Edp S.a. · EURONEXT:EDP
Edp — Energias de Portugal — Q1 2011 Earnings Presentation
36 slides from Edp's earnings presentation, May 6, 2011
Slide 1: 1Q11 Results Presentation
1Q11 Results Presentation May 6th, 2011
Slide 2: Disclaimer
Disclamer 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 5th of May 2011 and its purpose is merely of informative nature and, as such, it may be amended and supplemented. By attending the meeting where this pre
Slide 3: 1Q11: Highlights of the period
1Q11: Highlights of the period EBITDA: €1,008m, +7% YoY 61% of 1Q11 EBITDA came from out of Portugal Strong EBITDA growth in Brazil (+20%) and EDPR (+19%, driven by US and Europe ex-Iberia) Hydro & Wind power represented 61% of installed capacity, 71% of production in 1Q11 +188MW of wind capacity in
Slide 4: 1Q11: Highlights of the period
1Q11: Highlights of the period Net Profit: €342m, +11% YoY Capex -31% YoY to €393m in 1Q11: 100% of expansion capex was in wind, hydro & Brazil In line with capex reduction previously announced; targets: 2011E ~€2.2bn / 2012E ~€2.0bn Net debt -2.2% vs. Dec-10 to <€16.0bn: Positive Free Cash Flow in
Slide 5: 1Q11 Operating Headlines
1Q11 Operating Headlines Installed Capacity 1Q11 Generation Breakdown by Technology (GW) (%) Wind Hydro CCGT Other (1) +7% Other (1) CCGT 22.2 20.7 16% 14% 22% 24% 16% 17% 26% 31% 45% 33% 61% Hydro & Wind 71% 27% 30% Hydro & Wind 1Q10 1Q11 Installed capacity up 7% YoY Wind & Hydro: 61% of total capa
Slide 6: 1Q11 EBITDA: Significant YoY and QoQ growth
1Q11 EBITDA: Significant YoY and QoQ growth EBITDA – Quarterly evolution (€ million) +19% +5% 1,008 962 936 940 891 849 817 820 761 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 1Q11 was again an all time high for EDP in terms of Quarterly EBITDA performance 5
Slide 7: 1Q11 EBITDA: Increasing portfolio diversification
1Q11 EBITDA: Increasing portfolio diversification EBITDA Breakdown by Geography (%) 13% 18% 20% Brazil 7% 18% 14% 22% EDP Renováveis 19% 19% Spain 61% 49% 39% Portugal 1Q06 1Q09 1Q11 Weight on EBITDA from operations out of Portugal increased from 39% in 1Q06 to 61% in 1Q11 6
Slide 8: 1Q11 EBITDA: 87% from Regulated and LT Contracted Activities
1Q11 EBITDA: 87% from Regulated and LT Contracted Activities EBITDA Breakdown by Activity (€ million) % Chg. YoY +7% €1,008m €940m Liberalized 13% 18% -21% Activities Iberia 20% Brazil 18% +20% 22% Wind Power 20% +19% 87% Regulated 22% 26% Networks Iberia(1) +19% LT Contracted Generation Iberia 23%
Slide 9: EDP Consolidated operating costs
EDP Consolidated operating costs 12-Month avg. Inflation: Mar-11 Operating Costs: 1Q11 vs. 1Q10 OPEX/Gross Profit (1) : 1Q11 vs. 1Q10 (%) (%) (%) +3% 387 26% 26% 8.1% 378 2.2% 2.4% Portugal Spain Brazil 1Q10 1Q11 1Q10 1Q11 • Rising inflation in our core markets and 7% increase of installed capacity
Slide 10: Business Areas
‘ SO business reas
Slide 11: Electricity & Gas Demand in EDP's Key Markets
Electricity & Gas Demand in EDP’s Key Markets Brasil Portugal Spain Electricity Electricity Gas (Total Market) Electricity Gas (Total Market) 11% 17% 10% 4.8% 3.4% -0.5% -1.1% -2.0% -1.8% 1Q11 vs. 1Q10 (YoY) 1Q11 vs. 1Q08 (pre crisis levels) -12.9% Brazil: Steady consumption growth prompted by new c
Slide 12: Long Term Contracted Generation Iberia (20% of EBITDA)
Long Term Contracted Generation Iberia (20% of EBITDA) EBITDA LT Contracted Generation EBITDA LT Contracted Generation Ex-Carregado (€ million) (€ million) PPA/CMEC (1) Special regime (2) PPA/CMEC (1) Special regime (2) -7.5% +3.3% 214 198 192 198 -17% -17% -6% +6% 1Q10 1Q11 1Q10 1Q11 • PPA/CMEC: en
Slide 13: Liberalised Energy Activities Iberia (13% EBITDA)
Liberalised Energy Activities Iberia (13% EBITDA) EBITDA Liberalised Activities (€ million) -21% +63% 167 131 81 1Q10 2Q10 3Q10 4Q10 1Q11 EBITDA -21% YoY, but recovering from 4Q10 12
Slide 14: Liberalised Energy Activities Iberia: Unit gross profit 24% lower YoY
Liberalised Energy Activities Iberia: Unit gross profit 24% lower YoY but 31% higher QoQ EBITDA Liberalised Activities Spain – Electricity final wholesale price (€/MWh) (€/MWh) Spot price Final wholesale price(1) EDP’s Avg. Thermal generation cost -24% 55 14.3 +31% 10.9 45 35 25 15 1Q10 2Q10 3Q10 4Q
Slide 15: Regulated Energy Networks Iberia (26% of EBITDA)
Regulated Energy Networks Iberia (26% of EBITDA) EBITDA EBITDA (adjusted for non-recurrent) (€ million) (€ million) Gas Iberia Gas Iberia Electricity Spain Electricity Spain Electricity Portugal Electricity Portugal +19% +4% 276 239 231 232 +10% +10% +160% +25% -2% -2% 1Q10 1Q11 1Q10 1Q11 • Electric
Slide 16: Regulated Energy Networks Iberia: Higher Efficiency
Regulated Energy Networks Iberia: Higher Efficiency with improvement on quality of service Opex(1)/Network Km Opex(1)/Connected customers Equivalent Interruption Time(2) (€th) (€th) (minutes) -50% -3% -3% 42 2.68 85 2.59 83 21 1Q10 1Q11 1Q10 1Q11 1Q10 1Q11 Efficiency ratios improved 3% YoY Higher qu
Slide 17: EDP Renováveis (22% EBITDA): Wind power prices
EDP Renováveis (22% EBITDA): Wind power prices Production Breakdown Avg. Selling Price per MWh Higher contribution from US at lower 1Q11 1Q10 % prices than the portfolio avg., partially 4,421 GWh €58 €60 -3% compensated by increasing prices in Europe Tariffs, PPAs 16% & Merchant €98 €97 +2% Portugal
Slide 18: EDP Renováveis: EBITDA up 19% YoY
EDP Renováveis: Renováveis: EBITDA up 19% YoY Installed Capacity Output EBITDA (MW) (GWh) (€ million) +19% +21% +19% 6,625 4,421 220 5,567 185 3,639 1Q10 1Q11 1Q10 1Q11 1Q10 1Q11 EBITDA growth in line with 19% increase of installed capacity 17
Slide 19: Brazil (20% of EBITDA)
Brazil (20% of EBITDA) Evolution of EBITDA of EDP Brasil Evolution of EBITDA of EDP Brasil (BRL millions) (€ million) Generation & Other Distribution +9% +20% 452 413 198 166 +11% +8% 1Q10 1Q11 1Q10 1Q11 EBITDA +20% YoY; +9% in local currency + 9% appreciation of BRL vs. EUR • Distribution: 4% growt
Slide 20: Consolidated Financials
Consolidated Financials 19
Slide 21: Capex: Execution of Selective Growth
Capex: Capex: Execution of Selective Growth Consolidated Capex by technology (1) Consolidated Capex by geography (€ million) (%) -31% 573 EDP Brasil 18 9% CCGT Iberia 20 27 Hydro Portugal 32% 35% 393 31 7% 42 382 18% Wind Power 21% 190 13% 14% 30% Maintenance 126 131 22% 1Q10 1Q11 1Q10 1Q11 Capex -3
Slide 22: Construction in Progress & Paid Hydro Concessions
Construction in Progress & Paid Hydro Concessions €2.5bn Pécem Coal plant in Brazil: 15 Year PPA contract, 360 MW attributable capacity Total investment: BRL1.5bn Brazil 0.6 Generation Operation to start in Jan-12; Expected EBITDA in 2012: BRL240m (€110m) Wind 0.3 402 MW under construction: 35% in E
Slide 23: Net Regulatory Receivables by Mar-11
Net Regulatory Receivables by Mar- Mar-11 Regulatory Receivables (€ million) 1,443 1,399 Portugal: €883m (+€195m vs. Dec-10) • Distribution & Last resort supply: €537m (+€349m vs. Dec- 10) €325m generated in the period, (€191m to be recovered in 689 2011 through tariffs) and €22m paid back to custom
Slide 24: Change in Net debt
Change in Net debt Change in Net Debt: Mar-10 vs. Mar-11 (€ billion) 0.3 16.3 0.3 0.0 0.3 16.0 16.0 Net Debt Adjusted Free Net Debt After Expansion Capex Regulatory Forex & Fair Value Net Debt Dec-10 Cash Flow (1) Adj.FCF (2) Receivables (3) (4) 1Q11 • Slight decline in regulatory receivables follow
Slide 25: Net Debt Breakdown by Mar-11 & credit ratios
Net Debt Breakdown by Mar- Mar-11 & credit ratios EDP consolidated debt maturity profile (€ million) Debt by Interest Rate Term Commercial paper Average Debt Maturity Other subsidiaries(1) Brazil: € 279 M EDP SA + BV Project Finance: € 73 M Mar-11: 5 years Fixed 47% €0.5bn Bond: Jun-11 53% 3.500 €0.
Slide 26: Credit ratings EDP vs. Sovereigns
Credit ratings EDP vs. Sovereigns Sovereigns S&P Fitch Moody's 1Q11 EBITDA Breakdown (%) AAA AAA Aaa 8% of total AA+ AA+ Aa1 EBITDA from USA AA AA Aa2 AA- AA- Aa3 22% A+ A+ A1 A A A2 20% A- A- A3 BBB+ BBB+ Baa1 19% BBB BBB Baa2 BBB- BBB- Baa3 39% BB+ BB+ Ba1 BB BB Ba2 BB- BB- Ba3 EDP’s rating above
Slide 27: EDP financial liquidity position
EDP financial liquidity position (€ million) Sources of liquidity (Mar-11) Instrument Maximum Number of Utilised Available Maturity Amount counterparties Revolving Credit Facility (US$1.5bn) 1,056 22 1,056 - 02-07-2014 Revolving Credit Facility 2,000 21 - 2,000 03-11-2015 Domestic Credit Lines 230 1
Slide 28: EDP main sources and uses of funds in 2011-2012
EDP main sources and uses of funds in 2011- 2011-2012 Sources of funds Use of funds • Refinancing needs in 2011-2012: Bond maturing in Jun-11: €0.5bn • Cash & Equivalents (Mar-11): €1.9bn Loans maturing in 2011: €0.1bn • Available Credit Lines (Mar-11): €2.9bn Bond maturing in Jun-12: €0.5bn Bond ma
Slide 29: Net Profit up 11% YoY
Net Profit up 11% YoY (€ million) 1Q10 1Q11 ∆% ∆ Abs. EBITDA 940 1.008 +7% +69 Increase of installed capacity in EDPR, Net Depreciations and Carregado plan fully depreciated in Dec-10 351 360 +3% +9 Provisions EBIT 589 648 +10% +59 Financial Results & Higher cost of debt: 3.8% in 1Q11 vs. 3.5% in (1
Slide 30: Prospects 2011
Prospects 2011 29
Slide 31: Inflation evolution in EDP's key markets
Inflation evolution in EDP’s key markets Portugal Spain Brazil 5.5% 2.3% 4.9% 5.0% 2.1% 2.7% 1.4% -0.2% -0.9% 2009 2010 2011E 2009 2010 2011E 2009 2010 2011E Portugal (45% of EBITDA(1)): inflation linked revenues at PPA/CMEC (monthly), distribution (1Y lag) Spain: inflation updates on electricity/ga
Slide 32: Liberalised activities: Outlook for 2011
Liberalised activities: Outlook for 2011 EDP: Electricity Forward Contracting, 2011 (TWh) • Avg. selling price contracted OTC with clients(1): ~€50/MWh Purchases • 85% of expected output with Contracted contracted margins locked in 24TWh Sales with Clients • Average Clean Thermal Spread(2) Locked in
Slide 33: New Hydro Investments: 2,147MW under construction
New Hydro Investments: 2,147MW under construction; EBITDA delivery as from Jan- Jan-12 Hydro capacity under construction – Start date (MW) Dec-11: Picote II, Bemposta II Jul-12: Alqueva II 2,147 693 242 1,212 MW under construction 2012 2014 2015 First 693MW of new hydro in place: ~+€50m EBITDA in 1s
Slide 34: Prospects
Prospects: Forex performance may slow down EBITDA growth in Brazil/US, higher level of hedging closed EBITDA Operating performance in Brazil and liberalized activities in Iberia slightly above expectations Maintenance of guidance for EBITDA 2011 Low single digit growth YoY 2Q11 events known: (1) €23
Slide 35: A resilient business model in a challenging environment
A resilient business model in a challenging environment • EBITDA +7% (operations out of Portugal represented 61% of EBITDA) Improvement of • Net financial costs: +13% (cost of debt 3.8% in 1Q11, avg. maturity 5 years) returns • Net Profit: +11% • Total Installed capacity: +7% YoY (wind power capacit
Slide 36: IR Contacts
IR Contacts Miguel Viana, Head of IR Sónia Pimpão Elisabete Ferreira Ricardo Farinha Pedro Coelhas Noélia Rocha E-mail: ir@edp.pt Phone: +351 210012834 Visit EDP Website Next Events May 9th-10th – London Roadshow Site: www.edp.pt May 11th-13th – Netherlands/Frankfurt /Zurich Roadshow Link Results &
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