Renewables Infrastructure Group Limited GBP Red.Shs · LSE:TRIG
Renewables Infrastructure Group Limited GBP Red.Shs — The Renewables Infrastructure Group — FY2017 Earnings Presentation
42 slides from Renewables Infrastructure Group Limited GBP Red.Shs's earnings presentation, Feb 20, 2018
Slide 1: Annual Results Presentation: Year to 31 December 2017
The Renewables Infrastructure Group Annual Results Presentation: Year to 31 December 2017 20 February 2018 Generating Real Value. trig-ltd.com
Slide 2: Generating Real Value.
Generating Real Value. trig-ltd.com
Slide 3: Contents
Contents Section Slide Introduction 4 Overview of Annual Results 5 Portfolio & Operations 12 Financials 19 Outlook 25 Appendices 28 Contacts / Important Information 41 3 trig-ltd.com
Slide 4: Introduction
Introduction A leading London-listed renewables investment company TRIG is invested in 58 wind, solar and battery projects in the UK, France and Ireland with 876MW of power output capacity London-listed investment company (IPO in 2013) established in Guernsey with an independent board of non-exe
Slide 5: Overview of Annual Results
Overview of Interim Results trig-ltd.com
Slide 6: Financial Highlights – 2017
Financial Highlights – 2017 Strong NAV growth and solid earnings ▲ NAV per share: 103.6p (Dec 2016: 100.1p) ▲ Earnings per share: 9.8p (2016: 8.8p) ▲ Ongoing charges: 1.11% (2016: 1.10%) ▲ Investments totalling £230m ▲ New equity raised of £110m ▲ NAV total return1: 10.1% for 2017 (annualised) Divid
Slide 7: Additions to the Portfolio
Additions to the Portfolio Over 160MW of incremental capacity Date Acquired Project Consideration Net Capacity Location May 2017 Neilston onshore wind £22.6m 10MW East Renfrewshire, Scotland May 2017 Garreg Lwyd onshore wind £102.8m 34MW Powys, Wales August 2017 Broxburn energy storage £20.4m 20MW (
Slide 8: Growth & Funding
Growth & Funding Further diversification & scale Equity Issuance and Financing Portfolio Evolution February December December April 2017: £110m of new equity issued following an 2018 2017 2016 oversubscribed institutional placing Projects 58 57 53 31 December 2017: Revolving Acquisition Facility Net
Slide 9: Sheringham Shoal Offshore Wind Farm
Sheringham Shoal Offshore Wind Farm TRIG’s first investment in the offshore wind sector ▲ In December, TRIG acquired a 14.7% interest in Sheringham Shoal wind farm ▲ 316.8MW offshore wind project (c. 47MW pro rata) off Norfolk coast, England ▲ Total investment of £80m ▲ 88 Siemens turbines of 3.6MW
Slide 10: Power Prices
Power Prices Current prices firm but downward revisions to forecasts ▲ 2017 spot prices have improved since 2016 ▲ But long-term forecasts down c.7% year-on-year (down c.30% since IPO) ▲ Longer-term increases driven by Asian demand for gas as well as increases in carbon costs ▲ A key determinant of
Slide 11: Dividend Policy
Dividend Policy To consider inflation and wider factors As noted in the Chairman’s statement: Dividends The Company will set the dividend target for each financial Aggregate dividend year at the time of publication of the Company’s Annual Period per share Report and Accounts for the previous year. 2
Slide 12: Portfolio & Operations
Portfolio & Operations Gearbox replacement at Haut Cabardes, France trig-ltd.com
Slide 13: Portfolio
Portfolio 876MW net capacity / 58 projects (February 2018) By Technology1 Battery Storage 2% Solar PV 23% Offshore Wind 7% Onshore Wind 68% By Jurisdiction / Power market 1,2 France 12% Republic of Ireland England (GB) (SEM) 27% 6% Northern Ireland (SEM) 5% Wales (GB) 9% Scotland (GB) 41% 1. Segment
Slide 14: Revenue Profile
Revenue Profile Medium-term project-level revenues mainly fixed / indexed Project Revenue by Type PPA Market Revenue 20% Indexed Fixed PPAs & FiTs 29% PPA Market Revenue at Floor Next 12 8% months1 ROC Recycle and Other 5% Indexed ROC Buyout 38% £300m £250m £200m £150m £100m £50m - '18 '19 '20 '21 '
Slide 15: Counterparty Exposure
Counterparty Exposure Broad spread of counterparties monitored regularly 7 Number of associated projects Valuation of associated projects 1. By value, as at 31 December 2017 using Directors’ valuation. Where projects have more than one contractor, valuation is apportioned. 15 2. Equipment manufactur
Slide 16: Operational Performance (1)
Operational Performance (1) High wind speeds boosting portfolio performance UK Average Wind Speed2 ▲ Portfolio generation 2.5% above budget 12 2017 p 10 year mean Average wind speed (knots) 10 ▲ TRIG’s wind assets outperformed budget by 3.3% 8 ▲ Solar generation was 5% below budget but 5% higher 6 t
Slide 17: Operational Performance (2)
Operational Performance (2) Diversification sustaining performance close to long-term expectations Technology Region Electricity production (GWh) 2017 Performance vs. P50 estimates 2017 2016 Onshore wind UK & Ireland 1,391 +3.7% -9.7% France 215 +0.4% -5.7% Solar PV UK & France 160 -5.1% -9.7% Total
Slide 18: Optimising Asset Performance
Optimising Asset Performance Active targeting of value-enhancing initiatives RES control centre overseeing site activities Individual turbine data monitored & analysed Main bearing replacement underway Enhancement Initiatives Technical: increase the amount of electricity produced, or Commercial: inc
Slide 19: Financials
Financials Haut Languedoc, France trig-ltd.com
Slide 20: Portfolio Valuation Bridge
Portfolio Valuation Bridge Valuation improvement in the year to 31 December 2017 £1,200m £1,000m 73.0 111.8 26.0 56.1 23.9 £800m 229.9 £600m 1,081.2 818.7 975.6 975.6 943.4 969.4 919.5 919.5 £400m 818.7 £200m £m 31-Dec-16 New Cash distributions Rebased valuation Change in Reduction in Change in Bala
Slide 21: Valuation – Key Assumptions
Valuation – Key Assumptions As at 31 December 2017 As at 31 December 2016 Discount Rate Weighted average 8.0% 8.4% Weighted by market Power Prices Based on third party forecasts Based on third party forecasts (See power curve on slide 9) 2018: 3.40% (ROCs only) UK 2019: 2.90% (ROCs only) 2.75% Long-
Slide 22: Summary Income Statement
Summary Income Statement On-target production plus portfolio growth and valuation gains Year to Year to 31 December 2017 31 December 2016 £m £m Statutory Basis Adjustments1 Expanded Basis Expanded Basis Total operating income 93.1 12.6 105.7 88.1 Acquisition costs - (0.8) (0.8) (0.3) Net operating i
Slide 23: Summary Balance Sheet
Summary Balance Sheet NAV per share up 3.5p As at 31 December 2017 As at 31 December 2016 £m £m Statutory Basis1 Adjustments Expanded Basis Expanded Basis Portfolio value 973.3 107.9 1,081.2 818.7 Working capital (1.2) (1.6) (2.8) (3.1) Debt - (106.4) (106.4) - Cash 10.6 0.2 10.8 18.7 Net assets 982
Slide 24: Summary Cash Flow
Summary Cash Flow Steady cash flow performance Year to 31 December 2017 Year to 31 December 2016 £m £m Statutory Basis Adjustments1 Expanded Basis Expanded Basis Cash from investments 59.2 13.8 73.0 59.5 Operating and finance costs (1.1) (8.8) (9.9) (9.2) Cash flow from operations 58.1 5.0 63.1 50.3
Slide 25: Outlook
Outlook Roussas Claves, France trig-ltd.com
Slide 26: Market Opportunities
Market Opportunities Disciplined approach seeking value across multiple sectors In Europe EU – New Power Capacity Installations, 2017 (29GW) ▲ Renewables remains dominant new generation in EU (& world-wide) ▲ Significant wind capacity additions in 2017 in Germany (+6.6 GW) & UK (+4.3 GW), leading th
Slide 27: Concluding Remarks
Concluding Remarks Strong NAV growth, solid earnings and positive outlook On-track operating performance ▲ Driven by a diversified portfolio, scale benefits and prudent management ▲ Portfolio enhancement initiatives Attractive dividends Crystal Rig, Scotland ▲ Delivered 6.40p per share distribution
Slide 28: Appendices
Altahullion,; Nerthern.treland
Slide 29: Scale of the Global Market for Renewables
Scale of the Global Market for Renewables Renewables is now mainstream Global Cumulative Renewables as % of Global Power Capacity1 Installed Wind and Solar Capacity (GW)2 600 60% 55% 50% 51% 49% 45% 500 40% 42% 40% 39% 30% 32% 400 27% 20% 20% 17% 15% 13% 12% 14% 10% 11% 300 10% 8% 9% 10% 11% 8% 8% 8
Slide 30: EU – New Power Capacity Installations
EU – New Power Capacity Installations Wind & Solar PV: dominating European new power capacity Hydro 1% 2015: 29GW Biomass Other 1% Renewables 2% Onshore wind 2016: 34GW Gas Hydro 34% 6% 3% Biomass Other Renewables 4% Coal 1% 16% Onshore wind 45% Gas 2017: 29GW 13% Coal Hydro 3% Biomass 4% 1% Other R
Slide 31: The Team
The Team Access to Experienced Management Independent Board Investment Manager Operations Manager Helen Mahy CBE (Chair) Strong, 20+ year track record in The world’s largest independent renewable infrastructure and real estate funds energy developer Jonathan Bridel Over US$10 billion of equity
Slide 32: Board and Senior Management Team
Board and Senior Management Team Over 100 years of relevant experience on the TRIG Advisory Committee TRIG Independent Board Helen Jonathan Klaus Shelagh (Non-Executive) Mahy CBE Bridel Hammer Mason (Chairman) Investment matters Operational TRIG Investment Werner Chris Tony Jon Richard matters Commi
Slide 33: Operational Management
Operational Management Breadth and depth of capability provided by RES Managing Performance ▲ Availability – minimising lost production, fault rectification ▲ Generation – maximising output, maintenance planning, turbine & grid settings ▲ Financial – budget control, minimising costs, distributions ▲
Slide 34: NAV sensitivities
NAV sensitivities Based on portfolio at 31 December 2017 -£285.2m -£185.2m -£85.2m £14.8m £114.8m £214.8m Discount rate +/- 0.5% -£37.8m £38.9m Output P90 / P10 (10 year) -£108.3m £104.7m Power price -/+ 10% -£79.1m £81.1m Inflation -/+ 0.5% -£43.5m £50.8m Operating costs +/- 10% -£42.0m £41.5m Exch
Slide 35: Broxburn Battery Storage
Broxburn Battery Storage First investment by listed sector in wholesale power storage ▲ In August TRIG acquired a 100% interest in a battery storage project, Broxburn ▲ Capacity of 20MW, in construction ▲ Acquired from RES – the project developer ▲ Total investment of £20m ▲ Provides dynamic grid ba
Slide 36: Construction Projects
Construction Projects Capitalising on upstream experience Case Study: Freasdail Wind Farm (2016-17) ▲ Strong manager experience Offloading turbine components Constructing the turbine base ▲ Established risk management at Campbeltown Harbour, Kintyre techniques ▲ Favourable pricing ▲ TRIG’s construct
Slide 37: Debt Structure
Debt Structure Disciplined approach Term Project Debt Gearing1 TRIG’s portfolio at 19/02/2018 ▲ Limited to 50% of portfolio enterprise value Project Category typically (Younger = <10yrs) Average % of # of available gearing1 portfolio projects ▲ Fully amortising within period of firm power prices (i.
Slide 38: Dividend Track Record
Dividend Track Record Aggregate dividend target of 6.50p per share for 2018 Period Aggregate annual dividend per share Interim dividends per share Payment timing Q4 2018 1.625p Target 3/2019 Q3 2018 1.625p Target 12/2018 Target 6.50p Q2 2018 1.625p Target 9/2018 Q1 2018 1.625p Target 6/2018 Q4 2017
Slide 39: UK Government Benchmark Yields
UK Government Benchmark Yields Low rate environment makes yielding assets attractive UK Gilt Yields (Last 5 Years) 5 4.5 IPO 4 3.5 3 % 2.5 2 1.5 1 0.5 0 5 year Gilt 10 year Gilt 20 year Gilt Source: InfraRed, Thomson Reuters 39 trig-ltd.com
Slide 40: Key Facts
Key Facts Fund Structure ▲ Guernsey-domiciled closed-end investment company Performance ▲ Dividends to date paid as targeted for each period ▲ NAV per share 31 December 2017 of 103.6p Issue / Listing ▲ Premium listing of ordinary shares on the Main Market of ▲ Market Capitalisation c. £1.028bn (31 D
Slide 41: Contacts
Contacts Investment Manager Other Advisers InfraRed Capital Partners Limited Administrator / Company Secretary Registrar 12 Charles II Street London SW1Y 4QU Aztec Financial Services (Guernsey) Ltd Link Asset Services (Guernsey) Ltd East Wing Mont Crevelt House Trafalgar Court Bulwer Avenue +44 (0)2
Slide 42: Important Information
Important Information By attending the meeting where this presentation is made, or by reading the presentation slides, you agree to be bound by the following limitations: This document is an advertisement and is not a prospectus. Any decision to purchase shares in The Renewables Infrastructure Compa
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