Edp S.a. · EURONEXT:EDP
Edp — Energias de Portugal — H1 2015 Earnings Presentation
29 slides from Edp's earnings presentation, Jul 31, 2015
Slide 1: Results Presentation 1H15
Results Presentation 1H15 Lisbon, July 31st, 2015 0
Slide 2: Disclaimer
Disclaimer This document has been prepared by EDP - Energias de Portugal, S.A. (the "Company") solely for use at the presentation to be made on the 4th of March 2015 and its purpose is merely of informative nature and, as such, it may be amended and supplemented. By attending the meeting where this
Slide 3: 1H15: Key Highlights
1H15: Key Highlights EBITDA: €2,131m +7% YoY Adjusted EBITDA: €1,747m +1% YoY impacted by adverse weather conditions in 1H15 vs. 1H14 Acquisition by EDP Brasil of remaining 50% stake in Pecém I coal plant: concluded in May 15th Earnings accretive deal from day 1: +€295m impact on EBITDA, +€132m on N
Slide 4: 1H15 results penalized by weaker hydro & wind volumes in our key markets
1H15 results penalized by weaker hydro & wind volumes in our key markets vs. a very strong 1H14 GSF (Generation Scaling Factor) - Brazil EDP Hydro, Wind and Solar Production (100% = avg. year) (TWh) % Chg. YoY 95% 80% -20% 1H14 1H15 25.6 Hydro Coefficient - Portugal Hydro Brazil 4,0 (1.0 = avg. year
Slide 5: EBITDA +7%; Adjusted EBITDA +1% supported by EDP Brasil and EDPR
EBITDA +7%; Adjusted EBITDA +1% supported by EDP Brasil and EDPR EDP EBITDA EDP Adjusted (1) EBITDA (€ million) (€ million) Recurrent Adjustments +1% +7% €1,728m €1,747m €2,131m Generation & €1,986m Supply Iberia 29% 384 37% -21% 129 EDP Renováveis +11% 31% 29% 1.728 1.747 EDP Brasil +70% 13% 8% Reg
Slide 6: Results Analysis
Results Analysis
Slide 7: Market Conditions in Iberia
Market Conditions in Iberia: Hydro & Mini-Hydro Power Production – Iberia (1) Avg. Pool Price in Spain (TWh) (€/MWh) 1H -38% 43% 30 18 47 33 1H14 1H15 1H14 1H15 1.37 Hydro Coefficient Portugal 0.75 Wind Power Production – Iberia Thermal Power Production in Iberian market (TWh) (TWh) 1H -4% 53% 35 33
Slide 8: Iberia: Energy Demand
Iberia: Energy Demand Electricity Demand in Iberian Market 1H15 (1) Electricity demand Portugal (1) (∆% YoY) (∆% YoY) % Weight in Iberia in 1H15 (2) Real Adjusted 100% 17% 83% 3% 2,2% Iberian 2,0% Portugal Spain 2% 1,5% 3Q14 Market 0,8% 4Q14 1,8% 1,9% 1% 0,7% 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 1,2% 0,0%
Slide 9: Electricity Generation in Iberia
Electricity Generation in Iberia EDP Liberalised Generation Portfolio – Production EDP PPA/CMEC Plants in Portugal: market deviation(1) (TWh) (€ million) % Chg. YoY Coal Hydro 2014 Adjustment +17% +5% 8.7 104 99 7.5 +3% 6% 4 4 Nuclear 7% 35% -29% 51 Hydro 58% 96 46% +69% Coal 48 32% CCGT +397% 3% 12
Slide 10: EDP Liberalised Activities Iberia in 1H15: Market environment
EDP Liberalised Activities Iberia in 1H15: Market environment EBITDA Liberalised Activities in Iberia vs. Hydro Volumes and Pool Price (€ million and €/MWh) EBITDA (€m) Pool Price Spain (€/MWh) EDP market positioning: 350 55 Significant weight of hydro 300 in generation mix 45 250 Long position in s
Slide 11: Generation and Supply Iberia (24% EBITDA)
Generation and Supply Iberia (24% EBITDA) Adjusted EBITDA(1) Generation & Supply Iberia (€ million) Liberalised Activities Long Term Contracted Generation Liberalised Energy Activities in Iberia(1): -40% (-€122m) -21% Avg. generation cost +62% YoY on lower hydro volumes 638 1H14 performance marked b
Slide 12: Regulated Energy Networks Iberia (27% of EBITDA)
Regulated Energy Networks Iberia (27% of EBITDA) EBITDA Adjusted EBITDA (1) (€ million) (€ million) Gas Iberia Gas Iberia Electricity Spain Electricity Spain Electricity Portugal Electricity Portugal +2% +2% 559 569 471 480 +74% -5% +15% +15% -21% +2% 1H14 1H15 1H14 1H15 Electricity Portugal: New re
Slide 13: EDP Renováveis (26% of EBITDA)
EDP Renováveis (26% of EBITDA) Growth supported by higher prices and stronger USD Installed Capacity Production (2) EBITDA (MW) (GWh) (€ million) Iberia North America Other (1) +11% -1% +6% 548 10,965 10,842 8,254 495 7,762 36% 35% 33% - 34% -9% 41% 36% +0% 13% 16% 21% +4% 18% +21% +12% 19% 21% 52%
Slide 14: Brazilian Electricity System: 1H15 environment
Brazilian Electricity System: 1H15 environment Hydro Generation Deficit (1-GSF; in %) 1H15 developments 4x 20% Rainfall level vs. historical avg. (2): 58% in 1Q15 and 93% in 2Q15 5% Strong thermal dispatch to preserve hydro reservoirs under low rainfall conditions: Penalising Gencos w/ hydro PPAs 1Q
Slide 15: EDP Brasil (24% of EBITDA)
EDP Brasil (24% of EBITDA): Reported EBITDA in local currency +98% YoY, adjusted EBITDA flat YoY EDP Brasil reported EBITDA EDP Brasil Adjusted(1) EBITDA (BRL million) (BRL million) Distribution Generation & Other Capital Gains Generation & Other Distribution +98% +0.3% 1,657 770 772 885 838 369 +12
Slide 16: Operating costs: flat YoY
Operating costs: flat YoY Operating costs(2): 1H15 vs. 1H14 1H15 YoY Inflation (3) (€ million) (%) Brazil EDPR Iberia +1% 8,9% 752 758 133 133 ~0% 154 172 +11% 464 453 -2% 0,0% -0,5% Portugal Spain Brazil (IPCA) 1H14 1H15 Iberia: -2% YoY on execution of OPEX III efficiency program and headcount redu
Slide 17: Investments breakdown
Investments breakdown Net Investments breakdown by division (1) (€ million) -14% €544m 72 556MW of wind capacity under €633m Other 142 construction (54% US; 22% Brazil; Generation & Other Brazil 61 11 25% Europe) EDP Renováveis 117 327 Expansion Hydro Portugal 274 4 hydro projects in final stage of
Slide 18: Evolution of Regulatory receivables in Portugal: Slight Tariff surplus in 2Q15
Evolution of Regulatory receivables in Portugal: Slight Tariff surplus in 2Q15 Global Regulatory receivables in the Portuguese electricity system (€bn) Owed to Financial Investors (Securitized) Owed to EDP +0.5 Flat +0.14 +0.05 +0.08 5.3 +0.05 5.3 5.3 4.8 +0.23 -0,01 2,4 3,0 3,2 2,4 2,3 2,1 Dec-13 1
Slide 19: EDP's regulatory receivables
EDP’s regulatory receivables EDP’s Net Regulatory Receivables (€ million) -€157m 2,747 2,504 2,347 Portugal (1) 2.422 2.315 2.101 Spain 2 44 Brazil 264 61 187 201 Dec-13 Dec-14 Jun-15 Portugal: -€214m YTD (securitisations: -€651m; ex-ante deficit: +€750m; net deviations(2): -€313m) Spain: +€42m YTD,
Slide 20: 1H15 Change in Net Debt
1H15 Change in Net Debt Change in Net Debt: Jun-15 vs. Dec-14 (€ billion) +€0.7bn +€0.1bn 0,7 17.7 17.0 1,2 0,3 17.0 0,4 0,7 0,2 2,3 2,5 2,3 Regulatory Receivables 14,5 14,7 15,4 Net Debt Free Cash Reg. Expansion Dividends Paid Forex Net Debt Pecém Net Debt Dec-14 Flow (1) Receivables Capex & Net (B
Slide 21: Financial Debt: Average cost and maturity profile
Financial Debt: Average cost and maturity profile Avg. Cost of Debt: 1H15 vs. 1H14 EDP consolidated debt maturity profile as of Jun-15 (%) (€ billion) Commercial paper Other subsidiaries(1) Avg. Debt Maturity: EDP SA + BV 4.6 years +10bp Brazil: €209M 4,6% 4,7% Project Finance: €40M 4,0 3,5 3,0 2,5
Slide 22: Main sources and uses of funds
Main sources and uses of funds Sources of funds Use of funds Cash & Equivalents (Jun-15): €1.4bn Refinancing needs in 2015 (loans): €0.6bn Available Credit Lines (Jun-15): Refinancing needs in 2016: €2.8bn Revolving Credit Facilities €3.34bn Bonds maturing in Feb-16 €0.75bn Other Credit Lines €0.3bn
Slide 23: Financial Results
Financial Results Financial Results: 1H15 vs. 1H14 (€m) Higher net financial interests: (36) 5 (364) +10bps on avg. cost of debt and (21) (47) +23% USD/EUR (20) (245) ForEx: €14m losses in 1H15 vs. €33m gain in 1H14 (non-cash) Gains of tariff Deficit Securitisation: €46m in 1H15 vs. €67m in 1H14 Low
Slide 24: Net Profit breakdown
Net Profit breakdown (€ million) 1H14 1H15 ∆% ∆ Abs. Adoption of IFRIC 21: changes the accounting EBITDA 1.986 2.131 +7% +145 of levies to the moment in which they are due vs. previous linear accounting over the year; Amortisation, Impairm. 1H14 results restated for comparison purposes 698 692 -1% -
Slide 25: Outlook
Outlook 24
Slide 26: EDP Brasil: Recent developments improve earnings prospects
EDP Brasil: Recent developments improve earnings prospects Regulatory and Market developments Improved earnings prospects for EDP Brasil Government talks to limit Generators’ losses with GSF Generation: Hydro reservoirs – Southeast/Center-West Regions (1) - Prospects of lower GSF costs (reservoirs >
Slide 27: 2015 Outlook
2015 Outlook EBITDA Breakdown (%) Gas Murcia & Pecém 2H15: Better thermal spreads, avg. hydro > €3.85bn volumes, contribution from new hydro capacity ~ €3.6bn Liberalised visible only in 2016 10% Activities Iberia ~0.4 < 0.15 16% EDP Brasil 2H15: Weaker BRL, lower PLD, Pecém full contribution, Bande
Slide 28: Capital allocation: A balanced and value enhancing approach between growth and deleverage
Capital allocation: A balanced and value enhancing approach between growth and deleverage Disposals Investments Execution of 2014-17E Business Plan CTG Partnership: €1bn of deals executed; Hydro Portugal: 1.4GW (4 plants) at 91% completion; Under discussion for 2H15: ENEOP and other EU deals 0.1GW c
Slide 29: IR Contacts
IR Contacts Miguel Viana, Head of IR Sónia Pimpão Elisabete Ferreira João Machado Maria João Matias Noélia Rocha E-mail: ir@edp.pt Phone: +351 210012834 Visit EDP Website Next Events Sept 11th: BPI Iberian Conference in Oporto Site: www.edp.pt Sept 15th: BBVA Iberian Conference in London Sept 17th:
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