Endesa S.a. · BME:ELE
Endesa — 9M 2019 Earnings Presentation
30 slides from Endesa's earnings presentation, Nov 5, 2019
Slide 1: Endesa 9M 2019 Consolidated Results
Endesa 9M 2019 Consolidated Results November 05, 2019
Slide 2: Key highlights
Key highlights EBITDA increased by +4% thanks to the good performance of liberalized business Decarbonization Steady evolution in the Distribution business Smart networks Flat fixed costs with an outstanding investment effort Customer value Net Ordinary Income (1) +3% Efficiency through digitalizati
Slide 3: Decarbonization: Discontinuity of the mainland coal
Decarbonization: Discontinuity of the mainland coal Context Impairment(1) of mainland coal fleet (€bn) • Adverse market conditions: Increase in CO2 1.4 prices (MSR mechanism) and decrease in gas prices triggered the exclusion of coal plants from Economic merit order Dismantling provision 0.5 rationa
Slide 4: Accelerating renewable development
Accelerating renewable development Net capex(1) (€bn) Pipeline of renewable projects(3) (GW) By type By business ~12.0 10% 8% 23% 1.3 1.3 ~7.4 35% 55% 45% 21% 3% Projects with awarded Asset Management Mainland Gx + others EGPE(2) connection points ~4.6 Customers Sx + Endesa X Non Mainland Asset Deve
Slide 5: Market context in 9M 2019
Market context in 9M 2019 Demand (1) Electricity wholesale prices Endesa output(4) (TWh) Endesa distribution area(2) (Not adjusted) Average pool prices Spain (€/MWh) -16% -10% -0.7% Industry -0.4% 55.5 Services +1.3% FY2018: 57.3 €/MWh 2.7 6.9 46.6 3.0 +8% 0.4% Residential -3.2% 3.9 51% -43% 18.4 58
Slide 6: Power operational highlights
Power operational highlights Electricity sales(1) (TWh) Number of electricity customers (Thousands) -1% -1% 74.8 73.7 10.9 10,754 10,674 10.0 14.6 14.3 5,029 4,849 -4% 49.3 49.4 5,725 5,825 +2% (3) (4) 9M 2018 9M 2019 FY2018 9M 2019 B2B(2) B2C SCVP Free Regulated Flat electricity sales and improving
Slide 7: Electricity sales and energy management
Electricity sales and energy management Energy management (TWh) Integrated unitary margin (€/MWh) 0% Sales(1) 61.9 61.7 Revenue 65.8 67.7 Energy purchases 16.0 24.1 Variable cost(2) 40.3 40.7 +6% Mainland output 45.9 37.6 Integrated margin 25.5 27.0 9M 2018 9M 2019 9M 2018 9M 2019 Free customers 31/
Slide 8: Gas operational highlights
Gas operational highlights Total sales (TWh) Gas unitary margin(1) (€/MWh) -4% ~90% 3.3 73.2 70.3 Wholesale business 7.7 6.8 11.8 14.8 CCGT sales 1.7 Retail 53.7 48.7 9M 2018 9M 2019 9M 2018 9M 2019 Number of gas customers +2% 31/12/18-30/09/19 (k#) 1,604 1,636 Exploiting market opportunities to rec
Slide 9: Financial results
9M 2019 consolidated results Financial results
Slide 10: 9M 2019 consolidated results: Financial highlights
9M 2019 consolidated results Financial highlights (€M) 9M 2019 9M 2018 Δyoy EBITDA 2,898 (1) 2,791 +4% Net ordinary income (2) 1,228 1,193 +3% FCF 385 34 11x (4) Net debt 7,225 5,770 +25% Net capex(3) 1,282 735 +74% Reported net income 176 1,193 -85% (1) Including +€27 M of the Catalan Nuclear Tax r
Slide 11: EBITDA evolution
EBITDA evolution €M +4% DYoY 2,791 2,898 6 175 - 74 (1) +18% 985 1,160 286 212 -26% 1,520 1,526 +0% (2) 9M 2018 Dx Non mainland Gx Gx + Sx 9M 2019 Distribution Non mainland Gx Generation & Supply EBITDA improvement mainly supported by liberalized business performance (1) Including +€27 M of the Cata
Slide 12: Regulated business
Regulated business €M EBITDA Net capex(1) -4% Margin: €2,347 M (-2%) 1,806 8% 1,738 286 • Dx margin: €1,931 M (+0%) 212 • Non mainland margin: €416 M 42% (-13%) (2) €343 M 1,520 1,526 50% Fixed costs: €609 M (+2%) 9M 2018 9M 2019 Distribution Non mainland Asset Management Asset Development Customers
Slide 13: Liberalized business
Liberalized business(1) €M EBITDA Net capex(2) By type By business +18% Margin: €2,043 M (+9%) 10% 11% 1,160 • Electricity&Others margin: €1,775 28% M (+6%) 985 160 130 • Gas margin: €183 M (+71%) 30% €939 M €939 M • Endesa X margin: €85 M (-3%) 60% (4) 1,000 61% 855 Fixed costs: €883 M (0%) Asset M
Slide 14: Fixed costs evolution
Fixed costs evolution €M +€12 M +1% -€13 M -1%(1)(2) 1,480 11(1) 1,469 1,456 36(2) 1,492 Personnel 704 691 +7% 741 759 costs O&M costs 921 923 -5% 880 898 Capitalized costs -145 -145 -165 -165 9M 2018 9M 2018 9M 2019 9M 2019 Reported Adjusted Adjusted Reported (1) 9M 2018 Fixed costs adjusted by: Pr
Slide 15: From EBITDA to Net Ordinary Income
From EBITDA to Net Ordinary Income €M 9M 2019 9M 2018 Δyoy EBITDA(1) 2,898 2,791 +4% EBITDA increase +4% D&A (2) (2,563) (1,147) +123% EBIT 335 1,644 -80% Higher D&A affected by IFRS 16 effect apart from the coal impairment Financial expenses (139) (106) +31% Results from equity investments & Others
Slide 16: Cash Flow
Cash Flow €M -223 -634 -177 -54 (1) 2,898 1,810 -1,425 385 (2) (3) (4) (5) EBITDA Provisions paid Working capital Income Taxes Financial CFO Cash Capex FCF & Other Expenses 11% Previous year 2,791 -194 -1,332 -67 -57 1,141 -1,107 34 Delta YoY +4% +15% -52% +2.6x -5% +59% +29% 11x CFO improves about
Slide 17: Net financial debt analysis
Net financial debt analysis €M Gross debt Net debt evolution 49 7,225 7,670 1,520 1,168 5,770 271 445 Cash & Derivatives 6,021 810 recognized as 251 - 1,810 1,425 financial assets 7,176 7,225 6,057 Net debt 5,770 4,960 4,231 (1) (2) FY 2018 9M 2019 FY 2018 IFRS 16 CFO Cash Capex Dividends Others 9M
Slide 18: Final Remarks
Final Remarks Proven resilience of our integrated model Efficiencies through digitalization Accelerating the decarbonization of our generation mix to lead the Energy Transition Outstanding TSR of 23% as of 9M2019 Highly confident to meet 2019 guidance 9M 2019 Results- Madrid, 05 November 2019 18
Slide 19: Annexes
9M 2019 consolidated results Annexes
Slide 20: Installed capacity and output
Installed capacity and output Total output(1) (GWh) Total output (GWh) -16% GWh 9M 2019 55,548 (and chg. vs. 9M 2018) Total Output (1) Total 46,588 -16% 9,615 46,588 Hydro 3,898 -43% 3,907 Nuclear 20,245 10% 8,953 Coal 6,353 -60% 10,448 5,719 Natural gas 10,102 55% 3,524 3,925 Oil-gas 3,031 -40% 2,7
Slide 21: Gross margin evolution
Gross margin evolution €M +3% DYoY 4,271 173 4,390 7 - 61 +9% 1,870 2,043 477 416 -13% 1,924 1,931(1) +0% 9M 2018 Dx Non mainland Gx Gx + Sx 9M 2019 Distribution Non mainland Gx Generation & Supply 9M 2019 Results- Madrid, 05 November 2019 21 (1) Including +€27 M of the Catalan Nuclear Tax reversal
Slide 22: Financial debt maturity calendar
Financial debt maturity calendar €M Gross balance of maturities outstanding at 30 September 2019: €7,627 M(1) ECP’s and other marketable securities (2) Bank Debt Other debts 5,122 3,509 Endesa's liquidity covers 29 months of 27 1,807 debt maturities 25 75 1,755 277 1,601 51 79 169 64 252 151 90 188
Slide 23: Headcount
Headcount # Employees 9M 2018 FY 2018 9M 2019 9,757 9,763 9,923 1,621 1,630 1,680 7,489 7,484 7,562 865 867 887 2,968 2,977 2,978 2,537 2,535 2,526 2,361 2,268 5,159 2,279 5,155 5,275 4,149 793 4,087 756 4,082 763 442 440 443 1,126 1,072 1,073 Male Female Total Male Female Total Male Female Total Ge
Slide 24: Spanish power market
Spanish power market Customers (mn) Energy sold (TWh) Endesa Endesa market share1 172.6 market share1 193.7 18.2 29.4 41.5 32% 61.4 17.3 30% 42.8 43.3 28.5 11.3 24% 131.1 0.9 132.3 16.3 31% 11.2 21.1 24.6 8.3 19.9 0.0 0.9 1.2 Regulated 45% Free 30% Total Regulated 47% Free 31% Total Residential Busi
Slide 25: Endesa: 9M 2019 P&L
Endesa: 9M 2019 P&L Gx+Sx Dx Structure Adjustments TOTAL Income 12,905 2,057 434 -591 14,805 Procurements and services -10,392 -126 -28 131 -10,415 Gross margin 2,513 1,931 406 (460) 4,390 Self-constructed assets 50 102 13 0 165 Personel expenses -404 -211 -157 13 -759 Other fixed operating expenses
Slide 26: Endesa: 9M 2018 P&L
Endesa: 9M 2018 P&L Gx+Sx Dx Structure Adjustments TOTAL Income 13,442 2,069 431 -589 15,353 Procurements and services -11,010 -145 -60 133 -11,082 Gross margin 2,432 1,924 371 (456) 4,271 Self-constructed assets 33 102 10 0 145 Personel expenses -396 -191 -129 12 -704 Other fixed operating expenses
Slide 27: Glossary of terms (I/II)
Glossary of terms (I/II) Reference note (#) of Consolidated Item Calculation Management Report Cost of gross financial debt / gross average financial debt: (€100 M x (360/270) + €1 M) / €7,610 M = Average cost of debt (%) 4.1 1.8% (Principal x number of days of term) / (Principal in force at the end
Slide 28: Glossary of terms (II/II)
Glossary of terms (II/II) Reference note (#) of Consolidated Item Calculation Management Report Gross tangible (€1,208 M) and intangible (€136 M) Capex - assets from clients’ contributions and Net Capex (€M) 4.3 subsidies (€62 M) = €1,282 M Long and short term financial debt (€5,616 M + €2,054 M) -
Slide 29: Disclaimer
Disclaimer This document contains certain "forward-looking" statements regarding anticipated financial and operating results and statistics and other future events. These statements are not guarantees of future performance and they are subject to material risks, uncertainties, changes and other fact
Slide 30: IR Team
IR Team Contact us Contacts Email: ir@endesa.es Mar Martinez Phone: + 34 91 213 15 03 Head of Investor Relations + 34 91 213 90 49 Investor Relations team Website: www.endesa.com Isabel Permuy Javier Hernandez Francesc Trilla Juan Carlos Jimenez Sonia Herranz Paloma de Miguel 30