Suzlon Energy Ltd · NSE:SUZLON
Suzlon Energy — Q2 FY2011 Earnings Presentation
35 slides from Suzlon Energy's earnings presentation, Oct 30, 2010
Slide 1: Suzlon Energy Limited Q2 FY 2010-11 Earnings Presentation
Suzlon Energy Limited Q2 FY 2010-11 Earnings Presentation 30th October 2010
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: Contents
Contents Suzlon Group: Key highlights – Q2 FY2011 Growth in volume Momentum in order inflow continues Working towards a leaner balance sheet Consolidates its holding in SE Forge Outlook for the H2 FY2011 Robust long term growth expectations Developed markets stagnant, however emergin
Slide 4: Financial Performance snapshot
Financial Performance snapshot INR Cr. Particulars Q2 FY2010-11 Q2 FY2009-10 H1 FY2010-11 H1 FY2009-10 FY2009-10 Unaudited Unaudited Unaudited Unaudited Audited (a) MW Volume (Suzlon Wind) 361 283 569 406 1,460 Suzlon Wind Business 2,188 1,868 3,628 3,031 9,635 Revenue REpower revenue 1,559 2,059 2,
Slide 5: Group order book
Group order book Firm group order book Announced Framework Contracts Suzlon Wind 300MW business agreement with Techno Electric Order book as on 29th Oct. 2010 is 1,550MW: Rs.8,285crs (USD 1.85bln*) 225 MW framework agreement with EUFER (JV between ENEL Green Energy and Union India : 693MW Fe
Slide 6: Significant progress towards leaner balance sheet
Significant progress towards leaner balance sheet FY11 Rupee Loan refinancing of Rs.10,694 crs closed Refinancing of Rupee facilities of approx. Rs. 6,587 crs and trade credit facilities May 2010 (non-fund based) of Rs. 4,037 crs which provides liquidity Holiday of 2 years in principal repayme
Slide 7: Revenues continue to improve at SE Forge
Revenues continue to improve at SE Forge and we expect to have a profit for the full year (INR Crs) Revenues have been FY2009-10 FY2010-11 improving Domestic demand picking up Sales 149 Forging & foundry plants Gross Profit operational EBITDA Positive EBITDA Forging Order book strengthen
Slide 8: Contents
Contents Suzlon Group: Key highlights – Q2 FY2011 Growth in volume Momentum in order inflow continues Working towards a leaner balance sheet Consolidates its holding in SE Forge Outlook for the H2 FY2011 Robust long term growth expectations Developed markets stagnant, however emergin
Slide 9: Wind industry has grown steeply over last decade
Wind industry has grown steeply over last decade and will continue to outgrow other energy capacities Annual Installation (GW) Cum. Installation (GW) 140 126 1,000 New Installations (GW) 900 Wind capacities 120 have grown at 29% Cumulative (GW) 800 100 700 CAGR from 2000 to 600 2009, while total 8
Slide 10: Industry reports suggest decent growth in medium term
Industry reports suggest decent growth in medium term Annual new wind installations (2010-2015) CAGR (10-14) GW 28 38 42 49 59 65 72 14% Actual Projected Emerging Markets 29,800 27,000 2,750 Rest of world 35% 24,050 2,350 21,250 1,600 19,325 16,372 1,100 825 319 Asia Pacific 9% 9,881 23,650 25,550 1
Slide 11: Offshore market is poised for growth
Offshore market is poised for growth 15,598 Growth expected in the offshore market Offshore MW 3,955 +42% 3,216 3,525 1,418 1,374 1,421 689 Cum. MW 2009 2010 2011 2012 2013 2014 Cum MW 2008 end 2014 end By 2015, offshore wind is expected to constitute 8% of new global wind power installations, com
Slide 12: Developed markets continue to be stagnant
Developed markets continue to be stagnant… North America USA: New installations likely to decline by 25% and 45% from last year levels ~ 1,240 MW installed in H12010, indicating a 70% reduction from 1H 2009. Lack of PPAs, low gas prices economic scenario not auguring well for Wind energy Fed
Slide 13: Key Emerging Markets: Showing Promise
Key Emerging Markets: Showing Promise Asia Pacific China: China amended RE laws and targets to generate 15% of electricity from renewable sources by 2020 Higher entry barriers set to address the oversupply issue in the wind equipment manufacturing Removal of import duties and VAT on wind and h
Slide 14: India business roaring ahead
India business roaring ahead Strong order inflows…… …resulting in robust order book 889MW 693MW +278% +463% 235MW 123MW H1FY10 H1 FY11 H1 FY10 H1 FY11 The market is expected to grow to 2,000-2,200MW in current fiscal and 2,600-3,000MW next fiscal year Booked approx. 400MW of orders since last or
Slide 15: Update on Brazil & China
Update on Brazil & China Brazil China Wind auction replaces Proinfa regime China has a total onshore project pipeline Consecutive tenders signal commitment estimated at ~170 GW to sustained wind power growth Estimates by NDRC shows offshore 1.8GW of wind power projects awarded in potential
Slide 16: South Africa: A promising market
South Africa: A promising market South Africa Wind Energy Association 400 1200 (SAWEA) estimates 25% of total generation should come from wind by 2025 1000 That would translate to 30GW of cumulative 300 300 installation by 2025 300 The National Energy Bill (2008) provides for 800 the introduct
Slide 17: Group continues to build product pipeline
Group continues to build product pipeline to address all market segments with competitive cost / kWh Low wind speed (IEC Class-III) sites presents significant opportunity New offerings from Suzlon Group are designed with larger rotor diameters, increased hub heights, improved aerodynamic efficie
Slide 18: Suzlon Group has all the relevant competencies
Suzlon Group has all the relevant competencies Suzlon strengths REpower strengths Group Positioning Asia, US, ANZ, Bra Global player Market coverage zil Europe, US, Canada Present across Customer Developing markets Developed markets geographies, with flexible Geographic Strong cust
Slide 19: Suzlon Group: Well positioned in current market environment
Suzlon Group: Well positioned in current market environment • India: a high margin market, capitalizing on the robust growth 1 Emerging markets • Entrenched in China, Brazil • Early entrant in South Africa, Chile, Argentina and Mexico Offshore & key • Well entrenched with a comprehensive product por
Slide 20: Contents
Contents Suzlon Group: Key highlights – Q2 FY2011 Growth in volume Momentum in order inflow continues Working towards a leaner balance sheet Consolidates its holding in SE Forge Outlook for the H2 FY2011 Robust long term growth expectations Developed markets stagnant, however emergin
Slide 21: Consolidated financial results
Consolidated financial results (Suzlon Wind + SE Forge + Hansen + REpower*) INR crs. Q2 FY11 Q2 FY10 H1 FY11 H1 FY10 Particulars Unaudited Unaudited Unaudited Unaudited(a) Sales 3,772 4,793 6,170 8,946 Raw material cost 2,537 3,220 4,314 6,132 Gross Profit 1,235 1,573 1,856 2,814 Gross Profit margin
Slide 22: Consolidated financial results: Q2 - Year-on-year
Consolidated financial results: Q2 - Year-on-year INR crs. Q2 FY11 (unaudited) Q2 FY10 (unaudited) Particulars Suzlon SE Forge Hansen REpower Suzlon SE Forge Hansen REpower Sales MW 361 283 Sales 2,188 94 -- 1,559 1,868 11 1,032 2,059 Raw material cost 1,444 57 -- 1,103 1,367 5 570 1,443 Gross Profi
Slide 23: Consolidated financial results: Excluding impact of foreign exchange
Consolidated financial results: Excluding impact of foreign exchange loss / (gain) Suzlon Wind Consolidated – Ex Hansen INR Particulars Q2 FY11 Q2 FY10 Q2 FY11 Q2 FY10 crs. Sales 2,188 1,868 3,772 3,761 Raw material cost 1,444 1,367 2,413 2,650 Gross Profit 743 501 1,359 1,111 Gross Profit margin 34
Slide 24: Consolidated financial results: H1 - Year-on-year
Consolidated financial results: H1 - Year-on-year INR crs. H1 FY11 (unaudited) H1 FY10 (unaudited) Particulars Suzlon SE Forge Hansen REpower Suzlon SE Forge Hansen REpower Sales MW 569 406 Sales 3,628 149 -- 2,508 3,031 28 1,957 4,125 Raw material cost 2,503 88 -- 1,835 2,197 13 1,107 3,010 Gross P
Slide 25: Consolidated financial results: Year-on-year
Consolidated financial results: Year-on-year INR crs. FY10 (unaudited) (a) FY09 (unaudited) (b) Particulars Suzlon SE Forge Hansen REpower Suzlon SE Forge Hansen REpower Sales MW 1,460 2,790 Sales 9,635 104 2,656 8,502 15,897 17 3,994 7,125 Raw material cost 6,391 60 1,491 6,010 10,481 4 1,939 5,288
Slide 26: Suzlon Group order book
Suzlon Group order book Orders as on New Sales in Orders as on Sales in Region Sales in FY09 Sales in FY08 11/08/10 Orders Q2 FY11 29/10/10 FY10 India 580 403 290 693 688 749 975 USA 248 -- 2 246 410 989 593 China 416 50 69 397 182 249 134 ANZ 53 -- -- 53 128 430 143 Europe 162 -- -- 162 53 166 298
Slide 27: Consolidated: NOWC stabilized
Consolidated: NOWC stabilized INR Cr Particulars As on 30th Sept. As on 30th Jun As on 31st Mar As on 31st Dec. ’10 ’10 ‘10 ’09 Inventories 6,321 5,890 5,994 5,796 Receivables 4,283 4,428 6,192 5,524 Advances * 2,268 1,771 1,684 1,884 Total (A) 12,872 12,089 13,870 13,204 Prepayment from customers (
Slide 28: Suzlon Wind: NOWC stabilized
Suzlon Wind: NOWC stabilized Suzlon Wind Business: Inventories level has stabilized Collections from receivables improving Significant and consistent reduction in payables INR Cr Particulars As on 30th Sept. As on 30th Jun As on 31st Mar As on 31st Dec. ’10 ’10 ‘10 ’09 Inventories 3,013 2,91
Slide 29: Suzlon Wind: WTG revenue by geography
Suzlon Wind: WTG revenue by geography Region H1 FY11 Sales FY10 Sales FY09 Sales FY08 Sales (MW) (Rs.Crs.) (MW) (Rs.Crs.) (MW) (Rs.Crs.) (MW) (Rs.Crs.) India 429 2,429 688 4,094 749 4,420 976 5,572 USA 27 348 410 2,483 989 5,229 593 2,289 China 108 448 182 813 249 1,104 134 455 ANZ -- 345 128 1,192
Slide 30: Group Financial Leverage
Group Financial Leverage INR crs. Particulars As at 30th Sept. 2010 As at 30th June 2010 As at 31st March 2010 As at 31st Dec. 2009 SEL Wind Consol. SEL Wind Consol. SEL Wind Consol. SEL Wind Consol. (a) (a) (a) (a) Group (a) Group (a) Group (a) Group (a) Gross External Debt (A) 11,070 12,073 10,853
Slide 31: Suzlon Wind: Financial leverage
Suzlon Wind: Financial leverage (a) INR Cr. Debt type Balance as on 30th Balance as on 30th Balance as on 31st Balance as on 31st Sept. 2010 June 2010 March 2010 Dec. 2009 Acquisition loans 2,085 2,155 2,083 2,159 FCCBs 2,153 2,225 2,151 2,229 W.Cap, Capex and other loans 6,832 6,473 6,284 6,085 Gro
Slide 32: FCCBs: Post restructuring
FCCBs: Post restructuring Key Terms: Outstanding amount Conversion Redemption FCCBs Maturity date Coupon rate (USD mln) price (Rs.) Premium June 2012 - Old 211.3 97.26 June 2012 0% 145.23% October 2012 - Old 121.4 97.26 October 2012 0% 144.88% June 2012 - Exchange 35.6 76.68 June 2012 7.5% 150.24% O
Slide 33: REpower Net Profit Reconciliation
REpower Net Profit Reconciliation Q2 FY 2011 H1 FY 2011 Particulars EURO m INR crs EURO m INR crs Profit / (loss) as per REpower books 20.1 115 21.8 126.2 Less: Policy alignment impact (1.1) (5.3) 3.8 23.7 Profit / (loss) before translation loss 21.2 120.3 18.0 102.6 Less: FX loss on translation of
Slide 34: Consolidated Balance sheet
Consolidated Balance sheet Consolidated INR crs Particulars September 30, 2010 March 31, 2010 (Unaudited) (Audited) Shareholders' Funds: Share Capital 349 311 Employee stock options outstanding 20 16 Reserve and Surplus 5,892 6,274 Preference shares issued by subsidiary company 3 3 Minority Interest
Slide 35: Thank You
| ot Thank You 35 ae www.suzlon.com