may have a residual interest in the performance of the investment, such as servicing rights
Slide 22: Income Statement
Income Statement IN ARMSTRONG SUSTAINABLE INFRASTRUCTURE CAPITAL, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (@OLLARS IN THOUSANDS, EXCEPT PER SHARE DATA) For the Three Months For the Year Ended Ended December 31, December 31, 2023 2022 2023 2022 Revenue Interest income $ 62,170 $ 36,752 $ 207,794 $
Slide 23: Balance Sheet
Balance Sheet HANNON ARMSTRONG SUSTAINABLE INFRASTRUCTURE CAPITAL, INC. CONSOLIDATED BALANCE SHEETS (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA) December 31, December 31, 2023 2022 Assets Cash and cash equivalents $ 62.632 $ 155.714 Equity method investments 2,966,305 1,869,712 Commercial receivabl
Slide 24: Statement of Cashflows
Statement of Cashflows HANNON ARMSTRONG SUSTAINABLE INFRASTRUCTURE CAPITAL, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS: (DOLLARS IN THOUSANDS) ‘Years Ended December 31, 2023 2022 2021 ‘Cash flows from operating activities ‘Net cash provided by (used in) investing activities (1,992,803) (592,110) _ (
Slide 25: Reconciliation of GAAP Net Cash Operating Activities to Adjusted Cash Flow
Reconciliation of GAAP Net Cash Operating Activities to Adjusted Cash Flow from Operations and Other Portfolio Collections 25
Slide 26: Reconciliation of GAAP Net Income to Distributable Earnings
Reconciliation of GAAP Net Income to Distributable Earnings 26
Slide 27: Reconciliation of GAAP Net Income to Distributable Earnings
Reconciliation of GAAP Net Income to Distributable Earnings 27
Slide 28: Reconciliation of GAAP-based NII to Distributable NII
Reconciliation of GAAP-based NII to Distributable NII 28
Slide 29: Additional GAAP to Non-GAAP Reconciliations
Additional GAAP to Non-GAAP Reconciliations 29
Slide 30: Visit our website at www.hasi.com
Visit our website at www.hasi.com Securities are offered by Hannon Armstrong Securities, LLC, a registered broker dealer, member FINRA and SIPC and subsidiary of Hannon Armstrong Sustainable Infrastructure Capital, Inc.
HA Sustainable Infrastructure Capital — FY2023 Earnings Presentation on 6ix