Keystone Infra Ltd · TASE:KSTN
Keystone Infra — Investor Presentation (September 2024)
31 slides from Keystone Infra's investor presentation, September 2024
Slide 1: Keystone Infra Ltd H1 2024 Investor Presentation
Keystone Infra Ltd H1 2024 Investor Presentation September 2024
Slide 2: Legal Disclaimer
Legal Disclaimer This presentation is an English translation of the Hebrew version of Keystone Infra Ltd. presentation for the second quarter of 2024, that was published on August 28 (the “Hebrew Version”). The Hebrew version is the binding version and the only version having legal effect. The Engli
Slide 3: Managing a Portfolio of High-Demand Infrastructure Assets
Managing a Portfolio of High-Demand Infrastructure Assets Strong, Diversified, and Predictable Cash Inflows Approx. NIS 3 billion Cash-Generating Assets Approx. 8 % Attractive LTM Cash Yield 1 Over NIS 250 million Projected Avg. Annual Cash inflows2 with growth potential from high-quality infrastruc
Slide 4: Business Segments
Business Segments approx. 3B NIS Asset Value1 56% 37% 7% Transportation & EVs Energy and Renewables Water and Communication 35% Egged 14% IPM Power Plant 6% VID Public transit in Israel & Europe, Travel & Tour, 450MW combined cycle power plant Water desalination facility in Ashkelon maintenance, and
Slide 5: Value-Focused Investment Strategy
Value-Focused Investment Strategy1 Excess Returns Relative to the Risk Level, With Rapid Payback From Cash-Generating Assets IRR 2 7% 16% 30% 31% 10% 13% 14% ROI 48 % 80% 110% 88% 31% Weighted IRR approx. 3.5 yrs. approx. 4.5 yrs. 3.5 yrs. 2 yrs. 2 yrs. 27 % 1,338 21 % 114 % 250 % 122 % 608 609 1,05
Slide 6: Diversified Portfolio: Key to Financial Resilience
Diversified Portfolio: Key to Financial Resilience 2x Expanded Cash inflows sources from 3 to 6 Approx. 8% 4x LTM Cash Yield1 Egged: Fourfold Cash inflows growth 2021-2024E 1st Cash 222M Distribution Q2 2024 253 Approx. NIS 222 2024 Projected Cash inflows2 198 56 2021 2022 2023 2024E VID Drive Group
Slide 7: Predictable Cash Inflows
Predictable Cash Inflows Over NIS M 250 Projected Average Annual Cash inflows from Income-Generating Assets (2025-2032) 398 417 400 Approx. 90% of assets provide significant 262 216 199 221 and predictable cash inflows 182 2025 2026 2027 2028 2029 2030 2031 2032 RUN RATE VID Drive Group Ramat Hovav
Slide 8: Consistent Growth in Equity and Dividends
Combined Value: Approx.16% LTM Return on Equity (Pre-Tax)2 Consistent Growth in Equity and Dividends 32% CAGR (Dec 2021 - June 2024) 85% Dividends Growth (2022-2024)1 Approx.7.9% 2024 Expected Dividend Yield3 January 2024: adopted a quarterly dividend policy based on equity and was added to Tel-Div
Slide 9: Meticulous Financial Management
Meticulious Financial Management Optimizing Capital Structure to Ensure Sustainable Value Creation Approx. NIS Cash Surplus2 315M Approx. NIS 724M Net Financial Debt 25% NIS 2 B Company Equity LTV 30.6.2024 NIS 690 M Series A bonds with a weighted fixed interest rate of approx. 1.15%, index-linked,
Slide 10: Key Financial Results
Key Financial Results H1 2024 Income Statement Highlights (in NIS thousands) H1 2024 H1 2023 Reaffirming 2024 expected Cash inflows Cash inflows1 147,486 175,670 at nis 222 million Changes in Fair Value (98,998) 126,299 Total Revenues 48,488 301,969 Operating Expenses2 (24,640) (18,455) Diversified
Slide 11: Transportation & EVs
Transportation & EVs Egged I Eranovum I Drive Group Drive The Carmel Tunnels
Slide 12: Egged
Valuation Summary2 Egged (in NIS millions) 30.6.2024 Israel's Leading Diversified Transportation Company Egged Operating Assets Value Total Real Estate Value 7,648 1,179 Operating Real Estate Value1 (356) 5 Net Financial Debt )2,110( Net Employee Liabilities )1,073( Total Egged Value 5,288 Keystone-
Slide 13: Keystone-Egged Partnership
Keystone-Egged partnership structure post-option exercise1,2 Keystone-Egged Teachers and Partnership Keystone Fund Educators' Fund 81% 19% Bank Debt NIS 624M Egged's total distributions to shareholders Egged Partnership Egged Members The partnership's NIS 375M share was primarily used for debt repay
Slide 14: Egged
Egged From a Cooperative to a Leading, Profitable, and Growing Company H1 2024 Revenue Breakdown H1 2024 EBITDA1 Breakdown Approx. 11% 3 Revenue CAGR 2020-2024E 22% 15% 7% Approx. 17% 3 EBITDA CAGR 2020-2024E 68% NIS 2.7B ~14% YoY growth 8% 78% NIS 580 M ~8% YoY growth 2% Public transportation in Is
Slide 15: Public Transportation in Israel, Derech Egged
Public Transportation in Israel Derech Egged Egged Standalone (solo) by the Numbers Jerusalem Envelope 28% Market Share 3,000 Buses 7,000 Employees 15 Million Kilometers Approx. Approx. Annual licensing for 10 years Twice the size of the second-largest Including ~430 electric buses Including ~5,100
Slide 16: Egged Europe
Egged Europe1 EBS Netherlands Mobilis Poland Egged Europe: G R O W T H Expanding into New E N G IN E S Markets and Sectors 15% Market Share 800 Buses 35% Market Share 305 Buses Exploring entry into additional 352 electric, under 4 operated under 6 clusters public bus sector privatized transportation
Slide 17: Egged Travel & Tour
Egged Travel & Tour The largest transport company in Israel with 280 buses Implementing a business plan to drive efficiency initiatives, optimize G R O W TH subcontractor utilization, and expand into additional sectors Revenue Breakdown E N G IN E S within the country 78% Egged Transportation 17% Ed
Slide 18: Light Rail in the Tel Aviv Metropolitan Area
Additional Activities: Light Rail in the Tel Aviv Metropolitan Area Tevel, an Egged Subsidiary (51%), Operates the Red Line of the Light Rail Since August 2023 10-year contract and extension option NIS 67M 90 70KM H1 2024 Revenue Carriages; 45 trains in total Total track length NIS (2)M 34 100,000 H
Slide 19: Real Estate - Egged
Real Estate - Egged Significant potential for value appreciation North 30% of value Haifa and the Krayot Nof Galil Jerusalem 35% of value Jerusalem 1.2B 360 21 Beit Shemesh Approx . NIS Approx. -dunam Mishmar David Fair Value as of 30.6.20241 of land area Prime location properties Central 27% of val
Slide 20: Eranovum
Eranovum 1 Strategic Deployment of Charging Points in Key Locations Across Europe to Create a Competitive Advantage Keystone holdings: 49% 700 1,300 Valuation Summary: 30.6.24 In millions In millions of Euros of NIS Active charging points Charging points under construction Company value: 126 507 2,4
Slide 21: Drive Group
Drive Group Operation of Highways and Toll Roads, including Highway 6 and the Carmel Tunnels Keystone Holdings: 21.3% G R O W TH E N G IN ES Revenue1 EBITDA1 (NIS millions) (NIS millions) Extension of the operation & maintenance period for Highway 6 with the concessionaire, following the decision to
Slide 22: Energy and Renewables
Energy and Renewables IPM, Hagit, and Ramat Hovav Power Plants | Sunflower Sunflower Poland
Slide 23: IPM Power Plant
IPM Power Plant Keystone Holdings: 34.3%1 Keystone Valuation Components (in millions of NIS) 450 MW Revenue EBITDA3 Triple-M (approx. 40%) 334 (NIS millions) (NIS millions) Loan value to G.P. Global and in combined cycle A.Y.H. Paris 52 Market value of G.P. Global 85% 35 363 (approx. 10.6%) of capac
Slide 24: Ramat Hovav Power Plant and Hagit Power Plant
Ramat Hovav Power Plant Hagit Power Plant Keystone Holdings: 16%1 Keystone Holdings: 16%1 1,195 MW of generation capacity 660 MW of generation capacity Operates under the SMP regulation Operates under the SMP regulation Revenue EBITDA2 Revenue EBITDA2 (NIS millions) (NIS millions) (NIS millions) (NI
Slide 25: Sunflower - Renewables
Sunflower - Renewables A publicly traded company operating in the renewable energy sector in Poland, Israel, and the U.S. Keystone Holdings: 51.81% Poland Israel U.S. 5 operational wind farms with a 156 rooftop solar systems with a 604 MW / 1.3 GWh pipeline of total capacity of approx. 50 MW total c
Slide 26: Water and Communications
Water and Communications Water desalination (VID) | Cinturion VID Ashkelon
Slide 27: VID and Cinturion
VID Cinturion Water desalination in Ashkelon Communications Keystone Holdings: 50% Keystone Holdings: 30% 120 million cubic meters of water production capacity per year, 2027 Concession ends, A 20,000 km optical fiber venture connecting India to Europe via the Middle East, offering an alternative to
Slide 28: Comprehensive Value Creation Strategy
Comprehensive Value Creation Strategy Striking the Optimal Balance Between Growth, Stability, and Shareholder Returns Maximizing Cash Flow Unlocking Value Shareholder Rewards Optimal Debt Management Active asset management Strategic partnerships Quarterly dividend policy Continuous optimization of d
Slide 29: Thank you!
Keystone Thank you!
Slide 30: IPM Power Plant
IPM Power Plant Ownership Structure and Valuation1 Keystone Ownership (%) Value Components for Keystone (in Millions ILS) Indirect Ownership in the Plant Triple-M (~40%) 334 ~34% Keystone Infra Ltd. In Triple-M, directly and indirectly Value of Loan to G.P. Global and A.Y.H. Paris 52 10.66% owns the
Slide 31: Real Estate - Egged
Real Estate - Egged 10 Assets Comprising Approximately 90% of the Portfolio Value1 Property Name2 Land Built Current Use Approved Zoning Building Value Basis for Appraisal Potential For Development & Enhancement6 % of Area Area (Sqm) Rights Egged's Share Total (Dunam) (Sqm) (NIS Million) Value Kirya
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