Suzlon Energy Ltd · NSE:SUZLON
Suzlon Energy — Q1 FY14 Earnings Presentation
26 slides from Suzlon Energy's earnings presentation, Aug 2, 2013
Slide 1: Q1 FY14 Earnings Presentation
Suzlon Energy Limited Q1 FY14 Earnings Presentation 2nd August 2013 Thornton Bank Offshore Wind Farm, Belgium 1 www.suzlon.com
Slide 2: Disclaimer
Disclaimer • This presentation and the accompanying slides (the “Presentation”), which have been prepared by Suzlon Energy Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securi
Slide 3: Quarter Takeaways – Q1 FY14
Quarter Takeaways – Q1 FY14 Suzlon wind farm in Kutch, India 3 www.suzlon.com
Slide 4: Key highlights – Q1 FY14
Key highlights – Q1 FY14 • Operations ramping up at Suzlon wind – 219 MW • 325 MW Thornton Bank offshore wind farm completed • Group headcount reduction of 1,000+, in addition to 1,500+ reductions in FY13 • Opex reduced by 31% QoQ, despite adverse FX movement • Working capital further rationalized t
Slide 5: Operations ramping up at Suzlon Wind
Operations ramping up at Suzlon Wind Constrained liquidity Focus on Liability Volume ramp-up Management MW sold +46% 219 167 150 >FY14 & Beyond< 16 -77 1Q ’13 2Q ’13 3Q ’13 4Q ’13 1Q ’14 - $360mn FCCB - FCCB extension failed - Completed CDR process in Apr’13 payment - Filed for CDR - Execution ramp
Slide 6: REpower completes its largest offshore wind farm
REpower completes its largest offshore wind farm 325 MW Thornton Bank project with 6M Showcase project for the European Offshore Industry • Project with largest fleet of 6M turbines • One of the largest project financed offshore wind farms in Europe (~€900mn) • Total project cost: ~€1.3bn Reaffirms
Slide 7: Business Performance
Business Performance Suzlon wind farm in Minnesota, USA 7 www.suzlon.com
Slide 8: Financial snapshot
Financial snapshot Rs Crs Q1 FY14 Q4 FY13 Q1 FY13 FY13 FY12 Particulars Unaudited Audited Unaudited Audited Audited Consolidated Revenue 3,851 4,281 4,747 18,743 21,082 Consolidated EBITDA -302 -594 -257 -1,296 1,821 Consolidated EBIT -482 -786 -435 -2,037 1,160 Consolidated Net working capital 2,02
Slide 9: REpower: Stable performance continues
REpower : Stable performance continues REpower revenues* (€M) Highlights of 1Q FY14 Stable performance despite adverse market dynamics 517 Focus on cost reduction 92 ― Fixed cost reduction, right sizing headcount 333 ― Improving production efficiency 5 263 ― Eliminating cost redundancy 49 425
Slide 10: Service Business: Growing business with stable revenues
Service Business: Growing business with stable revenues Revenues (Rs. Crs)* +53% Key Highlights 640 418 • 1Q FY14 OMS revenue at ~Rs. 640 crs 345 305 258 — >50% higher than same quarter last year 189 295 115 160 • High growth with stable and consistent 1Q FY12 1Q FY13 1Q FY14 *External only Suzlon R
Slide 11: Robust order book position
Robust order book position Total value of US$7.1 bn Order book by geography – US$7.1bn South Africa ROW Australia • Order book at ~5.4 GW 6% France 3% 2% Brazil 6% Germany • Order book value: US$ 7.1bn 3% 38% UK 8% - Onshore markets: 5% • Emerging : ~US$1.5bn Belgium (India, Brazil and South 13% Afr
Slide 12: Project Transformation Update
Project Transformation Update Suzlon wind farm in Penamacor, Portugal 12 www.suzlon.com
Slide 13: Right-sizing across verticals continued over Q1
Right-sizing across verticals continued over Q1 Employee Headcount Suzlon* REpower *Ex REpower 2,000+ 230+^ -18% -7% 11,093 778 3,316 -9% 3,080 9,050 8,272 2,795 Mar 12 Mar 13 Jun 13 Mar 12 Mar 13 Jun 13 Headcount reduced by 778, over and above 500 permanent + 250 temporary employee 2,000+ reduc
Slide 14: Further reduction in fixed costs achieved
Further reduction in fixed costs achieved Consolidated operating expenses* (Rs. Crs) 1,097 1,090 1,100 Key actions taken: • Stringent cost control measures in place -31% 844 • Rationalizing travel and consulting 758 expenses 709 747 759 • Rationalized office and factory space 492 544 Plan for furthe
Slide 15: Continuing to optimize Working Capital ratio
Continuing to optimize Working Capital ratio Net Working Capital Ratio* Key actions underway: 27.1% • Leaner inventory cycle 25.9% • Make vs Buy analysis • Controlled procurement • Focus on realizations 13.6% 11.4% • Project prioritization, better receivables management • Expediting order execution
Slide 16: Comprehensive Liability Management Update
Comprehensive Liability Management Update Suzlon wind farm in Rajasthan, India 16 www.suzlon.com
Slide 17: Liability Management in place
Liability Management in place CDR: Back-ended maturity profile & Interest Rate reduced to 11%… CDR Credit enhanced Bonds / FX Loans Debt Under CDR Pre-Restructuring Mn USD 818 246 258 206 Liability Credit 146 118 Management Enhanced Bond 0 H2FY13 FY14 FY15 FY16 FY17 FY18 Beyond Post-Restructuring 79
Slide 18: FCCB: Status update
FCCB: Status update • Paid the first tranche of FCCBs of $360mn in July 2012 after 45 days extension • Prior to maturity had officially sought four months extension for October series with intention to meet our obligations in their entirety - Extension did not achieve required super-majority, result
Slide 19: Key Priorities for FY14
Key Priorities for FY14 Suzlon Manufacturing unit in Dhule, India 19 www.suzlon.com
Slide 20: FY14 priorities
FY14 priorities Asset light / Debt light Products / Orders Asset sales Continued R&D focus to optimize yield and reduce cost of energy • ~$400mn targeted from non-critical assets Strategic Investing in project pipeline in India Working capital optimization • Focus on realization of sticky re
Slide 21: Detailed Financials – Q1 FY14
Detailed Financials – Q1 FY14 Manufacturing unit in Daman, India 21 www.suzlon.com
Slide 22: Consolidated financial results
Consolidated financial results Rs Crs. Q1 FY14 Q1 FY13 Q4 FY13 FY13 FY 12 Particulars Unaudited Unaudited Audited Audited Audited Revenue from operations 3,851 4,747 4,281 18,743 21,082 Less: COGS -2,731 -3,555 -3,185 -13,640 -14,074 Gross Profit 1,120 1,191 1,095 5,104 7,009 Gross Profit % 29.1% 25
Slide 23: Consolidated net working capital
Consolidated net working capital Rs Crs As on As on As on As on As on As on Particulars 30th June’13 31st Mar ’13 31st Dec ‘12 30th Sept’12 30th June’12 31st Mar’12 Inventories 5,386 5,264 5,928 5,421 5,960 5,580 Trade receivables 5,759 6,382 6,990 8,584 8,265 8,201 Short-term loans and 2,435 2,185
Slide 24: Financial leverage
Financial leverage(a) As on (Rs. Crs) Debt type 30th Jun 13 31st Mar 13 31st Dec 12 30th Sep 12 30th Jun 12 31st Mar 12 Suzlon Wind Debt FX loans* 3,843 3,513 3,555 3,475 2,053 1,920 FCCBs 2,418 2,211 2,239 2,152 3,641 3,327 W.Cap, Capex and 9,218 8,701 8,383 8149 7,783 7,895 other loans Gross debt
Slide 25: FCCBs: Status update
FCCBs: Status update Outstanding Conversion Coupon Maturity value with FCCBs Maturity date amount (US$ mn) price (Rs) rate redemption premium October 2012 – Old 121.4 97.26 October 2012 0% 144.88% October 2012 – 20.8 76.68 October 2012 7.5% 157.72% Exchange July 2014 – New 90.0 90.38 July 2014 0% 13
Slide 26: Thank you
Thank you Suzlon wind farm in Paracuru, Brazil 26 www.suzlon.com