Greencoat Renewables Plc · EURONEXT:GRP
Greencoat Renewables — FY2023 Earnings Presentation
36 slides from Greencoat Renewables's earnings presentation, 2024
Slide 1: Greencoat Renewables 2023 Full Year Results Presentation
GREENCOAT RENEWABLES PLC 2023 Full Year Results Presentation Marketing material for professional clients only.
Slide 2: Disclaimer
Disclaimer This Presentation (the 'Presentation') has been prepared and issued by Greencoat Renewables PLC (the 'Company' or 'Greencoat Renewables'). While this Presentation has been prepared in good faith, the information contained in it has not been independently verified and does not purport to b
Slide 3: Contents
Contents 1 2 INTRODUCTION FINANCIAL PERFORMANCE 3 4 ASSET MANAGEMENT & CONTRACTING PORTFOLIO DEVELOPMENT 5 6 FINANCING SUMMARY 7 APPENDIX 3
Slide 4: 1. Introduction
1. INTRODUCTION
Slide 5: Vision and Strategy
Vision and Strategy ACTIVE A leading pan European owner and operator of renewable PORTFOLIO energy assets MANAGEMENT Diversified portfolio Prudent use of leverage Balanced investment Real Impact Highly Cash Flexible Capital strategy Generative Allocation Disciplined Contributing to a Contracted and
Slide 6: One of the Largest Owners of European Renewables
One of the Largest Owners of European Renewables 1 €2.6bn cash generative portfolio & critical scale reached Geography Ireland (59%) Existing assets Germany (22%) Offices Finland Portfolio 43MW, 1 asset France (9%) Sweden (4%) Sweden Spain (4%) Ireland Portfolio 236MW, 2 assets Finland (2%) Portfoli
Slide 7: 2023 Highlights
2023 Highlights Continued strong cash generation €197m¹ Cash generated Financials 6.42c of dividends paid and 5% increase for 2024² 2.7x Gross dividend cover NAV stable with strong cash generation offsetting 112.1c NAV/share power price movement 6.36c dividends paid €524m deployed in the year €2.6bn
Slide 8: Track Record of Consistent Delivery
Track Record of Consistent Delivery Long term dividend growth and increased reinvestment €2.6bn pan European Cash Dividends PF debt Gross Year Reinvestment² portfolio supporting: generation paid repayment dividend cover 2017¹ €11.8m – – €11.8m – Cash generation capacity 2018 €23.1m €20.9m – €2.3m 1.
Slide 9: 2. Financial Performance
2. FINANCIAL PERFORMANCE
Slide 10: Financial Performance Overview (1 of 2)
Financial Performance Overview Year-on-Year comparison (1 of 2) Cash P&L FY2022 (€m) FY2023 (€m) Key considerations Revenue 330.6 379.2 +15% ● Consistently strong cash generation and dividend cover Operating expenses¹ (89.8) (128.0) ● Significant power price upside impact EBITDA 240.7 251.2 +4% in 2
Slide 11: Financial Performance Overview (2 of 2)
Financial Performance Overview Year-on-Year comparison (2 of 2) Key considerations Balance sheet FY 2022 (€m) FY 2023 (€m) Fair Value of investments1 2,082.7 2,511.6 +21% ● €2.6bn pan European and highly cash generative portfolio of scale Other liabilities3 (43.6) (33.0) ● Acquisitive growth with 4
Slide 12: €1.3bn Net Asset Value
€1.3bn Net Asset Value Strong cash generation equating to 2.6x dividend cover and offsetting depreciation Key considerations ● NAV per share declined marginally in 2023 ● Net cash generation of 16.6c representing 15% on NAV ● Strong cash generation offsetting impact of depreciation and dividends ● P
Slide 13: Benefits of Strong Cash Flows
Benefits of Strong Cash Flows Sustainable dividend cover of >2.0x to 2028 Illustrative dividend cover profile1 Flexibility and opportunity 2024 2025 2026 2027 2028 Dividend cover 2.1x 2.0x 2.3x 2.2x 2.1x ● High income security and protection Sensitivities €60/MWh2 2.4x 2.2x 2.1x 2.2x 2.1x €50/MWh2 2
Slide 14: 3. Asset Management and Contracting
3. ASSET MANAGEMENT AND CONTRACTING
Slide 15: Revenue Structure
Revenue Structure Strong contracted outlook providing a pricing floor while maintaining power price upside Forecast revenue breakdown Revenue mix 2024 to 2027 to 2032 ● 66% of the revenues in the portfolio are 17% contracted to 2032 24% 34% ● 46% of revenues are contracted and 83% 52% 76% Contracted
Slide 16: Contracting Strategy
Contracting Strategy High contracted revenues and positive impact of PPAs GRP strategy 450 100% 400 90% ● c.70% contracted revenues target 83% ● Strong dividend cover 77% 80% 350 ● Upside potential from exposure to merchant 71% 72% power prices 70% 64% 64% 300 62% Contracted Revenue % 60% 2023 devel
Slide 17: Recontracting
Recontracting Significant progress on re-contracting strategy in 2023 Butendiek – BKW and other large energy provider ● Secured contracts for 373GWh of annual production for 6.5 years through two separate power purchase agreements ● BKW PPA one of the largest PPAs signed in Europe, highlighting our
Slide 18: Asset Management KPIs
Asset Management KPIs Active asset optimisation improving asset yield, value and ESG performance ESG Health and Safety Revenue Enhancement Improvement Homes powered Health and safety >750,0001 (equivalent) 444 audits 15 projects completed Annual contracted Tonnes of CO2 Site inspections >1.3m2 avoid
Slide 19: Operational Excellence Supporting NAV Growth
Operational Excellence Supporting NAV Growth Continuous Improvement Plan and strong pipeline for further optimisation Performance to date Project pipeline Long term potential Operations optimisation Further planned developments Significant opportunities Performance to date ● Highly experienced and m
Slide 20: Comprehensive ESG Strategy
Comprehensive ESG Strategy 100% renewable electricity generation Operational ESG performance Disclosure and progress Independent board with five non-executive directors providing Article Sustainable Finance Disclosure Regulations (SFDR) – strong governance and oversight of the PLC Article 9 fund whi
Slide 21: 4. Portfolio Development
4. PORTFOLIO DEVELOPMENT
Slide 22: Acquisitions
Acquisitions Accretive acquisitions in the year Key considerations >€500m 332MW €119m Capital deployed Increase in Funded with ● 1 offshore wind asset in German generation capacity operating cashflow North Sea ● 1 solar farm in Spain 4 acquisitions completed across 5 transactions ● 2 onshore wind fa
Slide 23: Growing Exposure to Offshore Wind – Butendiek
Growing Exposure to Offshore Wind – Butendiek Technological diversification in compelling market Investment fundamentals Asset highlights ● Initial investment made in February 2023 ● 288MW offshore wind farm, located in Germany’s exclusive economic zone ● Off market follow-on investment executed on
Slide 24: Strategic Framework Agreement
Strategic Framework Agreement Key partnership with FuturEnergy Framework highlights Growth opportunity ● Enables GRP to partner with a leading developer with a significant ● Development pipeline comprising over 15 projects totalling 1.5GW+ pipeline of attractive assets ● Majority of the existing pip
Slide 25: Forward Sale Commitments
Forward Sale Commitments Fully funded sites under construction Construction Expected partner Construction progress completion Capacity ● Construction complete South Meath South ● Generation and export to grid has Canadian Solar commenced Q2 80.5 Meath¹, Statkraft Ireland panels 2024 MW ● Corporate P
Slide 26: 5. Financing
5. FINANCING
Slide 27: Financing Overview
Financing Overview Key considerations Weighted average cost ● 51% gearing with 83% of revenues €1.3 bn Total debt 2.9% of debt contracted in 2024 ● Large pool of supportive lenders Repayments from 10 Institutional lenders €58m operating cashflow ● 2024 forward sales fully funded ● €350m upsized RCF
Slide 28: Active Debt Management
Active Debt Management Strategically managed balance sheet with supportive lenders €m 700 Key considerations >€400m of post 600 dividend operating ● Supportive and growing lending pool 500 cashflow to 2028 400 ● €150m term debt facility secured in 300 Feb 2024 at an all-in cost of 4.1% 200 maturing
Slide 29: Self-Funded Accelerated Deleveraging
Self-Funded Accelerated Deleveraging Path to c.40% gearing 51% Debt repayment using post dividend cashflow 50% Material ● Post dividend operating cashflow to reduction 2028 of >€400m 47% in gearing ● Debt repayment providing deleveraging opportunity over the medium term 45% ● Potential debt repaymen
Slide 30: 6. Summary
6. SUMMARY
Slide 31: Disciplined Capital Allocation
Disciplined Capital Allocation Maximising shareholder value 2023 overview Future options ● Deleveraging opportunity through use of Debt repayment ● €58m of debt repayments post dividend operating cashflow ● Accretive acquisitions and good ● Pan European portfolio presenting >€400m Asset recycling pr
Slide 32: Outlook
Outlook Strong cash generation and increased capital allocation flexibility ● €251m cash EBITDA Continued strong trading with balanced approach to power price risk ● 2.6x net dividend cover ● >€400m post dividend operating cashflow to 2028 Increased cash generation driving earnings and NAV growth ●
Slide 33: 7. Appendix
7. APPENDIX
Slide 34: European Investment Opportunity
European Investment Opportunity Investible market expected to reach €1.3 trillion by 2030¹ 2022 2030 2050 Offshore wind 28GW 124GW 307GW Long term capital €109bn €305bn €664bn plays a central role in the energy 203GW 373GW 680GW Onshore wind €414bn €609bn €989bn transition by providing liquidity 194
Slide 35: Net Asset Value
Net Asset Value NAV sensitivities Impact on NAV Valuation factors Discount rate (+/- 0.25%) ● The base case asset life depends on the technology as those are underpinned by different design life: Inflation rate (-/+ 0.5%) – On-shore wind assets’ lifetime is typically 30 years – Off-shore wind assets
Slide 36: High-Quality and Long-Term Investor Base
High-Quality and Long-Term Investor Base Major shareholders include a mix of institutional and wealth investors Investor Ordinary shares held % Key considerations BlackRock 10% ● Listings on Euronext Dublin and KBI Global Investors 9% London Stock Exchange (AIM) FIL Investment International 7% ● Div