Renewables Infrastructure Group Limited GBP Red.Shs · LSE:TRIG
Renewables Infrastructure Group Limited GBP Red.Shs — The Renewables Infrastructure Group — Merger or Acquisition (June 2015)
40 slides from Renewables Infrastructure Group Limited GBP Red.Shs's merger presentation, Jun 24, 2015
Slide 1: Investor Update: Fred. Olsen Acquisition and Placing
THE RENEWABLES INFRASTRUCTURE GROUP Investor Update Fred. Olsen Acquisition and Placing 24 June 2015 www.TRIG-Ltd.com
Slide 2: Contents
CONTENTS Section Page Overview 3 Fred. Olsen portfolio investment and proposed placing 6 Portfolio update 10 TRIG – A Differentiated Proposition 14 Appendices 16 Contacts 39 This presentation and subsequent discussion may contain certain forward looking statements with respect to the financial condi
Slide 3: Overview
ATRIG OVERVIEW
Slide 4: TRIG – Experienced Management
TRIG – EXPERIENCED MANAGEMENT Independent Board Investment Manager Operations Manager Helen Mahy (Chair) Strong, 15+ year track record in One of the world's leading renewable infrastructure and real estate funds energy developers and operators Jonathan Bridel Over US$8 billion of equity under
Slide 5: Overview: TRIG
OVERVIEW: TRIG Investment Proposition ▲ Investing in operating renewables projects in UK & Northern Europe, and in proven technologies (onshore wind & solar PV) ▲ Defensive nature of long-term revenues ▲ Inflation-linked dividend yield of c.6% p.a.1 o Met performance and distribution targets since I
Slide 6: Fred. Olsen Portfolio Investment and Proposed Placing
FRED. OLSEN PORTFOLIO INVESTMENT AND PROPOSED PLACING
Slide 7: Investment in Fred. Olsen Portfolio
INVESTMENT IN FRED. OLSEN PORTFOLIO Agreement signed on 23 June 2015 Crystal Rig I Rothes II Six operational onshore wind projects in Scotland Gross generating capacity of 433MW £246 million investment 49% of the equity and 100% of a mezzanine loan Partnering with Fred. Olsen Renewables (F
Slide 8: Overview of Fred. Olsen Portfolio
OVERVIEW OF FRED. OLSEN PORTFOLIO Project: Crystal Rig 1 Rothes 1 Paul’s Hill Crystal Rig 2 Rothes 2 Mid Hill Location East Lothian, Moray, Moray, East Lothian, Moray, Aberdeenshire, Scotland Scotland Scotland Scotland Scotland Scotland Commercial Oct 2003 May 2005 May 2006 Jun 2010 Jun 2013 Jun/Nov
Slide 9: New Equity Issue
NEW EQUITY ISSUE Proposed placing to institutional investors £246m consideration for Fred. Olsen portfolio investment funded by: TRIG’s existing cash resources; and the Group’s acquisition facility extended to £204 million (from £120 million) provided by Royal Bank of Scotland plc and Nati
Slide 10: Portfolio Overview
ATRIG PORTFOLIO OVERVIEW
Slide 11: Portfolio Growth
PORTFOLIO GROWTH Acquisitions – 2014 Portfolio Data 9 projects (150 MW) added for £178m 24 Jun 2015 Dec 2014 Dec 2013 - March: Solar - 31MW (2 projects) # of projects 36 29 20 - June: Wind - 22MW (2 projects) - August: Solar - 57MW (3 projects) Net generating - November: Wind - 41MW (2 projects) cap
Slide 12: Portfolio Diversification
PORTFOLIO DIVERSIFICATION By Jurisdiction / By Technology / Power Market1 2 Weather System2 3 (by portfolio valuation) (by portfolio valuation) 1. Northern Ireland and the Republic of Ireland form a Single Electricity Market, distinct from that operating in Great Britain. 2. Segmentation by estimate
Slide 13: Update on UK Renewables Policy
UPDATE ON UK RENEWABLES POLICY Extensive further portfolio opportunities expected from UK renewables UK Onshore Wind Capacity Contracts-for-Difference (CfD) Under Government Programmes (June 2015) Round 1 Results (February 2015) Generating ▲ 27 projects awarded contracts Estimated total 2.1GW of cap
Slide 14: TRIG – A Differentiated Proposition
TRIG – A DIFFERENTIATED PROPOSITION
Slide 15: TRIG: A Differentiated Proposition
TRIG: A DIFFERENTIATED PROPOSITION ▲ Solid operating performance since IPO ▲ Delivering target returns: c.6% cash yield with surplus reinvestments ▲ Benefits of substantial, diversified portfolio ▲ Healthy acquisition pipeline with selective approach across segments ▲ Distinct management combination
Slide 16: Appendices
ATRIG APPENDICES 16
Slide 17: Overview: Financial Highlights
OVERVIEW: FINANCIAL HIGHLIGHTS For the year to 31 December 2014 Results Profit before tax: £23.3m (2013 – 5 months: £10.3m) Earnings per share: 6.2p (2013: 3.4p) NAV per share: 102.4p (2013: 101.5p) Total Shareholder Return: 7.5% in 2014 TRIG Dividend Schedule (FTSE-All share total return: 1
Slide 18: Operational Performance to December 2014
OPERATIONAL PERFORMANCE TO DECEMBER 2014 Benefits of diversification – close to target production in challenging 2014 UK weather Operational Output Electricity Production1 Against P50 Estimates At Acquisition Produced 814 GWh of electricity in 2014 2014 IPO to Dec 2013 IPO to Dec 2014 Segment (12
Slide 19: Operations Management
OPERATIONS MANAGEMENT Breadth and depth of capability provided by RES Managing performance RES: Resourcing Structure • Availability – minimising lost production, fault rectification • Generation – maximising output, maintenance planning, turbine & grid settings • Financial – budget control, minimisi
Slide 20: Portfolio Valuation Bridge
PORTFOLIO VALUATION BRIDGE Robust performance in 2014 Valuation Movement in the Year (£m) 1 1. The foreign exchange movement at the portfolio level excludes £1.2m gain in 2014 as a result of currency hedging arrangements in place at the Company level, resulting in a net effect of -£2.0m. 20
Slide 21: Valuation – Key Assumptions
VALUATION – KEY ASSUMPTIONS 31 December 2014 31 December 2013 Discount Rate1 Weighted Average 9.0% 9.8% Energy Yield All markets Third party acquisition P50 – central case Third party acquisition P50 – central case Based on updated third party forecasts (with Based on updated third party forecasts (
Slide 22: NAV Sensitivities
NAV SENSITIVITIES Based on portfolio as at 31 December 2014 Impact on NAV per share at 31 December 2014 (£ labels represent impact on Portfolio Value of £472.9m) 22
Slide 23: Cash Flow and NAV Outlook
CASH FLOW AND NAV OUTLOOK Based on portfolio as at 31 December 2014 Illustration of Long-Term Cash Flows and NAV (including effect of re-investment of surplus after dividend payment) 1. The chart is illustrative only and is not a profit forecast. There can be no assurance that these levels of perfor
Slide 24: Overview: Financing Activity – 2014 / 2015
OVERVIEW: FINANCING ACTIVITY – 2014 / 2015 £178m of acquisitions in 2014 were financed by: o £13m reinvestment of surplus cash generated internally o £60m draw down from revolving acquisition facility o £105m of new equity raised during the year 12-month Share Issuance Programme (up to 250m shar
Slide 25: Diversification by Project Revenue Type
DIVERSIFICATION BY PROJECT REVENUE TYPE Revenue from PPAs, FITs, ROCs, LECs… December 2014 Portfolio: Evolution of Annual Project Revenues Under Current Contracts1 MARKET (green) FIRM (blue) Revenue Characteristics2 Framework Counterparty Wholesale Power (merchant) Market price, PPA typically 15 yea
Slide 26: Counterparty Exposures
COUNTERPARTY EXPOSURES Broad spread of high quality equipment, maintenance and off-take counterparties ▲ Main credit exposure is to national governments through subsidy commitments (both directly and indirectly) ▲ Commercial counterparties performing as expected – power off-takers, equipment and mai
Slide 27: 2014 Change in Accounting Basis
2014 CHANGE IN ACCOUNTING BASIS ▲ December 2013: TRIG adopted IFRS 10 o Enabled TRIG to carry its investments at fair value (“Investment Basis”) rather than line-by-line consolidation ▲ December 2014: IFRS 10 was amended to clarify treatment of Investment Entity subsidiaries o TRIG UK (TRIG’s portfo
Slide 28: 2014 Summary Income Statement
2014 SUMMARY INCOME STATEMENT A continuation of TRIG’s robust performance since launch Year ended 5 months ended 31 December 2014 31 December 2013 £m £m IFRS Basis Adjustments Expanded Basis Expanded Basis Total operating income 23.1 7.0 30.1 15.2 Acquisition costs - (1.5) (1.5) (3.2) Net operating
Slide 29: 2014 Summary Balance Sheet
2014 SUMMARY BALANCE SHEET Portfolio growth through acquisitions; incremental uplift in NAV after power price adjustments At 31 December 2014 At 31 December 2013 £m £m IFRS Basis Adjustments Expanded Basis Expanded Basis Portfolio value 412.4 60.5 472.9 299.81 Cash 12.4 0.5 12.9 16.2 Debt - (60.1) (
Slide 30: 2014 Summary Cash Flow
2014 SUMMARY CASH FLOW Distributions on target Year ended 5 months ended 31 December 2014 31 December 2013 £m £m IFRS Basis Adjustments Expanded Basis Expanded Basis Cash from investments 25.6 9.7 35.3 13.2 Operating and finance costs outflow (1.0) (3.7) (4.7) (0.3) Net cash inflow before acquisitio
Slide 31: Senior Management Team
SENIOR MANAGEMENT TEAM Over 100 years of relevant experience on the TRIG Advisory Committee TRIG Independent Board Helen Jonathan Klaus Shelagh (Non-Executive) Mahy Bridel Hammer Mason (Chairman) Investment matters TRIG Investment Werner Chris Tony James Richard von Gill Roper Hall-Smith Committee1
Slide 32: Management: InfraRed + RES
MANAGEMENT: INFRARED + RES Jointly delivering a best-in-class renewables proposition to investors ▲ Key Roles of Investment Manager ▲ Key Roles of Operations Manager ▲ Sourcing and approving new investments ▲ Monitoring and evaluation of all technical matters within TRIG’s portfolio ▲ Advising TRIG
Slide 33: RES & Operations Management
RES & OPERATIONS MANAGEMENT TRIG’s leading edge in unrivalled experience, in-house IP and technical expertise RES brings a complete reliability monitoring service to TRIG Full access to an integrated team of experts in engineering, technical and asset management (30+ staff) RES knowledge from a
Slide 34: Investment Decisions
INVESTMENT DECISIONS Acquisition from third party or RES* Acquisition from funds managed by InfraRed Potential Acquisition Potential Acquisition Independent Executive team procures valuation Executive team Third party due a third party valuation procures external due diligence and external due Third
Slide 35: UK – Renewables Generation
UK – RENEWABLES GENERATION Production variability depends on technology-related seasonality and weather outcomes UK Overall Electricity Generated By Renewable Sources Quarterly: 2010 Q1 – 2014 Q3 Electricity 20,000 generated Growth driven (GWh) by installations 18,000 Winter 16,000 14,000 Summer Oth
Slide 36: EU – New Generating Capacity
EU – NEW GENERATING CAPACITY Onshore wind and solar PV dominating European new power capacity 2013 Share of EU New Power Capacity Installations (Total = 35GW) 2014 Share of EU New Power Capacity Installations (Total = 27GW) Source: Data from EWEA Annual Statistics (Copyright The European Wind Energy
Slide 37: TRIG: Key Facts
TRIG: KEY FACTS Fund Structure ▲ Guernsey-domiciled closed-end investment company Return Targets1 ▲ Initial 6.0p annualised dividend, increasing with inflation over the medium term; targeting 3.08p for 6 months to 30 June 2015 Issue / Listing ▲ Premium listing of ordinary shares on the Main Market o
Slide 38: Glossary
GLOSSARY ▲ CfD contract for difference: typically , a contract between a buyer and seller, stipulating that the seller will pay to the buyer the difference between a pre-agreed price of an asset or commodity and its actual (if higher) value at contract time (if the value is lower, then the buyer pay
Slide 39: Contacts
CONTACTS INVESTMENT MANAGER OTHER ADVISERS INFRARED CAPITAL PARTNERS LTD ADMINISTRATOR / COMPANY SECRETARY REGISTRAR 12 CHARLES II STREET DEXION CAPITAL (GUERNSEY) LTD CAPITA REGISTRARS (GUERNSEY) LTD LONDON SW1Y 4QU 1 LE TRUCHOT MONT CREVELT HOUSE +44 (0)20 7484 1800 ST PETER PORT BULWER AVENUE KEY
Slide 40: Important Information
IMPORTANT INFORMATION By attending the meeting where this presentation is made, or by reading the presentation slides, you agree to be bound by the following limitations: This document is an advertisement and is not a prospectus. Any decision to purchase shares in The Renewables Infrastructure Compa
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