Slide 1: FY 2019 Results
FY 2019 Results February 27th 2020
Slide 2: Collective, complementary and operational management team
Collective, complementary and operational management team ⚫ Paulo Almirante, COO ⚫ Judith Hartmann, CFO ⚫ Claire Waysand, interim CEO Three main objectives ⚫ Maintain the strong engagement of teams ⚫ Ensure delivery of operational performance and financial objectives ⚫ Set up a roadmap to simplify,
Slide 3: A sustainable business model
A sustainable business model 3
Slide 4: Strong financial performance, carbon-neutrality transition, CSR responsibility
Strong financial Transition towards CSR performance carbon-neutrality responsibility 4
Slide 5: Carbon reducing solutions for our customers
GHG(1) emissions Gender diversity Renewables GHG(1) emissions from power production, Share of women in the management of the Share of Renewables (GW at 100%) in line with the SBT(2) trajectory Group in the electric capacity mix, in line with the SBT(2) trajectory 50% 58% 149 Mt 80 Mt 23% 24% 28% 20%
Slide 6: Focus on operational performance & priorities
Focus on operational performance & priorities 6
Slide 7: 2019 achievements by business line
THERMAL / NUCLEAR / CLIENT SOLUTIONS NETWORKS RENEWABLES SUPPLY / OTHERS Commercial successes Acquisition of TAG in Brazil Additional 3 GW in operation Increase of nuclear availability University of Iowa, (4,500 km gas transmission) (4x higher than 2018) (79% in 2019 vs. 52% in 2018) Ottawa city and
Slide 8: 2020 priorities by business line
⚫ Focus on growth of asset-based projects CLIENT SOLUTIONS ⚫ Improve performance of asset-light activities ⚫ Integrate TAG and deliver ongoing development projects in Latin America NETWORKS ⚫ Optimize costs of European networks ⚫ Commission 3 GW and execute partial sell-downs RENEWABLES ⚫ Demonstrat
Slide 9: 2019 performance
2019 performance 9
Slide 10: 2019 guidance achieved
2019 NRIGS GUIDANCE ACHIEVED €7.4 BN GROWTH INVESTMENTS, 2.5x FINANCIAL NET DEBT TO EBITDA RATIO STRONG ORGANIC COI GROWTH (+14% YOY) DRIVEN BY NUCLEAR, OTHERS (ENERGY MANAGEMENT), THERMAL AND RENEWABLES PARTIALLY OFFSET BY SUPPLY AND NETWORKS PROPOSED 2019 DIVIDEND OF 0.80 €/SHARE, AN INCREASE OF 7
Slide 11: 2019 results
2019 RESULTS– In €bn, ∆ ∆ Actual Guidance unaudited figures(1) Gross(2) Organic(2) EBITDA 10.4 +7% +8% 9.9-10.3 COI 5.7 +11% +14% - NRIgs (continued) 2.7 +9% +11% 2.5-2.7 NIgs 1.0 -0.0 - - FINANCIAL NET DEBT 25.9 +2.7 - - FINANCIAL NET DEBT / EBITDA 2.5x +0.1x - ≤2.5x CFFO(3) 7.6 -0.2 - - COI YoY gr
Slide 12: Regulatory visibility and enhancing growth profile
Regulatory visibility Enhancing growth profile 3.0 GW Renewables commissioned (x4 versus 2018) 4-year framework for Networks in France Announcement of 1.7 GW hydro acquisition in Portugal Constructive arrangement regarding nuclear provision and funding in Belgium Key acquisitions in Networks and Cli
Slide 13: Client Solutions performance
Good performance on decentralized energy activities and strong contribution from 2019 acquisitions Impacted by temporary operational difficulties and investments made to prepare the future FY2019 COI - In €M FY2019 PERFORMANCE YoY gross Revenues up 11%, including significant contribution of tuck-i
Slide 14: Networks performance
Broadly in line with expectations despite headwinds in distribution and French transmission First contribution of TAG FY2019 COI - In €M FY2019 PERFORMANCE YoY gross Gas Distribution: 5,726 €M % • International: negative one-offs, temperature and FX effects • France: tariff increase and commission
Slide 15: Renewables performance
Solid combined performance of wind & solar, hydro drive renewed growth FY2019 COI - In €M FY2019 PERFORMANCE YoY gross Hydro up ~6%: 5,726 €M % Better prices in Brazil 1,090 Lower hydro volume in France (-6% YoY) partly offset by higher prices On-shore wind & solar up ~12%: Commissioning of ne
Slide 16: Thermal performance
Disposals and end of PPAs weighed on results, partially offset by favorable price effects FY2019 COI - In €M FY2019 PERFORMANCE YoY gross Glow and LYB disposals 5,726 €M % PPA expiry in Turkey 1,090 LatAm PPA ramp-up and lower sourcing costs (Chile) UK CRM(1) reinstated retroactively since Q
Slide 17: Nuclear performance
Significant growth mainly driven by availability recovery FY2019 COI - In €M FY2019 PERFORMANCE YoY gross Higher volumes due to restarts in Belgium (+13 TWh) 5,726 €M % Higher achieved prices (+2 €/MWh) 1,090 Termination of German drawing rights (-2 TWh) 2,327 Availability Belgium Achieved pri
Slide 18: French retail market conditions continue to be a challenge
French retail market conditions continue to be a challenge FY2019 COI - In €M FY2019 PERFORMANCE YoY gross Margin squeeze in French retail (market offers in gas and power) 5,726 €M % Commissioning costs accrual reversal 1,090 Positive 2018 one-offs in Benelux Temperature in Australia and Fra
Slide 19: Strong performance in Energy Management
Strong performance in Energy Management FY2019 COI - In €M FY2019 PERFORMANCE YoY gross Energy Management: 5,726 €M % Long-term gas contract renegotiations, partial sale of a gas supply contract 1,090 Gas sourcing optimization, benefitting from market volatility Development of international
Slide 20: Performance improvement: cost reduction and revenue enhancement
NET COI IMPROVEMENT (€bn), COST REDUCTION REVENUE ENHANCEMENT CUMULATED PROCUREMENT INDUSTRIAL ASSETS 0.55 Category management, pooling, PERFORMANCE IMPROVEMENT insourcing, spending centralization Asset and networks availability, and standardization efficiency DIGITALIZATION IMPROVED 0.33 CRM, proce
Slide 21: From EBITDA to NRIgs and NIgs
From EBITDA to NRIgs From NRIgs to NIgs 2019 2018(1) ∆ YoY EBITDA €10.4bn €9.7bn +0.7 NRIgs 2019 €2.7bn D&A and others (4.6) (4.5) (0.1) MtM below COI (0.4) COI €5.7bn €5.2bn +0.5 Restructuring costs (0.2) Net interest expense(2) (1.3) (1.2) (0.1) Capital gains(4) +1.6 Income tax (1.1) (0.8) (0.3) I
Slide 22: Cash flow from operations
Commodity related margin calls and financial derivatives negative impact almost fully offset by higher operating cash flow and lower taxes and interest paid In €bn 0.9 (1.3) incl. Margin 7.7 Calls & financial 7.6 derivatives 0.2 Operating Cash Flow Delta Taxes & WCR Interest paid CFFO CFFO 2018 2019
Slide 23: Forward outlook
Forward outlook 23
Slide 24: 2020 indications and proposed 2019 dividend
EBITDA indication COI indication NRIgs guidance In €bn In €bn In €bn 10.5-10.9(1) 10.4 2.7-2.9(1) 5.8-6.2(1) 2.68 5.7 2019 2020e 2019 2020e 2019 2020e Proposed 2019 dividend to be paid in 2020: 0.80 €/share i.e. 72% pay-out ratio on 2019 NRIgs Leverage: Strong investment grade rating, Economic Net D
Slide 25: 2020 COI drivers by business line
BUSINESS LINE 2019 COI (€bn) COI 2019-20(1) KEY DRIVERS CLIENT SOLUTIONS 1.1 ⚫ Organic revenues and margin growth, new acquisitions NETWORKS 2.3 ⚫ Increase from TAG offset by decreases in new remuneration rates ⚫ Hydro volume and prices in France and positive decision in Brazil on RENEWABLES 1.2 com
Slide 26: Capex, nuclear funding and disposals over 2020-22
Growth Capex(1) over 2020-22 Nuclear funding Disposal Indicative split by Business Line Thermal & Supply ~€4bn Renewables Clients expected over 2020-22 Solutions ~€4bn New arrangement with Belgian nuclear authorities over 2020-22 ~€10bn(1) excl. DBSO proceeds over 2020-22 100% funding of waste manag
Slide 27: EBITDA, COI and ROCEp outlook
EBITDA Outlook COI Outlook ROCEp(1) Outlook In €bn In €bn In €bn Upper single digit 10.4 CAGR CAGR 7.5%(2) 2-4% 5.7 4-6% 2019 2022 2019 2022 2019(1) 2022 (1) See FY 2019 appendices for detailed calculation (2) Restated for IFRS 16 treatment, calculated on average productive industrial capital employ
Slide 28: NRIgs outlook and dividend policy
Net recurring income group share outlook Dividend policy 3.2-3.4(1) 65-75% pay out ratio(1) €0.8 € 2.7 bn CAGR per share 6-8% 2019 2022 2019 2022 (1) Main assumptions: average weather in France, full pass through of supply costs in French regulated gas tariffs, no major regulatory or macro-economic
Slide 29: Q&A
Q&A 29
Slide 30: Additional material
Additional material 30
Slide 31: COI by business line and geography
Client In €M Networks Renewables Thermal Nuclear Supply Others(1) Total Solutions France 574 1,957 181 149 2,861 Rest 345 82 88 293 (314) 190 684 of Europe Latin 280 849 504 61 1,694 America USA & 13 1 45 26 25 49 159 Canada Middle East, 25 15 72 460 (13) 559 Asia & Africa Others 132 (8) (45) (23) (
Slide 32: Net financial debt and cost of gross debt
Net financial debt and cost of gross debt In €bn 10.0 (2.8) 0.6 25.9 23.3 (7.6) 2.5 ⚫ In April 2019, S&P confirmed its A- Others long-term rating, upgraded its short- Dividends Disposals(2) term rating to A-1 and maintained its Dec. Gross Dec. outlook at stable. 2018(1) CFFO Capex 2019 ⚫ In June 201
Slide 33: EBITDA by main effects
By main effects - in €bn +8% org. +0.3 +0.65 10.4 9.7 +0.2 (0.3) o/w one-offs (0.2) (0.1) EBITDA FX & Prices Volumes Lean Others EBITDA Dec 2018 Scope 2021 net(1) Dec 2019 France Latin America Middle East, Asia & Africa Rest of Europe USA & Canada Other (1) Gross gains (recurring) less i
Slide 34: Financial assets, ARO and pension provisions
Financial assets as of 12/31/2019 ARO(1) & pension provisions as of 12/31/2019 Investments in associates Other financial Pensions & joint ventures assets €7.5bn €9.2bn €3.7bn Total Total €18.8bn €22.7bn Loans & receivables at amortized costs ARO(1) €5.9bn €15.2bn (1) Asset Retirement Obligation 34
Slide 35: Income statement from EBITDA to net recurring income
In €m FY 2018(1) FY 2019 EBITDA 9,702 10,366 of which recurring contribution of share in net income of entities accounted for using the equity method 510 592 Depreciation, Amortization and others -4,548 -4,640 CURRENT OPERATING INCOME 5,154 5,726 Financial result -1,209 -1,282 of which recurring cos
Slide 36: Achieved prices, forex and weather assumptions
Achieved Prices - In €/MWh Forex Weather Conditions European outright 48 47 44 Normalized conditions in France: OVER 2020-2022 gas distribution and energy supply normalized hydro production 2020 2021 2022 Hydrology in Brazil EUR-BRL EUR-USD to improve by 2022 Market @ ~4.57 @ ~1.16 Prices (1) 42 45
Slide 37: 2020-2022 contingencies and tax rate
Recurring effective Networks Nuclear Supply tax rate Belgium nuclear availability 74%/93%/94%(1)(2) Returns review of our Full pass through 31% in 2020 reducing for 2020/2021/2022 French LNG infrastructures of supply costs in French by c. 300bps business regulated gas & power through 2022 in 2021 ta
Slide 38: Forward-Looking statements
Forward-Looking statements This communication contains forward-looking information and statements. These statements include financial projections, synergies, cost-savings and estimates, statements regarding plans, objectives, savings, expectations and benefits from the transactions and expectations
Slide 39: Ticker: ENGI
Ticker: ENGI +33 1 44 22 66 29 ir@engie.com https://www.engie.com/en/finance-area FOR MORE INFORMATION ABOUT FY 2019 RESULTS: https://www.engie.com/en/finance/resultats/2019 39