Acciona Sa · BME:ANA
Acciona Sa — FY2013 Earnings Presentation
46 slides from Acciona Sa's earnings presentation, Feb 27, 2014
Slide 1: 2013 Results January - December
2013 RESULTS JANUARY - DECEMBER 27% February 2014
Slide 2: Disclaimer
Disclaimer This document has been prepared by ACCIONA, S.A. (“ACCIONA” or the “Company”) exclusively for use during the presentation of financial results for the full year of 2013 (FY2013). Therefore it cannot be disclosed or made public by any person or entity with an aim other than the one express
Slide 3: Table of contents
Table of contents 1. 2013 key highlights 2. Group financial information 2.1. Energy 2.2. Infrastructure, Water and Service 3. Strategic update and closing remarks Appendix FY 2013 Results Presentation 3
Slide 4: 2013 key highlights
1. 2013 key highlights José Manuel Entrecanales Chairman
Slide 5: Group financial information
2. Group financial information Carlos Arilla Group Chief Financial Officer
Slide 6: 2013 key highlights
2013 key highlights (€m) % Chg. Revenues 6,607 -5.8% EBITDA 1,228 -14.1% EBITDA (ex regulatory impact) 1,485 +3.8% Ordinary EBT 29 -88.1% Ordinary EBT (ex regulatory impact) 286 +16.7% EBT -2,174 n.m. Ordinary capex 381 -55% NFD (vs Dec 12) 6,715 -10% FY 2013 Results Presentation 6
Slide 7: 2013 key highlights – extraordinary effects
2013 key highlights – extraordinary effects Negative EBT explained by -€2.2bn of extraordinary effects Positive ► Capital gains from the disposals of: + effects − Korean renewable assets €18m €19m − Canadian Royal Jubilee Hospital concession €1m ► Goodwill deterioration €870m - Energy ► Value
Slide 8: Capex by division
Capex by division Capex breakdown Key highlights By division (€m) Capex Significant ordinary capex reduction to Jan-Dec 12 Jan-Dec 13 €381m (-55%) Energy 440 205 Core areas capture most of 2013 Infrastructure 343 198 capex: Water 83 30 − Infrastructure: Capex down by 42%. Diversified in various
Slide 9: Debt breakdown by division and nature
Debt breakdown by division and nature Net debt breakdown Gross debt breakdown By division By nature (€m) Net Debt Net Debt 31-Dec-12 31-Dec-13 33% Non recourse Energy 6,086 5,215 67% Recourse Infrastructure 225 275 Water 77 68 Service 42 28 €8,332m Other Activities 1,052 1,130 (Million Euro) 31-Dec-
Slide 10: Net debt evolution
Net debt evolution Net debt reconciliation 2013 (€m) 727 Debt 577 associated 370 to work in progress 6,178 372 Derivatives 5,973 Debt associated to Derivatives work in progress FY 2013 Results Presentation 10
Slide 11: Debt amortization schedule
Debt amortization schedule Principal repayment schedule 2014-2018 (€m)¹ 731 48 7 91 566 494 48 7 1 470 29 55 2 10 39 148 352 40 9 7 584 18 23 481 389 285 292 2014 2015 2016 2017 2018 Energy Infrastructures Water Service Other Activities Undrawn corporate credit lines of €1.0bn as of 31/12/2013 €1.7b
Slide 12: 2.1. Energy
2.1. Energy Rafael Mateo CEO ACCIONA Energy
Slide 13: New framework model for Spanish renewables
New framework model for Spanish renewables Spanish Energy business heavily impacted by Electricity Sector Reform Regulatory changes applying from 1 Jan 2013 – Impact was already known Draft Ministerial Order (MO) with incremental impact – Recently published MO contains the inputs and outputs of
Slide 14: New framework model for Spanish renewables: wind bears the brunt
New framework model for Spanish renewables Wind power bears the brunt of the cuts Wind power the most affected: ~65% of the cuts Wind the most efficient technology, contributes the most to reducing wholesale prices, creates employment, avoids fossil fuel imports and positioned Spain at the forefront
Slide 15: New framework model for Spanish renewables: impact for ACCIONA
New framework model for Spanish renewables Impact for ACCIONA Impact of regulatory cuts adopted in the last 18-months represents a major blow to ACCIONA’s profitability and value ~40% of ACCIONA´s wind assets installed pre-2005 Based on an external expert report The PF/annualized impact on 2013 eq
Slide 16: Regulatory measures affecting ACCIONA
New framework model for Spanish renewables Impact for ACCIONA Estimated annual Regulatory measures affecting ACCIONA 2012- Annual EBITDA impact: EBITDA impact: 2013 2013 Proforma normalized year Wind RD-L 9/20131 Mini – hydro Pre-tax Pre-tax Σ €249m Σ ~€200m CSP + + Biomass Pre-tax Pre-tax 2/2013 Σ
Slide 17: Action Plan 2013–2014: Good progress
Action Plan 2013–2014: Good progress Energy division plays a key role in contributing to the company’s 2013- 2014 Action Plan 2013 targets achieved ► 2013 cost reduction target exceeded €39m achieved (vs €31m 2013 target) Cost-base reduction: ► 9% staff reduction (14% in Spain – flat international
Slide 18: Action Plan 2013–2014: Cost cutting detail
Action Plan 2013–2014: Good progress Cost cutting detail Achieving ACCIONA Energy Action Plan targets Cost cutting Target (€m) Achievement (€m) Cost reduction of €38.5m vs O&M 13.7 16.3 estimated reduction of €30.7m Others 17.0 22.2 in 2013 Total 30.7 38.5 Reduction of staff of 9%: -14% in Spain
Slide 19: Strategic focus
Strategic focus Strategic focus on cash generation and lower capital intensive growth ► Promote EPC and other activities, leveraging on our development, construction, O&M, capabilities for third-parties Continue to − No capex requirements develop, design and − Good progress made Australia, Mexico an
Slide 20: Wind turbine business - AWP
Wind turbine business - AWP AWP’s 3.0MW turbine is now a proven and competitive product 12 months of efforts to re-design processes Significant COE reduction On track to achieve 2-year target to reduce COE by -20% by 2014 -13% achieved in 2013 Reduction target for 2014 increased to -25% (bas
Slide 21: Energy: Key figures
Energy: Key figures Key figures Key highlights The impact from the regulatory changes (Law (Million Euro) Jan-Dec 12 Jan-Dec 13 Chg. Chg. (%) 15/2012 & RD-L 2/2013 as well as the RD-L 9/2013(e) in force since 14/07/13) amounted to Revenues 2,107 2,120 13 0.6% €257m in 2013 Attributable productio
Slide 22: Energy: Installed capacity and under construction
Energy: Installed capacity and under construction Installed MW @ Dec 2013 2013 Attributable production Wind Spain 9.6TWh +10% MW (Total) Spain Internat. Total Wind Inter. 6.4TWh -1% Wind 4,743 2,397 7,139 Hydro 2.9TWh +58% Conventional Hydro 681 - 681 Solar 0.6TWh -8% Hydro special regime 23
Slide 23: Outlook 2014: Trends
Outlook 2014: Trends Negatively impacted by RD-L 9/2013 EBITDA , affected by new regulation Capacity addition: ~200MW Committed capex / assets under construction: ~€350m AWP: Positive EBITDA contribution expected Energy Single digit percentage change approximately Double digit perc
Slide 24: 2.2. Infrastructure, Water and Service
2.2. Infrastructure, Water and Service Luis Castilla CEO ACCIONA Infrastructure, Water and Service
Slide 25: Key figures 2013
Key figures 2013 Revenues 2013 Revenues of €3,959m and EBITDA of €157m >29,000 employees in 25 countries EBITDA 2013 Backlog of ~€16,500m FY 2013 Results Presentation 25
Slide 26: Infrastructure: Key figures and backlog
Infrastructure: Key figures and backlog Key figures Construction backlog Dec 2013 (Million Euro) Jan-Dec 12 Jan-Dec 13 Chg. Chg. (%) International 54% Revenues 3,326 2,733 -593 -17.8% Spain EBITDA 163 82 -81 -49.6% 46% Margin (%) 4.9% 3.0% €5,723m International backlog Dec 2013 Key highlights By reg
Slide 27: Infrastructure: Concessions
Infrastructure: Concessions Road Rail Canal Port Hospital Total # of concessions 12 3 1 1 5 22 EBITDA FY 2013 (€m) 43 0 3 0 18 59¹ 3 Average life (yrs) 33 32 30 30 29 33 Average consumed life (yrs) 3 6 7 7 8 6 6 Equity: €420m Invested capital (€m) 1,337 68 60 17 217 1,772² Net debt4: €1,352m Canada
Slide 28: Water and Service
Water and Service Water: key figures Service: key figures (Million Euro) Jan-Dec 12 Jan-Dec 13 Chg. Chg. (%) (Million Euro) Jan-Dec 12 Jan-Dec 13 Chg. Chg. (%) Revenues 506 585 79 15.6% Revenues 592 641 49 8.3% EBITDA 41 54 13 30.5% EBITDA 18 20 2 13.5% Margin (%) 8.2% 9.2% Margin (%) 3.0% 3.2% Key
Slide 29: Reorganization of the division
Reorganization of the division Reorganization based on 5 drivers: 1 Maximize specialization creating new business lines 2 Reinforce accountability in each business line 3 Focus on profitability and risk control 4 Improve the effectiveness separating business development and delivery of contracts 5 L
Slide 30: Reorganization of the division
Reorganization of the division Business Units will be accountable for their own P&L Units specialized in “products” Units specialized in geographies Roads, special structures, Spain and bridges Mexico Railways and tunnels Brazil Ports and hydraulic projects Chile Water Australia Industrial construct
Slide 31: Reorganization of the division: specialized businesses
Reorganization of the division Specialized Businesses Civil works (new) Industrial business Roads, ► >1,700km of roads during ► Focus on water treatment the last 10 years and significant presence in special the integral water cycle ► Hundreds of bridges Water structures & including international ► W
Slide 32: Reorganization of the division: integrated international development
Reorganization of the division Integrated international development North America 4 regions for international development… Latam Europe, Africa and Middle East Australia and Asiatic Southeast North America ...with support from platform countries: Mexico, Chile, Brazil, Canada, Europe, Aust
Slide 33: Reorganization of the division: regional opportunities
Reorganization of the division Strong footprint and significant business opportunities in all regions Business opportunities Current positioning of ACCIONA ► Investment of €450bn p.a. ► ~4,200 employees on infrastructures (inc/water) ► Platform countries: Mexico, Chile and Brazil Latam and non-resid
Slide 34: Reorganization of the division: benefits
Reorganization of the division What will be the benefits from the new organization? ► Common and integrated international structure to support Infrastructure, Water and Service business development Revenue growth ► A single & more comprehensive global offer to clients ► Additional business opportuni
Slide 35: Outlook 2014: Trends
Outlook 2014: Trends Water Infrastructure Service Revenues = Revenues Revenues EBITDA ≈ EBITDA EBITDA Capex ~€20-30m Capex ~€60-70m Capex ~€10-20m Backlog = Backlog = Concessions and O&M weight International backlog weight FY 2013 Results Presentation 35
Slide 36: 3. Strategic update and closing remarks
3. Strategic update and closing remarks Juan Muro-Lara Chief Corporate Development and IR Officer
Slide 37: Action Plan: What we aim to achieve
Action Plan What we aim to achieve The Action Plan aims to: ► Mitigate significant impact of regulatory changes affecting the Spanish renewable energy portfolio ► Financially deleverage the group and access a wider range of sources of capital ► Transform our growth model: Focus on ACCIONA’s core c
Slide 38: Action Plan: Strategic / Financial measures
Action Plan Status Dividend ► 2013 interim dividend cancelled Unprecedented Strategic / Financial measures Capex ► Significant short term capex reduction FY13 capex –55% ► Significant cost reduction plan being implemented in Costs Energy, Infrastructure & Other Activ. More initiatives under cons
Slide 39: Sale of minority stake in International energy portfolio
Action Plan Sale of minority stake in International energy portfolio ACCIONA Energía has recently initiated the process of securing a long- term partner for its international renewable energy portfolio ► The strategic relationship to enable ACCIONA Energy to accelerate its growth ► ACCIONA Energy is
Slide 40: Sale of minority stake: operating and financial data
Action Plan Sale of minority stake in international energy portfolio Operating data Financial data Portfolio net capacity: 2,273MW ~€500m of revenues o In operation 2,078MW ~€350m of EBITDA o Under construction 195MW ~€130m of cash available for dividends 7.2TWh (net) of output Consolida
Slide 41: Action Plan: Other activities
Action Plan Other activities ► 2013 Revenues: €113m Bestinver ► 2013 EBITDA:€78m ► AUM: €8,930m ► 2013 Revenues: €419m Trasmediterranea ► 2013 EBITDA: €11m ► 2013 Revenues: €66m Real Estate ► 2013 EBITDA: €3m ► GAV 2013: €1,401m 85% Spain, 15% International ► 3 concessions: 2 roads and 1 hospital
Slide 42: Closing remarks
Closing remarks MO draft is the final step of the energy regulatory reform Major impact in Group financials Balance sheet and liquidity strengthening: Significant capex reduction Disposals Cost cutting Interim dividend cancellation Convertible bond Action Plan for the transformation of gro
Slide 43: Appendix
Appendix
Slide 44: Real Estate: 2013 independent asset appraisal
Real Estate: 2013 independent asset appraisal GAV (€m) GAV 2013 breakdown 2012 2013 By region By asset type 44% Residential 31% Offices 24% Other Development Land Rental Book value Gross capital gain GAV 2013: €1,401m Note: Independent asset appraisal – Savills, Aguirre Newman and Instituto de valor
Slide 45: New IFRS 11 - Implications
New IFRS 11 - Implications New accounting rules applicable from 01/01/2014 – changes in consolidation method affecting certain assets Proportionally accounted assets will now be accounted by equity method (IFRS 11) Preliminary analysis suggests the following estimated effect: Revenues EBITDA NFD Rep
Slide 46: 2013 Results January - December
2013 RESULTS JANUARY - DECEMBER 27% February 2014