Redwheel Next Generation Power Infrastructure Fund - Institutional Class · NASDAQ:ECOIX
Redwheel Next Generation Power Infrastructure Fund - Institutional Class — HydrogenOne Capital Growth — FY2022 Earnings Presentation
43 slides from Redwheel Next Generation Power Infrastructure Fund - Institutional Class's earnings presentation, Apr 4, 2023
Slide 1: FY22 Annual Results presentation
HydrogenOne Capital Growth plc FY22 Annual Results presentation Investing in clean hydrogen for a climate-positive impact LSE: HGEN 4 April 2023
Slide 2: Disclaimer
Disclaimer This document is issued by HydrogenOne Capital Growth plc (the "Company") for the confidential use of only those persons to whom it is distributed and is not to be reproduced, distributed or used for any other purpose. By accepting delivery of this document, each recipient agrees to treat
Slide 3: Contents
Contents • Full year results for the year ending 31st December 2022 • Portfolio update • Appendix: Market update • Appendix: Invested companies update 3
Slide 4: 2022 highlights
2022 highlights • NAV increased by 22% from £102.8m to £125.4m from the end of 2021 to 2022, with £125m 97p NAV per share of 97.3p at the end of 2022 NAV NAV per share • Portfolio of companies are performing well against the backdrop of improving industry fundamentals. Private companies, which accou
Slide 5: Unique and diversified portfolio across the hydrogen value chain
HydrogenOne has a unique and diversified portfolio, invested across the hydrogen value chain Portfolio composition (as at 31 Dec 22) Where we invest Cranfield • Revenue-generating equipment businesses Gen2 Energy Aerospace 3% HH2E Solutions 5% 6% • Hydrogen production projects NanoSun Elcogen 11% 19
Slide 6: Financial and operational highlights 2022
Financial and operational highlights 2022 31 Dec 31 Dec % change 1,2.3 • Diversified portfolio of hydrogen assets, delivering 2022 2021 growth for investors across the portfolio NAV per Ordinary Share 97.31p 95.75p 1.6% • The NAV increase was driven primarily by valuation NAV £125.4m £102.8m 21.9% u
Slide 7: Growing our NAV and NAV/share in 2022
Growing our NAV and NAV/share in 2022 NAV movements 2021-2022 (pence per share) NAV (£m) and NAV pence per share, 2021-22 135 100.00 96.8p 96.9p 97.3p 96.5p 100.00 3.94 (2.15) 130 94.9p 95.00 99.00 £125.4m £124.8m £124.3m 125 98.00 90.00 120 97.00 115 85.00 96.00 0.58 Listed -2.81p, 95.00 Private +6
Slide 8: Portfolio valuation changes 2021-22
£20.0m £1.8m £21.8m £10.0m £2.9m £12.9m £9.1m £2.4m £11.5m £10.0m £0.0m £10.0m £3.3m £0.1m £3.4m £5.6m Portfolio valuation changes 2021-22 £0.7m Portfolio valuation changes, 12 months ended 31 December 2022 £6.3m £20.0m £0.4m £20.4m £5.0m £0.1m £5.1m £9.9m £1.7m £11.6m £8.2m £0.2m Listed (£4.7m) £3.
Slide 9: Well established investment process and access to deal flow
Well established investment process and access to deal flow 1. Specialist insights into deal flow • Investment Adviser networks and track record • Building out opportunities via our investments • First mover… “see everything” • Investing alongside industrials, ESG funds and VC 2. Investment Policy •
Slide 10: Six new private investments into leading clean hydrogen companies in 2022
Six new private investments into leading clean hydrogen companies in 2022 £10m £13m £7m £20m £5m £10m Pioneer in revolutionary Large scale Norwegian Developing hydrogen- Industry-leading innovator A prominent German Leader in offshore fuel cell design and green hydrogen project powered emissions-fre
Slide 11: Capital deployment has slowed in H2 2022
Capital deployment has slowed in H2 2022 in response to market conditions Total new investment deployed, Capital deployed in the 12 months ended 31 December 2022 Jun 2021 - Dec 2022 £44.8m £9.5m £54.3m £39.1m £5.1m £20.5m £5.6m £3.5m £10.0m £9.5m £3.5m £5.6m £20.5m £5.1m £9.5m Bramble Elcogen HH2E (
Slide 12: HGEN valuation methodology
HGEN valuation methodology Valuations using IPEV guidelines Consistent approach to valuation • Valuations updated for the entire private portfolio on a quarterly basis, reviewed and approved by the AIFM and Board Discounted Cash Flow • The private portfolio is principally valued using either the DCF
Slide 13: Rigorous valuation method and downside protections
Applying a rigorous valuation method and embed downside protections in investments Portfolio fair value by valuation methodology, YE 31 Dec 22 Governance and downside protection • 100% of the private portfolio has downside protections 90% 84% such as anti-dilution and liquidation preferences 80% • 6
Slide 14: Valuation evolution – listed vs. private companies
Valuation evolution – listed vs. private companies The Company’s approach to valuation remains consistent while market has seen strong rise and correction HydrogenOne NAV/share vs listed hydrogen shares Implied EV/Revenue Multiple, 0.0x (2024-2026) (SOLGHYD ) 12.0 140 EV/Revenue multiple, 0.0x 9.7 1
Slide 15: ESG integrated in investment decisions and asset monitoring
Our alignment ESG integrated in investment decisions and asset monitoring Effective Boards £103 million 89% 42,716 tCO2e 50,579 tCO2e 201,000 MWh Our impact deployed in low-carbon EU taxonomy-aligned emissions avoided emissions avoided potential clean growth portfolio in 2022. Carbon neutral since I
Slide 16: ESG KPIs and delivery in 2022
ESG KPIs and delivery in 2022 E S G Capital invested in low-carbon growth: Jobs supported: Positive and proactive engagement with private ü £102.9m since IPO to 31 Dec 2022 ü 1,135 full-time staff employed by private portfolio portfolio to deliver effective boards: ü 100% representation on Boards EU
Slide 17: ESG case study – Sunfire
ESG case study – Sunfire • Sunfire’s innovative and proven solutions are addressing a key challenge of today’s energy system: providing renewable hydrogen and syngas as substitutes for fossil energy sources • Their electrolysers enable the transformation of energy-intensive sectors such as the chemi
Slide 18: Contents
Contents • Full year results for the year ending 31st December 2022 • Portfolio update • Appendix: Market update • Appendix: Invested companies update 18
Slide 19: Distinctive and unique hydrogen portfolio
Distinctive and unique hydrogen portfolio Portfolio segmentation Portfolio segmentation Fund holdings (as at 31 Dec 22) by theme by geography Private portfolio NAV £m NAV % 4% Sunfire GmbH 22 17% 8% +1.1 1% 11% +1.63Plc Elcogen +1.1% 20 16% 23% 7% 26% HiiROC Ltd 13 10% Strohm Holding B.V 12 9% NanoS
Slide 20: Invested in significant manufacturing capacity and scale
Invested in significant manufacturing capacity and scale Strohm’s TCP pipeline plant in Ijmuiden, Port of Amsterdam Sunfire’s alkaline electrolyser plant in Solingen, Germany • New expanded facility launched in 2023 • Newly expanded plant in 2023 following EUR30m investment • Tripled production capa
Slide 21: Growing value for investors
Growing value for investors Annual revenue of portfolio companies 10-15% average NAV growth target1 Early stage • Growth delivery in invested companies Late stage • Follow-on investment at higher valuation • Exit via IPO or trade sale 2021-22 % of portfolio Target holding revenue (31.12.22) period (
Slide 22: Growth delivery and outlook
Growth delivery and outlook Revenue potential of private portfolio (HGEN share) 2024 Estimated Revenue (HGEN share), by sector, £m Hydrogen Hydrogen Production 60 Applications 2021-2024: 21x CAGR: +174% Supply Chain 40 £m 20 Storage & Distribution - 2021 2022 2023E 2024E • Significant financial grow
Slide 23: Portfolio is revenue generating with consistent growth
The portfolio is revenue generating and has produced consistent growth Growth in private portfolio revenues since investment • Seven of the private investments, representing 89% the invested portfolio by value, are revenue-generating 16 • The aggregate revenue from these investments was c. £33m Incr
Slide 24: Sunfire GmbH investment
Sunfire GmbH investment (Supply chain) Description Growth in revenues since investment 16 German industrial electrolyzer producer, of pressure alkaline (AEL) and solid oxide electrolizers (SOEC) Increase in revenues since investment (0x) 14 www.sunfire.de 12 Investment size / date / • £20m / October
Slide 25: HH2E & Thierbach investments
HH2E & Thierbach investments (Hydrogen Production) Description German green hydrogen project developer with a focus on industrial customers. Operator of the Thierbach green hydrogen development Thierbach project, in which HGEN has a direct investment. www.hh2e.de Berlin Investment size / date / • HH
Slide 26: Exclusivity on green hydrogen projects
Exclusivity on 12 green hydrogen projects Norway Germany HGEN Capex Burn, semi-annual, £m 70 350 HGEN investment in semi-annual period, £m Project 1 • 100MW – 2027 Cumulative capex investment, £m • 60/40 electrolysis/battery 60 300 • 1GW potential HGEN investment 2024-2026 50 250 Lubmin 40 200 • 100
Slide 27: Investment pipeline
Investment pipeline >£20bn private Investible Universe ➣ £500m private Pipeline Invested across the value chain • Diversified portfolio across multiple asset classes • Clean hydrogen supply projects Hydrogen production • Supply chain and developer companies • <10% allocation to strategic listed comp
Slide 28: Summary
Summary Identifying the best investment opportunities Strong management Revenue-generating Distinctive project Avoided GHG 10-15% target teams equipment suppliers developers potential return1 Specialist team Active stewardship Grow EBITDA and exit >£500m pipeline Clear strategy to grow NAV (1) For a
Slide 29: Contents
Contents • Full year results for the year ending 31st December 2022 • Portfolio update • Appendix: Market update • Appendix: Invested companies update 29
Slide 30: Strong macro tailwinds underpin hydrogen investment case
Strong macro tailwinds underpin hydrogen investment case Structural drivers of the hydrogen economy… …step change in policies Hydrogen policies Energy Transition in 39 countries for Net Zero $8bn >300GW ‘hydrogen hubs’ + REPowerEU 2030 hydrogen tax credit in hydrogen target Inflation Reduction Act i
Slide 31: The colours of hydrogen
The colours of hydrogen Grey hydrogen Steam methane reforming (SMR) of natural gas $2-8/kg US: $1.5-2.3/kg Asia-Pacific: $5-8/kg $175 billion “grey” market today… EMEA: $6-7/kg • Industrial gas: refining, steel, cement, ammonia • Cleaning up 830mtpa GHG emissions Fossil fuel Hydrogen …and >$2 trilli
Slide 32: Hydrogen's key role in avoiding GHG emissions
Hydrogen’s key role in avoiding GHG emissions >20 Gtpa GHG reduction potential Feedstock Feedstock – 1.2 Gtpa1 GAS Grid Blending Grid blending – 5.7 Gtpa2 Renewables Electrolysis Storage & distribution Transport Transport – 7.2 Gtpa3 ELECTRICITY Off grid Off grid – 6.2 Gtpa4 1GW green hydrogen: >1 M
Slide 33: Large-scale clean hydrogen deployment is underway
Large-scale clean hydrogen deployment is underway Ningxia Hydrogen Plant, China 150MW / 27,000 tonnes hydrogen/year EUROPE 0.3GW 2.6GW 210GW NORTH AMERICA 0.1GW 0.3GW 632GW ME/ASIA 0.4GW 3.0GW 122GW Ningxia Hydrogen Plant, China SOUTH AMERICA <0.1GW 136GW AUSTRALIA <0.1W 0.1GW 86GW AFRICA <0.1GW 45G
Slide 34: Contents
Contents • Full year results for the year ending 31st December 2022 • Portfolio update • Appendix: Market update • Appendix: Invested companies update 34
Slide 35: Fund holdings
Fund holdings As at 31 Dec 2022 As at 31 Dec 2021 Private portfolio NAV £m NAV % NAV £m NAV % Sunfire GmbH 22 17% 20 19% Elcogen Plc 20 16% - - HiiROC Ltd 13 10% 10 10% Strohm Holding B.V. 12 9% - - NanoSUN Limited 11 9% 9 9% Bramble Energy Limited 10 8% - - Cranfield Aerospace Solutions 7 5% - - HH
Slide 36: HiiROC Limited investment
HiiROC Limited investment (Storage & Distribution) Company description Growth in revenues since investment UK-based thermal plasma electrolysis developer, with 16 world-leading (IP-protected) technology for low-cost, zero-emission hydrogen, also enabling flare/waste gas Increase in revenues since in
Slide 37: Strohm Holding B.V. investment
Strohm Holding B.V. investment (Storage & Distribution) Company description Growth in revenues since investment 16 Netherlands-based hydrogen pipeline company Increase in revenues since investment (0x) 14 www.strohm.eu 12 Investment size / date / • £10m / Aug & Dec 22 / 9% of NAV 10 % of NAV Co-inve
Slide 38: Elcogen Plc
Plc Elcogen Plc Company description Growth in revenues since investment 16 Fuel cell and electrolyser manufacturer with presence in Increase in revenues since investment (0x) Estonia and Finland 14 www.elcogen.com 12 Investment size / date / • £20m / May 22 / 16% 10 % of NAV Co-investors • Biofuel O
Slide 39: NanoSUN Limited
NanoSUN Limited Company description Growth in revenues since investment 16 UK-based developer of hydrogen distribution and mobile refueling equipment Increase in revenues since investment (0x) 14 www.nanosun.co.uk 12 Investment size / date / • £9m / Dec 21 / 9% % of NAV 10 >60x Co-investors • Westfa
Slide 40: Bramble Energy Limited
Bramble Energy Limited Company description Growth in revenues since investment 16 UK-based fuel cell and portable power solutions company Increase in revenues since investment (0x) 14 www.brambleenergy.com 12 Investment size / date / • £10m / Feb 22 / 8% 10 >70x % of NAV 8 Co-investors • IP Group, B
Slide 41: Cranfield Aerospace Solutions Ltd
Cranfield Aerospace Solutions Ltd Company description Growth in revenues since investment 16 UK-based passenger flight innovator, powering turboprop Increase in revenues since investment (0x) flight with hydrogen 14 www.cranfieldaerospace.com 12 Investment size / date / • £7m / Mar 22 / 6% 10 % of N
Slide 42: Gen2 Energy
Gen2 Energy Company description Norwegian green hydrogen project developer Oslo www.gen2energy.com Holandsvika Investment size / date / • £3m / Mar 22 / 3% • 500MW – est. 2026 % of NAV • Electrolysis with shipping transport HGEN investment 2023-2024 Co-investors • HyCap, Vitol, Hoegh LNG, Knutsen Gr
Slide 43: Contact us
Contact us HydrogenOne Capital LLP: Dr JJ Traynor, Managing Partner E: JJ.Traynor@hydrogenonecapital.com Richard Hulf, Managing Partner E: Richard.Hulf@hydrogenonecapital.com 5 Margaret St London W1W 8RY www.hydrogenonecapitalgrowthplc.com/ Barclays Bank PLC: Dion Di Miceli E: BarclaysInvestmentComp
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