Suzlon Energy Ltd · NSE:SUZLON
Suzlon Energy — FY2015 Earnings Presentation
37 slides from Suzlon Energy's earnings presentation, May 29, 2015
Slide 1: Suzlon Energy Limited FY15 Earnings Presentation
Suzlon Energy Limited FY15 Earnings Presentation 29th May 2015
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: Suzlon Wind: Improving Profitability
Suzlon Wind: Improving Profitability Volume (MW) Normalized EBITDA* (Rs. Crs) 1,583 795 • Improving EBITDA despite low volumes • Key Drivers for Profitability: -166 723 — Improved gross margins 454 -812 251 — Reduced fixed expenses — More predictable -1,672 FY12 FY13 FY14 FY15 FY12 FY13 FY14 FY15 Vo
Slide 4: Business Acceleration Underway
Business Acceleration Underway Past 3 years Initiatives / Changes Now (FY16 Onwards) Comprehensive Liability Management High Debt Reduced Senvion sale and Debt Debt reduction DSA equity infusion for Poor India FY13-15 Weak growth Robust India FY16 Strong Market Liquidity Market onwards Liquidity W/C
Slide 5: Long Term Strategic Initiatives Status Update
Long Term Strategic Initiatives Status Update Suzlon wind farm in Cookhouse, South Africa 5 www.suzlon.com
Slide 6: Senvion Sale Completed
Senvion Sale Completed Deal Specifics Total Consideration • Reduced debt Immediate Cash EUR 1 bn Earn Out EUR 50 mn (Subject to conditions) Licensing Arrangements • Reduced interest India - Offshore Suzlon to get Offshore technology license for India market US - S111 Senvion to get Suzlon’s S111 lic
Slide 7: Equity Allotment to DSA Completed
Equity Allotment to DSA Completed Preferential Allotment Fund Raised No. of Shares 100 crs DSA Allotment Price Rs. 18 / share Total Size Rs. 1,800 crs Shareholding New Investor Promoter Preferential Allotment Post Allotment 20.7% 21.8% Diluted 16.7% 17.5% To accelerate growth, invest in wind farm an
Slide 8: Key Other Transactions with DSA
Key Other Transactions with DSA Strong Liquidity and Business Support • Working capital lines from DSA (through credit enhancements) ― To be provided over 2 years period ― Over and above the normal working capital lines sanctioned by lender group • 450 MW Wind Farm JV – DSA & Suzlon to partner via W
Slide 9: Planned Utilization of Proceeds
Planned Utilization of Proceeds Fund Raising and Utilization (Estimates) (Rs. Crs.) DSA Equity Business Infusion Operations 1,800 2,400 Rs. 8,800 crs Bank / Lender IPP JV Payments Senvion Sale 400 6,000 Proceeds 7,000 Achieves debt reduction as well as adequate liquidity for growth 9 www.suzlon.com
Slide 10: FCCB Conversion to Equity
FCCB Conversion to Equity FCCB Principal Value* (US$ Mn) 575.7 247.6 328.2 Conversion Details 546.9 Conversion Price Rs. 15.46 per share 299.4 Exchange Rate Rs. 60.225 28.8 28.8 Post Restructuring Conversion till date Current Outstanding July 2019 Series April 2016 Series * Includes notices received
Slide 11: FY15 Performance Update
FY15 Performance Update Suzlon wind farm in Brazil 11 www.suzlon.com
Slide 12: FY15 Financial Snapshot
FY15 Financial Snapshot Rs Crs Suzlon Wind Q4 FY15 Q4 FY14 FY15 FY14 Revenue 926 1,493 4,883 5,627 EBITDA (Before Special Items) -224 -255 -166 -812 EBIT (Before Special Items) -322 -339 -542 -1187 Net Loss (Before Special Items) -790 -819 -2,376 -2,989 Key takeaways: • Business performance ― Volume
Slide 13: Service Business
Service Business External Service Revenues (Rs. Crs.) +19.8% 1,454 • Strong Growth at ~20% CAGR 1,355 1,085 • 50+% Contribution margin 846 • ~100% renewal track record • Annuity-like cash flows • Non cyclical business in nature FY12 FY13 FY14 FY15 Growing into a sizeable & profitable business Annuit
Slide 14: Order Book
Order Book Order Book as on 31st Mar 2015 Particulars Amount Order Book Volume ~1,123 MW Order Book Value Rs. 6,886 crs. • New Products gaining traction (S111 and Hybrid Tower) — >350 MW orders received Additional upside to Order book: Inflow post 31st Mar’15 ~103 MW • Service order backlog is over
Slide 15: Debt Profile and Shareholding Structure
Debt Profile and Shareholding Structure Suzlon Wind Farm in Uruguay 15 www.suzlon.com
Slide 16: Current Debt Profile
Current Debt Profile As on 31st March 2015 Suzlon Wind (Rs. 16,964 crs) Rupee Foreign Currency Denominated Denominated (Rs. 10,100 crs) (Rs. 6,864 crs / $ 1,068 M) 1 FCCBs(2) $328M 1 Secured Domestic Debt(1) Rs. 10,100 Crs. Effective Interest Rate @ ~3.3% Effective Interest Rate @ ~11% 5 yr bullet m
Slide 17: Shareholding Structure
Shareholding Structure As on 29th May 2015 No. of shares in Crs. % Holding 599.0 116.6 42.3% 53.5% Public 482.4 15.1% 12.2% Lenders 20.7% 16.7% DSA 21.8% 17.6% Tanti Family Current Potential FCCB Diluted Current Fully Diluted Conversions 17 www.suzlon.com
Slide 18: Industry Opportunities
Industry Opportunities Suzlon windfarm at Dhule, India 18 www.suzlon.com
Slide 19: India Market: Government Target
India Market: Government Target India plans to increase wind capacity to 60,000 MW by March 2022 • Translates into > 5,000 MW of annual market size +36,600 MW — More than double the size of FY15 market (~2,300 MW) 60,000 MW • Key Initiatives taken: ~ 23,400 — Reinstatement of key incentives — Green
Slide 20: India Market: A Huge Opportunity
India Market: A Huge Opportunity Annual Wind Installations (MW) - India Growing wind competitiveness and increasing preferential tariffs SME + PSU + Captive + IPP + PSU IPP + PSU + SME + Captive SME + PSU + Captive Emergence of IPP Suzlon +33% -10% 4,100 +29% 3,500 3,179 2,345 1,161 2,312 2,077 1,56
Slide 21: Suzlon Strengths in India: Unique Leadership Position
Suzlon Strengths in India: Unique Leadership Position 01 Strong Satisfied Customer Base • >1,700 existing customer base • High repeat business potential 05 02 Strong Track Record Pan India Presence • 18+ years of leadership in India • Strong sales, project and service • Proven execution capabilities
Slide 22: Global Industry Overview
Global Industry Overview Global Wind Industry Installations (GW) +27% 55 • Wind approaching grid parity 49 6 5 ― Wind energy not linked to oil 11 34 11 ― Oil contributes only 4% of world power 3 14 11 11 • Installations to reach record high in 2015 4 20 21 ― US, China, and India to drive the growth
Slide 23: Suzlon Wind Overview
Suzlon Wind Overview Suzlon Manufacturing unit in Dhule, India 23 www.suzlon.com
Slide 24: Business Overview
Business Overview Suzlon Group Existing Business Proposed New Businesses • Developing Wind Solar Integrated parks in India Overseas Domestic (America, China, Australia, (India) • Third party component supply Europe etc.) >8.5 GW installations till ~6.0 GW installations till • Tap offshore opportunit
Slide 25: Proven Capability and Track Record
Proven Capability and Track Record MW Volumes 2,790 Impacted due to constrained liquidity and liability management 2,311 1,456 1,460 1,521 1,583 964 723 454 251 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 Revenues (Rs. Crs.) 15,897 11,467 9,635 9,175 10,003 6,129 5,627 4,883 3,841 3,228 FY06 F
Slide 26: Global Footprint
Global Footprint 14+ GW Installations As on 31st March 2015 Country MW India 8,617 North America 2,716 China 929 Australia 764 5,936 Brazil 741 Spain 233 8,617 South Africa 139 Portugal 103 Turkey 88 Uruguay 65 India Overseas Nicaragua 63 Romania 44 Sri Lanka 31 Others 19 Geographically well diversi
Slide 27: Suzlon Wind Technology
Suzlon Wind Technology Manufacturing unit in Daman, India 27 www.suzlon.com
Slide 28: S111: Moving Towards Bigger Turbines and Better Yields
S111: Moving Towards Bigger Turbines and Better Yields 2MW series evolution Higher energy yield Lower cost of energy Higher returns • Better generation • Lower cost of energy • Higher IRR for customers • Makes low wind sites viable S88 S9X S111 ~5.5 GW already ~900 MW already First agreement in US •
Slide 29: Hybrid Towers: First of its Kind
Hybrid Towers: First of its Kind Hybrid Tower: Combination of lattice and tubular • Higher hub height (120 M) at optimized cost • 10-12% increase in annual generation • Optimized logistical solution • Available in S97 and S111 product suite • Prototype installed in Jan’14 • Over 300MW orders already
Slide 30: Strategic Focus
Strategic Focus Suzlon wind farm in Kutch, India 30 www.suzlon.com
Slide 31: Strategic Focus
Strategic Focus Focus on markets like India, America, China, Turkey etc. • High growth, High volume, Better margin markets only Superior Technology • Continued focus on R&D aimed at reducing cost of energy Increasing Market Competitiveness Best in Class Service; Growing Service business • Aimed at m
Slide 32: Detailed Financials
Detailed Financials Suzlon wind farm in Rajasthan, India 32 www.suzlon.com
Slide 33: Suzlon Wind Income Statement
Suzlon Wind Income Statement Rs Crs. Particulars Q4 FY15 Q4 FY14 FY15 FY14 Revenue from operations 926 1,493 4,883 5,627 Less: COGS 662 1,194 3,138 4,335 Gross Profit 264 299 1,745 1,292 Gross Profit % 28.5% 20.0% 35.7% 23.0% Employee benefits expense 161 162 747 787 Other expenses (net) 273 532 1,3
Slide 34: Suzlon Wind Income Statement
Suzlon Wind Income Statement Rs Crs. Particulars FY15 FY14 FY13 FY12 Revenue from operations 4,883 5,627 3,228 10,003 Less: COGS 3,138 4,335 2,616 6,392 Gross Profit 1,745 1,292 611 3,611 Gross Profit % 35.7% 23.0% 18.9% 36.1% Employee benefits expense 747 787 833 1,027 Other expenses (net) 1,336 1,
Slide 35: Suzlon Wind Working Capital
Suzlon Wind Working Capital Rs Crs. As on Particulars 31st Mar 2015 31st Dec 2014 31st Mar 2014 31st Mar 2013 31st Mar 2012 Inventories 1,639 1,630 2,018 3,597 3,258 Trade receivables 1,614 1,796 1,745 2,883 5,315 Loans & Advances and Others 1,809 1,897 2,008 2,023 2,070 Total (A) 5,061 5,323 5,770
Slide 36: Consolidated Balance Sheet
Consolidated Balance Sheet Rs Crs. Liabilities Mar-15 Mar-14 Assets Mar-15 Mar-14 Shareholders' Fund Non Current Assets a) Shareholder's Fund -9,122 -544 a) Fixed Assets 6,200 13,948 b) Share application money 1,800 162 b) Non Current Investments 15 4 -7,322 -382 c) Long Term Loans & Advances 368 51
Slide 37: Thank You
Thank You Suzlon wind farm in Texas, USA 37 www.suzlon.com